ARCEP authorises Bouygues Telecom to deploy 4G in the 1800 MHz band, starting on 1 October 2013, provided the operator relinquish certain frequencies beforehand

Paris, 14 March 2013

■ In the past, the different frequency bands assigned to mobile services had, for technical reasons, each been dedicated to a specific technology (GSM, UMTS, LTE). Recent technical developments have nevertheless helped lift this constraint. Moreover, the massive increase in demand for spectrum for mobile telephony, particularly as the mobile internet’s development accelerates, has made it vital to optimize the use of radio frequencies. One of the ways to achieve this will be technology-neutral spectrum.

It is within this environment that European and French legislation have provided for the implementation of technological neutrality. It will come into force by 25 May 2016 at the latest, but operators can ask permission to do so earlier.

■ In a letter dated 19 July 2012,  Bouygues Telecom sought ARCEP’s permission to operate a fourth-generation (4G) ultra high-speed mobile network based on LTE technology, using its spectrum in the 1800 MHz band – on which only GSM (2G) systems are permitted today.

ARCEP examined this request, by virtue of the provisions of Article 59 of the Order of 24 August 2011. The Authority was therefore required to investigate:

- whether there was a reason – among those listed in Article L.42 of the French Postal and electronic communications code (CPCE) – which made it “necessary” to continue to restrict this band to GSM technology;

- whether ARCEP needed to “take appropriate measures to ensure equality between operators and the conditions for effective competition”.

To this end, ARCEP engaged in a transparent process in concert with stakeholders, which included meetings, a public consultation and a series of meetings with all of the interested parties. Once this work was complete, on 12 March 2013 ARCEP published a set of recommendations on the method to follow for introducing technological neutrality in the 1800 MHz band. The purpose of this document is to give the affected players a clear view of the terms under which requests will be investigated, and to guarantee that scarce spectrum resources will be properly distributed once the entire band is open to 4G systems. Lastly, ARCEP today adopted its decision in response to the request from Bouygues Telecom.

■ The investigation led ARCEP to conclude that there was no reason, among those listed in CPCE Article L.42, which made it “necessary” for the terms of Bouygues Telecom’s 1800 MHz band licence to continue to restrict its use of the band to GSM technology – provided that, in light of current spectrum assignments, a more balanced allocation of the 1800 MHz band be performed, in the name of “measures to ensure equality between operators and the conditions for effective competition”.

Particularly relevant is the fact that, under these conditions, any advantage that Bouygues Telecom might enjoy from the premature lifting of this technological restriction, would not be so great, either in scope or duration, that it would distort competition in the mobile market. On the contrary, this move is expected to create an incentive for all operators to take advantage of the spectrum licences they acquired to develop ultra high-speed mobile systems, by accelerating their rollouts and introducing innovative services. Moreover, the investigation did not conclude that the permission given to Bouygues Telecom would compromise jobs, investments or competitiveness in the electronic communications sector as a whole.

■ As a result, should it chose to do so, Bouygues Telecom will be able to reuse the 1800 MHz for technologies other than GSM, starting on 1 October 2013, provided it relinquish some of its spectrum, as detailed below.

By 1 October 2013 at the latest, the operator’s spectrum holdings in the 1800 MHz band must be reduced to below or equal to a duplex block of 23.8 MHz, in other words the same quantity of spectrum that the firms Orange France and SFR currently own in the whole of Metropolitan France.

In addition, by virtue of the provisions of Article 59 of the Order of 24 August 2011, Bouygues Telecom must have handed back additional spectrum in the 1800 MHz band by 25 May 2016, such that it will own only a duplex block of 20 MHz. The premature lifting of the restriction that Bouygues Telecom requested also requires the operator to pass through an intermediate stage – whose timetable, which is set by this decision, will vary depending on the area in question – during which it will only have a duplex block of 21.6 MHz.

Furthermore, the fees attached to the ability to use these frequencies in a technology-neutral fashion will be set by decree at a later date.

In accordance with the applicable regulation, Bouygues Telecom has been informed of the new licensing terms for the 1800 MHz band, set by today’s ARCEP decision. Bouygues Telecom may retract its request in the month following this notification, in which case the terms of its licence will remain unchanged. Otherwise, the Decision of 5 November 2009, authorising the Bouygues Telecom to employ spectrum in the 900 MHz and 1800 MHz bands will be amended in accordance with the decision published today.

■ Operators SFR and Orange may also, at any time, request that their 1800 MHz band licences be extended to include 4G.

Lastly, operator Free Mobile, which does not have any 1800 MHz band spectrum may, upon request, be allocated available frequencies in this band, as part of the process to allow more balanced access to the spectrum, in the name of “appropriate measures to ensure equality between operators and the conditions for effective competition”.