telecommunications liberalization and regulatory framework re-farming for broadband lebanon dr. imad...

Telecommunications Liberalization Telecommunications Liberalization

and Regulatory Frameworkand Regulatory Framework

Re-farming for Broadband LebanonRe-farming for Broadband Lebanon

Dr. Imad Y. HoballahCommissioner, Board Member, Head of Telecommunications Technologies Unit

Telecommunications Regulatory Authority (TRA)

Lebanonwww.tra.gov.lb

http://www.tra.gov.lb/

OutlineOutline

3- Nov - 2008 TRA Lebanon

I. The Telecom Market Today – The Urgent Need for Re-from

II. Lebanon’s Telecom Reform

III. Current Broadband Market

IV. Broadband Spectrum Re-farming

V. Next Steps and the Way Forward

3

The Lebanese fixed and mobile services markets have been stagnantThe Lebanese fixed and mobile services markets have been stagnant

and the data and internet services market have been constrained and the data and internet services market have been constrained

• 33

Fixed

60%

1 State Owned SP

Monopoly

Fixed

60%

1 State Owned SP

Monopoly

Mobile

30%*

2 State Owned SPs

Monopoly

Mobile

30%*

2 State Owned SPs

Monopoly

Broadband

ADSL:6%*, 8 Priv. Using MOT LL, Lim.

Comp.

Internet: 32%, 16 Priv. SPs. Competitive

Broadband

ADSL:6%*, 8 Priv. Using MOT LL, Lim.

Comp.

Internet: 32%, 16 Priv. SPs. Competitive

11

22

33

Strengths Weaknesses

Relatively good copper infrastructure Regionally competitive price per minute

Relatively good copper infrastructure Regionally competitive price per minute

No competition No incentive to upgrade the infrastructure and

introduce new technologies Low penetration rate Stagnant growth

No competition No incentive to upgrade the infrastructure and

introduce new technologies Low penetration rate Stagnant growth

Pent up demand for mobile services High mobile revenues per user

Pent up demand for mobile services High mobile revenues per user

No competition Lag behind in terms of new technologies (e.g.

MMS, EDGE, 3G) High connection and subscription charges High per minute prices Limited choice in mobile packages, Low QoS Saturated mobile network /no upgrade Low Penetration

No competition Lag behind in terms of new technologies (e.g.

MMS, EDGE, 3G) High connection and subscription charges High per minute prices Limited choice in mobile packages, Low QoS Saturated mobile network /no upgrade Low Penetration

Relatively competitive Lucrative segment New wireless technologies deployed Pent-up demand for data and internet

services

Relatively competitive Lucrative segment New wireless technologies deployed Pent-up demand for data and internet

services

ADSL services were recently launched Access is hindered by incumbent operator Until recently, high international bandwidth prices Moving towards certainty with regulatory

framework

ADSL services were recently launched Access is hindered by incumbent operator Until recently, high international bandwidth prices Moving towards certainty with regulatory

framework

International AccessInternational Access

44

Future expansion Plans ( I-ME-WE) Future expansion Plans ( I-ME-WE)

No competition No transparent allocation spectrum Limited capacity High prices for retail

No competition No transparent allocation spectrum Limited capacity High prices for retail

3- Nov - 2008 TRA Lebanon – Existing Market* % Households

4

Penetration of telecommunications services in Lebanon betweenPenetration of telecommunications services in Lebanon between

2000 and 2007 has increased very slowly2000 and 2007 has increased very slowly

Source: Globalcomms, operator data, ITU, Arab Advisors Group

0%

5%

10%

15%

20%

25%

30%

35%

2000 2001 2002 2003 2004 2005 2006 2007

Fixed line penetration Mobile penetration

Broadband penetration Internet penetration

3- Nov - 2008 TRA Lebanon – Existing Market

5

The telecommunications market is still underdeveloped The telecommunications market is still underdeveloped compared to other countriescompared to other countries

Bahrain

Jordan

Morocco

Tunisia

United Arab Emirates

Egypt

Algeria

Venezuela

Romania

Chile

South Africa

Poland

Bulgaria

Slovakia

Hungary

Singapore

Ireland

Italy

Libya

LEBANON

y = 0.3441Ln(x) - 2.1968R2 = 0.6852

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

0 10,000 20,000 30,000 40,000 50,000 60,000

LEBANONLibya

Italy

Czech Republic

IrelandSingaporeHungary

SlovakiaBulgaria

PolandSouth AfricaChile

Romania

Venezuela

Saudi Arabia

Algeria

Egypt

United Arab Emirates

Tunisia

Morocco

Jordan

Bahrain

Russia

Qatar

Kuw ait

y = 0.2162Ln(x) - 1.1851R2 = 0.7209

0%

20%

40%

60%

80%

100%

120%

140%

0 10,000 20,000 30,000 40,000 50,000 60,000

Libya

US

Germany

Spain

UK

ItalyFrance

Egypt

UAE

Qatar

KSA

Bahrain

LEBANON

Jordan

Venezuela

Saudi Arabia

PeruEgypt

Algeriay = 0.1165Ln(x) - 0.689

R2 = 0.483

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 10,000 20,000 30,000 40,000 50,000

Fixed Line Penetration vs. GDP per Capita (2005)

PS

TN

Pen

etra

tion

GDP per Capita (USD/ Year)

Mob

ile P

enet

ratio

n

Inte

rnet

Pen

etra

tion

Mobile Penetration vs. GDP per Capita (2005)

Internet Penetration vs. GDP per Capita (2005)

GDP per Capita (USD/ Year) GDP per Capita (USD/ Year)

Sources: Economist Intelligence Unit, interviews with industry


6

A typical internet user in Lebanon will spend six to eight times more A typical internet user in Lebanon will spend six to eight times more

than users in similar countries due to low download ceilings than users in similar countries due to low download ceilings

Source: Operators Websites


7

The penetration of DSL services in Lebanon is the The penetration of DSL services in Lebanon is the

lowest in the region, due in part to a late startlowest in the region, due in part to a late start

Source: Operators Websites

3- Nov - 2008

TRA Lebanon – Existing Market

8

Only a limited range of applications and services is offered in Only a limited range of applications and services is offered in Lebanon Lebanon

Estimation of bandwidth requirements for the UK households: By 2008, demand for the most bandwidth intensive households could reach 18 Mbps

downstream and 3 Mbps upstream By 2012, the bandwidth demand for the most intensive bandwidth households could reach 23

Mbps downstream and 14 Mbps upstream

Source: New Zealand National Broadband Strategy , Broadband Stakeholder Group UK

Teleconference Online games

MP3 streaming Video Conference

Multiplayers game Video Streaming

Video on Demand Multi-Channel TV

Quality Video Streaming 5 second CD download

Web Surfing

Virtual Reality

VOIP

Telepresence

Email

0.01 0.1 1 10 100

Indicative Application Bandwidth Demand (Mbps) Indicative Application Bandwidth Demand (Mbps) Indicative Application Bandwidth Demand (Mbps) Indicative Application Bandwidth Demand (Mbps)

Current Limit on Residential Broadband


9

OutlineOutline







10

The GoL, recognizing the need for reform, has committed to open the telecom The GoL, recognizing the need for reform, has committed to open the telecom sector to competition and has recognized it as an important lever for sector to competition and has recognized it as an important lever for economic developmenteconomic development

“… there is a need to reduce the cost of production resulting mainly from unreliable supply of electricity, the high cost of telecommunication …”

“The Government of Lebanon will implement reforms in order to improve competitiveness and reduce the cost of doing business in Lebanon…”

“The government will seek a greater private sector role in sectors such as telecommunications…”

International Conference for Support to Lebanon” -Paris III Conference

البيان الوزاري 2008للحكومة

حكومة دولةالرئيس فؤاد

السنيورة

(§ 56) تعزيز إ في يسهم وهو الوطني لالقتصاد أساسي ك محر- هو االتصاالت قطاع ن

. مجتمع بناء إلى تهدف القطاع لهذا رؤية تقديم على يعمل ولبنان المتوازن اإلنماء

والحكومة المنطقة، في وريادتها العالمية االتصاالت ثورة مواكبة أجل من المعلوماتية

القطاع الستثمارات السوق وفتح االتصاالت قطاع بتحرير السياق هذا في تلتزم اللبنانية

حقوق وحماية والمنافسة المستهلكالخاص . The TRA is charged with promoting competition in telecommunications (Telecommunications Law, Art. 5.1(C)).

The Law provided for the liberalization of the telecommunications market by privatizing state-owned telecommunications entities and opening the market to private sector investments and competition.

Telecommunications Law 431 / 2002

The GoL Governmental Declarations in 2005 and 2008 commit the Council of Minister (CoM) to the liberalization of telecommunicationsThe GoL Governmental Declarations in 2005 and 2008 commit the Council of Minister (CoM) to the liberalization of telecommunications

3- Nov - 2008 TRA Lebanon – Liberalization Benefits

11

Reform of the telecom sector entails the restructuring of the Reform of the telecom sector entails the restructuring of the market, the establishment of an independent regulator, and a market, the establishment of an independent regulator, and a top notch regulatory framework top notch regulatory framework

CompetitiveMarket

Structure

Independent Regulatory Authority

Clean and Stable

Regulatory Framework

Reform and Liberalization of

the Telecom Sector

3- Nov - 2008 TRA Lebanon – Regulatory Environment

12

The Telecommunications Law 431 requires the creation of a proper The Telecommunications Law 431 requires the creation of a proper structure for a competitive telecommunications market structure for a competitive telecommunications market

Regulator

Operators

MoT: policymaker, regulator and service provider

CoM: Arbitrary regulatory role

(e.g. issuing all licenses)

No formal regulatory regime

Before Telecom Law 431

Ministry of Telecommunications

MoTPolicymaker

Set the general guidelines for telecom policy

Recommend to CoM the award of some individual licenses (mobile/fixed, int’l voice, UMTS)

Review and propose to CoM Pricing of Radio Frequency TRA annual budget

Approve TRA budget & other TRA documents as per Law 431

TRARegulator

Develop/implement regulations

Award telecom licenses

Ensure competition and prevent anti-competitive behavior

Manage on behalf of GoL radio frequencies

OperatorsIncumbents & New Entrants

Provide telecom services to the public Install own and manage telecom networks and facilities Abide by TRA regulations, decisions and licenses

Policymaker

2

1 3

3- Nov - 2008 TRA Lebanon – Regulatory Environment

13

As a first step in assuming its duties as per the Telecom Law (Law As a first step in assuming its duties as per the Telecom Law (Law 431), the TRA has defined its mission statement and objectives431), the TRA has defined its mission statement and objectives

Mission Statement To establish a regulatory environment that enables a competitive telecommunications market to deliver state-of-the-art services at affordable prices to the broadest spectrum of the Lebanese populationإليه توصلت ما آخر تقديم في االتصاالت سوق تساعد أن شأنها من م(نِظ&مة بيئة إيجادنطاق أوسع وعلى ومعقولة، تنافسية، بأسعار االتصاالت خدمات مجال في التكنولوجيا

اللبنانية وللشركات اللبناني للمواطن .ممكن

TRA Prerogatives ( Non-exhaustive list)

Issue Regulations and draft Decrees (Art 5)

Liberalize the market and take any necessary measure to reach a competitive market (Art 30)

Manage Radio Frequency, Interconnection agreements, numbers, equipment import, etc.. (Art 29)

License telecommunications service providers and radio frequency bands (Art 20)

Resolve disputes between service providers (Art 43)

3- Nov - 2008 TRA Lebanon - Mission

14

Major steps of the Liberalization RoadmapMajor steps of the Liberalization Roadmap

Mobile Market

Executed an MOU with the Higher Council for Privatization (HCP) to ensure smooth privatization and licensing

Launched the Mobile Privatization and Licensing Tender Process in November 2007: Finalized the Financial Model for the license valuation Developed the Online Data Room and answered bidders’ Questions Prepared financial, legal and technical due diligences and conducted site visits Finalized the RFA Drafted the Mobile License Prepared the draft Sale and Purchase Agreement

Executed an MOU with the Higher Council for Privatization (HCP) to ensure smooth privatization and licensing

Launched the Mobile Privatization and Licensing Tender Process in November 2007: Finalized the Financial Model for the license valuation Developed the Online Data Room and answered bidders’ Questions Prepared financial, legal and technical due diligences and conducted site visits Finalized the RFA Drafted the Mobile License Prepared the draft Sale and Purchase Agreement

Broadband and ISP/

DSP Market

Re-issued licenses for the Internet Service Providers (ISP’s) and Data Service Providers (DSP’s) in accordance with Law 431

Authorized the use of new services including IPTV Issued a Re-farming plan for Consultation – Ready for different regulations

Re-issued licenses for the Internet Service Providers (ISP’s) and Data Service Providers (DSP’s) in accordance with Law 431

Authorized the use of new services including IPTV Issued a Re-farming plan for Consultation – Ready for different regulations

TRA Lebanon - Competitive Market Structure

Creating Liban Telecom (LT)

Capacity Building - Building the Institution and Transitioning Responsibilities

Regulatory Framework

3- Nov - 2008

15

REGULATORY FRAMEWORKREGULATORY FRAMEWORKRegulations that are needed to ensure the success of Regulations that are needed to ensure the success of liberalization have been put in placeliberalization have been put in place

Issued

Type Approval RegulationType Approval Regulation

SMP RegulationSMP Regulation

Interconnection RegulationInterconnection Regulation

Decisions: • VSAT• Trial IPTV• Spectrum trial Allocation for

MoT / OGERO

Decisions: • VSAT• Trial IPTV• Spectrum trial Allocation for

MoT / OGERO

Draft Ready Stage

Spectrum Pricing Opinion

Spectrum Pricing Opinion

Broadband Policy Statement

Broadband Policy Statement

VOIP Policy Statement

VOIP Policy Statement

National Roaming National Roaming

Interconnection Interim Pricing

Decision

Interconnection Interim Pricing

Decision

Drafting Stage

Accounting Separation Regulation

Accounting Separation Regulation

Unbundling Regulation

Unbundling Regulation

Spectrum Refarming Guidelines

Spectrum Refarming Guidelines

Spectrum Management and

Licensing Regulation

Spectrum Management and

Licensing Regulation

Consultation Stage

Administering and Implementing the

NNP

Administering and Implementing the

NNP

Final Review (TRA Board)

Consumer Affairs Regulation

Consumer Affairs Regulation

Lebanese National Frequency Table

Lebanese National Frequency Table

National Numbering PlanNational Numbering Plan

Liberalization Roadmap

Liberalization Roadmap

LicensingRegulation Licensing

Regulation

Pricing RegulationPricing Regulation

Quality of Service RegulationQuality of Service Regulation

Regulatory Framework for establishment of call centersRegulatory Framework for

establishment of call centers

3- Nov - 2008 TRA Lebanon - Clean and Stable Regulatory Framework

16

DraftDraft Liberalization Roadmap Liberalization Roadmap proposes introducing proposes introducing competition across all telecom markets while allowing competition across all telecom markets while allowing LibanTelecom some exclusivity over some servicesLibanTelecom some exclusivity over some services

2008 2009 2010 2011 2012

Mobile Network Operator

Virtual Network MNVOs

PSTN/ Basic Telephony

Network Operator

Reseller

BroadbandAccess

National

International Access

Facilities Service Provider

Reseller

3

1

***5+

**

* Liban Telecom expected** TRA is still considering the appropriate number of NBLs to issue*** Two for the mobile licenses, one for Liban Telecom and two others for the NBLs for data traffic only

License AwardOpen licensing Market Review

NotesNotes

*

3- Nov - 2008 TRA Lebanon – Liberalization Roadmap

17

LIBAN TELECOMLIBAN TELECOMThe TRA views the creation, corporatization, and privatization of Liban The TRA views the creation, corporatization, and privatization of Liban Telecom as a major step in the history of the telecom sector and a central Telecom as a major step in the history of the telecom sector and a central component of liberalization and future growthcomponent of liberalization and future growth

Sale of up to 40% to a

strategic partner

Establishment Plan for Liban Telecom

Full sale of Liban Telecom

Shares!Corporatization

Maximum Two Years

TRA plan for Liban Telecom’s licensing and exclusivity rights as proposed in the Liberalization Roadmap

Mobile License

Fixed License

LT’s establishment

End 2008* - TBD* TBD*

End of exclusivity on international public voice

services

End of exclusivity on

basic telephony services

Undefined time

3- Nov - 2008 TRA Lebanon – Liban Telecom

18

MOBILE MOBILE The Mobile Auction was suspended in January 2008, but The Mobile Auction was suspended in January 2008, but could be held within 8 weeks from a GoL decisioncould be held within 8 weeks from a GoL decision

Most of the preparatory work for the auction has been completed: Executed an MOU with the Higher Council for Privatization (HCP) to ensure smooth privatization and

licensing Launched the Tender Process for privatization and licensing of mobile in November 2007:

Finalized the Financial Model for the license valuation Developed the Online Data Room and answered questions submitted by bidders Prepared financial, legal and technical due diligences and conducted site visits Finalized the RFA Drafted the Mobile License Prepared the draft Sale and Purchase Agreement ( SPA)

Most of the preparatory work for the auction has been completed: Executed an MOU with the Higher Council for Privatization (HCP) to ensure smooth privatization and

licensing Launched the Tender Process for privatization and licensing of mobile in November 2007:

Finalized the Financial Model for the license valuation Developed the Online Data Room and answered questions submitted by bidders Prepared financial, legal and technical due diligences and conducted site visits Finalized the RFA Drafted the Mobile License Prepared the draft Sale and Purchase Agreement ( SPA)

Mobile Auction Launch:

RFA published

Mobile Auction Launch:

RFA published

January 2008

Licensing Process Freeze

November 2007 to+ 2 (Mths)

GoL Decision to Re launch Process

GoL Decision to Re launch Process

Auction – Announcing two winning

bidders

Auction – Announcing two winning

bidders

to to+ 5 (Mths)

Handover completedCrucial phase that

should be completed smoothly and in the

specified time

Handover completedCrucial phase that

should be completed smoothly and in the

specified time

Technical & Pre-Auction Financial Bids Due

Technical & Pre-Auction Financial Bids Due

to+ 3 (Mths)

3- Nov - 2008 TRA Lebanon - Mobile

19

BROADBANDBROADBANDTRA's objective is for Lebanon to become a global leader in TRA's objective is for Lebanon to become a global leader in broadband communications within 10 years broadband communications within 10 years

What is Broadband?What is Broadband?What is Broadband?What is Broadband?

Broadband refers to a wide range of technologies supporting the delivery of

innovative interactive services, equipped with an always-on functionality,

providing enough local bandwidth and capacity allowing the simultaneous use of

voice, data, and video services, and MOBILE

Broadband refers to a wide range of technologies supporting the delivery of

innovative interactive services, equipped with an always-on functionality,

providing enough local bandwidth and capacity allowing the simultaneous use of

voice, data, and video services, and MOBILE

Residential Services in 2013Residential Services in 2013 Business Services in 2013 Business Services in 2013

For around US$40/month at least 10Mbps

speed triple/quad play services:

1.High speed Internet – surfing and data

transfer

2.Digital Entertainment – video

3.Voice Communications – voice

4.Mobility

For around US$40/month at least 10Mbps


1.High speed Internet – surfing and data

transfer

2.Digital Entertainment – video


4.Mobility

For around US$ 600/month at least 1Gbps


1.High speed Internet and data transfer

2.Digital Entertainment – video and

teleconferencing


4.Mobility

For around US$ 600/month at least 1Gbps


1.High speed Internet and data transfer

2.Digital Entertainment – video and

teleconferencing


4.Mobility

3- Nov - 2008 TRA Lebanon - Broadband

20

OutlineOutline







21

Broadband Statistics - Middle-EastBB penetration in Lebanon is very low – room to expand

Source: www.internetworldstats.com/middle.htm, ITU data Sept/2007

Notes: Some figures are probably dated since for example UAE is known to have reported double the penetration by mid-2008

Broadband Penetration

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

3- Nov - 2008 Re-farming for Broadband Lebanon

22

Existing broadband penetration in Lebanon is low by international benchmark

0

5

10

15

20

25

30

35

40

Source: OECD

Other

Fibre/LAN

Cable

DSL

OECD Broadband subscribers per 100 inhabitants, by technology, December 2007

OECD average

Broadband Statistics – Worldwide

Lebanon is still 4 times lower than the Average


23

Current Internet Status in Lebanon

Internet penetration increased from 6% to 25%


24

Broadband Background - Lebanon

3- Nov - 2008

For 10 years the MoT partnered with the private sector to provide data connectivity and internet services

Spectrum was being authorized on an annual basis – no clear licensing policy Limited ADSL services despite the fast growth with close to 60K-70K subscribers

served by the incumbent operator/private sector. The incumbent (Ogero) is the only fixed operator with ~70% ADSL market share on the local loop. Unbundling and Bit-Stream models provided. Five private DSPs contributing to ~30% of market share

Wireless BB is provided by 4 private DSPs with end-to-end wireless access and backhauling using microwave – no fiber Coverage ranging from national in the FWA corporate market to limited urban

coverage for personal broadband internet market with “3” players offering portable nomadic broadband in a multiplayer ISP-DSP scenario

“17” ISP’s, “5” DSPs, and “1” fixed line operator, and “2” mobile (GPRS & limited EDGE) constitute the regulated data & internet market players

Non-regulated market players (incl. WISPs) & illegal local cable operators serving residential users using ISM 2.4 GHz & some licensed spectrum bands

Mobile broadband (3G) is not yet available

Re-farming for Broadband Lebanon

25

Existing DSPs occupy most of the available valuable spectrum

Spectrum used by DSPs include (same DSPs have large portions of the spectrum):

1.9GHz: TDD UMTS band allocated to provide personal broadband using proprietary technology (I-burst)

2.2GHz (legacy TDMA PMP systems since 1999 but being migrated since 2003) 2.5 - 2.69 GHz: IMT Prime spectrum; allocated by MoT for FWA (to evacuate) 3.4 - 3.6GHz: Prime Spectrum for FWA and BWA including WIMAX 3.6 - 3.7GHz: Used for some FWA without being authorized 5GHz used heavily by unlicensed WISP’s and some DSPs 24-26GHz FWA high capacity PMP backhauling

Limited Residential Broadband Wireless coverage in major cities & GBA

Lack of initiatives to ensure rural access to broadband wireless

A number of unlicensed wireless ISPs serving residential & SOHO internet markets

Occasional interference on some bands from cross boarders and operators and unlicensed WISPs


26

ECC/DEC/(05)05 FDD 2 x 70 MHz (2500 - 2570 MHz & 2620 - 2690 MHz) TDD 50 MHz (2570 - 2620 MHz)

Plan

2500

2505

2510

2515

2520

2525

2530

2535

2540

2545

2550

2555

2560

2565

2570

2575

2580

2585

2590

2595

2600

2605

2610

2615

2620

2625

2630

2635

2640

2645

2650

2655

2660

2665

2670

2675

2680

2685

GB Reserved 40Mhz FDD GB GB

Existing

Reserved for future use; in total 80 MHz (2 x 40 MHz) including mobile operators potential allocation

NBL 1 and NBL 2, 20 MHz TDD each

Spectrum to be auctioned: in total 55 MHz (11 x 5 MHz)

Guard band 3 blocks; in total 15 MHz. It is assumed that TDD networks are synchronized; if not 5 MHz guard bands are reuired between unsynchronized TDD networks

Note: After the auction TRA will assign the specific location in the spectrum in order to ensure an optimized assignment of spectrum

Reserved 40Mhz FDDNBL 1 NBL 2

FDD downTDDFDD up

Intensive use11.000 subs

Mostly outside Beirut

Intensive use 2.000 subs - reduction to 15 MHz or less

WWANPilot Network, no subs

Broadband Wireless Spectrum – 2.5GHz Band Status

27

OutlineOutline







28

BROADBANDBROADBANDLebanon has to improve its telecom infrastructure and open it Lebanon has to improve its telecom infrastructure and open it to competitionto competition

Fixed MoT Infrastructure: currently the only provider of national internet

and data transmission, however needs major upgrade of national and

international capacity.

Fixed MoT Infrastructure: currently the only provider of national internet

and data transmission, however needs major upgrade of national and

international capacity.

National Broadband Licenses: Provide a best in class alternative national

networks (core, metropolitan and access), enabling the national transmission

and provision of high speed communication

National Broadband Licenses: Provide a best in class alternative national

networks (core, metropolitan and access), enabling the national transmission

and provision of high speed communication

Broadband Access Licenses: Unleash competition on the access level and

provide more choices to consumers ( e.g. incumbent data service providers)

Broadband Access Licenses: Unleash competition on the access level and

provide more choices to consumers ( e.g. incumbent data service providers)

The TRA proposed plans to issue licenses (through an international public auction) in order to

establish across Lebanon best in class core, metropolitan and access networks :

1. Two new NBLs (+ Liban Telecom )

2. Unrestricted number of Broadband Access Licenses (for existing DSP and new

licenses) taking into account limitations in the availability of spectrum resource

The TRA proposed plans to issue licenses (through an international public auction) in order to

establish across Lebanon best in class core, metropolitan and access networks :

1. Two new NBLs (+ Liban Telecom )

2. Unrestricted number of Broadband Access Licenses (for existing DSP and new

licenses) taking into account limitations in the availability of spectrum resource


29

BROADBAND SpectrumBROADBAND SpectrumThe TRA is paving the way to meet a growing spectrum The TRA is paving the way to meet a growing spectrum

demanddemand

Spectrum Planning and RefarmingSpectrum Planning and Refarming Spectrum Planning and RefarmingSpectrum Planning and RefarmingPlanning Objectives Efficient spectrum distribution - Optimize the use of spectrum Introduce new national and regional operators to the market Open gates for new technologies and services Reserve spectrum for future needs taking into consideration technology evolution Define frequency bands and bandwidth that can be offered for TV distributors Maintain a smooth migration plan from analog to digital TV transmission Secure minimum committed spectrum to the existing operators

Spectrum Re-farming Re-farming plan for the bands 1.9, 2.3, 2.5, 3.5, 5 and 26 GHz is studied with primary

focus on the 2.5 GHz band that has been designated as extension band to IMT and on the 3.5 GHz band which may considered in future as an extension to IMT

Auction model for broadband networks is being studied by the TRA in order to realize goals defined in the liberalization roadmap by introducing new operators (2NBLs, 5-6 BAL)

Re-farming for the 12 GHz and 26 GHz bands will be studied as a solution to the cable TV distributors


30

Questions to Address – PlanningWhat are the policies?

Re-farming for Broadband Lebanon

31

Questions to Address – PlanningHow to treat existing operators?

Treatment of existing operators Basis for decisions (legal, other) Licenses (type, renewals, and transition) Bands and spectrum (Smin: number of bands, size, price, issues) Continuity of services - Ensuring continuity of services/minimum interruption Transition and Migration - Schedule, dependencies, consumer services, cost, Interim period - duration per band, per operator, and per service Pricing (revenue sharing, auction, auction derivatives, AIP, averages,

benchmarking) Technology neutrality vs. ensuring coexistence conditions Size of the spectrum per operator (DSPs, NBL, etc.) Auction(s) - sequencing, design, number, timing, dependencies (LT, Mobile, etc.)

Re-farming for Broadband Lebanon3- Nov - 2008

32

Spectrum Management Objectives

Enable liberalization of, and competition for, telecommunications (including radio communications) services and equipment

Boost economic growth, create employment, promote general welfare

Ensure transparency in spectrum award process ensuring best value

Reallocate spectrum to meet new regulations while minimizing impact on services and consumers

Support national security and defense needs

Enable the realization of public policy objectives on enviornmental safety (including emergency services), cultural (including broadcasting), social and economic development

Harmonize spectrum use with international developments & ITU-R

Stimulate technological innovation and competitiveness


33

Spectrum Milestones

The TRA has had to pave the way A Spectrum Policy harmonizing bands & national interest according to best practices/ITU

• Spectrum Policy. Guidelines, Handbook• National Frequency Allocation Table (LNFT-Final version issued)• Spectrum pricing in the different bands (regulations, auctions, auction-related, AIP, ..) Re-farming for bands of interest ( BWA plan under consultation)• Re-farming bands• Assigned/allocated spectrum per package (minimum, maximum, short and long term)• Reserved spectrum per band Migration plan from Analog to Digital TV broadcasting (consultation soon) Clearing as much spectrum sub 6GHz to be offered for new services or reserved Develop and implement spectrum licensing regulations - Universal, Technology, infrastructure,

service, duration, obligation, treatment of licensing requests (new, renewals) Establish Enforcement & Inspection Regime - regulations, monitoring, inspection,

enforcement, illegal operators & cable providers, etc. Develop position for Lebanon in ITU activities and working parties Build capacity and resources


34

TRA decided to propose a re-farming plan for the most important broadband bands

Issue new licenses for long periods and reserve spectrum for future use

Establish a Re-Farming Plan for important bands like 2.5 GHz and 3.5 GHz in order to be auctioned for new technologies and services

Technology neutrality principle where possible while ensuring:

Interference management and compliance to technical conditions is met (challenge )

Equivalent services can be delivered using different technologies. Let the market decide which services to deliver to consumers

Use spectrum ceilings to ensure a minimum of 3 players in the market Make a distinction in a short term cap (auction period) and long term cap (after M&A)

Give operators sufficient time for transition into the new situation

Reserve sufficient spectrum for future use (LTE)

Keep the auction design and the auction process as simple as possible Minimize the complexity of the assignment process as much as possible.


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The TRA proposed a clear licensing frameworkto accelerate Broadband Lebanon

Substantial investments in broadband access and fiber optic backbones are required to accelerate broadband deployment

The Liberalization Roadmap outlines issuing licenses in 2009 with a view to establishing across Lebanon – in the cities/rural areas – access to high speed core, metropolitan & access networks

National Broadband Licenses - services barring Liban Telecom exclusivity Up to 2 licenses to be issued with fixed (fiber) and wireless access capabilities Build own infrastructure to offer BB services using any technology for a core network (linking

nodes in the main cities), metropolitan networks (covering towns and cities), and access networks (i.e., connecting metro and core networks to points of presence (POPs)

Include sufficient amount of ‘access’ spectrum, and int’l gateway rights Roll-out coverage obligations to provide national coverage over most of the territories

Universal Service Obligation!! Access obligation is modest due to competition/BALs but core obligation is more stringent

Broadband Access Licenses (National and Regional) Build access infrastructure

Offer customers the same telecommunications services as the NBLs Some would be with radio spectrum bands to deploy wireless access technology This can trigger investments in infrastructure and actual deployment Competition will help speed up deployment, improve service and reduce prices


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Outline of broadband spectrum packaging

• Maximum spectrum (Smax)

• Short Term: 30 MHz on 2.5 GHz and 35 MHz on 3.5 GHz

• Long Term:, when we expect that the reserved spectrum will be made available, to 60 MHz on 2.5 GHz and 56 MHz on 3.5 GHz, with effect not before 2 years following the NBL and BAL auctions


2.5 GHz 3.5 GHz

Spectrum available in principle 190 MHz 196 MHz

Spectrum for NBL each 20 MHz 21 MHz

Total spectrum for 2 NBL 40 MHz 42 MHz

Spectrum for Smin - 84 MHz

Mobile operators (each 10 MHz) 10 MHz

Total spectrum for mobile operators 30 MHz

Reserve 28 MHz

Guard Bands 10-15 MHz 7 MHz

Reserved for future use 50 MHz

Available for BAL auction 55-60MHz 35MHz (National + Regional)

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OutlineOutline







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Next StepsNext Steps

• Finalize Consultation• Issue Final Re-farming policy• Issue BB Policy• Issue RFA• Run Auctions

3- Nov - 2008 TRA Lebanon – TRA Commitments

Auction ConsultationAnnounce

Time FrameRun Auction

Migration to interim frequency plan and reduce spectrum usage

Requirement on current DSP’s to clear spectrum used in Reserved Band

6 months from announcement date

End of Interim Period

NBL Auction Oct-08 Nov-08 Feb-09 May-09 31-Oct-2009

2.5 GHz Spectrum Auction

Oct-08 Nov-08 May-09 Jul-09 31-Oct-2009

3.5 GHz Spectrum Auction

Oct-08 Nov-08 May-09 May-09 31-Oct-2009

telecommunications liberalization and regulatory framework re-farming for broadband lebanon dr. imad...

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