1

ACP-WGF22/WP-
/
International Civil Aviation Organization
INFORMATION PAPER / ACP-WGF24/IP-06

AERONAUTICAL COMMUNICATIONS PANEL (ACP)

TWENTY FOURTH MEETING OF WORKING GROUP F

Paris, France17 – 21March 2011

Agenda Item 8: / Any other business

Application of Spectrum Pricing in the UK

(Presented by John Mettrop, UK)

SUMMARY
This paper provides information on various consultations that Ofcom have undertaken on applying spectrum pricing to the aeronautical sector and their statement on future fees for aeronautical spectrum.
ACTION
  • To note the paper

1.INTRODUCTION

1.1Ofcom in the UK believe in the economic regulation of spectrum use, allowing market forces to influence how spectrum is used. However they do recognise that a number of what could be considered government services, including aviation, require spectrum. The question mark for Ofcom is how they can incentivise government services to use spectrum efficiently, release spectrum where possible.

1.2In 2005 professor Martin Cave carried out an independent audit of government spectrum holdings in the UK for the Chancellor of the Exchequer. In that report he recommended that crown bodies (this would be the department for transport in the UK) should be given recognised spectrum access to formalise their spectrum rights and allow the potential for spectrum trading. He also recommended the introduction of administrative incentive pricing to provide a pricing mechanism that encouraged efficient use of the spectrum by government bodies thus clearing spectrum that can then be released to the market.

1.3At previous meetings of WG-F I have provided updates on Ofcom’s moves to introduce spectrum incentive pricing into aeronautical bands. This paper provides a further update on progress including a second consultation, an Ofcom Statement in response to that consultation and a further consultation that has recently been released by Ofcom.

2.Discussion

2.1In July 2008 Ofcom released a consultation document “Applying spectrum pricing to the Maritime and Aeronautical sectors“[1]. This consultation elicited a significant response from all sectors of aviation. As a result of Ofcom’s reaction to those responses as well as advice received as a result of a report commissioned on the application of administrative incentive pricing to the aeronautical VHF communications bands a second consultation “Applying spectrum pricing to the Aeronautical sector”[2] was published in December 2009 which again elicited a significant response from the aviation community.

2.2Following the closure of the second consultation Ofcom reviewed the responses and published a” revised Framework for Spectrum Pricing”[3]in March 2010 and made a statement “Fees for aeronautical radio licences”[4]. In that statement Ofcom indicated that the following fee structure would be applied to licences within the aeronautical VHF communications band:-

Service type / Fee today / 2012/13 / 2013/14 / 2014/15 / 2015/16 / Subsequent
Fire and distress frequencies / £25 / £0 / £0 / £0 / £0 / £0
Block of shared sporting frequencies (unpowered flight and Microlight) / £25 / £75 / £75 / £75 / £75 / £75
Offshore mobile stations / Included with offshore fixed fee / £75 / £75 / £75 / £75 / £75
Surface communications (incl Departure ATIS), and Operational Control and Offshore fixed stations / £250/£150 / £350 / £350 / £350 / £350 / £350
Air/Ground Tower and AerodromeFlight Information with limited DOC / £150/£100 / £350 / £500 / £650 / £650 / £650
Other Air/Ground, Tower and Aerodrome Flight Information / £150/£100 / £350 / £500 / £1200 / £1900 / £2600
Area control, Approach, Arrival ATIS, ACARS and VOLMET / £250/£150 / £1000 / £2000 / £3000 / £6000 / £9900
VHF Digital Links per frequency (50kHz channel spacing) / £250 / £2000 / £4000 / £6000 / £12000 / £19800

Note: Temporary licences will continue to be available and will attract a fee of one twelfth of the annual fee for each month or part month, subject to a minimum fee of £75.

2.3These figures are based on a unit cost of £9900 per 25 kHz frequency within the UK per year. On the basis of this figure the frequency band 108-137 MHz would has been assessed by Ofcom to be worth approximately £11.5m per year.

2.4Since the publication of the Fee structure another consultation has been release on “Bespoke licence fees for aeronautical VHF communications frequencies”[5]. This consultation document was released on the 10th March 2011 and finishes on 21st April 2011. The consultation aims to further refine the methodology for calculating fees for VHF communications assignments so that the relationship between the DOC volume and it’s protection are better related to the price paid.

3.ACTION BY THE MEETING

3.1The ACP WG-F is invited to:

  • Note the information provided

[1]

[2]

[3]

[4]

[5]