Will European MSS get off the ground?

In our blog European Space War? we noted that the European Commission and the ITU may have a difference of opinion about the EU’s allocation of spectrum to 2 mobile satellite services’ (MSS) operators.  Inmarsat and Solaris Mobile were announced as the the lucky winners in the Official Journal on 12 June 2009.

Our earlier blog was really concerned about the issue of setting national spectrum licence fees for these MSS operators.  Set too low and the terrestrial mobile operators could easily get upset at being put to a significant disadvantage.  Too high and the whole project gets killed off or delayed, as happened to 3G.

So has Ofcom got the level right?  In their statement on licensing the complementary ground components, they have set the licence fee at £554,000 per 2 x 1 MHz nationwide, being the Administered Incentive Pricing of the GSM mobile operators’ spectrum first described in their January 2008 consultation paper (which has a very straight forward explanation of the 2GHz mobile satellite system, including the use at this spectum by complementary ground components).

Our gut instinct is that this is too high, given the overall costs of the infrastructure of mobile satellite systems complementary ground components AND the manufacture, launch and operation of the satellites themselves, particularly if this level of licence fees are set in all other member states.   Maybe that’s why we’re lawyers, and not regulatory economists?

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