Select Committee on Trade and Industry Minutes of Evidence

Examination of Witnesses (Questions 151 - 159)




  151. Good afternoon, gentlemen. Is it Mr Short who is going to introduce you?
  (Mr Short) I will do a brief introduction if I may. My name is Mike Short and I am Vice President of the FEI, and Director of BT Cellnet. On my far right I have Head of Public Policy, Peter Dunn, from Orange. On my immediate right I have John May, Radio Networks Director for Vodafone. On my immediate left I have Richard Rumbelow, Head of Public Policy for Hutchison 3G, and on his left, Paul Innes, Director of Network Build and Maintenance from One2One. and last, but certainly not least, Mike Dolan of the FEI who traditionally has been our spokesperson, but we wanted to all be present to help you today.

  152. Thank you very much. We start off with Stewart and we were wondering what your attitude was to Stewart and what you think of the Government's response and how you view that? Is there an industry view?
  (Mr Dolan) Thank you, Chairman. On the day the Stewart Report was published we issued a notice welcoming the Report. We thought it was a very fair and balanced piece of work, an enormous amount of work had gone into the research effort, and there were a good number of useful recommendations. There has of course been an enormous amount of work done in the intervening period on a range of fronts and the industry has been working with Government as well as with other stakeholders to implement many of those recommendations.

  153. One of the things we would like to try and establish is where do we go from here? How many more of these masts do you guys require? Have you been able to map out your expectation of demand and are there blackspots that you have as yet have been unable to penetrate? What about 3G and the roll out of that? It would be interesting to get an industry and individual company view of where we are going.
  (Mr Innes) There are a number of questions in there and I will try and give you a fairly succinct answer that covers them all. The industry currently has around 22,500 base stations of one sort or another. That industry figure says a base station could be co-located amongst industry and shared amongst industry. There are probably 18,000 sites out there that people recognise as base stations. Three years from now the industry anticipates that number will be round 40,000 which nets down to 27,000 base stations. What does that mean in terms of development? Not all base stations are built solely for one occupier and we are likely to see an increase from 6,000 to 9,000 stand-alone new mast sites as a result of that. Clearly everything we do as an industry is led by consumer demand for services. We are not building sites we do not require for servicing customers and growth of services and the networks may go beyond that. As a window of opportunity 2004 looks like 27,000 radio locations for the industry.

  154. On the 3G roll out at one stage it was suggested that you might not need as many and it now seems you might need more. Is that because 3G does not penetrate buildings as well?
  (Mr Innes) I think it is fair to say that 3G has different characteristics, potentially, to some of the systems operated within industry in that we already have conflicts—the existing cellular systems work at 900 megahertz. The second generation operators, One2One and Orange, operate only in the 18000 band width, and they do have different propagation characteristics. I think the belief within the industry is that 80 per cent of our existing sites will serve UMTS base station purposes and further base stations beyond that will be required depending on customers' demand for service and the locations they require the service. Substantially it will be demand-led and the vast majority, certainly of the earlier sites, will be delivered through the existing infrastructure.

  155. We were in Finland recently and we visited Nokia and they suggested that they could in fact do the work with little micro cells, little boxes maybe 100 metres apart. How do you view that prospect? Here you are going through all these hoops and hurdles about masts and base stations and there is an emerging technology that might change the whole ball-game. Is this something you view with optimism or do you say that you will believe it when you see it?
  (Mr Short) We know that miniaturisation is occurring within the total numbers of the ball-game, including the ground-based masts, the micro cells and the pico cells. Within that miniaturisation potential we can see a lot of opportunities to look to much smaller, less significant base stations, (significant in terms of visual amenity) so the environmental impact and design is coming along. There are some other technologies coming along which may provide more choice of competition as well so if what you saw were pico cells or micro cells we are looking forward to working with companies like Nokia to bring them about, particularly to help in the growth of our industry and to serve demand.

  156. One of the consequences of devolution is that we are going to see different Parliaments and Assemblies approaching this in different ways. Do you think that you really need to try and get all of the elements across the road, Edinburgh, Belfast and I am never very sure what powers Wales does and does not have—and we are not going to get into any Anne Robinson situations—suffice it to say have you as an industry been trying to get your act together in order that politicians can be shepherded in the way that sometimes we need to be to have a clear way of dealing with this?
  (Mr Dunn) It obviously would be much more helpful to the industry given that we are all licensed for the whole of the UK to have a single planning guidance, single planning legislation for the whole of the UK. If that is not possible given the current state of the regional powers then we think it is very important that all the regional authorities get together and have a consistent approach to planning for telecommunications. We are about delivering services to customers in the UK and building a UK infrastructure to deliver these services. It would be a real shame if there was a regional divide because of regional planning legislation.

Mr Laxton

  157. Given the concerns that are around about health issues associated with antennae and masts—and presumably some of the micro systems that we were looking at Nokia to which the Chairman referred utilise far less power than some of the masts—can you envisage a situation whereby perhaps in urban areas (where a lot of your business is from clearly as you build your system) there is a proliferation of these small, low-powered but close together masts, perhaps moving to a situation where in more rural areas you tend to have more masts around and greater coverage? Do you envisage being driven by technology and planning issues and public concern down that road?
  (Mr May) I think the answer is that as the networks develop for 3G, in the same way they have developed in technological terms for 2G over a period of five to ten years, there will be a number of new, enabling technologies in miniaturisation that will come along and aid us. That goes with the maturity of the technology and our understanding of how to exploit it. The small physical installations, as you say, work at much much smaller powers and therefore have much much shorter ranges and typically cover a small pedestrian area or the internal part of a building. So they are part of a portfolio of solutions that we will exploit as they become available but the miniaturisation of that equipment, as you will have seen if you have been to Finland, is the sort of thing being developed by manufacturers for future years.

  158. Just one more thing if I can just clarify it so I have got it clear in my mind. You were talking about the numbers of masts and bases stations. On the figures we have had bandied around—and it is difficult to nail it down as to whether it is accurate or grossly inaccurate—we would end up in the United Kingdom with 76,000. This is a ball-park figure. Can you provide us with a ball-park figure as regards base stations, masts, antennae, or your best guesstimate as to what you think the total number of masts is likely to be on current technological terms? Or is that asking a little bit too much of you?
  (Mr Innes) It possibly is not asking too much but it needs to have a horizon within which we can look at as an industry which is driven by our forecast of customer use. In that horizon on what we have defined as a ground based mast those numbers would be heading towards 9,000 ground based masts in the UK from a position of around about 6,000 today. That is pure mast terminology. That is where we struggle in the industry with how the industry uses terminology, how the Government uses terminology and local authorities and the community use it. On pure masts, ground based masts, we envisage them growing from 6,000 to 9,000 in a period of three to four years.

  Mr Laxton: Thanks.

Mr Chope

  159. This brings me on to the issue of planning permission. What do you think will be the practical effects of having to obtain planning permission for all these masts? Will it add to the timescale? Do you expect to have more turned down?
  (Mr Short) Richard, do you want to take that one?
  (Mr Rumbelow) Thank you. I think in general terms if the pendulum of regulation was to swing more towards every site requiring full planning permission, undoubtedly that would cause delay in terms of what we have to do as operators to provide the customers with the service they are looking for. The other point about full planning is that it is not necessarily the answer that people are looking for in terms of how to answer that concern. It will provide, we believe, the opportunity to raise expectations in their minds providing in their belief a veto over development which clearly full planning is not there to achieve. Planning is there to balance the needs of industry and other applicants against other environmental considerations. In overall terms we do not feel that full planning is the answer to this particular situation. It will cause delay, it will cause frustrations to customers who want the service where they want it and how they want it. Certainly in terms of meeting the concerns of constituents where this issue is concerned we think it will provide only further disenfranchise for them rather than actually answering their questions.

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