Importance of the Digital Dividend

More than 6.5 billion mobile connections exist today, and the numbers continue to grow rapidly, with analysts predicting a further 1 billion mobile connections added worldwide within one year. The number of subscribers using next-generation LTE technology is expected to double in 20131. Mobile broadband technologies are already the primary means of accessing the internet worldwide.

At the end of 2011, 15.7% of the world’s population was connected to mobile broadband, compared to only 8.5% using a fixed broadband connection2. Mobile connections are growing, with the amount of data consumed by each also increasing. Cisco estimates that between 2011 and 2016 global mobile traffic will increase 18 times. The analyst firm Canalys stated that shipments of smartphones globally have now exceeded the number of PCs (including pads)3, with China favoring smartphones as the preferred means of accessing the internet.

To accommodate the accelerating growth in mobile broadband, the right spectrum is needed. For densely populated urban areas, high-capacity bands above 1GHz can be used. However, in order to cover rural areas with mobile broadband, lower frequencies with better propagation characteristics are vital.

The spectrum that has been and will continue to be freed up in the switch-over from analogue to digital television is known as the Digital Dividend. This spectrum will be used by a number of services, including a much wider range of digital television channels, HDTV, regional broadcasting, etc. It has also been recognised that some of the spectrum should be allocated to mobile broadband. The Digital Dividend is located in the UHF band below 1GHz, and this part of the radio spectrum offers a perfect balance between transmission capacity and geographic coverage. The characteristics of Digital Dividend frequencies mean that fewer masts are required to provide a high level of service in rural areas, resulting in cheaper mobile broadband for consumers.

Access to Digital Dividend spectrum is a requirement for mobile operators to deliver broadband in rural areas. Such areas are typically underserved by fibre and ADSL solutions, and mobile is able to connect homes and businesses that previously had no access to broadband internet.

Internationally harmonised spectrum bands are vital to ensuring that consumers can choose from the widest range of affordable devices. When spectrum is harmonised, manufacturers can develop devices that function in multiple markets, enabling them to achieve economies of scale, driving prices down. For the Digital Dividend, harmonisation has occurred on both a regional and multiregional basis. Europe has worked hard to ensure a harmonised regional approach is being followed on the Digital Dividend. This market is likely to be joined by much of Africa and the Middle East after commitments to harmonisation were made at WRC-12. In Asia, the Asia Pacific Telecommunity has also agreed on a harmonised band plan, which is also being widely adopted by countries in Latin America. Other regions are working together to provide the same level of clarity for operators and consumers.

The enormous consumer benefits of broadband are shown in data such as the World Bank analysis of 120 countries. Here, it was estimated that for every 10% increase in the penetration of broadband services, there is an increase in economic growth of 1.3 percentage points.