A new report from the Spectrum Policy Forum, which was conducted by Plum Consulting, has called on the Government to update on their progress toward doubling the annual contribution to the UK economy of use of spectrum by 2025 (mobile broadband, wifi, Satellite, digital TV etc.).
Back in 2012 the Government set out their UK Spectrum strategy, which among other things noted that the value of spectrum to the United Kingdom had increased significantly from £35bn per annum in 2006 to £52bn in 2011. In response it set several goals to develop a better way of assessing the full value of spectrum and to double the annual contribution to the economy of use of spectrum by 2025.
It is now around half way to the 2025 goal and the SPF believes it’s high time that the Government ran another assessment to see how much progress has been made, as well as to identify any areas where they may be falling short of the goals and to develop a more holistic review of the impact of spectrum on the UK economy.
Tony Lavender, UK SPF Chair, said:
“Spectrum use already contributes billions to the UK economy. However, Government want to double its financial contribution by 2025 during a time that the spectrum use landscape is and will continue to transform. Therefore, industry feel Government should provide an update to their UK Spectrum Strategy.
This update should develop a more holistic review of the impact of spectrum on the UK economy which they can act on if need be and industry can learn from.”
The UK Spectrum Strategy set out goals for spectrum in the UK including to double the contribution made by spectrum to the UK economy by 2025. It also set a goal for consistency of methodology for assessing the value of spectrum. Given the timing of the last study commissioned by DCMS in 2012, carrying out a follow up study in the near term (i.e. 2019) and reconsidering of methodological aspects would allow:
• Changes in the spectrum use landscape since the last report to be captured and the implications of these to be properly considered.
• An assessment of progress toward the goal of doubling the value to the UK economy to be carried out and any implications identified to be properly assessed and acted on.
The Cluster 3 workshops held in 2018 have highlighted several matters to consider when specifying further work in this area. These are set out below together with recommendations for action:
• It was clear that there is confusion regarding the term “value” among participants at the workshops. It is therefore recommended that the government clearly explain what it is seeking in the specification for a future study to avoid misunderstanding among stakeholders.
• The 2012 study did not consider externalities and social value aspects of spectrum use. The DCMS commissioned an expert panel to consider this, which reported in 2015. It is recommended that the DCMS review the findings and recommendations of the expert panel and consider incorporating at least a qualitative assessment of external and social value issues into a future study.
• The lack of robust willingness to pay data for spectrum using services is a concern for the accuracy and validity of a future study. The last available data commissioned by government was obtained more than 10 years ago. It is recommended that fresh primary research is undertaken as part of a future study to update this information.
• For the 2012 report, several methodologies were used to assess the value delivered by spectrum use, including the use of economic welfare (i.e. producer and consumer surplus). The Spectrum Strategy set a goal to use a single approach to value spectrum. While it is recognised that the application of a single approach to all spectrum uses may be challenging, it is recommended that the next study should consider this and move in this direction if possible.
• The 2012 study did not consider the value of public sector use of spectrum. The public sector continues to be an important user of spectrum, not least for defence and security purposes, and it delivers value in doing this. It is therefore recommended that the scope of a future study should include public sector spectrum use, not least to understand the scope for improving the efficiency of public sector use.
• The dynamic nature and continuing innovation with spectrum use are clear from contributions to the Cluster 3 workshops. A key function of the 2012 study was to identify factors influencing future spectrum demand. The SPF has recently updated its spectrum demand report13 and it plans to carry out further work to assess demand by industry verticals. It is recommended that identification of trends and future use of spectrum should be retained in the scope of a future study, and potentially enhanced to allow appropriate scenarios for future use to be developed.
• Assessment of progress toward the 2025 goal is a key aspect of a future study. To do this a valid a comparison must be made with the outcome of the 2012 study. This requires that revisions undertaken to methodology still allow this comparison to happen. It is recommended that enabling valid comparisons with previous work is clearly specified as an aim of the study.
The full report can be read online (here).