Capacity Constraints Require More Spectrum, Network Optimization, NARUC Panelists Say
LOS ANGELES -- The rising volume of data-rich traffic requires carriers to address capacity issues with technical solutions in the short run and deploying more spectrum in the long run, panelists at the National Association of Regulatory Utility Commissioners summer meeting said. Operators need to continue to deploy more advanced wireless technologies and offload data traffic onto alternate networks like Wi-Fi and femtocells, which have greater capacity due to their much higher frequency reuse, said Peter Rysavy, president of Rysavy Research. The measures aren’t sufficient to meet growing market demand, he said late Tuesday. The only viable long-term solution is to allocate more spectrum, he said.
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For now, available tools to address capacity issues include deploying available spectrum, using more-efficient technologies, investing in additional infrastructure and small cell technologies, said Rick Engleman, a Sprint Nextel director. In the long run, more spectrum is the answer, he said. On AT&T’s plan to buy T-Mobile, he said AT&T can greatly increase its network capacity without needing to make the purchase, which will harm competition and consumers. AT&T could develop its warehoused spectrum, accelerate 4G buildout and implement a more efficient network architecture, just as other carriers are doing, he said. Many of the benefits that AT&T claimed are not merger related, said Engleman said.
There’s no doubt that there’s a spectrum crisis, said John Kuzin, a senior director at Qualcomm. The industry needs more licensed spectrum, he said, urging the FCC and NTIA to continue the efforts to identify more licensed spectrum for mobile broadband. The commission needs voluntary incentive auction authority from Congress to release more spectrum, the most important piece, he said. That measure is a reasonable approach to transfer spectrum to entities that could maximize the value of frequencies, he said. Qualcomm’s strategy to maximize spectrum efficiency is to have chipsets that support multiple bandwidth, interfaces and networks, said Kuzin. It will take time for 4G networks to reach the coverage of 2G and 3G networks, he said. Wi-Fi offload is becoming an attractive option for operators with an increasing number of Wi-Fi enabled devices and Wi-Fi access becoming more widely available in homes, enterprises and retail locations, he said. Kuzin emphasized the need for interference cancelation and equalization.
Limited access to spectrum, handset availability, lack of data roaming and interoperability are major barriers to rural carriers, said Daryl Zakov of Bennet & Bennet, which represents rural carriers. Consolidations have concentrated spectrum into the handsets of fewer carriers, he said. Recent spectrum auctions have created regional and “super-regional licenses blocks” and fewer smaller licensed blocks, he said. This dampens demand by small carriers and prevents small/rural carriers from bidding, he said. It’s clear that the best, latest devices aren’t available to rural carriers, he said. The economics of scale and scope prevent small and rural carriers from acquiring innovative devices or network equipment without critical mass, he said.
Handset exclusivity agreements further hinder small and rural carriers from being competitive, Zakov said. Consolidation would also reduce the number of potential vendors, resulting in higher prices for hardware and software, he said. Two major carriers are so large that they don’t need the coverage and roaming pieces of most small rural or regional mobile carriers, he said. Preventing smaller carriers from getting data roaming agreements limits those smaller companies’ marketing footprint, he said. Additional higher wholesale roaming costs to rural and small carriers creates retail costs higher than national carriers’, which in turn prevents small and rural carriers from competing on price, he said.