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UK May Get 'Thousands' of 5G New Entrants Under Proposed Shake-Up by Ofcom

Iain Morris
6/13/2019

LONDON -- 5G World -- The future 5G opportunity for UK operators appeared to shrink today after regulatory authority Ofcom announced dramatic plans to sell licenses to "thousands" of 5G new entrants, imitating moves that have already been made in Germany and several other markets.

Under proposals unveiled at today's 5G World event in London, Ofcom would reserve 390MHz of valuable "mid-band" spectrum between 3.8GHz and 4.2GHz for local coverage and campus use. If the scheme takes off, anyone could apply for a 5G license covering an area of just 50 square meters and develop their own local 5G network.

That could be done in partnership with a mobile network operator, but it could also be through an equipment vendor or startup, said Mansoor Hanif, Ofcom's chief technology officer, describing the proposals as "revolutionary" during a presentation at today's event.

"5G is an opportunity for everyone and we'd like to encourage new entrants," he said. "We want to give low-cost access to local spectrum so that anyone who thinks they need 5G coverage on an industrial campus and feels it isn't served by MNOs [mobile network operators] fast enough should be able to build their own network."

The move could provoke a backlash from telcos, which have been fiercely critical of similar plans in Germany after its regulatory authorities decided to reserve 100MHz of "mid-band" spectrum for local, industrial use. German operators blamed that decision for driving up the price of spectrum during the country's initial 5G auction, which wrapped up this week with final bids at €6.5 billion ($7.3 billion).

The scheme could also pose a threat to 5G equipment vendors such as Ericsson, Huawei and Nokia, which have preferred to work through service providers when targeting other industries. Out of concern about upsetting its large telco clients, Ericsson has stopped serving enterprise customers directly and could be most at risk from Ofcom's spectrum plan.

Hanif may have alarmed those companies in presenting the scheme as a potential boost for startups involved with the Telecom Infra Project (TIP), a Facebook-led initiative to spur innovation in the network equipment sector. "There has been skepticism about mobile operators buying from startups but now it can be a new ecosystem for TIP and that should incentivize more startups to go out and build products," he said. "The bottom line is that these are revolutionary times."

The spectrum being considered is low power and would be offered in 10MHz blocks. While chipsets are not yet commercially available, Hanif expects them to arrive soon thanks to activities in Japan, where authorities have set aside 3.8-4.2GHz spectrum for telecom usage. "No one has had the opportunity before to build their own network and we are expecting demand to be in the thousands across the country."


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Gabriel Brown, a principal analyst with Heavy Reading, described the proposals as a "big deal" and "potentially a game changer," but said there were still many unanswered questions, noting the current absence of any official statement from Ofcom following an industry consultation on the matter.

"Is there going to be a backlash from the MNOs? What is the ecosystem going to be around it? These bands are being allocated and deployed in Japan, so there will be products, but will they be the right kind of products for this ecosystem?" he told Light Reading. "Also, what are the license terms and is this going to be a stable enough licensing regime for industrials to invest in operational technologies that have a long lifecycle? They need that security and surety of tenure."

Ofcom has already sold 5G spectrum licenses covering the 3.4-3.6GHz bands to the UK's mobile operators and plans to auction airwaves in the 3.6-3.8GHz band to them next year. Quizzed about today's proposals, Hanif said there would be "no direct interaction" between the MNO spectrum and that dedicated to local usage. "There could be a risk of interference but because these are low-power licenses we think it is manageable."

Hanif also reckons the plan would lead to more secure 5G networks as companies starting from scratch opt for the "standalone" version of the technology, which comes with a new 5G core network. "A non-standalone 5G network built on 4G will have the same vulnerabilities as 4G, but a new ecosystem of critical industries building on 3.8GHz does not need to build on the 4G base and can go straight to standalone and build a more secure 5G network," he said.

Heavy Reading's Brown describes the plan as a "different skew" on Germany's controversial spectrum move and says there are similar proposals in Japan and the Netherlands.

Hanif joined Ofcom as chief technology officer in September last year after working in senior technology roles at EE and BT. After today's announcement, he may have fewer friends left at those companies.

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— Iain Morris, International Editor, Light Reading

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