European Affairs

So what is 5G and why is it so important?[2] 5G is an evolution of wireless technology that will deliver much faster video over consumer devices like smartphones and tablets, but will also enable new industrial applications that demand very low latency and very high reliability, like connected cars, meshed drones, and remote surgery. 5G will also be much more efficient, both spectrally and in use of the cloud for network resources for particular applications at particular times. Finally, while the Internet of Things (IoT) is already being deployed by various providers in various sectors, 5G will facilitate IoT through enhanced management of networks with far more connected nodes, like thermostats, wearables, and industrial sensors, to name a few.

With such a wide variety of applications, from faster consumer broadband; low-latency, highly reliable connections; to Massive Machine-Type Communications, 5G will require radio spectrum in low-, mid- and high-band ranges.

While the EU and the U.S. both want to lead on 5G, their approaches have been notably different.

The EU has funded 5G R&D in the amount of €700 million and encouraged 5 times that investment from the private sector, totaling more than €3 billion.[3] While certain U.S. universities and tech companies have invested in 5G R&D, for the most part the U.S. government has chosen to support 5G by getting more spectrum to the market.[4] Currently, the U.S. Federal Communications Commission (FCC) is holding the world’s first voluntary auction of low-band broadcast spectrum at 600 MHz for repurposing for mobile broadband, and next month it is expected to adopt rules for high-band spectrum that will enable 5G applications.

Despite the EC’s goals on leading in 5G, it has a number of systemic challenges to overcome, not the least of which are determining policy with 28 different countries with widely different deployment scenarios for 4G or even 3G. The EU’s privacy regulation may also inhibit innovative uses of 5G, both in the consumer broadband space and with IoT. Europe’s greater tendency to regulate, including of Internet access prices, arguably has led to less investment in broadband infrastructure.[5] Mr. Oettinger may now be open to a lighter regulatory hand in order to spur more European investment in 5G.[6]

But more fundamentally, demand for mobile broadband in Europe may not be what it is in the U.S.[7] The test will be whether the vertical industries in Europe – like the strategically important automotive and energy industries - that would be customers for IoT will demand these new bandwidth-hungry applications.

Of course, the U.S. is not without its own challenges to leading in 5G. The painstakingly slow process in the U.S. for authorizing mobile cellular towers and base stations, with zoning authority resting with local and municipal governments, is exponentially slower with 5G’s expected “densification” of cellular networks - small cells filling in the macro cellular network to relieve congestion and increase speeds.[8] The U.S. also has extensive federal government use of mid-band spectrum, which impacts U.S. positions at the International Telecommunication Union (ITU), where spectrum for 5G is being studied and negotiated for possible international harmonization. The U.S.’s two competing spectrum regulators – the FCC for private and public safety and the Department of Commerce (NTIA) for federal use – complicate the development of domestic and international spectrum policy.

Relative to international spectrum negotiations, the EU enjoys several advantages, including a more powerful centralized bureaucracy in Brussels and its articulated connection of 5G to its Digital Single Market goals. In contrast, the U.S. Department of Commerce has just recently initiated the development of a Green Paper on IoT.[9]

But specifically on 5G, the U.S. advantages outweigh the disadvantages from its policy apparatus. Most importantly, the U.S. has led the world in 4G deployment through 2015.[10] A number of factors contribute to that leadership, but the primary reason is getting spectrum to the market place. A close corollary is the FCC’s long-standing flexible use policy for spectrum licensing. Finally, the FCC has been more comfortable with unlicensed use of spectrum for broadband devices, which has been critical to the growth of 4G with cellular Wi-Fi offload. Unlicensed will also be critical in 5G, since many of the industrial IoT nodes will be low-power unlicensed devices.

The U.S. is also further along in the difficult political battle of requiring broadcasters to transition from analog to digital broadcasting, improving spectrum efficiency, and thereby allowing the government to repurpose some of that broadcast spectrum for broadband. U.S. carriers were able to deploy 4G in the spectrum repurposed from that digital transition, thereby leveraging the so-called “digital dividend.”

The U.S.-EU contrasting approach generally on spectrum policy is also evident with 5G. The EU appeared ahead of the curve when the European Commission announced in 2013 that it was forming the 5G Infrastructure Public Private Partnership (5GPPP).[11] The EC is also reportedly developing a 5G Action Plan.[12] The FCC, in contrast, has no official 5G plan, and even avoided including the marketing label of “5G” in the title of its proceeding initiated in 2014 on flexible use of high-band spectrum.[13]

Tale of Two Bands

The different regulatory approaches impacting the roll-out of 5G are reflected in the tale of two bands, the low-band spectrum in the 700 MHz range, and the high-band spectrum at 28 GHz. Low-band spectrum is ideal for applications requiring wide-area, wall-penetrating coverage, like broadband cellular, while high-band spectrum is ideal for applications requiring superfast transmission in smaller areas, like high-resolution video in a home or stadium. Low, mid- and high-band spectrum is all needed for 5G, given the diversity of applications that that generation of technology will bring.

The U.S. repurposed its 700 MHz band for mobile broadband and auctioned it in 2008, after a decade of political opposition from U.S. broadcasters, as part of the U.S. transition to digital broadcasting. The FCC’s auction allowed U.S. carriers to deploy 4G services in the new spectrum beginning in late 2010 and 2011, with minimal disruption to their existing 3G customers in existing bands.

In contrast, Europe has had a far slower road on 700 MHz, despite agreeing to a plan in 2006[14] to allow mobile in repurposed broadcast spectrum. Six years later, at the 2012 World Radio Communication Conference (WRC-12),[15] it took Europe’s neighbors to the south, the fifty countries comprising the Africa Telecommunications Union to force the rest of the EMEA region to study the band internationally for a possible mobile allocation at WRC-15. It was not until this most recent WRC that Europe agreed to a mobile allocation for 700 MHz.[16] Following WRC-15, at the mobile industry’s largest conference in February 2016, the annual Mobile World Congress in Barcelona, Commissioner Oettinger announced that the European Commission had proposed to the other bodies of the EU to allocate the 700 MHz band to mobile broadband.[17] In late May, the EU Member States agreed to the proposal, which still requires the European Parliament’s approval before it comes law.[18]

A comparable tale of the power of European incumbents is playing out in the 28 GHz band, to the likely detriment of 5G’s roll-out in Europe. At the last WRC, much of Asia and the Americas supported adopting a study of 28 GHz for possible identification for mobile broadband at WRC-19. However, at the conference, incumbent satellite operators that are primary in 28 GHz in Europe today blocked the band from being included in the 5G global study. The U.S. plans to move forward on 28 GHz this summer, with the FCC adopting rules to allow flexible use in the band. Japan and South Korea are both expected to follow on with 5G rules for the 28 GHz band in support of high-level demonstrations at the upcoming 2018 and 2020 Olympics. Europe instead is studying use of 28 GHz to benefit satellite companies head-quartered in Europe that seek to provide Internet access to airplane passengers.

The U.S. has a history of moving ahead on spectrum allocation, independent of the ITU, particularly when it comes to decisions facilitating mobile broadband.[19] The 28 country membership of the EU – let alone the scores of borders which necessitate harmonized spectrum use along Europe’s internal and external borders - may make any one European country’s move independent of its neighbors more challenging – as well as make the ITU that much more politically consequential to Europe.

Conclusion

The EU and U.S. both want to lead on 5G. But perhaps Commissioner Oettinger would do best by taking a page from the American playbook, and focus on getting more spectrum to the broadband market. 700 MHz is a good start.

Oettinger has called 5G “the communication platform that will power the digital revolution.”[20] If Oettinger truly sees 5G as a “chance to reinforce the competitiveness of European industry,” then he should allow Europe’s mobile operators flexible use of the spectrum they need to innovate.

After all, Oettinger said at this year’s Mobile World Congress: “The race is on.” Two weeks earlier, the FCC’s leading technologist said: “This isn’t a race.” He added wryly, “But if it were, the U.S. would be winning.”[21]


Patricia Paoletta is a partner at the law firm Harris, Wiltshire & Grannis LLP in Washington, DC, which represents companies involved in these issues. Paoletta is former Telecommunications Trade Director at the U.S. Trade Representative.

 


[1]Press Release, “EU and Brazil to work together on 5G mobile technology,” European Commission (Feb. 23, 2016), http://europa.eu/rapid/press-release_IP-16-382_en.htm.

[2]See James D. Spellman, “’5G’ Angst: Europe’s Bid to Drive Future of Wireless Technology,” European Institute, available at http://www.europeaninstitute.org/index.php/274-european-affairs/ea-january-2016/2124-5g-angst-europe-s-bid-to-drive-future-of-wireless-technology, for a description of 5G and why Europe wishes to lead in its development.

[3]Press Release, “The EU and China signed a key partnership on 5G, our tomorrow’s communication networks,” European Commission (Sept. 28, 2015), http://europa.eu/rapid/press-release_IP-15-5715_en.htm.

[4]See Whitepaper, “4G Americas’ Summary of Global 5G Initiatives,” 4G Americas (June 2014) at 12-16, available at http://www.4gamericas.org/files/2114/0622/1680/2014_4GA_Summary_of_Global_5G_Initiatives__FINAL.pdf (note NIST and ITS R&D on next generation wireless technology, funded under the Spectrum Act of 2012 from spectrum auctions that occurred in 2014, can be considered supportive of 5G).

[5]Larry Downes, “How to Understand the EU-U.S. Digital Divide,” Harvard Business Review (Oct. 19, 2015), https://hbr.org/2015/10/how-to-understand-the-eu-u-s-digital-divide.

[6]See Daniel Thomas and Duncan Robinson, “Brussels summons European telcos to 5G meeting,” Financial Times (January 11, 2016) (available by subscription).

[7]As a data point on robust data growth in the United States, CTIA – The Wireless Association recently published its annual survey showing that Americans used twice as much data in 2015 (almost 10 trillion megabytes) as in 2014, and three times as much as in 2013. See Press Release, “Americans’ Date Usage More Than Doubled in 2015,” CTIA – The Wireless Association (May 23, 2016), http://www.ctia.org/resource-library/press-releases/archive/americans-data-usage-more-than-doubled-in-2015.

[8]The FCC is attempting to expedite small cell siting to the extent it can by encouraging federal agencies responsible for developing practices for siting in historic areas, and the U.S. Senate is considering a bill to require the General Accounting Office to develop a model siting form for federal agencies to streamline the siting of small cells.

[9]Request for Comments, “The Benefits, Challenges, and Potential Roles for the Government in Fostering the Advancement of the Internet of Things,” Docket No. 160331306-6306-01, National Telecommunications and Information Administration (NTIA), U.S. Department of Commerce (Apr. 1, 2016), https://www.ntia.doc.gov/files/ntia/publications/fr_ntia_iot_notice_and_rfc.pdf .

[10]“The U.S. is a Global Leader in 4G LTE,” CTIA – The Wireless Association (Sept. 25, 2015), http://www.ctialatest.org/2015/09/25/the-us-is-a-global-leader-in-4g-lte/.

[11]“5G Infrastructure PPP: The next generation of communication networks will be ‘Made in EU,’” European Commission (2013), http://ec.europa.eu/research/press/2013/pdf/ppp/5g_factsheet.pdf .

[12]See Press Release, “EU and Brazil to work together on 5G mobile technology,” European Commission (Feb. 23, 2016).

[13]See Use of Spectrum Bands Above 24 GHz For Mobile Radio Services, et al., GN Docket No. 14-177, Notice of Inquiry, FCC 14-154 (rel. Oct. 17, 2014). “

[14]GE06 Procedures and List,” International Telecommunications Union, available at http://www.itu.int/en/ITU-R/terrestrial/fmd/Pages/ge06-list.aspx.

[15]The United Nations’ specialized agency, the International Telecommunication Union, hosts World Radiocommunication Conferences approximately every four years to discuss global spectrum harmonization.

[16]France and Germany have allowed mobile services to operate in 700 MHz under GE-06, while the United Kingdom, Denmark, Sweden, and Finland have had plans to allow mobile to operate in the band since before WRC-15.

[17]See Press Release, “Commission proposes to boost mobile internet services with high-quality radio frequencies,” European Commission, http://europa.eu/rapid/press-release_IP-16-382_en.htm. The Commission has recently made an important step to pave the way for 5G in the EU. Earlier this month, the Commission presented a proposal to coordinate the use of the 700 MHz band for mobile services. Mobile operators using the 700 MHz band will be able to offer higher-speed and higher-quality broadband (i.e. without service interruption) to consumers and cover wider areas, including rural and remote regions. It will enable Europe to move ahead and provide mobile broadband speeds beyond 100 Mb/s and catch up with leading regions in 4G mobile broadband take-up (like South Korea or the USA).

[18]See e.g., “EU states approve plans to coordinate key mobile spectrum,” Reuters (May 26, 2016), http://www.reuters.com/article/us-eu-telecoms-spectrum-idUSKCN0YH0LY.

[19]For example, in 2014, the FCC liberalized its rules on unlicensed broadband devices in the 5 GHz band, despite an ITU Resolution restricting some of that spectrum to use by low-power, indoor broadband devices. See Revision of Part 15 of the Commission’s Rules to Permit Unlicensed National Information Infrastructure (U-NII) Devices in the 5 GHz Band, ET Docket No. 13-49, First Report and Order, FCC 14-30 (rel. Apr. 1, 2014).

[20]“5G Networks Getting Closer,” Network Computing (Feb. 29, 2016), http://www.networkcomputing.com/wireless-infrastructure/5g-networks-getting-closer/1917640207.

[21]See Julius Knapp, Director, FCC Office of Engineering and Technology, Panel Appearance at Leadership Forum on 5G: The Next Generation of Wireless, CTIA – The Wireless Association (Feb. 1, 2016), available at http://www.ctialatest.org/2016/02/01/ctia-hosts-5g-leadership-forum/.