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3. Looking forward – Trends in spectrum management

Spectrum management approaches are changing to adapt to technological developments. Internationally, regulators are considering different and new approaches in spectrum management. We expect that industry’s approach to commercial structures and operating models will also change.

With reference to 4 aspects shown in figure 4, this section highlights the trends that we think will be influential in how we regulate radio spectrum in New Zealand:

• regulatory framework 
• spectrum sharing 
• use of higher frequencies 
• licensing.

We are seeing an ever growing number of technologies and proliferation of devices driving increasing demands for access to spectrum. This will require tighter spectrum management, and technologies will need to use the spectrum more efficiently. Regulators will have to continue to look for ways to get increasing use out of the radio spectrum to enable sustained improvements in efficiency over time. Generally radio frequency spectrum is managed with respect to 3 technical dimensions:

• Frequency (different users or applications on separate frequencies)
• Spatial (different users or applications separated by distance, geography, or obstructions)
• Time (different users or applications access the spectrum at different times)

Traditionally, spectrum management has been based on conservative approaches, primarily on frequency, where frequency ranges have been allocated to a single service (such as fixed, mobile, broadcasting, satellite) and assignment to exclusive use for one particular purpose or technology in a particular frequency range (‘spectrum silo’ approach). In addition, frequency separation (guard bands) has been used to compensate for transmitter and receiver performance. There is a growing need for regulators to minimise guard-bands and make more use of spatial and time dimensions to enable more spectrum use.

Policy and planning interventions, market forces, and technological development are 3 aspects that regulators in many jurisdictions are considering. Policy and planning levers used to increase efficiency could include a combination of:

• undertaking tighter co-existence analysis using improved assumptions
• setting of tighter rules on licensing
• requiring better equipment performance
• allowing spectrum sharing among different types of users
• using different authorisation mechanisms
• re-farming and recycling spectrum
• allocating use of higher frequency ranges.

Use of market mechanisms to incentivise the highest benefit and most efficient use of spectrum will continue to be important. This may require spectrum regulators to identify opportunities to take action where required and appropriate to support these outcomes. It would be necessary to have the appropriate tools and data to enable an analysis of this type. There are a range of technologies that will help to achieve greater efficiency. These include the use of more spectrally efficient equipment that achieves more data through a given bandwidth (bits per second per Hertz), greater frequency reuse, and use of equipment that is more tolerant to interference.

Changing expectations of spectrum users where they are required to operate in an environment with other users and some level of degradation (no longer a noise limited environment) will also be relevant.

3.1 Spectrum re-farming, recycling and sharing

3.1.1 Re-farming and recycling

Spectrum re-farming is a tool that could increase the efficient use of spectrum. Spectrum re-farming and recycling allows the use of existing spectrum to support newer generation technologies. Often the transition from one technology to another technology can be complex and requires detailed technical management so that old and new networks can continue to operate with minimal interruptions. We have seen examples of this through the transition from analogue to digital television in New Zealand and through the transition through first, second, third, fourth and fifth generation cellular technologies.

Transition from current cellular technologies to sixth generation is likely to happen towards the end of the decade. With 5G there are technology options to ease transition allowing coexistence with 4G in the same band such as using dedicated carriers or Dynamic Spectrum Sharing. In the case of cellular, this transition has happened with limited regulatory intervention as the radio frequency spectrum was in private management rights, where the mobile network operators (MNOs) managed their own transition.

Implications for New Zealand

Investigations into the efficient use of spectrum are largely due to a growing number of technologies and the proliferation of devices. The dwindling availability of spectrum in key frequency bands is also a factor, vital to ensuring the long-term sustainability of wireless infrastructure. While this has not yet become a significant issue for New Zealand, RSM maintains a watching brief on developments in this area.

Historically, we have taken a band-by-band approach, requiring use of licencing and technical conditions to fulfil regulatory and wider government outcomes. We see a need for a technology neutral approach to support flexibility in equipment upgrades as technology evolves. However, many factors will shape this approach moving forward. When we undertake spectrum planning there is always a band plan involved (for example duplex spacing, uplink and down link frequencies) which is inevitably suitable to particular technologies. With growing spectrum use and the need for tighter spectrum management, this may require specific technical conditions.

Where possible, we will continue to use a technology-neutral approach with least restrictive technical conditions as this provides flexibility for spectrum users. We have been using this approach when assigning spectrum to MNOs to enable a transition to different technologies over time. While we will continue to apply this as a principle, tighter management of the radio frequency spectrum may require RSM to be more specific in some areas to enable new use while managing interference risks.

3.1.2 Spectrum sharing

Spectrum sharing is where a radio frequency spectrum band can be authorised and used by multiple different users that may be operating different technologies. Regulators are now finding it increasingly challenging to give different users their own frequency bands (spectrum silo approach) and have to look at different users in the same band. Regulators are also finding that many existing bands are not used ubiquitously over an entire country and there are often frequencies or location gaps where another use can be enabled.

Internationally there has been ongoing work on dynamic spectrum access, under a few models. This uses a database to automatically find unused frequencies and occupy them with mixed success but this is further maturing. Dynamic spectrum access is not widely used except in Northern America so far. Static forms of sharing are more common globally. Despite this, spectrum sharing is maturing and is beginning to factor into strategic thinking for many regulators who are starting to see such methods able to drive more efficient spectrum use in the long term.

Implications for New Zealand

Along with other regulators, we are changing the way we are thinking about how we can make spectrum available. Traditionally management rights have included long-term exclusive rights on a frequency band, with a set of accompanying commercial terms, technical requirements and sometimes implementation obligations. Responding to changing business models and technological developments, and competing demands for spectrum rights, requires us to look more closely at the merits of sharing methods and what might work in New Zealand.

Spectrum sharing can be implemented through both of the traditional static licensing mechanisms (radio licensing and general user licensing). This already happens in some cases through prescribed licensing rules but is normally for particular technology types (for example fixed to fixed, land mobile to land mobile). A recent database approach called Automated Frequency Coordination (AFC) is being implemented in North America to enable more flexibility with wifi 6E while coexisting with fixed links. We are continuing to monitor this approach.

We will continue to monitor the demand for different tools and levers to allow more innovative approaches to spectrum sharing.

3.2 Use of higher frequencies

As technology advances, higher and higher frequency ranges become feasible and more equipment becomes available. Higher frequencies offer higher bandwidths but come with increased propagation losses. Frequency ranges that did not seem feasible decades ago now have widespread use. This includes the frequency ranges recently identified for mmWave 5G in the 26 GHz, 40 GHz and 66 - 71 GHz bands and satellite bands 40 - 50 GHz (Q/V band) 70 - 80 GHz (E band).

There is growing interest in the use of even higher frequency ranges (for example, above 100 GHz) with the latest technological advancements. Higher frequency ranges can offer very wide bandwidths, much higher data throughput and network capacity for fixed and mobile applications. These high bandwidths can also offer high resolution for radio determination applications. International work, research and development are considering the 100 - 1000 GHz frequency range as a possibility for providing large bandwidths to provide very high data rates, high resolution imaging and industrial applications.

Other regulators have recognised the potential for technology innovations in higher frequency bands. Both the US and the UK have provided frameworks to increase access to frequencies above 100 GHz to promote technological innovations.

Higher frequency ranges can be shared more readily than lower frequency ranges, mainly due to their propagation characteristics. In addition technologies can utilise spectrum access techniques to minimise the risk of interference to other users. How spectrum is made available in these higher frequency ranges may need further investigation where shared models may be the default.

Implications for New Zealand

We will need to consider the most appropriate time to make higher frequencies available, noting that this will be driven through the development of international activities and available equipment. Because higher frequency ranges can be shared more readily this could favour nonexclusive licensing approaches that maximise the number of users that can access spectrum.

There are models of spectrum sharing that RSM currently use that could be applied to higher frequency ranges, such as general user licences (GUL).

3.3 Licensing approaches enabling new technologies

With the development of new technologies, commercial models are changing and more complex service arrangements are emerging. Regulators will need to look at the merits of licensing approaches and the extent that they constrain or incentivise use of new technologies and applications. In some cases, a new approach to allocation and licensing will be necessary.

Regulators are looking more closely at new licensing approaches including spectrum sharing, small cells and short range devices (SRDs). Currently, where individual licensing would be impractical (like for SRDs and wifi connectivity). With the proliferation of such devices and the continuing development of technologies, we are likely to see a reassessment of technical conditions and other regulatory requirements. This is because traditional licensing approaches did not anticipate the current and emerging commercial models, which means traditional licensing approaches may prevent the uptake or success of new technologies. In future, there is likely to be a greater emphasis on more flexible spectrum sharing techniques.

Implications for New Zealand

RSM is actively considering ways to address issues from the regulator and operator perspectives. There are a range of potential approaches such as in the current GUL regime (traditionally used in New Zealand for spectrum sharing), radio licensing and management rights. Finding a balance between protecting consumers and supporting innovation is an ongoing focus.

We are interested in exploring ways the licensing framework might work better for the deployment of indoor small-cells for private networks. We will monitor international developments to consider if GULs are appropriate when developing future spectrum bands (for example higher frequency bands like mmWave bands).

In 2021, we commenced a review of rules for the 2575 MHz – 2620 MHz Managed Spectrum Park for the remaining years on the management right.

A number of management rights are due to expire in the 2028 to 2031 period. We aim to start review of management rights around 5 to 6 years before expiry, to allow lead in time to undertake the planning work required. Considerable planning effort on rights reviews will be needed in this Outlook period.

Implementation of the Crown-Māori Memorandum of Understanding on Radio Spectrum (MOU) is underway (discussed in section 4.2). The MOU applies to the allocation of new Management Rights and the renewal of expiring Management Rights.

3.4 Regulatory frameworks

We have identified 3 priority work programme areas needed to enable our regulatory framework to respond to technology trends and innovations in spectrum management. These relate to:

• our regulatory settings under the Radiocommunications Act
• how we fund spectrum management services
• how we sustain the pool of engineering expertise needed to support spectrum use.

3.4.1 Adapting the New Zealand Spectrum Management Framework

The Radiocommunications Act has not been substantially amended since its introduction in 1989.

Many provisions are outdated and are affecting administration of the Act. In addition, specific provisions are unnecessarily constraining new technologies from being authorised within the regime. This is preventing deployment of key tools for law enforcement and border controls by government agencies.

Operational workarounds have progressively been used for some law enforcement activities and in administering rights to spectrum. If this continues, it will significantly impact spectrum management in the medium and long-term in 2 areas: allocation of spectrum, particularly spectrum for 5G technologies; and inhibit developing innovative forms of licencing to reflect changing commercial models, as highlighted throughout this outlook.

Each of these broader issues have more specific implications for items of work that are planned for the 2023 to 2027 period or have an effect on the levers that are available to RSM in authorising new technologies.

• The Act was drafted at a time when systems were paper based and online transactions were not envisaged. Modernising the provisions will ensure the Act reflects changes in trade, technology, equipment and industry best practice.
• There are inconsistencies in how technical requirements and reference standards are authorised under the Act and regulations. This is apparent for both radio and spectrum licensing regimes, and has led to constraints over adapting and responding to new technologies (including responding to the ITU Radio Regulations, changing business models and network evolution). This creates serious implications for compliance monitoring and enforcement.
• The current approach to competition in the Act creates duplication, uncertainty and may not always result in outcomes that are in the public interest. Reliance on deeds and commercial contracts to impose conditions on spectrum use and holdings creates uncertainties for spectrum right holders and difficulties for enforcement.
• The radiocommunications regime was originally designed with the intent that all spectrum would be transferred to the management rights regime, and spectrum use and allocation decided by the market – very little regulatory role for government was anticipated. However, current practice and the outcomes sought from spectrum management do not reflect the initial regime design.

Implications for New Zealand spectrum management framework

We are considering ways in which to support law enforcement by providing for approved agencies to deal effectively with security and safety threats that cause potential or actual harm such as those arising from drones or improvised explosive devices (IEDs). Law enforcement should be able, in appropriate circumstances, to use wireless technologies to detect, monitor, disrupt, use, intervene and prevent communications.

RSM will seek to continue to modernise the approach to and administration of the radiocommunications regime under the Radiocommunications Act 1989 so that it is fit-for-purpose for current and future needs.

This includes ensuring the regulatory framework can meet desired objectives including:

• supporting public policy objectives, including providing for te reo Māori and public broadcasting
• supporting economic growth by enabling information and communications technology innovation, and competitive broadcasting and communications sectors
• meeting the growing demand for wireless services
• facilitating non-commercial spectrum uses that benefit New Zealand, including public safety and defence communications, and industrial, scientific and medicinal applications.

We will also need to ensure that there are adequate tools available across government agencies to manage security threats (for example, ability to deploy a range of devices to monitor, intercept and disrupt telecommunications). Any changes to the regulatory frameworks will need to ensure New Zealand can meet obligations under international agreements, treaties and conventions relating to radiocommunications and the radio spectrum.

3.4.2 Radio Spectrum fees review

Holders of radio and spectrum licences must pay an annual fee to cover the administrative costs of registering their licences. This fee covers the costs of technical planning, licence registration and compliance activities to protect the rights of licence holders. Spectrum policy work is funded by the tax-payer. Revenue from spectrum sales goes to the Crown account and is not used for administrative costs. A memorandum account is used to hold fee revenue and pay relevant expenses. This means that fee revenue can be held to the credit of fee payers over multiple years and allows for the smoothing of fees over time.

Treasury guidelines require that government-imposed fees, such as those for radio and spectrum licences, be reviewed every 3 years. Radio licence fees are mandated by the Radiocommunications Regulations – Schedule 6: Annual Admin Fees. Following the 2017 review, the vast majority of users pay a fee of $150 (including GST) per licence.

We are currently in a phase of planned under-recovery of fees to reduce the positive balance in the memorandum account. The aim of the 2017 review was to reduce the memorandum account gradually so that a sudden, large reversal in fees is not required. A high-level fees review was also conducted in 2020 which found that a more detailed review was unnecessary. Additionally, based on this 2020 review, ongoing monitoring would be prudent and it appeared that the next regular fees review would be the appropriate time for a fees reset.

3.4.3 Building certification capability

Approved Radio Engineers (AREs) and Approved Radio Certifiers (ARCs) are a critical component of the radio licensing regime in New Zealand. The effectiveness of the radiocommunications regulatory regime is reliant on the expertise of these authorised experts.

The Radiocommunications Act 1989 and the Radiocommunications Regulations 2001 were updated in 2004 and 2005 to provide processes and certification of authorised persons.

Authorised persons include Radio Engineers, Radio Certifiers and Radio Examiners. The amendments were specifically to allow people that are not employed by the Ministry to certify radio and spectrum licences and issue certificates of competency.

Since 2006, MBIE and industry sectors have progressively increased their reliance on authorised persons to provide efficient and technically compatible assignment of radio spectrum. This is particularly apparent in key industries where there is growing demand for radio spectrum such as the telecommunications, maritime and aeronautical industry sectors, as well as the growing space industry. These industry sectors are vital for New Zealand’s economic prosperity.

Implications for New Zealand

We have mapped the environment to understand the demand versus the availability of AREs and ARCs. This work points to the lack of radio engineering training and qualifications in New Zealand. We expect that in the coming years, there will be a significant shortage of skills and capability in the radio sector.

To sustain the pool of expertise to adequately service key industries, an increase in support of the authorised persons regime is needed to meet current and future projected industry demands.

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