IDEAS home Printed from https://ideas.repec.org/a/eee/telpol/v41y2017i5p518-532.html
   My bibliography  Save this article

Assessment of spectrum value: The case of a second digital dividend in Europe

Author

Listed:
  • Frias, Zoraida
  • González-Valderrama, Carlos
  • Pérez Martínez, Jorge

Abstract

This work assesses the perceived value of 700MHz according to the impact that this spectrum could have in decreasing rollout costs. 700MHz spectrum, recently allocated to mobile network operators (MNOs), could help increase coverage in rural area, as well as aid capacity-constrained networks. In both cases, the use of this spectrum could reduce the rollout costs of a Radio Access Network (RAN) based on Long Term Evolution (LTE) technology. The perceived value of 700MHz is presented in this article as the difference in the Total Cost of Ownership (TCO) of deploying the network with and without this spectrum. However, the rollout costs can differ greatly among MNOs if they previously hold different spectrum portfolios that may or may not include sub-1GHz frequencies. The results of this study reveal that an MNO not holding the additional 2×10MHz at 800MHz, would perceive 62% more value of 2×10MHz at 700MHz, than an MNO that does hold 2×10MHz at 800MHz. In addition, the value of this spectrum comes largely from urban areas, where networks are strongly capacity-constrained. This leads to the conclusion that under current demand forecasts, low-frequency spectrum starts being more valuable for simply being spectrum, rather than for being low frequency. Indeed, the results prove that adding spectrum with similar propagation characteristics to a coverage-constrained network is of no value.

Suggested Citation

  • Frias, Zoraida & González-Valderrama, Carlos & Pérez Martínez, Jorge, 2017. "Assessment of spectrum value: The case of a second digital dividend in Europe," Telecommunications Policy, Elsevier, vol. 41(5), pages 518-532.
    • Handle: RePEc:eee:telpol:v:41:y:2017:i:5:p:518-532
    DOI: 10.1016/j.telpol.2016.12.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0308596116302786
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.telpol.2016.12.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lundborg, Martin & Reichl, Wolfgang & Ruhle, Ernst-Olav, 2012. "Spectrum allocation and its relevance for competition," Telecommunications Policy, Elsevier, vol. 36(8), pages 664-675.
    2. Cambini, Carlo & Garelli, Nicola, 2011. "Evaluation of the opportunity cost of the spectrum: Application to the digital dividend," Telecommunications Policy, Elsevier, vol. 35(7), pages 633-649, August.
    3. Mölleryd, Bengt G. & Markendahl, Jan, 2014. "Analysis of spectrum auctions in India—An application of the opportunity cost approach to explain large variations in spectrum prices," Telecommunications Policy, Elsevier, vol. 38(3), pages 236-247.
    4. El-Moghazi, Mohamed & Whalley, Jason & Irvine, James, 2016. "Wireless access policy for electronic communications services (WAPECS): Collision between theory and practice," Telecommunications Policy, Elsevier, vol. 40(8), pages 821-835.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Oughton, Edward J. & Frias, Zoraida, 2018. "The cost, coverage and rollout implications of 5G infrastructure in Britain," Telecommunications Policy, Elsevier, vol. 42(8), pages 636-652.
    2. Matinmikko, Marja & Latva-aho, Matti & Ahokangas, Petri & Seppänen, Veikko, 2018. "On regulations for 5G: Micro licensing for locally operated networks," Telecommunications Policy, Elsevier, vol. 42(8), pages 622-635.
    3. Cheng, Xiaoyuan & Hu, Yukun & Varga, Liz, 2022. "5G network deployment and the associated energy consumption in the UK: A complex systems’ exploration," Technological Forecasting and Social Change, Elsevier, vol. 180(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. González-Valderrama, Carlos & Frías, Zoraida & Martínez, Jorge Pérez, 2015. "Assessment of spectrum value: application to sub-1GHz frequency bands," 26th European Regional ITS Conference, Madrid 2015 127144, International Telecommunications Society (ITS).
    2. Chou, Yuntsai, 2014. "A compensation model developed to liberalize spectrum in the G4 era," 20th ITS Biennial Conference, Rio de Janeiro 2014: The Net and the Internet - Emerging Markets and Policies 106897, International Telecommunications Society (ITS).
    3. Chou, Yuntsai & Hu, Weimin & Lien, Hsienming, 2015. "A compensation model developed to increase spectrum usage efficiency in the 4G era," 2015 Regional ITS Conference, Los Angeles 2015 146334, International Telecommunications Society (ITS).
    4. Alessandro Avenali & Tiziana D'Alfonso & Claudio Leporelli & Giorgio Matteucci & Alberto Nastasi & Pierfrancesco Reverberi, 2014. "A supervised market mechanism for efficient airport slot allocation," DIAG Technical Reports 2014-03, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    5. Avenali, Alessandro & D'Alfonso, Tiziana & Leporelli, Claudio & Matteucci, Giorgio & Nastasi, Alberto & Reverberi, Pierfrancesco, 2015. "An incentive pricing mechanism for efficient airport slot allocation in Europe," Journal of Air Transport Management, Elsevier, vol. 42(C), pages 27-36.
    6. Rana, Md Sohel & Prasad, Rohit & Yoon, Hyenyoung & Hwang, Junseok, 2020. "Opportunity cost of spectrum for mobile communications: Evaluation of spectrum prices in Bangladesh," Telecommunications Policy, Elsevier, vol. 44(3).
    7. Kim, Yongkyu & Kim, Kiwon & Jang, Yunjeong & Park, Seungkeun, 2022. "Value of Spectrum for Mobile Communications: Case of Korea," 31st European Regional ITS Conference, Gothenburg 2022: Reining in Digital Platforms? Challenging monopolies, promoting competition and developing regulatory regimes 265642, International Telecommunications Society (ITS).
    8. I. Vogelsang, 2015. "Will the U.S. and EU telecommunications policies converge? A survey," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 42(2), pages 117-155, June.
    9. Howell, Bronwyn E. & Potgieter, Petrus H., 2022. "Effective competition and ineffective mobile industry regulation in South Africa," Telecommunications Policy, Elsevier, vol. 46(7).
    10. Vogelsang Ingo, 2013. "The Endgame of Telecommunications Policy? A Survey," Review of Economics, De Gruyter, vol. 64(3), pages 193-270, December.
    11. Martins, Maria Lurdes, 2023. "Cybersecurity provision and online services access and usage," 32nd European Regional ITS Conference, Madrid 2023: Realising the digital decade in the European Union – Easier said than done? 278001, International Telecommunications Society (ITS).
    12. Basaure, Arturo & Suomi, Henna & Hämmäinen, Heikki, 2014. "Effects of transaction and switching costs on mobile market performance," 20th ITS Biennial Conference, Rio de Janeiro 2014: The Net and the Internet - Emerging Markets and Policies 106830, International Telecommunications Society (ITS).
    13. repec:aeg:report:2014-3 is not listed on IDEAS
    14. Ratidanai Hoonsawat, 2013. "Technological Migration: The Case of Thai Digital Terrestrial Television," Applied Economics Journal, Kasetsart University, Faculty of Economics, Center for Applied Economic Research, vol. 20(2), pages 1-22, December.
    15. Jang, Yunjeong & Park, Seungkeun & Kim, Kiwon & Kim, Yongkyu, 2024. "Valuation of Mobile Spectrum to be Reassigned," 24th ITS Biennial Conference, Seoul 2024. New bottles for new wine: digital transformation demands new policies and strategies 302518, International Telecommunications Society (ITS).
    16. Basaure, Arturo & Marianov, Vladimir & Paredes, Ricardo, 2015. "Implications of dynamic spectrum management for regulation," Telecommunications Policy, Elsevier, vol. 39(7), pages 563-579.
    17. Massaro, Maria, 2017. "Next generation of radio spectrum management: Licensed shared access for 5G," Telecommunications Policy, Elsevier, vol. 41(5), pages 422-433.
    18. Ashutosh Jha & Debashis Saha, 2019. "Examining categorization of Telecom Circles in India using unsupervised k-means clustering on techno-economic indicators," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 46(4), pages 365-383, December.
    19. Kwon, Youngsun & Park, Duk Kyu & Rhee, Hongjai, 2017. "Spectrum fragmentation: Causes, measures and applications," Telecommunications Policy, Elsevier, vol. 41(5), pages 447-459.
    20. Ashutosh Jha & Manisha Chakrabarty & Debashis Saha, 2023. "Network Investment as Drivers of Mobile Subscription – A Firm-level Analysis," Information Systems Frontiers, Springer, vol. 25(5), pages 1811-1828, October.
    21. Baquero, Maria & Kuroda, Toshifumi, 2015. "Analysis of the role of international network effects on the diffusion of second and third generation mobile communication networks," 26th European Regional ITS Conference, Madrid 2015 127126, International Telecommunications Society (ITS).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:telpol:v:41:y:2017:i:5:p:518-532. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/30471/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.