FCC Staff Liberated!Normal Intellectual Interchange Resumes
Yesterday I attended a seminar at George Mason University in nearby Arlington. The speaker was Prof. William Webb, Head of Research and Development and Senior Technologist at Ofcom, the telecommunications regulator in the United Kingdom. (I had previously publicized this event here.) The talk was a good presentation of recent trends in the UK in spectrum policy. The speaker carefully credited US developments that were the early foundations for some recent UK policies. The seminar was well attended by industry officials and students. But the real surprise was not noticed by many because it was a little subtle: about 10 FCC employees were present.
A few years ago this would have been normal and unremarkable. But for the past several years such attendance by FCC employees has required explicit a priori approval of the Chairman's Office which was hard to come by and indirectly discouraged.
The FCC employees present were vague about the change so it is unclear if the Chairman's Office has changed their policy or just whether after the election no one cares anymore. Someone from industry commented that everyone in the Chairman's office may be too busy sending out resumes to care about such issues.
In any case I applaud this change and hope that the FCC never returns to a policy that inhibits staff from listening to new ideas. Reasonable management controls on public speaking by staff on policy issues makes sense and is a long tradition at FCC. But centralizing authority on both speaking and listening in the Chairman's Office was excessive and showed a lack of trust in FCC staff and managers.
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2 comments:
I'm glad you didn't name names, Mike.
Ofcom: A Law Unto Itself
Ofcom’s Professor William Webb’s presentation at the George Mason University in Washington DC at the end of 2008 shed light on what has led Ofcom to their unique and problematic approach to formulating generic licence conditions for radio spectrum liberalisation.
Ofcom began regulating in earnest in 2003 after taking over from the former UK Radiocommunications Agency. Webb paints the main changes in working environment as:
• “At arms length from Government
• Around 80% of the senior management had never previously worked for a regulator
• A natural remit to conduct ‘blank sheet of paper’ review”
Given the diverse nature of spectrum management, with political, economic, social and technical inputs, it has been the traditional province of government. It also takes many years of experience to acquire a working level of skill. A ‘blank sheet’ approach with 80% of senior management never previously working for a regulator simply encourages intemperate ‘think-tank’ solutions which turn out to be impractical after more sober scrutiny.
Just prior to 2003, the USA Spectrum Task Force Policy Review had proposed licence conditions based on ‘interference temperature’: a maximum level of general field strength that receivers are expected to tolerate (aggregate power flux density (A-PFD)). This was the outcome of a separate ‘blank sheet’ approach in the USA. Ofcom spectrum usage rights (SURs) were similarly based. Webb said they “restrict the interference that a licence holder can cause to others, rather than the power levels that they are allowed to transmit. In principle, this is clearly superior”. Sadly for UK industry, in principle there is a logical nexus between transmitting and receiving with one element not being more important that the other, but in practice, transmitter limits, which have been designed to embed a predictable level of receiver protection in relation to all interference mechanisms, are clearly superior because they lead to much better managerial efficiencies. Likewise, interference temperature turned out to be a cause for embarrassment for the USA Task Force and has never been implemented. Both the Ofcom and USA approach were purely theoretical and can not produce practical outcomes for licensees. In early 2008, the EC adoption of a transmit based limit (BEM) for introducing spectrum liberalisation throughout Europe provided further supporting evidence. Ofcom has locked itself into a series of positions which can only be supported through assertion, because, based on reasoned argument, the Ofcom position is unsupportable.
Ofcom’s oft repeated assertion that “most supported our proposals” is not borne out by a reading of their consultation responses. A Vodafone response (Vodafone response to Ofcom consultation on Spectrum Usage Rights, September 2007) to an Ofcom consultation on SURs says “Another approach, known as ‘space-centric spectrum management’ has been successfully used in Australia for one class of licences. We are extremely disappointed that Ofcom has maintained a blinkered focus on the A-PFD approach; there is no evidence that it has seriously considered other approaches, either before the first consultation on SUR or as the result of responses to any of the consultations.” Ofcom responded with “Prior to the publication of the SUR consultation, Ofcom has commissioned external consultants to look into a range of possible approaches to SURs. These were described in our SUR consultation document and the consultants’ report is on our website”. The Ofcom response does not provide evidence that it has ever seriously considered other approaches. Surely Ofcom responds to a consultant’s report rather than simply accepting all without some level of critique?
One weakness of the Ofcom approach is that industry is paid for advice. In Australia this was not the case. Paid consultancies have no incentive for quick resolution and paralysis by analysis results. There is also a tendency to bias proposals to those that agree with a preferred government position in order to maximise the likelihood of future consultancies.
A later Vodafone response (Vodafone response to Ofcom consultation on Spectrum Usage Rights, January 2008) to Ofcom says “In its first consultation on SUR, Ofcom proposed to base them on A-PFD limits. It had not sought the views of stakeholders before this consultation, and we believe that consideration of alternative approaches from the outset could have resulted in more rapid progress towards a workable SUR regime. Ofcom continues to pursue this approach despite the substantial difficulties that it has encountered in two different methods of assessing A-PFD limits, and despite the views of stakeholders expressed in previous consultations. It is becoming ever clearer that this approach is inherently extremely complex, and possibly completely unworkable.”
T-Mobile’s response (T-Mobile Cleared DDR consultation response, August 2008) to Ofcom is also relevant “Any solution must be legally robust, easy to implement, measurable, enforceable and unambiguous. We remain unconvinced that this is true for SURs. Ofcom has so far progressed the SUR regime without taking any steps to validate it at a practical level by applying it to a current network.”
There are many other examples.
Recently, comments have been made by the instigator of liberalisation in the UK, Professor Martin Cave, that spectrum trading is not working well in the UK (See “Architect of UK spectrum liberalisation 'disappointed' by number of trades” PolicyTracker, 4 December 2008). This is partly a natural result of not having a clearly defined commodity to trade.
Having general in-principle support for spectrum liberalisation from most of UK industry, but faced with overwhelming opposition about Ofcom’s manner of implementation, Webb sought refuge in Machiavellian explanations. He said “Current licence holders are risk averse and often prefer the status quo while the new entrants who will benefit most have a relatively weak voice.” Noting that industry generally supports spectrum liberalisation, Ofcom would be applying its own Machiavellian strategy by pitting one part of industry against another to deflect criticism from its own ineptitude.
Ofcom’s plans are currently on hold because of a judicial process involving a situation where 4 of the current 5 main operators were given free licences to supply GSM services about 20 years ago. The 5th operator purchased very expensive 3G spectrum in 2000 and disagrees with Ofcom’s new proposal to allow 3G operation in the free GSM licences. Webb says “they’ve got a point, it wouldn’t be particularly fair”.
Seven years previous the very same issue, now surrounding the 2.6 GHz auction delay was predicted in a consultation response: “Owners of biased licences tend to lever an assumed right to limit competition off the relevant Government decision to bias the licences, and the high prices paid for the UK 3G licences are likely to have ramifications for policy development for 3G services in other bands well into the future. Government can avoid these situations by providing unbiased access conditions (Response to the UK’s Independent Radio Spectrum Management Review consultation, Futurepace Solutions, 19 September 2001).” While this advice was provided just after the 3G auction, Ofcom could have seen the ‘train’ coming and prepared much earlier. Ofcom has a long history of ignoring valuable advice.
Ofcom is susceptible to the same false sense of security engendered by a business that is not fully exposed to the consequences of its actions. It has the capacity to act in a manner contrary to economic commonsense because it believes it is beyond economic sanction. Instead of Ofcom worrying about whether additional regulatory tools are now required to prevent, what Webb refers to as legal “gaming” by licensees to limit competition, the UK would be better served by Ofcom using existing tools more efficiently. In any case, by considering itself at arms length from government, Ofcom is already acting as a law unto itself. This ignores the political reality. It may indeed be time for a return to good engineering practice to ensure that the UK communications industry retains its competitive position before it becomes even more hopelessly enmeshed in a regulatory miasma which is not capable of delivering the results required by either UK industry, the government or the community.
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