UHF2 realignment study - Ofcom Licensing

8.5.1 Option 1 – Full Alignment
Details on the assumptions used for Full Alignment are in Appendix H. The estimates of the
costs are based on the PA Consulting report with the benefits calculated taking into account
the following areas:
240689 - 450-470 Study Final Print
Version (Dec08).doc
Reduced continental interference reduces network costs and/or reduces
cellular costs used at the edge of the network;
Spectrum yield benefits calculated to be 2-3MHz (we take a mid-point of
equivalent AIP values and our own assessment of spectrum value of
equivalent spectrum at recent auctions);
Reductions in handset costs due to economies of scale;
Introduction of digital technologies such as TETRA equipment that requires a
10MHz duplex split;
The UHF2 band in the UK will be in the same configuration as Europe in line
with the ERC Recommendation TR25-08;
Reduced interference impact on the network due to a 7dB reduction in
interference from the Continent.
Table 20 below summarises the net benefits for full alignment.
Managed Band
Alignment
Table 20 Summary on Full alignment Net Benefits
Costs NPV Benefits NPV Net
Benefits
NPV
£286m £77.7m (reduced interference and
handset prices)
+ £19.5m (spectrum value)
Page 90
-£189m
8.5.2 Options 2 and 3 – Partial Alignment, with different uses for the spectrum yield
(narrowband versus wideband)
For the partial alignment options, we have chosen two scenarios; for narrowband services
and the other for wideband services. In both cases partial alignment on a mainland UK
basis 47 is only considered as the interference of aligned and unaligned within the borders of
the UK would prove to be inefficient.
The benefits are similar to the benefits that occur for Full band alignment, but the size of the
benefit is proportional to the number of base stations impacted for each of the band
47 Excludes Channel Islands and Northern Ireland
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