Facilitating the Wireless Broadband Facilitating the Wireless Broadband
Connection of Hong KongConnection of Hong Kong
APRSC 2016
9 March 2016
Connection of Hong KongConnection of Hong Kong
Sanda Cheuk
Assistant Director (Regulatory)
Office of the Communications Authority
Hong Kong
Agenda
� Overview of Hong Kong’s mobile
telecommunications market
� Principles in spectrum management
� Approaches for meeting the booming demand � Approaches for meeting the booming demand
for wireless broadband services
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Growth of Mobile Services
� No. of MNOs: 4
� No. of MVNOs: 23
� Total no. of mobile
subscribers:
16.7 million
(penetration at 228%)
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� No. of 3G/4G
subscribers:
14.1 million
(penetration at 193%)
� No. of 2G/2.5G
subscribers:
2.6 million
Growth of Mobile Data Usage
� Sustained robust growth
in monthly mobile data
usage
Last 12 months +26%
Last 2 years +66%
Last 3 years +161%
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Last 5 years +983%
Role of Communications Authority
in Spectrum Management
� The Communications Authority (CA) has a wide range
of powers under the Telecommunications Ordinance
for management of radio spectrum
� Promoting the efficient allocation and use of the radio
spectrum as a scarce public resource of Hong Kong
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spectrum as a scarce public resource of Hong Kong
� Power to assign, vary or withdraw frequencies
� Power to designate frequency bands subject to spectrum
utilisation fee (SUF)
� Due regard will be given to the Radio Spectrum Policy
Framework promulgated by the Government in 2007
Radio Spectrum Policy Framework (April 2007)
� Spectrum policy objectives
� Facilitate the most economically and socially efficient use of spectrum
with a view to attaining maximum benefit for the community
� Achieve technically efficient use of spectrum to facilitate the introduction
of advanced and innovative communications services and strengthen
Hong Kong’s position as a telecommunications and broadcasting hub
� Fulfil Hong Kong’s regional and international obligations relating to the
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� Fulfil Hong Kong’s regional and international obligations relating to the
use of spectrum
� Strengthen Hong Kong’s strategic position as a world city and the gateway
between the Mainland of China and the world by facilitating the provision
of key services in Hong Kong
� Ensure that necessary spectrum is reserved for Government services
Radio Spectrum Policy Framework (April 2007)
� Guiding Principles for spectrum management
� Use of a market-based approach wherever the CA
considers that there are likely to be competing demands
for the spectrum, unless there are overriding public policy
reasons to do otherwise
� No legitimate expectation for any right of renewal or right
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� No legitimate expectation for any right of renewal or right
of first refusal of any spectrum assignment upon expiry
� Reasonable advance notice to be given for any withdrawal
or variation of spectrum assignment
� Spectrum Release Plan to be published on potential supply
of spectrum for competitive bidding or tendering
Approaches for meeting the booming demand
for wireless broadband services
(1) Timely Release of Radio Spectrum
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(1) Timely Release of Radio Spectrum
Spectrum Release Mechanism� Spectrum Release Plan
� A 3-year spectrum release plan has been published every
year on a rolling basis
� Inform the industry about any spectrum available for
assignment through market based mechanism
� Launch of consultation for spectrum assignment upon
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Launch of consultation for spectrum assignment upon
application by the industry or at the initiative of the CA
� The CA aims to release available spectrum blocks as
soon as they are made available to enable the public to
enjoy the benefits of advanced wireless technologies as
early as possible
Potential Supply of New Spectrum
� Keep track of industry, regional and international
developments
� Active participation in the ITU’s World Radio-
communication Conference
� New spectrum for IMT services
� New allocation for government uses and commercial applications� New allocation for government uses and commercial applications
� Planning for the analogue switch-off (ASO)
� Government target of ASO for television broadcasting in 2020
� Frequency coordination with the Mainland required for benefit
from digital dividend
� Assessing the feasibility of sharing use the existing
spectrum (e.g. TV White Space)
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Assignment of Spectrum
� In exercise of the CA’s power under the TO and having
regard to the Radio Spectrum Policy Framework and
international regulations and standards, spectrum
assignments are made through different approaches
for different frequency bands:
� Licensing through auction (e.g. public mobile services)� Licensing through auction (e.g. public mobile services)
� Licensing through administrative means (e.g. fixed links,
government uses)
� Licence-exempt allocation (e.g. WiFi, cordless phone)
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Assignment of Mobile Spectrum
� Spectrum for public mobile telecommunications services
� A total of 572 MHz of spectrum has been assigned (800/900 MHz,
1800 MHz, 1.9-2.2 GHz, 2.3 GHz and 2.5/2.6GHz bands)
� Likely no or limited new spectrum available before ASO
� Default market-based approach for both assignment of new
spectrum and re-assignment upon expiry of existing assignments
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96.417%
233.641%
134.423% 107.6
19%
-
50
100
150
200
250
CMHK HKT Hutchison SmarTone
MHz
Distribution of Spectrum among MNOs
Re-assignment of 3G Spectrum� 120 MHz of spectrum in the 1.9 – 2.2 GHz band assigned through
auction in 2001 will expire in October 2016
� Objectives in spectrum re-assignment
Ensuring customer service continuity1
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Encouragement of investment and promotion of innovative services
Promotion of effective competition
Efficient utilisation of spectrum
Ensuring customer service continuity
4
3
2
Re-assignment of 3G Spectrum� Full engagement with stakeholders
� Two rounds of public consultation from March 2012 to July 2013
� A consultancy study commissioned to study any impact on service quality
and consumers stemming from different spectrum re-assignment options
� Decision of the CA announced in November 2013� A hybrid administratively-assigned cum market-based approach adopted
to re-assign the 120 MHz of spectrum
� 3 years advance notice given to the incumbent 3G operators on the
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� 3 years advance notice given to the incumbent 3G operators on the
spectrum re-assignment arrangements
� Outcome of re-assignment� Number of 3G operators increased from 3 to 4
� Total of $7 billion of SUF to be collected from the spectrum assigned
through auction and offer of right of first refusal
� 2x15 MHz of spectrum will change hand
Re-assignment of 2G Spectrum
� 198.6 MHz of spectrum in the 900 MHz and 1800 MHz
bands will expire in 2020/21
(45 days) (8 days)
29 Sep 2021
Hutchison SmarTone HKT
19 Nov 2020 3 Jan 2021 11 Jan 2021
900 MHz 1800 MHz
All 4 MNOs
� Competing demands likely exist for the spectrum
� market-based approach should be adopted
� Consideration of any overriding public policy reasons
(e.g. continuity of 2G voice services) for not adopting the
market-based approach
� Same four spectrum re-assignment objectives
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Re-assignment of 2G Spectrum
� CA and Secretary for Commerce and Economic Development
launched first stage public consultation on 3 February 2016
on approach of re-assignment and setting of SUF
� Proposed options currently under consultation
� Option 1 – full-fledged administratively-assigned approach
� Option 2 – full-fledged market-based approach� Option 2 – full-fledged market-based approach
� Option 3 – hybrid approach
� Consultation to close on 18 April 2016
� Aim to make a decision around November 2017 (i.e. three
years before expiry of existing assignments)
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Spectrum Refarming
� Technology neutral principle� Spectrum generally assigned on technology neutral basis
� MNOs may use any widely recognised technology for
service provisioning with the assigned spectrum
� Spectrum can be refarmed without the need for
regulatory approvalregulatory approval
� A large proportion of the 2G spectrum has already been
refarmed for the provision of 3G/4G services
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Spectrum Refarming
A large proportion of the 2G
spectrum has been re-farmed
to provide 3G/4G services
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Spectrum Swapping
� Building up of contiguous spectrum� Reduce adjacent channel interference
� Improve spectral efficiency
� Increase network capacity
� Two precedents of frequency swaps in recent years� Two precedents of frequency swaps in recent years� November 2012: 1800 MHz band
� January 2016: 2.5/2.6 GHz band
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Spectrum Swapping
Original Frequency Assignment
Frequency Assignment after the Swap
Swap in 1800 MHz Band
OtherMNOs
Other MNOs SM
C
CM
HK
CM
HK
CM
HK
CM
HK
CM
HKOther
MNOsOther MNOsS
MC
SM
C
SM
C
CM
HK
CM
HK
CM
HK
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Frequency Assignment after the Swap
HKT HKT HKT CMHKCMHKOther MNOs
HKT HKT CMHKCMHKOther MNOs
Original Frequency Assignment
Swap in 2.5/2.6 GHz Band
Mobile Data Offload through Public Wi-Fi� Light-handed licensing and regulatory approach for public
WiFi services� Operate on unlicensed spectrum in the 2.4 GHz and 5 GHz bands
� 5 carrier licensees authorised to provide municipal WiFi services
� 42 class licensees registered to provide indoor WiFi services
� No restriction for deployment of seamless mobile-WiFi handover
� Extensive coverage of public Wi-Fi service� Extensive coverage of public Wi-Fi service� 39,750 registered Wi-Fi access points
MTR stations, Airport Express stations and trains, buses,
ferries, etc.
Offices, shopping malls, coffee shops, restaurants,
convenient stores, etc.
Public hospitals, public libraries, parks, tourist spots, etc.
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(4) Facilitate Implementation of Wireless
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(4) Facilitate Implementation of Wireless
Broadband Infrastructure
Deployment of Small Cells
� Variety of configurations� Femto cells
� Pico / micro cells
� Range from 10m to several hundred metres
� Advantages of small cells� Advantages of small cells� Boost mobile network capacity by cell-splitting and
spectrum re-use
� Bring users closer to base stations and improve signal
reception
� Easier to find installation sites and more cost effective
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Deployment of Small Cells
Possible Locations for Installation
� Payphone Kiosks� Lamp Posts
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� Bus Stops / Shelters � Shops on the Street
Assignment of Backhaul Links
� OFCA facilitates extension of mobile broadband coverage
by use of microwave backhaul links for� Connection of small cells to the core network
� Connection between base stations / hill-top sites
� More efficient and cost effective mobile broadband � More efficient and cost effective mobile broadband
coverage in remote and rural areas
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Mobile Network Sharing
� Mobile network sharing is permitted to –� Lower the cost of building and operating mobile infrastructure
� Expedite rollout of mobile networks
� Avoid over-construction of mobile base stations
� Make more efficient use of sites
� Enable the provision of higher speed data services
� Existing forms of mobile network sharing in Hong Kong� Existing forms of mobile network sharing in Hong Kong� Antenna sharing
� Site and equipment sharing
� Capacity leasing
� New forms of mobile network sharing (e.g. carrier
aggregation) may be explored subject to compliance with
licence obligations
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Example of Mobile Network Sharing
� Sharing of all and part of the Radio Access Network (RAN) equipment or facilities
� Each mobile network operator maintains its operator maintains its own separate logical RAN using its own assigned spectrum
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