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Lecture Series in Mobile Telecommunications and Networks (1583KB)

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Nobody – believe you me, it came out of the Treasury, which thought it was a great idea, <strong>and</strong> economists thought it<br />

was a great idea. They were all people out of the <strong>in</strong>dustry, who knew noth<strong>in</strong>g about the <strong>in</strong>dustry, that spread the socalled<br />

discontent. People were actually very happy with<strong>in</strong> the <strong>in</strong>dustry.<br />

I then look at the model you are creat<strong>in</strong>g <strong>and</strong>, <strong>in</strong> a sense, you slightly backed off from the first part, when you said that<br />

this would have a space <strong>and</strong> it would be adm<strong>in</strong>istered alongside, <strong>and</strong> that is the way I th<strong>in</strong>k it should be. However, if<br />

you say that this should sweep the old world away, then I would characterise your new world as sweep<strong>in</strong>g out the<br />

prudent old world, unfettered market forces will deliver superior performance, <strong>and</strong> you create a system so complex that<br />

no one underst<strong>and</strong>s it. Now, those three th<strong>in</strong>gs have just described the bank<strong>in</strong>g deregulation. [Laughter] In a sense,<br />

that is what you are try<strong>in</strong>g to br<strong>in</strong>g across as the new world.<br />

I have sat on certa<strong>in</strong> advisory groups <strong>and</strong> I actually th<strong>in</strong>k that Ofcom are on the wrong track with spectrum trad<strong>in</strong>g.<br />

I th<strong>in</strong>k it will end <strong>in</strong> tears, although I will not spend the next half hour expla<strong>in</strong><strong>in</strong>g why. They have not understood, for<br />

example, about the important role of spectrum re-farm<strong>in</strong>g. If you look at GSM spectrum, for example, that has been<br />

re-farmed three times. As soon as you have unfettered market forces fragmented, suddenly that way of regenerat<strong>in</strong>g<br />

spectrum is lost <strong>and</strong> gone for ever. Technology neutrality is the biggest value destruction possible - for someone try<strong>in</strong>g<br />

to sell off spectrum, it has to be technologically neutral.<br />

Not align<strong>in</strong>g with Europe is a total disaster. If you take the Rubik’s cube, <strong>and</strong> if you have to get the Rubik’s cubes of 25<br />

member states all to l<strong>in</strong>e up with<strong>in</strong> a European-wide service, it will not happen with unfettered market forces. You can<br />

go on <strong>and</strong> on <strong>and</strong> on – it is a flawed approach.<br />

That said, I th<strong>in</strong>k your technologic approach is good. It has its place <strong>and</strong> its role <strong>and</strong> should have its space.<br />

The regulator should f<strong>in</strong>d spectrum for it <strong>in</strong> order for it to contribute to the economy. This is less of a question <strong>and</strong><br />

more of a provocation, <strong>and</strong> you are free to react to it.<br />

L<strong>in</strong>da Doyle: Your comments are very <strong>in</strong>terest<strong>in</strong>g <strong>and</strong> well made. When you are present<strong>in</strong>g an idea <strong>and</strong> giv<strong>in</strong>g a talk <strong>in</strong><br />

the time available, you cannot convey all the nuances. Some of my comments may have sounded blunt <strong>in</strong> the sense <strong>in</strong><br />

that they were probably too quick a way of say<strong>in</strong>g it.<br />

Referr<strong>in</strong>g to people <strong>in</strong> ivory towers mak<strong>in</strong>g decisions, I was emphasis<strong>in</strong>g the fact that the centralised decision is dist<strong>in</strong>ct<br />

from a distributed decision <strong>and</strong> there was no <strong>in</strong>sult to <strong>in</strong>dividuals or groups <strong>in</strong>tended.<br />

You mentioned auctions. There was a lot of happ<strong>in</strong>ess on one side with auctions, that revenue was generated, <strong>and</strong><br />

there was also a lot of unhapp<strong>in</strong>ess among operators who had to spend an enormous amount of money. There were a<br />

number of extremely serious implications. However, I’m not argu<strong>in</strong>g for auctions per se but I am argu<strong>in</strong>g for a freer <strong>and</strong><br />

fluid situation <strong>and</strong> all of the auctions that I have seen take place are falsely fluid <strong>in</strong> the sense that, around them, they<br />

have this tightly regulated system, <strong>and</strong> they have taken one th<strong>in</strong>g from that <strong>and</strong> freed it up.<br />

They have then said that this is like a free system, which can go whichever way it wants <strong>and</strong> the market can drive it, but<br />

it has all these other anchor po<strong>in</strong>ts, if you know what I mean. You are half do<strong>in</strong>g someth<strong>in</strong>g, <strong>and</strong> look<strong>in</strong>g at that <strong>and</strong><br />

say<strong>in</strong>g that it does not succeed is not look<strong>in</strong>g at what the picture could really be – it is look<strong>in</strong>g at a half-implementation<br />

of it. Any time you beg<strong>in</strong> to see th<strong>in</strong>gs free<strong>in</strong>g up, even like <strong>in</strong> the 700 MHz auctions <strong>in</strong> the US or even <strong>in</strong> some of the<br />

Ofcom auctions where they are more flexible <strong>and</strong> you could do comb<strong>in</strong>ation th<strong>in</strong>gs, you are still surrounded by a<br />

structure that it is fitt<strong>in</strong>g <strong>in</strong>to. I th<strong>in</strong>k there is more potential <strong>in</strong> these ideas but I also th<strong>in</strong>k it is very difficult, start<strong>in</strong>g from<br />

the system we have.<br />

I used the word ‘Utopia’ specifically when I gave that description to describe what it would look like if we were all like<br />

that. It is not a back<strong>in</strong>g away on my part to say that it will not fully be like that – it is an acceptance of reality.<br />

I specifically boxed that th<strong>in</strong>g with the Utopian view, but I still believe <strong>in</strong> the merit of much of what is <strong>in</strong> there. There is<br />

a wider space than you th<strong>in</strong>k for it.<br />

Unfortunately, I did not attend a talk at which Vivien Read<strong>in</strong>g was speak<strong>in</strong>g <strong>in</strong> Irel<strong>and</strong>. From what she said, it sounds<br />

very much like the whole notion of a European regulator. When she was talk<strong>in</strong>g about the ‘digital dividend’, she was<br />

38 The Royal Academy of Eng<strong>in</strong>eer<strong>in</strong>g

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