Huge spectrum costs taking toll on developing markets – Mobile World Live

Huge spectrum costs taking toll on developing markets

17 JUL 2018

LIVE FROM GSMA MOBILE 360 SERIES – AFRICA, KIGALI: Operators in developing markets pay effectively three times more for spectrum than in other locations around the world, raising prices and hampering access, the GSMA revealed.

GSMA Intelligence’s Spectrum Prices in Developing Countries study found huge differences in the cost of acquiring assets relative to GDP, a trend it described as a “major roadblock” to increasing mobile penetration.

Analysts at the Association found governments in some countries played an active role in hiking spectrum prices in a bid to maximise state revenue. Some of the highest fees were found in countries with a large amount of sovereign debt.

Across developing markets the average starting price at a spectrum auction was five-times higher than developed market equivalent, relative to GDP, the study revealed. It also drew a link between higher acquisition costs and poor coverage for end users.

Outside of inflated spectrum costs, regulators artificially limiting available airwaves and drawing up poorly designed auction rules were cited as contributing factors to high consumer pricing.

GSMA head of spectrum Brett Tarnutzer said: “Connecting everyone becomes impossible without better policy decisions on spectrum.”

“For far too long, the success of spectrum auctions has been judged on how much revenue can be raised rather than the economic and social benefits of connecting people,” he added. “These pricing policies will only limit the growth of the digital economy and make it harder to eradicate poverty, deliver better healthcare and education, and achieve financial inclusion and gender equality.”

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Chris Donkin

Chris joined the Mobile World Live team in November 2016 having previously worked at a number of UK media outlets including Trinity Mirror, The Press Association and UK telecoms publication Mobile News. After spending 10 years in journalism, he moved...

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