EU passed new telecom rules to promote 5G

The telecom ministers gave final approval to the new European Electronic Communications Code to encourage competition, promote new technologies, as well as protect consumer interests.

It has been a busy couple of weeks in Brussels. The telecom configuration of the Council of the European Union, composed of the government ministers whose portfolios cover telecom, gave the final seal of approval to the European Electronic Communications Code. This came after the European Parliament (composed of elected MEPs) voted in favour of the Code in mid-November, and after a year after the European Council (composed of heads of governments) reached an agreement on the rules.

More than two years in the making, the Code covers mainly four areas: the ubiquitous and unconstrained connectivity; the harmonisation of the competences of national regulatory authorities (NRAs); the harmonisation of spectrum-related issues, and revised rules on services. While harmonisation is the key to regulator operations and the rules governing radio frequencies across all member states, a few specific points stood out:

  • When it comes to 5G, the Code advocates for “binding and enforceable rules for enhancing coordination of spectrum management in the EU with greater focus on adapting spectrum rules to the future 5G challenges”. The European Commission (the executive branch responsible for the day-to-day operation of the EU) and NRAs will “review elements of individual Member States’ planned national assignment procedures which have more impact on market and business developments. Moreover, this option will place greater emphasis on the investment environment for dense 5G networks.”
  • On services, all member states will set up a public warning system to further strengthen the protection of residents. A ‘reverse 112′ system will be put into place send alerts to people’s mobile phones in the event of a natural disaster, terrorist attack or other major emergency in their area. It needs to be in operation within three-and-a-half years of the Code entering into force (see below).
  • On consumer rights protection, the Code will extend the same applicability of the rules to services provided over the internet, for example mobile apps. “Member States will also have to establish rules for compensation in case of misconduct by providers of electronic communications networks or services.”

The Council also approved the new remit of the Body of European Regulators for Electronic Communications (BEREC), the EU-wide telecom regulator. The office is tasked to create “an investment-friendly and pro-competitive framework which will lay the groundwork for the development of 5G across Europe.” New rules on cross-country calls and messages were also passed: the retail price of intra-EU mobile or fixed calls from the consumer’s home country to another EU country will be capped at 19 cents per minute. The cap for intra-EU text messages will be 6 cents per message.

Both regulations approved by the council of ministers are to be signed by the European Council and the European Parliament on 12 December and published in the EU Official Journal on 17 December. Both acts will enter into force 3 days after publication. Member states will have two years’ transition period before the Code needs to be transposed into national laws.

The Council also reviewed the progress of the ePrivacy Regulation. The proposal is aimed to aligned with GDPR and to cover applications such as instant messaging, VoIP, and other web-based communication tools. In November the telecom ministers agreed to delay the vote on the bill, which means the regulation is unlikely to be adopted before the next European election in May 2019.

FCC modifies frequency policy to encourage 5G investment

Changes to licence regulations on 3.5 Ghz have been approved by the FCC in an effort to encourage the 5G rollout.

The 150 MHz wide spectrum on the 3.5 GHz (3550MHz to 3700MHz.) band, or Citizens Broadband Radio Service (CBRS), is very busy. Following the rules of the FCC established in 2015, three tiers of users are sharing this band. There are the Incumbent Access Users, in particular the US Navy Radar Operators; the Priority Access Licenses (PALs) which are mainly commercial users like the telcos; and dinally, General Authorized Access (GAA) users which are permitted to use any portion of the 150 MHz frequency so long as it has not been granted to the other two tiers.

FCC Commissioner Michael O’Rielly, who was tasked to lead the review of current regulations and deliberation of new policies with special focus on PALs, claimed the old rules “would not support large-scale deployments, such as mobile or 5G networks… The rules in place favored small-scale, fixed networks, by making it unattractive for any other type of deployment. Basically, the rules were designed so that a select group could get licenses on the cheap.”

The Report and Order published by the FCC on Tuesday October 23 has kept the three tiers in place, but has made modifications to the specific implementations, including:

  • Changes the size of PAL license areas from census tracts to counties;
  • Extends the PAL license term to ten years and makes these licenses renewable;
  • Establishes end-of-term performance requirements;
  • Ensures seven PALs are available in each license area;
  • Allows the use of bidding credits for rural and Tribal entities;
  • Permits partitioning and disaggregation of PALs;
  • Updates information security requirements to protect registration information; and
  • Facilitates transmission over wider channels while maintaining protections for other services

In addition to extending the license term from three years to ten years and changing it from unrenewable to renewable, the new rules also did away with the limitations on the number of PALs a single applicant can have in one licence area (currently capped at four) and the bandwidth a PAL can use (currently limited to 10 MHz).

Ajit Pai, Chairman of FCC, admitted there has been debate on the new size of PAL licence, with different entrenched interest either arguing for maintaining the current census tract-sized licence, or demanding vastly enlarged areas. He had to cite support from Rural Wireless Association and Competitive Carrier Association, which represents smaller carriers, to defend the Commission’s  decision to opt for county-size license.

“We find that county-based licenses are just right,” said Pai. “This compromise will allow most interested parties, large and small, to bid on 3.5 GHz spectrum in order to provide 5G services. License sizes aside, we make other necessary changes today to promote investment and innovation in the 3.5 GHz band, including extending the license terms and giving an expectancy of license renewal.”

Pai also reassured the GAA users that “even after PALs are granted, General Authorized Access users can provide service in the PAL spectrum until licensees deploy. Taken together, these reforms will help make this band a sandbox for 5G and represent another aspect of our comprehensive 5G FAST plan to secure American leadership in the next generation of wireless connectivity.”

The rule modifications might not look revolutionary, but they should prove positive for more aggressive 5G rollout in the US. With the extended licence term and the possibility of renewal the new regulations provide more confidence to investors looking at long term. Meanwhile, it also strikes a balance both to encourage scale and to protect operators with local ambitions only.