GENEVA-The outcome of World Radio Conference (WRC)-2000 on International Mobile Telecommunication (IMT)-2000 standards was positive for the wireless industry and its customers.
The conference granted sufficient spectrum for third-generation (3G) systems to grow beyond 2010, identified common new spectrum worldwide in the best frequency ranges possible, and gave regulators and operators the flexibility to migrate to IMT-2000 whenever market conditions warrant.
The successful deployment of IMT-2000 systems now lies elsewhere-with the regulators’ licensing policies and with operators’ deployment strategies.
Regulators must ensure the nascent 3G industry meets no significant hurdles-financial, regulatory or technical-that would hinder its ability to build a market. The biggest price tags for operators will be for network infrastructure and for licenses. In both cases, the cards are yet to be played, with growing pressure from operators and consumer groups to give IMT-2000 a chance.
The more countries that opt for the same IMT-2000 band, the greater the economies of scale for manufacturers and the lower the price for operators that will buy the equipment. While handsets can roam globally without major difficulty because they can be manufactured for the entire 1 GHz to 3 GHz spectrum range, the radio-frequency (RF) front-end, including the base station system, would normally be built for a specific frequency band. So the earlier regulators indicate what band or bands they intend to select for 3G, the better chance consumers will get a good deal. For example, it can be assumed radio equipment for the 2 GHz band will achieve large economies of scale because Europe, large parts of Latin America, as well as major markets in the Asia-Pacific region are deploying IMT-2000 networks in the 2 GHz band.
On the license front, the valuation of spectrum must be fair and reasonable. There is a growing plea to consider RF spectrum as a world common resource to be shared equitably among all spectrum users, with licensing fees essentially a way to recover the costs for granting licenses. For many, considering spectrum as a priced commodity can only lead to spiraling prices that may be fatal to a number of operators because of the need to raise too high a level of capital investment. Operators’ abilities to offer 3G services at attractive prices to their customers will make or break the service, and the license costs are expected to be passed on to users.
In addition to obtaining a license, new operators will need to deploy the infrastructure, build a customer base and implement services, all of which are capital intensive. Incumbent mobile operators will also have to maintain their second-generation (2G) operations until the 3G customer base grows to levels that will warrant the deployment of base stations outside the highly dense, lucrative urban areas. The 2G business may also be adversely affected if 2G operators have to pay unreasonable license fees for 3G.
The next critical step for the successful implementation of 3G is in the hands of regulators.
Fabio Leite is counselor at the Radiocommunication Bureau of the International Telecommunication Union (ITU), in charge of mobile services including IMT-2000.
