Spectrum should be more affordable and allocated in a speedier fashion, according to the European Commission's Thierry Breton, who continues to campaign for greater telecoms unity in the EU.

Mary Lennighan

February 29, 2024

4 Min Read

Spectrum should be more affordable and allocated in a speedier fashion, according to the European Commission's Thierry Breton, who continues to campaign for greater telecoms unity in the EU.

While much of Breton's mission is centred on the creation of a single telecoms market served by pan-European players, he also gave hope to those telcos looking at in-market consolidation. Brussels' insistence on retaining four-player mobile markets is all in our heads, apparently; there is no magic number.

The internal market commissioner's keynote address at Mobile World Congress, also published by the Commission, was for the most part a précis of the key points of last week's digital infrastructure white paper, which broadly speaking is a series of proposals geared towards creating – and funding – the gigabit-capable network infrastructure the bloc needs by the end of the decade. But he added a touch of colour in some areas, including spectrum policy.

"We should give spectrum policy a true European dimension and push for more timely and 'affordable' auctions," Breton said. "Because, in the technology race towards 6G, we cannot afford further delays in the spectrum licensing process, with huge disparities in timeline of auctions and infrastructure deployment between Member States: we cannot afford the same outcome as for 5G auctions, where, after eight years, the process is not completed yet."

The inverted commas around the word affordable were included in the European Commission's transcript; we're not sure whether Breton made air quotes on stage. Presumably they are there to temper the comment a bit; there seems little doubt that operators will still have to spend big, one way or another. But if the EU gets its way, the parameters could change. Satellite spectrum is first in line for a potential shake-up, but mobile could follow.

"It is time to Europeanise the allocation of spectrum usage licenses, at least for satellites," Breton said.

"This is not about collecting at EU level money from spectrum auctions, which in any event should not be used as cash cows to replenish public finances," he added, doubtless reassuring national governments that they are not about to be parted with their spectrum allocation rights nor the income that accompanies them.

"It is about ensuring that all Europeans can benefit of the most advanced technologies in a timely manner," Breton said. "That is why as an alternative mechanism we propose that spectrum auctions, maintained at national level, are designed not to reward the highest bidder, but the operator which commits to invest more and faster in network rollout."

The commissioner may have been talking about starting with satellites, but it seems clear that he – or rather his successor(s); the current commission's term expires later this year – could turn his attention to frequencies for mobile operators too.

There's too much uncertainty here to make a sensible call on how mobile operators could react to competing for spectrum based on rollout speed and network investment, rather than upfront cost. But we have seen similar approaches in some global markets, where governments have chosen to free up operator cash for efficient network rollout rather than raking it in for licences, so it can be done.

Proposed changes in the way mobile spectrum is allocated form part of the Commission's goal to create a single telecoms market across Europe. Breton and his colleagues in Brussels are still very much wedded to the idea of operators working across the bloc and reaping the scale benefits of serving a market of 450 million people. It's obviously quite a challenge from both a political and logistical perspective, but that isn't stopping them from trying.

Part of that is, of course, the consolidation question. And the Commission accepts that it's not just about inter-market mergers, which are still proving a difficult sell.

"It also means demystifying the question of the optimal number of operators because NO, there is no magic number in this field," Breton said. "Given the convergence of different technologies and services towards the computing continuum, we cannot have a narrow look at markets and their players."

It's not the first time the European Commission has insisted that it is not fixated on four-player markets. But we are yet to see real evidence of that being the case, its recent Orange/MasMovil merger decision having come with competition remedies designed to facilitate the creation of a new fourth player.

The Commission may be looking at the broader picture when it comes to spectrum, security, digital infrastructure and so forth. But its competition policy still seems pretty narrow.

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About the Author(s)

Mary Lennighan

Mary has been following developments in the telecoms industry for more than 20 years. She is currently a freelance journalist, having stepped down as editor of Total Telecom in late 2017; her career history also includes three years at CIT Publications (now part of Telegeography) and a stint at Reuters. Mary's key area of focus is on the business of telecoms, looking at operator strategy and financial performance, as well as regulatory developments, spectrum allocation and the like. She holds a Bachelor's degree in modern languages and an MA in Italian language and literature.

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