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UK spectrum valued at £52bn

Jennifer Scott

Spectrum in the UK contributes £52bn to the economy, according to research carried out by Analysys Mason on behalf of two government departments – the Department for Business, Innovation and Skills (BIS) and the Department for Culture, Media and Sport (DCMS) – five years after the first research had been done into the topic.

“Spectrum is a finite resource, similar to property, and like property, different types of spectrum have different values,” read the report. “Some spectrum bands are highly valuable, like property in the heart of London, while others resemble industrial estates.”

It said the two departments wanted to re-evaluate what these values were and work out the best way to utilise them for future technologies.

Analysys Mason calculated the figures by taking the monetary benefit provided to consumers by having these services alongside what the industries gain as a surplus, resulting in what it calls the “economic welfare” contributed to the UK economy by the use of spectrum.

The numbers from the report showed as demand had increased for the frequencies – take the hotly fought allocation in the mobile industry, for example – so had its value. Since the first report of this kind in 2006, the figure for overall spectrum had risen by 25%, up from £35.2bn to the current estimation of £52bn.  

When broken down into specific technologies using the frequencies, nearly every area had increased the money it was making over the five-year period.

Public mobile communications will continue to grow in value and the need to release more spectrum is paramount to this increase

Television broadcasting had risen the most (77%), and now puts £7.7bn into the pot. However, this was dwarfed by the figure contributed to the UK economy by public mobile communications. Although only rising by 16% since 2006, the industry contributes £30.2bn to the economy, from the mobile operators themselves through to the supply chain of infrastructure manufacturers and application designers.

The report claimed public mobile communications would continue to grow in value and the need to release more spectrum was paramount to this increase.

The government has already completed the digital television switchover to free up spectrum for the mobile auction later this year – which will result in further 4G services launching across the UK – but it also announced the target of clearing 500MHz of spectrum for commercial use by 2020.

However, Analysys Mason said this freeing up of frequencies needed to look further than UK shores to ensure its effectiveness.

“As the highest value is likely to be obtained in the public mobile sector, releasing spectrum for this purpose will create most value,” read the report. “However, the value of spectrum for public mobile is maximised if it has been harmonised internationally, since the development of new smartphones, tablets and many other devices takes place at a global level.

“A programme of release therefore needs to go hand in hand with international efforts to agree bands for this use.”

At present, the bands being debated internationally to be used for mobile technologies are being used in the UK by the public sector. If the government commits to repurposing these bands, said the report, then the mobile industry could see a real boost.


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