Hamish MacLeod, Director, Mobile UK – November 2017

The Government will shortly bring into force the reformed Electronic Communications Code – a little known but vital piece of legislation that underpins the UK’s digital economy that is worth £18.3bn [1]. It is the Code that gives telecommunications providers the rights to lay cables, dig trenches, build masts and install other physical technology that is necessary to deliver the digital services that will enable the future growth of our economy.

Having said that, in the short history of the mobile phone industry, virtually all of the 40,000 mast sites built and operated by the industry in the last 30 years have been on terms negotiated between the landowner and telecoms provider. While it is always the preference for such agreements to be freely negotiated, it also the case that it has been virtually impossible to rely on the Code as a mechanism for resolving disagreements. The Code was published in 1984 before the first mobile networks operated in the UK and it has only been used six times to settle a formal legal process.

As a result, a ‘telecoms premium’ has crept into the compensation that landowners receive for the use of their land or buildings. A landowner that hosts an electricity pylon receives a few hundred pounds per annum; a landowner hosting mobile apparatus can receive thousands, or sometimes tens of thousands of pounds per annum. The premiums are especially acute with sites that are particularly well suited for radio transmission – high rooftops or prominent pieces of land. And when site agreements have been extended, the cost of relocating and the lack of suitable alternatives have often led to rent reviews well above inflation.

Since the first publication of the Code, mobile use has become the norm across the UK. According to Ofcom 94% of the population use a mobile, of which 70% access the internet via their handsets. People and businesses are increasingly reliant on mobile connectivity for their everyday lives. However, regulation has not kept pace, and the current ‘telecoms premium’ risks increasing prices for customers or reducing funds available for network investment.

To tackle this, the Government has reformed the Code, to facilitate a better environment for critical infrastructure deployment that will benefit all, and to support improvement in coverage through lowering costs, by setting out more clearly the rights of operators and landowners and the expected basis of valuation for compensation. Landowners can be confident that, if they need to redevelop their property, they will not be impeded by the presence of telecoms apparatus. Operators can be sure that they can get access quickly if they need to carry out emergency repairs and that they won’t be faced with unreasonable extra costs if they seek to share a site with another operator.

The reforms remove the link between the position in the landscape and its suitability for radio transmission and valuation. This will make it more cost efficient for operators to build new and maintain existing sites in areas that have been traditionally harder to reach. The competitive nature of the UK mobile industry means these savings will be used to invest in coverage and capacity to ensure we are able to meet the increasing expectations of customers and deliver the connectivity we need to build a digital society.

The changes have been supported by trade bodies that represent landowners. Enabling better connectivity is everyone’s clear priority; good connectivity is now crucial to property valuations, business productivity and consumer utility.  Operators will continue to work closely with partnder landowners and doubtless it will take a bit of time to adjust to the new regime, but it is too important to the future of the economy for the reformed Code to fail.

[1] UK ranked 7th in world http://www.cityam.com/268222/uks-digital-economy-among-best-world-according-new-study