BERLIN — The European Commission is poised this week to back a plan that would divert a portion of the valuable broadcast spectrum used by television stations to mobile operators by 2013, in a bid to create an European Union-wide market for wireless broadband services.
The proposal, a copy of which was obtained by the International Herald Tribune, is part of a package of broadband changes drafted by Neelie Kroes, the E.U. commissioner for telecommunications, that would require the 27 members of the bloc to set aside the 800 megahertz frequency band for mobile broadband by Jan. 1, 2013.
The deadline, if adopted by the European Parliament and Council of Ministers, the Parliament’s upper chamber, would increase pressure on countries like France, Britain and Italy to redeploy part of the so-called digital dividend that is being freed up as TV broadcasters convert to more efficient digital transmission from an analog system.
European broadcasters initially tried to oppose the diversion of spectrum, saying it would detract from their plans to introduce new high-definition TV channels. Under pressure from their own governments, which are eager to encourage the expansion of their Internet economies, television broadcasters appear ready to cede the diversion to prevent an even bigger loss of spectrum to mobile operators.
“Discussion on the digital dividend for other services should be limited to the 800 megahertz band,” said Michelle Roverelli, a spokeswoman for the European Broadcasting Union, the group in Geneva that represents state and private television broadcasters. “Any further reduction beyond the 800 megahertz band would have negative consequences for viewers and broadcasters, as well as for the associated industries.”
For European mobile operators, the plan could lay the foundation for an E.U.-wide set of common frequencies that could accelerate the use of wireless Internet by leading to the creation of a single broadband market that crosses national borders.
Using common frequencies would also allow equipment makers to mass-produce networks and devices for a much larger market and could encourage operators to expand into neighboring countries, providing more competition and opportunities for pan-European service.
The commission is relying on spectrum redeployment in part to help meet its goal of providing all E.U. residents with access to a fast broadband connection with download speeds of 30 megabits per second by 2020 and half of residents with even faster 100-megabit service by the same date. The commission is set to take up the plan Wednesday, and will tentatively announce it Sept. 20.
One in four E.U. residents, or 124 million people, now have fixed-line broadband connections, and 25 million subscribe to mobile broadband services.
Download speeds vary but are generally in the range of 2 megabits to 5 megabits per second.The European Commission estimates that telecommunications operators will need to invest €250 billion, or $318 billion, to meet its 2020 goals.
Telecommunications operators support the plan to give them additional frequencies to handle the explosion in data traffic.
Lobbyists have been busy in Brussels on the proposal to redeploy the freed-up spectrum. Mobile operators have battled television broadcasters, many of which are still partly or entirely state owned. The spectrum is in high demand, as its low frequency allows TV and mobile operators to broadcast inexpensively in urban areas.
Lobbyists said that Mrs. Kroes, the former E.U. competition commissioner who assumed her new role in February, had worked to produce a compromise acceptable to all participants in the telecommunications industry, from the large operators like Deutsche Telekom, Telefónica and Vodafone to smaller rivals clamoring for market opportunities.
“The lobbying on this has been intense,” said Ilsa Godlovitch, director for regulatory affairs at the European Competitive Telecommunications Association, a Brussels group representing the competitors of large formerly state-owned phone companies. “Mrs. Kroes has done a good job of producing what in the end had to be a compromise.”
So far only Germany has redeployed a portion of its 800 megahertz broadcast spectrum to mobile operators. Germany took the step through an auction, which lasted six weeks and ended May 21. The largest German mobile operators — T-Mobile; O2, owned by Telefónica of Spain; and Vodafone of Britain — spent a combined €4.4 billion to obtain new spectrum, only about half of what analysts had expected. The smallest German operator, E-Plus, owned by the Dutch company KPN, came up empty-handed. German regulators were accused of setting rules that allowed the larger operators to use their superior financial resources to suppress competition.
That pattern could be repeated across Europe in the future, as larger operators with greater financial clout are able to buy spectrum to maintain the commercial status quo. The commission must first persuade Parliament and Council of Ministers to adopt the 2013 spectrum deployment deadline, a legislative process that is not expected to be completed before 2012.
“These auctions that will take place are not necessarily going to open the market for new entrants,” said Jacques de Greling, an analyst at Natixis Bank in Paris. “The market is saturated, and what is taking place is that established operators are buying more spectrum to maintain existing businesses.”
The proposal to redeploy spectrum is part of a package of broadband changes being devised by the commission that also seek to require dominant national phone operators, like Deutsche Telekom and Telefónica, to open their newest high-speed fiber optic networks to competitors, who have complained of unreasonably high leasing rates. Under the proposal to open up those networks, which would not need parliamentary approval, regulators would determine leasing prices on the basis of cost.
Large operators had lobbied E.U. officials for the right to charge rivals for access to the networks, which would allow them to offset a portion of their investment costs. Their rivals have protested, saying they would effectively be compelled to subsidize the construction of a competitors’ network.
A representative of the large operators said the compromise proposal on network access was unlikely to please any of the interested parties.
“Next-generation networks require next-generation regulations,” said Michael Bartholomew, the director of the European Telecommunications Network Operators’ Association, a group in Brussels that represents large operators. “What this recommendation in its draft form does is simply impose the old regulations on new networks. That is not likely to provide the incentives needed for our members to build them.”
Luis Alvarez, the president of BT Enterprises, the business telecommunications unit of the British operator BT, urged E.U. lawmakers to ensure that any guidelines on new networks were strong enough to compel national regulators to mandate fair access to rivals.
“The recommendation is a helpful step forward in clarifying the rules on new fiber networks, and the need for competition in services,” Mr. Alvarez said. “The European Commission and national regulators must now make sure it leads to real open, nondiscriminatory access.”