French President Nicolas Sarkozy was supposed to present the “Digital Plan 2012” last week but the announcemen was delayed because of the global financial crisis. In the meantime, the French Engineering School of Telecommunications (ENST), which had planned a conference around Sarkozy’s Digital Plan, instead reviewed the status of the “digital dividend” in France.
The early days of radio communications
François Rancy, Director of Agence National des Frequences Radio (ANFR) painted a picture of the history of frequency use in France. Like other countries, France allocated frequencies on the basis of “first come first served”. The result has been that older technologies, and generally less efficient ones, are using the better frequencies.
As the ANFR’s mission is to resolve frequency allocation problems, it tried but failed in 1995 to broker an agreement among various parties on the switch from analog to digital TV. In 1997, the Chester conference introduced the principle of the terrestrial video broadcasting (DVB-T). In 2006 at “Conference Régionale des Radio communications” (CRR-06), it became clear that the migration from analog to digital could not be resolved on a country by country basis, but rather at the European level. Moreover, the telecommunications operators had to be parties to the deal. Because it was impossible to even get the parties in France to agree to a common agenda, the French government decided in May 2006 to create a “Comité Stratégique pour le Numérique” to coordinate all the parties involved in these decisions.
Regulators and telecom operators get involved
Gabrielle Gauthey, member of the board of the French regulator ARCEP explained: “We were worried at this time of the little interest showed by the telcos on these low frequencies. It was clear that a block of 50 to 150 MHz would be freed in the 700 to 900 Mhz zone. This is a one time opportunity for the digital economy to expand and to create the basis of a frequency management scheme in Europe. So we worked hard to motivate the telcos.”
France has two regulators for radio frequencies, ARCEP for telecommunications and CSA (Conseil Superieur de l’Audiovisuel) for TV broadcasting and radio. Within the CSA, the broadcasting companies were barely talking to one another. So it was not at all surprising that the telcos, which have developed TV over DSL offerings to customers, were at odds with the broadcasters. The frequency allocation process is made even more complicated and technical because the French military also own frequencies. As a result, this topic is almost never mentioned in the daily press or on TV.
Emmanuel Forrest, General Manager of Bouygues Telecom says, “ARCEP, and especially Gabrielle Gauthey gave us a wake-up call. We were busy developing our 3G strategy. At this time, we had found the killer app for 2G was SMS, and now with 3G, it looks like it is mobile Internet, either on a smartphone or a portable PC with a USB key to access the cellular network.” Forrest does not consider the digital dividend to be an urgent issue, but rather as a way to help cell phone operators extend 3G and 4G coverage at a lower cost to 99% of the French population.
Bi-partisan approach to digital TV switch and spectrum allocation
In March 2007, the French Parliament adopted the law on the “TV of the Future” to prepare for the switch to digital TV. At the same time, it created a bi-partisan commission composed of 4 senators and 4 deputies, headed by Senator Bruno Retailleau. Retailleau asserts: “Spectrum is a public asset. So it should be a topic for the Parliament, even if the final decision belongs to the Prime Minister. The commission worked first to understand the challenges of theses frequencies which are the Formula 1 of the frequencies with a strong economic, social and cultural impact. Our mission was to clear the many issues and prepare the decision of the government.” The report of the commission was published on July 2008, and contained seven recommendations, validating the choice of the sub-band of 72 MHz (from 790 to 862 MHz) to be entirely allocated to mobile telecommunication services. Retailleau points out that all seven recommendations were adopted unanimously by the bi-partisan members of the commission. The technical choice was made at a CRR-07 meeting in Geneva in October 2007. For Gabrielle Gauthey, and for many other actors, this is a basic minimum. By comparison, UK has selected 112 MHz (up to 128) and the US have selected 108 MHz. Gauthey explains that the broadcasters have been reallocated the larger part of the previous analog TV spectrum. And of the 72 MHz, only 40Mhz come from existing analog TV and 32MHz are coming from the military: TV broadcasters will have 12 multiplexes, which means about 40 HD TV channels, largely enough to replace the existing TV landscape in France. And remember the TV is rapidly moving to the Internet, as one of two users in France is no longer receiving its TV signal through the typical Hertzian way.”
She also said that during the CRR-07 negotiations where the sub-band was selected, it appeared the European Commission was not prepared to defend a common and coordinated position for the 27 member states. “We were in bad shape. Finally we could obtain our 72 MHz, thanks to the African countries who helped us.”
Measuring the economic value of the digital dividend
In its report, Senator Retailleau mentions several approaches to estimate the additional value of the dividend allocated to mobile telecommunications. The report mentioned, according to ARCEP, that over the last ten years, the revenues of the mobile telephony sector (€16.9 billion) have surpassed and now represent twice the revenues of the broadcasting sector.
Another study conducted by OFCOM (the UK regulator) reveals that enhanced mobile services and free standard TV channels bring the greatest value to communities. It appears HD TV and Mobile TV have a marginal social impact. Retailleau mentioned more recent studies made by Hogan & Hartson and by Analysys. “Both conclude that sharing allocation of the frequencies to the broadcasters (48 HD TV Channels) would create an added “social value” of €1.9 billion between 2012 and 2024, and that if the freed frequencies are split between TV broadcasters for 40 HD TV channels and mobile telecommunications for 72 MHz, the added social value is €27.6 billion, which includes the creation of 60,000 new jobs.”
Now, as rumors of last minute modifications for the digital dividend are circulating, the complete Digital Plan is expected to be unleashed on Monday, October 20, by Sarkozy. Retailleau concluded: ”France has to be a digital power, or it will be left behind.” Once the digital dividend has been decided, the allocation process of frequencies should start immediately.
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