License-free two-way radio: cost savings for small businesses

7 November 2018

No modern manufacturing company’s business strategy is complete without a section on cost management. Whether it is trimming waste with leaner, more efficient processes or reducing overheads, maintaining margins in straightened economic times depends in no small part on getting greater out for less in.

Take the example of communications equipment. Two way radio has been used in industry for decades as a front line tool to improve coordination of operations, helping to improve workflow and boost efficiency. No modern business wants to be without an effective and reliable means to keep people in touch as they move around a facility because they see the value in maximising productivity.

But when you are, say, a small specialist packaging firm battling to improve margins when raw material prices are rising and customers are seeking value, you have to look at all overheads to see where savings can be made. It is natural that expenditure on things like two way radio comes in for scrutiny.

For small operators, the trend towards increased sophistication and digital technology in two way radio is not entirely welcome. Yes, the capabilities and range of features on the modern digital handset have increased significantly. But so have the costs. When all you really need is standard push-to-talk functionality and reliable voice communication to keep your staff in touch with one another as they work, you are bound to question the need to pay for all the extras.

Not all two way radio products available are trying to blind you with technology, however. Examples such as the Motorola XT240, to name one among many, still keep things simple and stick to the core principles of what two way radio has always offered. More than that, they offer cost savings for business users in one crucial way - you don’t need a license to operate them.

Licensed versus unlicensed explained

Two way radios count as transmitting devices, which means that in most cases you need a license to use them. That is because there is only so much radio bandwidth to go round, so to stop unnecessary interference and confusion over the airwaves, access to communication frequencies is tightly controlled by public authorities in each country.

This includes allocating certain bandwidths for specific use cases. Examples of different uses of radio spectrum, each with their own specific frequency ranges, include business radio, amateur radio, ship’s radio, mobile broadband and IoT networks. In the UK, the authority that controls and regulates all of this is Ofcom.

While Ofcom’s main mode of regulating access to the airwaves is through licensing, it does also set aside a small ‘free to air’ segment of spectrum for each different use case. In the UK and across the EU, frequencies within the 446 MHz UHF band are set aside for open public radio use, without the need to buy a license. This is known as PMR446, standing for Personal Mobile Radio, as the main purpose of this band is to allow license-free access for leisure users.

Despite the name, there is no restriction on businesses making use of PMR446 either. The main benefit is the cost saving of not having to buy a license, but other perks include simple ‘plug and play’ connection, as you don’t have to programme PMR446 handsets to a specific bandwidth, it is already done for you. You can also use an unlicensed radio anywhere across the EU, as all countries operate the same free-to-air band.

The big drawback with license-free two way radio is that the narrow spectrum can become crowded with traffic. You could be sharing airwaves with other nearby businesses using unlicensed handsets, as well as personal users. This can cause interference and the risk of picking up other people’s calls unintentionally.

PMR446 handsets are also restricted to 0.5W power, which means signal can become unreliable over distance. You cannot use additional equipment such as repeaters or base stations to boost coverage of license-free radio.

For large manufacturing operations with hundreds of staff operating across multiple large shop floors, these restrictions are usually enough to negate the cost benefits of opting for unlicensed radio. In the long term, they will get better value from the higher performance of licensed two way radios.

But for SMEs with comparatively small work teams operating within the same building who just want a convenient means of enabling voice calls on the move, license-free radio remains a viable option in industry for companies looking to control costs.

For more information about the use of two way radio in industry, visit

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