The short answer is: nobody knows. The slightly more elaborated version is: after the study by Plum consulting, the cost and benefit of deploying a converged platform in sub-700 MJHz band is still unclear because of the uncertainties of the market demand for audio-visual service and the valuation of the sub-700MHz spectrum, so let’s wait another 5 years before drawing any definitive conclusions when these uncertainties somehow become less uncertain.
This is basically the message delivered by Plum consulting in the final EC workshop on Broadband-Broadcast convergence which I attended yesterday in Brussels. Or at least it is my and a few other attendees’ (somewhat pessimistic) impression.
As a short explanation on the background of this discussion: the EU commission is trying to formulate a cohesive strategy on how to deal with the sub-700 MHz band in the future, not least in the upcoming WRC-15. Apparently, EU is trying very hard to avoid the same situation in WRC-12 when it had to passively accept the decision of allocating the 700 MHz band to mobile usage, an agenda pushed by other non-EU countries. The broadcasters who originally have the exclusive access to the UHF band in 470-790 MHz are now pushing for a policy ensuring the safeguard access to the remaining sub-700 MHz band for an extended period of time—possible up until 2030. On the other hand, the mobile operators simply want more spectrums in this attractive frequency range and already hope to get a co-primary allocation in the sub-700 MHz band in WRC-15, however unlikely it maybe. Given the political status of the free-to-access DTT service in Europe and the importance of mobile broadband to digital economy, this is a highly sensitive issue to balance. One option is to develop a converged infrastructure platform that can provide both services efficiently. Plum consulting is hired by the Commission to conduct a cost/benefit analysis for such an option with a 15 years horizon.
Plum consulting has already held two workshops earlier this year, one in March and one in July, where they have presented their objectives and methodology. They focused on analyzing a converged platform based on Low Power Low Tower infrastructure, either using DVB or LTE technology. Convergence on content, application and service level are not included, because they would develop under the market mechanism while the convergence on the infrastructure level requires intervention from policy maker and regulator.
There had been a lot of discussions on their models and assumptions in the last two workshops. But overall I found it a reasonable approach, at least from the technical point of view (our paper studied on a similar subject (called CellTV) was also used as a reference in their study). The main advantage of LPLT network is that it can form large scale SFNs with small guard region in-between than HPHT DTT networks. In fact a recent study from ATDI and Qualcomm states that co-channel SFN could be deployed even without guard region by pointing the receiving antenna at the right direction. In the end it is estimated that 110-170 MHz spectrum in the 470-694 MHz band could be released by replacing the HTHP DTT network with a LPLT network, which sounds very promising.
However, what really complicated the picture is the difficulty in the transition from current DTT system to a converged LTLP network. The simulcast period may require considerably more spectrum than what is available in the sub-700 MHz band. The diversity in the EU member states w.r.t the DTT service penetration makes this process and planning more difficult. The cost for this transition thus varies significantly depends on what assumption you make.
On the other hand, the benefit, or the value of the saved spectrum is not clear either. Plum has estimated it to be in range of 0.1 to 0.45 euro per MHz per population based on previous spectrum auctions in other bands—just another reason to wait and see how much would be paid for the 700 MHz band.
In the end, the results seem to be less sensitive to the technical assumptions but more to the market demand. Both the cost and benefits have a large range of variation depending on the latter assumption. Thus they failed to reach a definitive answer, at least on the EU level. And no one is willing or able to make a strong decision to drive for one direction or the other.
Ending on a slightly positive note, at least Plum’s recommendation is to review this option in 3-5 years when the market gives a clear indication. In contrast, another study by EU High Level Group chaired by Mr. Lamy directly excludes the convergence option and instead sticks to a co-existence approach with an even more conservative timeline (someone comment this report is an admission of the failed attempt, albeit written in a politically correct manner, to reconcile two unreconciled groups, i.e., the broadcasters and the mobile operators). Mr. Lamy wrote in his report, ‘’we should be aware about the pace of changes we face and what is at stake if we just wait and may believe that staying in our comfort zone could last forever’’, but unfortunately, it seems ‘staying in our comfort zone’ for a while longer is just what we are doing.