Carrier Needs for More Spectrum Laid Out During Broadband Workshop

“Technology doesn’t offer year-over-year gains, maybe a small gain one time, but it’s not going to solve any of these problems, the ones we are staring at,” Laroia said. “Technology has its role but I don’t think technology itself is going to be the answer to all the spectrum needs. Spectrum is going to be the answer to spectrum needs.”

“What’s the right thing for us to quantify, what’s the math we should use, to understand how much spectrum we need?” asked John Leibovitz, deputy chief of the Wireless Bureau. In preparation for the last World Radio Conference in 2007, the ITU looked at worldwide spectrum needs, said Kris Rinne, senior vice president of architecture and planning at AT&T. “That recommendation was we needed to find about 1,280 MHz of spectrum for the 2020 timeline, and if you read those ITU documents it’s focused on a lot of the same products and services that we're talking about here,” Rinne said. “We haven’t raised machine to machine much, but also talking about those in addition to video services.”

Rinne said her company has seen demand rise rapidly in recent years. “AT&T over the last three years has seen a 5,000 percent increase in our wireless data usage and at the same time our voice usage continues to rise as well,” she said. “We would anticipate that over time there will be a challenge for this scare national resource that we manage, that being the spectrum demand for our customers.”

Bill Stone, executive director for network strategy at Verizon Wireless, said the carrier hopes to acquire more than 100 MHz of new spectrum licenses over the next five years: “There’s a lot of unknowns and I'll certainly be able to answer that better in another year or two, but that’s where I'm at.” Stone said Verizon has seen the same kind of growth as AT&T. He agreed technology alone won’t meet the industry’s growing needs. “We're pushing the envelope already and using the spectrum very efficiently,” Stone said. “The big variable that drives the wide spread in potential spectrum need is the usage per customer. There’s this wide range of bandwidth-hungry applications that are currently emerging, video being the classic example. The more users that adopt those applications and use them frequently, the more spectrum we're going to need.”

Tarun Gupta, vice president of Strategic Development at FiberTower, said carrier backhaul needs alone will likely require an extra 100 MHz of spectrum in the next five years.

Panelists also argued that carriers needs large blocks of contiguous spectrum. “Just a general rule would be: the larger the block, particularly in OFDM technologies the more efficient you are from a megabytes per hertz standpoint,” Rinne said. As Verizon Wireless moves rolls out LTE, it’s starting with paired 10 MHz blocks of spectrum, Stone said. “I'm think that is the minimum that we would want to implement on a go-forward basis,” he said. “If we could do two by 20 [MHz] we would, but we have to work within the portfolio we have today.”

A second panel looked at how the FCC can identify and allocate more spectrum for use by carriers. Wireless Bureau Chief Ruth Milkman posed a battery of questions that must be addressed by the commission. “Our goal is to isolate the biggest opportunities and the biggest challenges as we attempt to address the country’s future needs,” Milkman said. “A few of the big questions to consider -- How should we prioritize different frequency bands for potential broadband use? What are the most cost effective approaches to determining the actual use of spectrum in a given band? What’s the role of secondary markets, especially in rural areas where spectrum may otherwise go unused? What novel policies or economic mechanisms should we pursue?”

“There’s several areas that you could look for additional frequencies,” said Coleman Bazelon, principal at The Brattle Group. “We all suspect that the government controls spectrum that could more efficiently be used in the private sector. Unfortunately we don’t actually have the information at this point to find those frequencies or make the economic argument that they're more efficiently used elsewhere, which is why the spectrum inventory is such an important project.”

The FCC could also look at additional “white spaces” spectrum in both the TV and educational broadband service bands, Bazelon said. “There’s no evidence at this time that unlicensed spectrum is scarce, but there’s a lot of evidence that licensed spectrum is scarce,” he said. “Almost everything but the current commercial bands are probably undervalued.”

Kathleen Ham, vice president of federal regulatory affairs at T-Mobile, said one of the lessons learned in clearing government users from the AWS-1 band was the need for more certainty about timeframes and carrier’s need for more leverage in negotiating with government incumbents. “The Secret Service could be out of the spectrum in a year, the FBI needed four years,” Ham said. “We found that even though they had very similar technologies they had very different timeframes.” In discussions over clearing frequencies “we were pretty much pushed to the side and the negotiation largely became between [the Office of Management and Budget] and the government agencies,” Ham said. “That was very frustrating. We spent $4.2 billion for the spectrum. We thought that would give us a little bit of leverage.”

William Webb, senior technologist at the United Kingdom’s Office of Communications, said the use of administered incentive pricing (AIP) there to hold incumbents responsible for the cost of the spectrum they hold hasn’t had “a dramatic effect” so far. The FCC in its Wireless Innovation notice of inquiry asked a battery of questions about the use of AIP here.

“[AIP] hasn’t been applied everywhere; for example, we have not applied it to broadcasters,” Webb said. “Also, the economists have told us that if you [impose] AIP and set it slightly too high that could be quite poor for spectrum efficiency because potentially you could have all the spectrum returned back to you. You may be in a situation because no one wants to use the spectrum anymore because you've priced everyone out of the market.” But Webb said making the military account for the spectrum they use has caused military planners to view spectrum differently. “They now put spectrum into their business cases for all major programs,” he said. “They've markedly increased the size of their spectrum management team. They've handed back a number of pieces of spectrum. It really has focused their minds very substantially.”

Michael Calabrese, vice president of the New America Foundation, questioned the extent of spectrum shortages in the U.S. “I think in Washington there’s this conventional wisdom that there’s a shortage of spectrum, but, of course, that’s entirely wrong,” Calabrese said. “We measured here in Washington where [usage] is below 20 percent. In most places at most times spectrum is not in use and yet it’s all assigned. What we need really is more opportunistic access to the airwaves, as well as the clearing of some new bands.”