The FCC’s 700MHz auction
raised $19.6 billion, with $16 billion coming from just 2 operators:
Verizon and AT&T (National coverage maps). While I’m sure the FCC
would love to run more multibillion-dollar spectrum auctions, is it
really necessary to do so?
There are lots of moving parts in
delivering a mobile broadband service, but it’s interesting to look at
them holistically.
Different frequencies have very different
propagation characteristics. It has been said that the best thing about
700MHz spectrum is its propagation characteristics. It has also been
said that the worst thing about 700MHz spectrum is its propagation
characteristics. It goes forever, has good in-building penetration, but
these attributes present challenges from a frequency re-use perspective.
Great for coverage. Not so great for capacity.
Conversely, the
propagation characteristics in the 2GHz and 5GHz ranges are very
different. These have limited range and poor in-building penetration,
but these attributes are advantageous from a frequency re-use
perspective. Poor for wide-area coverage. Great for capacity.
With
the explosion in mobile broadband, the question today is whether the
delivery of wireless broadband is a coverage play or a capacity play?
And if capacity, what does the network look like?
Cell size and
capacity have an inverse relationship. Macrocells, by design, are built
to cover wide areas. However, the radios, spectrum and backhaul are all
shared elements. The more users you have within a cell competing for
these resources, the lower the throughput to each user. To increase
capacity over an area, mobile operators pack in more, smaller cells
(micro and picocells, and at the extreme low end of the spectrum,
femtocells are being contemplated).
Andy Germano, vice chairman
of the Femto
Forum, said it very well recently when referring to the deployment
of 4G networks: “Rather than go from big to small, they can go from
small to big,” referring to cellular topology.
We know that,
even today, it is challenging to keep up with the data capacity demands
being driven by smart phones and other mobile devices. This is due to
three factors: user demand for bandwidth, spectrum availability and
cellular topology.
AT&T has been at the forefront of
addressing the issue of adding data capacity to deliver a superior user
experience for its iPhone subscribers by embracing Wi-Fi and unlicensed
spectrum. Recently, at SUPERCOMM, John Stankey, president and CEO of
AT&T Operations, stated:
“I don’t think a single macro
wireless network is sustainable over time, given the pace of spectrum
availability and what’s actually out there in terms of fixed spectrum. I
think the reality is that there will be macro and micro networks. We’re
starting down that path at AT&T, focusing on how we make Wi-Fi and
licensed spectrum a more seamless experience for customers.”
So
back to the beach.
There’s 80MHz of free, unlicensed spectrum,
at 2.4GHz, being used today to augment data capacity by a leading
licensed spectrum owner. Very interesting, but it’s still a small and
pretty crowded stretch of beach. However, there’s 450MHz of spectrum, in
the 5GHz bands, that is a beautiful stretch of beach – much less
crowded, and ideal for small cells and frequency re-use, i.e.
high-capacity locations.
Great stretch of beach, but how do I get
there from here? Wi-Fi (802.11b/g) supports 2.4GHz and there are no
802.11a devices. The answer is 802.11n. Devices, such as the new Apple
iPod Touch, are shipping with chipsets that support .11n and both
frequency bands. Although the 5GHz radios are currently disabled, it is
not unreasonable to expect that any upcoming versions of the iPhone, and
other Wi-Fi enabled devices, will offer dual-band capabilities.
So,
we will see 4G services rolled out at 700MHz, which will bring LTE to a
big chunk of the country. But instead of waiting years (and paying
billions) for more licensed spectrum to add capacity, I would say to Mr.
Levin, “There’s a beautiful stretch of public beach up at this end,
just waiting to be used.”
That’s my .02!
Martin Suter
Martin
Suter is vice president of business development at BelAir Networks,
the global market share leader in service provider Wi-Fi, enabling 3G
data offload for wireless carriers, quad-play for cable operators, and
managed WLAN business services. Previously, Martin was the CEO at Cohda
Wireless, where he raised the company’s profile and negotiated a
licensing deal with a Fortune 100 vendor in its core franchise. Prior to
Cohda, he was vice president of business development at MeshNetworks
Inc., a classic tech transfer/disruptive technology success story that
achieved a major liquidity event for its investors in Q4/2004 with its
acquisition by Motorola. Martin also was responsible for building
several high profile alliances with and for leading technology
companies, including Fujitsu, Microsoft, Netscape, Sun Microsystems, and
Teradata. Additionally, Martin has successfully negotiated technology
transfer, distribution and/or licensing deals with companies like 3Com,
BioChem Pharma, Dow Chemical, Exodus, Fujitsu, IBM, Microsoft, Motorola,
Netscape and Sun.