Select Committee on Trade and Industry Minutes of Evidence

Memorandum submitted by Orange

Why do so many more base stations (masts) still need to be erected?

  Orange must continue to erect more base stations throughout the UK for reasons of both "coverage" and "capacity". Although geographical coverage is available over a large part of the country, broadly providing mobile services in areas where 99 per cent of the population live, gaps in coverage (commonly known as blackspots) still occur, primarily as a result of local topography.

  Greater coverage gaps exist in rural areas, outside the main population centres, but close to smaller towns and villages where consumers still demand access to mobile services. These gaps will mean that calls either cannot be made or will be dropped or will not be of sufficiently clear quality. As a result the service offered to consumers will be adversely affected, which is why Orange is continuously filling these gaps to provide the highest level of service.

  More base stations are also needed to meet the phenomenal demand for Orange mobile phone services. At the start of 2001, Orange had 10 million customers (one in six of the entire UK population), which is more than double the customer base just one year earlier. In the final quarter of 2000, Orange gained an additional 1.56 million customers, which is approximately the same number of customers gained in its first three and a half years of trading between 1994 and 1997.

  The physics of mobile technology means that each base station can only handle a limited number of calls at any point in time and therefore the only way to meet this huge surge in demand is by erecting more base stations. As more consumers continue to demand access to mobile services, the number of base stations must continue to rise in direct proportion and as a direct result.

Why will the extended use of full planning not resolve current concerns?

  Orange has no doubt that the extended use of the full planning system, in place of prior approval will not resolve the issue primarily because it will not achieve the aims of many of those who propose it. Full planning will not address any of the three main areas, which lie at the heart of the problem.

  Firstly, it will not give the local community any input into the site selection process, which is the most critical flaw. Nowhere does the full planning process involve any direct consultation between the community and the operator. It simply allows residents to write letters of objection to planning officers after the site has been chosen by the operator. Any effective solution must involve direct consultation between the local community (typically represented by the local authority) before the site has been chosen, which is why all of the operators have recommended that pre-application consultation between the operator and the local authority be made obligatory on both parties.

  Secondly, full planning will not give local planning authorities the power of veto which some people appear to believe it will deliver, as a result of a general misunderstanding of the powers it involves. For example, it will not allow them to introduce arbitrary exclusion zones around base stations. It will not allow them to introduce moratoria over base stations in particular areas. It will not allow them to force operators onto a particular site of their choosing. It will not allow them an automatic right of veto in areas where there is a high level of public concern. As the perception is that these powers will be available, Orange believes a sense of disillusionment and disappointment will inevitably follow its introduction.

  Thirdly, full planning will not provide any answer to the health concerns which are fundamental to why the public wants to be able to have an influence over radio base station location. It is very difficult to resolve fears which are not based on established scientific evidence and the planning system is totally unable and indeed, not designed to solve this problem. Simply changing a planning process will never get to the root of the problem, if people do not currently accept the balance of worldwide scientific evidence before them. Further research, public information and education are the best tools available to address this problem and some of the operators' commitments suggest a way forward. The public must be given the ability to place these risks in context and in comparison with the benefits which mobile communications brings.

What will be the effect of this kind of increased regulation?

  An increase in base station development regulation will have three principal effects which might not always be readily appreciated.

  Firstly, it will result in a significant delay to network rollout, primarily as a result of the removal of the defined timescale and presumption in favour of development contained in the prior approval system, which means applications may remain undermined indefinitely. This in turn will result in more refusals and therefore more appeals with the associated delay. In addition, full planning applications take longer to process than prior approval applications and so each individual application will take longer, which will lead to an ever growing backlog and increasing delay.

  Secondly, full planning regulation could lead to severe capacity problems on current second generation networks because it will become very difficult for Orange to address the huge demand and consequent need for further base stations (as outlined above), if every new application is subject to delay. Even with current prior approval rights, the operators are finding it difficult to erect enough radio base stations to meet current demand and these delays will make this task even harder. There is a very real risk that delay will begin to cause severe congestion to the networks which will become increasingly noticeable and frustrating to consumers wanting to make calls.

  Thirdly, the delays resulting from full planning will severely threaten the UK's leading position in telecoms and related technology, particularly in relation to rollout of third generation mobile networks. A mobile communications infrastructure is central to remaining at the forefront of technology and the congestion caused to the current networks together with the delays and congestion caused to third generation networks will severely threaten that position. The delays will mean that other countries will be able to deliver third generation services to business and consumers well in advance of the UK and the benefits gained by being the first to issue third generation licences will be lost entirely.

Why will mast sharing not resolve current concerns?

  In common with other operators Orange is obliged to consider the use of existing masts, buildings and other structures before erecting a new mast. If an application for a new mast is to succeed, it must satisfy the local planning authority that no existing structure is technically suitable. In addition, it is often in Orange's economic interests to share existing structures with other operators, particularly in more rural and remote areas where the costs of power supply, installation and maintenance can be shared.

  However, mast sharing is not always the most appropriate option for two reasons. Firstly the existing building or other operator's mast must be in a technically suitable location for the second operator. As each network is necessarily planned independently, the location of an existing mast belonging to another operator, may well not be positioned in the area in which Orange has a gap in coverage. If Orange shares sites which cover only part of the target area, other base stations will have to be erected to cover the rest of the target area, which will lead to greater proliferation.

  Secondly, if a second operator shares another operator's existing mast, the mast will invariably have to be taller (usually 5 metres) and wider, to allow the second operator's antenna equipment to be housed. In rural and more environmentally sensitive locations, the local planning authority may not feel a larger mast is the best option and it may decide two smaller masts would be less visually intrusive.

Why will national roaming and satellite technology not resolve current concerns?

  It would be technically possible for a mobile customer in the UK to roam between the existing four networks (Orange, Vodafone, BTCellnet and One2One) using the network of whichever operator has coverage in a particular area, in the same way as happens when customers use their handsets abroad.

  However, this would be tantamount to the nationalisation of the mobile telephony industry, because it would effectively create a single network available to all customers. This would be extremely detrimental to the consumer by removing virtually all competition in the industry, which currently incentivises all of the operators to provide the best coverage and thereby gain the most customers. National roaming would mean no operator had any incentive to extend its coverage, because it would gain no commercial advantage from doing so.

  National roaming will have no effect in large parts of the country where base stations are erected due to high capacity demands because the same number of base stations will still be needed to handle the high number of calls being made. Calls will always be dropped, when a customer attempts to move from one network to another. Many services will be unavailable to customers when they move off their home network and they will not know why. Call charges will increase, as customers will have to pay roaming charges and inter-operator tariff confusion will be caused.

  Orange is a licensed operator to provide mobile telephony services on a certain part of the radio spectrum. It is not licensed to provide satellite services. The difficulties faced by others in providing mobile telephony services via satellite have centred around the prohibitively high costs of both the handsets and the calls; the large and bulky nature of the handsets; and the fact that satellite signals cannot be received in buildings. So far, it seems that satellite telephony has no commercial application for the vast majority of users wanting to make calls in inhabited parts of the world.

Why does Orange not participate in more pre-application consultation with local communities?

  Orange regularly writes to all local authorities throughout the UK with details of its future rollout plans and offering to give presentations to local authority officers and members. Unfortunately, there has always been a very low response rate and an even lower take-up of the offer of a presentation and consultation meeting. This makes the task of early consultation extremely difficult, but Orange is committed to continuing to make such offers before every major rollout phase.

  Orange has recently recruited community liaison staff based throughout the country to meet and establish ongoing relationships with local residents groups expressing concerns about Orange base stations in their area. In conjunction with the rest of the industry, Orange is in the process of implementing a new consultation process, designed to complement whatever changes to legislation the Government brings forward. The new process will only work with optimum efficiency if local authorities are prepared to provide input by indicating what type of consultation is appropriate in individual cases.

  However, Orange continues to face ongoing difficulties in trying to conduct meaningful pre-application discussion before sites are chosen and applications are submitted. Local communities are often not interested in providing input and attending meetings at an early stage in the process before it is known whether the base station will be close to particular residences. Interest is only aroused when the site is chosen and the application submitted, which makes locating the best site at the outset very difficult.

Why will Orange not adopt a precautionary approach and agree not to site base stations (masts) within a certain distance of residential areas?

  The uses and benefits of current and future mobile telephony services are universally accepted and obviously base stations must be erected in order for those services to be available. Therefore it is crucial to have clear guidelines governing where base stations can and cannot be erected. Orange believes that these guidelines must be set by central Government, in the overall national best interest and can only be based on substantiated scientific knowledge, rather than arbitrary and unjustifiable criteria.

  As a matter of precaution, the Stewart Report recommended the adoption of the more stringent International Commission on Non-Ionising Protection (ICNIRP) guidelines for public exposure in place of the NRPB guidelines. The Government and industry accepted this specific scientific precautionary recommendation, but do not accept a general precautionary principle which sets no definite limits and can be applied differently in every situation, to the point at which it becomes meaningless.

  Similarly, any guidelines set purely on the basis of distance are equally meaningless and unjustified because the only important consideration is power density, which will vary enormously between a microcell and television transmitter, which both emit similar types of electromagnetic radiation. Therefore to state that both types of installation must be the same distance from residential properties is entirely misguided and scientifically without reason.

What will be the effect of moratoria introduced by local authorities?

  Some local authorities have introduced official moratoria not allowing any base stations to be erected on buildings or land which they own. Some local authorities are operating unofficial moratoria and are automatically refusing all telecoms base station applications which they receive. This second type of moratorium is clearly not permitted under the legislation.

  Orange understands that local authorities feel that they must respond to community concerns, which is why some have decided not to allow base stations on their own land. However, such policies do nothing to reduce the need for further base stations to be erected, which results from the huge demand for mobile telephony. They simply deny the operators a wider choice of sites and therefore make the task of finding the most environmentally suitable site, which satisfies the local community, even more difficult.

  For example a piece of land or a building might exist which meets the operators coverage requirements and is sufficiently far from residential property to allay local concerns. However, if the land belongs to a local authority, which will not accept a base station, the operator will be forced to investigate other less suitable sites. This could result in a taller more visually intrusive structure elsewhere, or more than one base station to cover the same target area or an installation closer to residential properties. The local community would rightly object if an environmentally less suitable solution had to be pursued purely as a result of a local authority's blanket ban on use of its own land for telecoms development. This would clearly not be in the interests of best siting of telecoms infrastructure.

What new services will be available as a result of further telecoms development?

  Second generation enhancements and third generation technology will significantly increase the type of services available via mobile handsets. Handsets offering face to face video phones calls, mobile video conferencing and e-mails sent with video attachments, combining with all of the functions of an electronic personal organiser will become the norm. Numerous kinds of location specific information will be available as users move about, which is likely to be the key attraction of the mobile internet.

  There will also be a vast range of e-commerce possibilities available via the handset (becoming known as "m" or mobile—commerce) both from established websites and a new range of sites which will be designed specifically to address WAP capabilities. Media convergence will enable the download of a vast array of different material from the internet directly to the handset, including e-mails, music, film clips, news reports and any other form of data.

  Mobile phones will soon incorporate Bluetooth technology, which via a very small low powered radio chip, will allow any electronic device to communicate with any other device up to a few metres away. Cables around the home and office will become largely redundant and connectivity will become the key as many devices become linked to each other and the mobile network. As a result they will be controllable via WAP, text message, PDA/internet or voice activation, whilst in the home/office or miles away.

What are the social and economic benefits of mobile telephony?

  The development of new mobile phone tariffs and services has been continuous in the last couple of years, but the introduction of pre-pay packages has revolutionised the market, opening it up to a whole range of people who had not previously thought of themselves as potential mobile phone users. Pre-pay tariffs are ideal for those on lower incomes and have been extremely popular amongst consumers who had previously been concerned about the open-ended nature of monthly charges of a mobile phone.

  OFTEL has stated that the mobile market is characterised by falling prices and that low usage customers on pre-pay schemes have seen the biggest price reductions. Mobile phone operators are reacting to the wishes of consumers by providing competitive tariffs demanded by those who aren't high users. More people on low incomes are deciding to swap their fixed phones for the cheaper mobile alternative. The low cost and higher familiarity associated with mobile handsets compared with PCs, may well mean that they become the chosen method of broadband access for some people on lower incomes, especially in rural areas where fixed broadband access may not be available.

  By creating a high speed digital mobile network to complement existing fixed networks, mobile operators create a framework for future development and growth. This allows businesses to communicate with each other wherever they are, whenever they wish and enables new working practices, such as homeworking. Mobile communications make traditional business more efficient, and create the conditions in which new business can flourish. A lack of coverage is a serious disincentive to a business locating in a certain area. Many businesses would find it extremely difficult to operate today, without mobile communications and as the type of available services increases even more businesses will come to rely on mobile, as a crucial form of communication.


How calls are made and received

  In order to run a network offering mobile services, each operator is granted a licence to broadcast at a particular frequency range within the radio spectrum. All other users of the radio spectrum must be allocated their own part of the spectrum to prevent interference occurring.

  Mobile phones work by converting voice into electronic signals and then sending and receiving these signals to and from antennae that are attached to radio transmitters, or radio base stations. They do so by using a part of the allocated frequency range, known as a radio channel.

  Therefore, in order for a two way conversation to be held without interference from other calls, each call must be allocated a radio channel at which to transmit and a radio channel at which to receive.

  However, the allocated frequency range can only be divided into a limited number of radio channels, which means only a limited number of calls can be made at any particular time. If all radio channels are being used no further calls can be made.

Increasing capacity

  In order to increase the number of calls which can be made, the operator must re-use the same radio channel many times simultaneously. As long as the same radio channel is not being used on more than one call within the same geographic area, interference will not occur and many calls can use the same radio channel without affecting each other.

  Radio base stations transmit and receive signals to and from the mobile handsets and allocate the radio channels to the calls being made. The area over which a single radio base station transmits and receives is generally referred to as "cell".

  Each base station uses a certain number of all the radio channels available to the mobile operator in its allocated frequency range. If all the radio channels in a particular cell are being used, greater capacity can be created enabling more calls to be made, by erecting another base station within the existing cell and creating two smaller cells.

  Therefore the way in which radio channels are reused is by increasing the number of radio base stations, which will always have to be multiplied in line with the number of calls made by new customers who buy mobile phones.

  As long as the base stations in these adjoining cells are not using the same radio channels, more calls can be made in the same area without causing interference.

Building a Network—obtaining coverage

  In order to ensure that a call remains continuous as the user moves around, the cells overlap slightly. When a user nears the edge of a cell and enters the overlap area with the next cell, the network will hand over from one base station to the next once the new base station is providing a stronger signal.

  The operator's network therefore is made up of many overlapping cells covering the entire geographical area over which coverage must be achieved.

  However, radio signals will suffer interference from any obstacles such as buildings, trees, hills and valleys and therefore wherever these obstacles exist a new base station must be erected to provide coverage in the area where signals from existing base stations cannot reach.

Building a Network—transferring a call

  Once a call reaches a radio base station, it must be transferred across the rest of the mobile operator's network and into the fixed line network or to wherever the call is being made.

  Depending on where the base station is located the call will be passed either through underground fibre optic cables or via "point to point" fixed links which transmit a "torch like" beam from one base station to the next and require a direct line of sight.

  By a combination of these methods, the call may travel between several base stations, before entering a main switching centre and then being passed off the mobile operators network through the public switch telephone network.

Mast Sharing and Roaming

  Mast sharing and roaming are often referred to as means by which to keep the number of base stations to the necessary minimum, but the distinction is not always clearly understood.

  Mast sharing simply involves two or more operators both placing their antenna equipment on the same mast, building or other structure, thereby reducing the need to erect a new structure in the same area, but not reducing the total number of antennae required, as each operator still has an entirely separate network.

  Roaming involves the customers of one operator making and receiving calls on the network of another operator, which has a commercial/billing arrangement with the first operator. In theory, only one base station is therefore needed in any area, which will be utilised by customers of all networks. In practice, the capacity demands outlined above will mean that several base stations will still be required and so in most cases there will be no reduction in the number of base stations in any particular area.

8 March 2001

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