As Goes Spectrum Policy, So Goes the Business

It is a truism that government policies create, shape, promote or diminish revenue and profit potential of all telecommunications endeavors. 

And it might happen that future regulator decisions on how much spectrum to allocated, and what licensing policies to use, will profoundly shape the future development of the global telecom industry.

Consider only the matter of spectrum scarcity. Some argue service provider and regulator actions have created spectrum scarcity, which in turn has created higher prices for consumer services. The evidence is provided by Wi-Fi, many would argue. 

The way to promote competition and innovation, and eliminate scarcity, is to release more spectrum on an unlicensed basis, some argue. 

Of course, there are direct contestant implications. More unlicensed spectrum would promote innovation, but also would favor application providers and others for whom "spectrum controlled by mobile or other service providers" is a cost of doing business. 

Conversely, some might argue, more unlicensed spectrum would put additional pressure on mobile, satellite and other service providers, as application and device suppliers could connect their users directly to the Internet, without the intervention of a mobile, satellite or other Internet service provider. 

So the matter of "additional spectrum" availability means stakes are very high, indeed. Perhaps that is among the reasons some ISPs are moving quickly to reduce reliance on revenue from the Internet access business.   

AT&T, for example, might experience radical changes in revenue sources if its acquisitions of DirecTV, Iusacell and Nextel Mexico are approved. Among those changes is a huge boost in business customer revenue and a dramatic decrease on reliance on consumer revenues overall. 

That obviously would reduce exposure to big changes in Internet access business conditions. 

New Movement Towards Network-Agnostic Access

It looks as though we might relatively soon get new tests of the value of network agnostic access.

If Google launches its own mobile service, relying on Wi-Fi, Sprint and T-Mobile US networks we might start to get a sense of how 5G mobile networks will operate, aggregating the best access “available right now.”

Whether that devalues or enhances the value of any specific retail operator’s offering remains to be seen, though 5G supporters obviously believe such “any network” access will enhance value for any retail mobile services provider.

Comcast is expected to do something along those lines, using a “Wi-Fi first” approach. Cablevision Systems Corp., in one sense, is using the “legacy” approach, relying on an owned network solely. Granted, it might be odd to classify a “Wi-Fi only” mobile network as a “legacy” approach, but that is what a sole reliance on an owned Wi-Fi network represents.

The long-term business issue is whether leading mobile networks would agree to allow a “use the best access” approach that includes roaming onto the networks of key competitors. An example: AT&T and Verizon customers having reciprocal rights to access either network, depending on which network has the strongest signal or the least congestion, right now.

That might have seemed crazy in the past, as both firms have competed fiercely to build and operate the “best” network, in terms of signal strength and coverage, as well as bandwidth.

But the emergence of new competitors, including Google, Comcast, Cablevision and Dish Network, on top of competition from Sprint and T-Mobile US, might change the strategic rationale.

If customers of AT&T and Verizon were able to automatically access the best network--AT&T, Verizon or Wi-Fi--that might add value to both carrier offers, compared to all the others.

As unthinkable as cooperation between AT&T and Verizon might be, it is not unthinkable.

The reason is that if Google and others manage to make Internet access using unlicensed spectrum a viable alternative to or replacement for, licensed access, access providers using the licensed approach will have to work harder to maximize the value of their approach.

Paradoxically, if shared access, or unlicensed access, become more-important parts of the access architecture, the value of licensed access might become more valuable, particularly as related to quality of service.

If most unlicensed access continues to rely on “best effort,” there will be times when a licensed approach will be able to provider higher user experience, during times of congestion.

Of course, supporters of unlicensed approaches will work to assure that there is so much available spectrum, across so many networks, that latency and quality will not be practical issues.

More Competition Coming in Internet Access Business

Competition in telecommunication markets in South Asia, Southeast Asia and elsewhere--already robust--is growing.

Strategically, providers of Internet access, especially mobile service providers and satellite Internet providers, are going to be challenged by the launch of two brand new satellite Internet service constellations.

Interest in TV white spaces initiatives are growing. In addition to TV white spaces, shared spectrum is likely to add even more capacity in many markets.

Google Fiber is expanding to four new metropolitan areas of the United States. On top of that that, it now is believed Google will enter the U.S. mobile business as well.

So it might not come as a shock that a new survey suggests telecommunications service providers might lose half their customers in one year.

The survey of 15,000 consumers and 2,700 enterprises in 15 major global markets by Ovum found that only about half of surveyed customers definitely had no plans to leave their current suppliers.

About 25 percent of all users globally say they will definitely change providers within 12 months, while 25 percent reported they might do so.

Those findings are not necessarily unusual, even if, in markets where the triple play offer is standard, customer churn rates are far lower, on the order of 12 percent to perhaps 15 percent annually. That tends to be true, in the U.S. market, for example, for the largest service providers, including AT&T, Verizon and Comcast.

Churn rates for smaller service providers still are in the 24 percent to perhaps 36 percent range.

Two decades ago, churn rates for constituent triple play services--even at the biggest companies--could range as high as 36 percent annually.

Buckle up: competition in the Internet access business is getting tougher.

Sky to Become Quad-Play Provider

U.K.-based Sky is about to enter the U.K. mobile service provider market, becoming a mobile virtual network operator using the Telefónica UK network in 2016.

The move will make Sky a quadruple-play services provider, as it already sells fixed line high speed access, fixed network voice and video entertainment.

Sky is the second-largest provider of consumer high speed access, with more than five million customers. Sky also sells a triple-play package to 40 percent of all its customers.

Telefónica UK will give Sky wholesale access to 2G, 3G and 4G services over its nationwide network, and should bolster Sky’s ability to compete in the consumer services business.

Telefónica UK also is the wholesale supplier for the largest MVNO, Tesco Mobile. The latest move by Sky simply illustrates the fact that the consumer telecom market now is based on triple-play or quadruple-play offers, not discrete services.

Another big deal involving U.S. satellite TV operator DirecTV, as well as separate deals involving Iusacell and Nextel Mexico would shift AT&T’s customer center of gravity in the other direction, towards business services.

If all deals are approved by U.S. regulators, AT&T’s proposed acquistions of DirecTV, Iusacell and Nextel Mexico would dramatically boost video entertainment and broadband segment revenues and business customer revenues, while dramatically reducing exposure to consumer wireless services.

The moves by Sky and AT&T illustrate the different ways a combination of satellite, fixed and mobile assets can drive company strategies. The move by Sky arguably positions that company as a stronger company in the consumer services business, while AT&T’s three moves will shift it more in the direction of business customer revenues.

For AT&T, as for many other tier-one service providers, the shift into business customer services might make lots of sense, given increasing competition in the consumer services business.

In the U.S. market, for example, cable TV operators already have the largest share of high speed access and collectively have the second-largest share of fixed network voice, as well as the highest share of video subscription customers.

If you think the U.S. mobile marketing war is about to become even more intense, with Google’s entry into the business, the revenue contributor changes might be a very good thing for AT&T.

Google Plots a New Way to Share Spectrum

Google apparently will try something new in the U.S mobile market: relying on two separate mobile networks, plus Wi-Fi, to support its new mobile service.

In addition to using third party Wi-Fi, Google apparently has signed up both Sprint and T-Mobile US as underlying access providers because Google wants devices used by its customers to switch between Sprint and T-Mobile US and Wi-Fi based on which network has the best signal “right now.”

If that concept sounds familiar, it is because many smartphones can be enabled to behave in precisely that way. The new twist is the ability to hop between a couple of mobile networks, in addition to using Wi-Fi.

The concept mirrors that which supporters of 5G want: a system that will use all available networks for access.

Perhaps only a firm as large and wealthy as Google could try this. No mobile virtual network operator (to my knowledge) ever has signed up to use two different wholesale providers.

So the hope is that by relying on Wi-Fi, Sprint and T-Mobile US network, Google customers often will be able to find one network that actually has a strong signal, even if both Sprint and T-Mobile US networks individually have coverage limitations, compared to Verizon and AT&T.

You might remember that it took Apple to revolutionize the relationship between handset manufacturers and the mobile service providers. Perhaps it is Google--more than T-Mobile US or Sprint--that now will disrupt the U.S. mobile market.

In some ways, this is a concrete method for “sharing spectrum,” as unorthodox as it might be.

Cable Company Launches Wi-Fi-Only Mobile Service

Observers for decades have suggested that, one day, Wi-Fi might provide the access infrastructure for what we now know as "mobile phone service."

To be sure, several firms, including Illiad's Free Mobile in France, as well as Republic Wireless and Scratch Wireless in the U.S. market, have used a "Wi-fi-first" model that defaults to mobile network access when necessary.

What is interesting is the coming launch, by Cablevision Systems Corp., of a Wi-Fi-only mobile service that relies exclusively on Wi-Fi access to a mobile phone. Cablevision Systems Corporation will launch Freewheel,  a new low-cost, all-Wi-Fi phone service in the first quarter of 2015, and possibly as early as February. In other words, unlike some other services that rely on Wi-Fi, but default to mobile networks, Freewheel will operate exclusively using Wi-Fi.

In essence, Freewheel is launching using a pattern described by management professor Clayton Christensen, where disruptors enter a market “on the low end,” with offerings that offer clear value for some customers, but do not have all the features, or necessary the performance, of the market-leading offers.

The expectation is that, over time, as the upstart service gains traction, it starts to upgrade capabilities, until, in the end, the feature set and presumed value are equivalent to the market leaders.

Freewheel is the first all-Wi-Fi service to be introduced by a U.S. cable provider and will be offered with the Motorola Moto G smartphone, selling for $99.95.

Freewheel customers also will have automatic access to the Optimum Wi-Fi network of 1.1 million hotspots. The no-contract service will work anywhere in the world where Wi-Fi is accessible.

Whatever might happen in the future, the first service provider is launching a Wi-Fi-only mobile service. We hope to be discussing this issue at Spectrum Futures, in Singapore in September 2015.

Commercializing 30 GHz to 300 GHz Frequencies

Two decades ago, most engineers would have said it was not practical to use millimeter waves (30 GHz to 300 GHz) for mass market communications purposes. Signal attenuation was simply too great, and we could not affordably apply digital signal processing cheaply enough to overcome those obstacles.

As with many other problems, such as real-time compression of high definition TV streams, Moore’s Law changed the economics of signal processing, making possible what previously was economically impossible.

Back in the late 1980s, for example, some might have said that processors powerful enough to process and compress 45 Mbps to 100 Mbps data streams to 6 MHz of bandwidth, in real time, might be observed in random and small quantities in chip foundries, but might not have been commercially reproducible in quantities big enough to be applied in consumer mass markets.

But Moore’s Law held, processor power has continued to double about every 18 months, and mass production of the more-powerful chips has been possible.

And make no mistake, it is Moore’s Law that underpins the notion that previously-unusable millimeter frequencies in the millimeter region will be useful for communications purposes.

There are other angles. Because of physics, signals in higher frequency bands can carry more information in any unit of time than signals at lower frequencies.

Basically, the issue is frequency, the number of times any waveform passes across a “zero” point between high and low states. A waveform that crosses the zero point millions of times per second cannot carry as much information as a wave crossing the zero point billions of time.

There always is a trade-off between frequency and reach, so millimeter waves operating in the gigaHertz range generally will be used for shorter-range communications (small cells) than megaHertz range.

But the bandwidth advances will be prodigious. It is common these days to hear proponents argue that the fifth generation mobile air interface will not so much be about the air interface as it is device access to all available network access platforms, or perhaps the new applications that are seen as  characteristic of 5G (Internet of Things).

Nevertheless, 5G also is likely to include new spectrum and much-faster access, much as prior generations have provided.

There is another possible implication as well. As all networks are capable of interworking, as apps move to the cloud, and then latency performance drops to perhaps a millisecond, cloud computing will be even more ubiquitous than it is today.

But paradoxically, many apps will shift to the edge of the network again, simply to match server and device latency performance requirements. But standards bodies now are working on new global standards for millimeter wave technology.

That means, among other things, a gigabit to every device, potentially. We will be discussing 5G implications of millimeter communications at Spectrum Futures in Singapore, in September 2015.

What Do Huge U.S. Mobile Spectrum Auction Bids Mean?

The Federal Communications Commission auction of Advanced Wireless Services-3 spectrum has accumulated a record-breaking $45 billion in bids, compared to an expected $10 billion the agency predicted would be spent, based on past auction results.

The AWS-3 spectrum includes frequencies in the 1695-1710 MHz, 1755-1780 MHz and 2155-2180 MHz bands.

One might speculate that bidding went so high because carriers have concerns about the outcome of the planned--and postponed--auctions of 600-MHz spectrum presently licensed to TV broadcasters.

Aside from expectations about the growing dominance of video applications and bandwidth requirements, which require an order or two magnitude increase in capacity, mobile service providers might have concluded it was too risky to wait for the 2016 incentive auctions for 600-MHz frequencies.

And though some had argued Verizon Communications would not bid too aggressively, as it might have considered a deal to acquire spectrum some other way, such as buying Dish Network spectrum, Verizon seems at the moment to have bid significantly, though perhaps not as heavily as AT&T probably did.  

If so, it likely will be because AT&T wanted to create a nationwide footprint of 10 MHz by 10 MHz channels, compared to the 5 MHz x 5 MHz channels also sold as part of the auction. Observers speculate that Verizon, T-Mobile US and Dish Network bid primarily for the 5 MHz channels. Sprint did not bid.

Bidders might also have concluded that the 600-MHz auctions, in addition to being expensive (because bids have to be high enough to convince broadcasters to give up the spectrum), would produce uneven spectrum allocations in local markets.

National mobile service providers prefer consistent bandwidth allocations across all their key markets, as that allows marketing of consistent end user experience and more-uniform speed offers.

AT&T Buys Nextel Mexico

AT&T, on the heels of its $2.5 billion purchase of Iusacell, now has reached agreement with NII Holdings to buy Nextel Mexico for about $1.88 billion.

The acquisition will give AT&T a network that covers about 76 million people in the Mexican wireless market, and answers in part the methods AT&T will use to assemble its network, acquire spectrum and amass customer scale.

As always, there are several proven ways for a mobile service provider to acquire spectrum assets.

A service provider can buy new spectrum, can acquire a firm that already has such assets, create more density in its transmitting network (using smaller cells), offload to Wi-Fi or other unlicensed spectrum, can use new air interfaces (fourth generation Long Term Evolution is at least 25 percent more spectrally efficient than third generation air interfaces), employ new radio technologies and, in the future, use shared spectrum.

By buying Nextel Mexico, AT&T will acquire about 20 MHz of spectrum in most of its local markets, in the 800-MHz range. That is important because such spectrum has optimal distance performance as well as in-building reach.

Iusacell owns about 20 MHz and 25 MHz of spectrum, also in the 800 MHz band, in most of its local markets, giving AT&T about 40 MHz to 45 MHz of combined spectrum.

GSMA Decries 36% Hike in Reserve Price for India Mobile Spectrum

Everyone agrees that billions of consumers in the developing world, especially those living in remote locations, need Internet access, as most now have mobile service.

Virtually everyone also agrees that the cost of service has to be very affordable to encourage people to buy Internet access service. That begins with policies that release spectrum for commercial use.

"Auction design is really important," says Robert Pepper, Cisco VP. "It is not so important to raise revenue as it is to get spectrum into the hands of people who want it," and wjp will use it to provide services.

Artificial spectrum scarcity sometimes is attributed to mobile service providers and others who hoard spectrum. In other cases, "governments have not released spectrum that is potentially available, creating artificial scarcity," said Pepper.

For that reason, every cost element, in any part of the ecosystem, makes it harder to provide affordable service to everyone.

Networks have to be efficient. Costs for acquiring spectrum have to be reasonable. Taxes, fees and other charges likewise make a difference.

So it is that the GSMA says it is “concerned by the action of the Telecom Commission (India) to increase spectrum auction reserve prices for India’s 2100 MHz spectrum auction” almost 36 percent higher than recommended by the Telecom Regulatory Authority of India (TRAI).

Moreover, the proposal by the Government to only put 2x5 MHz of spectrum in the 2100 MHz band up for auction, when the GSMA and TRAI recommended an auction at least 2x20 MHz of spectrum, will limit potential bandwidth.

“While high auction prices may generate short-term revenues for the government, in the longer term they will negatively impact the development of India’s mobile networks and delay investment in infrastructure, resulting in higher retail prices and an inferior mobile experience for consumers,” said Tom Phillips, GSMA chief regulatory officer.

Every cost in the ecosystem winds up affecting the retail cost of Internet access for consumers who cannot afford to pay very much for such access. That includes spectrum costs.

Sustainability is a core issue to be discussed at Spectrum Futures in Singapore in September 2015.

Without Unlicensed, Shared Spectrum, Mobile Networks Will Collapse

Globally, about 80 percent of all Internet data is generated by the mobile network, says Robert Pepper, Cisco VP. In India, device to macrocell traffic represents 30 percent of all traffic.

So Wi-Fi offload is about 66 percent of all mobile data consumption, and will reach 71 percent within about five years.

Mobile service providers might still prefer to operate their businesses using licensed spectrum, but unlicensed spectrum now is necessary, since the mobile network likely could not easily support all the traffic people already use.

When AT&T introduced the Apple iPhone in June 2007, almost no AT&T customers used a smartphone, so AT&T had no firm idea of the impact adoption would have on its network.

By the the end of the first quarter of 2012, 59 percent, or 41.2 million, of AT&T's postpaid subscribers had smartphones, lifting AT&T mobile data traffic 20,000 percent in five years. In fact, AT&T mobile data volume has doubled every year since 2007.

“It’s been a challenging year for us,” said John Donovan, AT&T CTO, said in 2009. “Overnight we’re seeing a radical shift in how people are using their phones,” Donovan said. “There’s just no parallel for the demand.”

In many cases, iPhone users were consuming an order of magnitude more data than users of other smartphones and 24 times more data than feature phone users.

So it comes as no surprise that Joan Marsh, AT&T VP, says AT&T Mobility now “depends on offloading” to support its mobile business. “We increasingly look to unlicensed spectrum to augment our licensed spectrum,” Marsh said.

Both small cell deployments using licensed spectrum, carrier Wi-Fi and third party Wi-Fi, using unlicensed spectrum, will be fundamental parts of the network fabric.

ABI Research has forecast that the number of LTE small cells will grow by 200 percent in 2014 and by a similar factor each year through 2019, when the value of LTE small cells will reach more than $5 billion in equipment, while another $5 billion will be spent for 3G solutions.

The Asia-Pacific region will represent over 50 percent of the global small cell equipment market by 2019.

Loan Airtime Minutes, It Can Work

Sustainable business models are a challenge for mobile and Internet service providers in South Asia, Southeast Asia and Africa where many would-be customers are hard to reach and cannot afford to pay too much for service.

As with products such as laundry detergent, mobile minutes of use are sold in bite-sized quantities. Mobile usage typically is sold on a prepaid basis. So customers limit use when their prepaid cards  approach the limit.

So Channel IT, a Nigerian mobile operator, allows customers to borrow about $1 in airtime, paying back $1.10, even if the loan is only for a day. That increases usage dramatically.

The default rate is less than one percent, since customers aren't allowed back on the network until they've repaid the loan.

5G and Millimeter Waves

Fifth generation mobile networks, most supporters are quick to say, will not be about “faster speeds” or novel air interfaces. Instead, at least for the moment, the emphasis is on making all access platforms available to mobile and untethered devices, seamlessly.

On the other hand, few seem to deny that 5G will bring new spectrum to bear, in particular in the millimeter wave area, where much work is being done to commercialize the use of frequencies that historically have been unworkable for communications applications.

Moore’s Law, though, allows cheap processing that enables networks to take advantage of formerly-forbidding millimeter wave frequencies (30 GHz up to perhaps 300 GHz).

Though there are key distance limitations, if millimeter frequencies can be harnessed for commercial use, millimeter waves promise a virtual end to spectrum scarcity.

In the United States, the 38.6 GHz to 40 GHz band already is used for licensed high-speed microwave data links and the 60 GHz band can be used for unlicensed short range (1.7 km) data links.

The 71 GHz to 76 GHz, 81 GHz to 86 GHz and 92 GHz to 95 GHz bands are also used for point-to-point high-bandwidth communication links.

Observers will readily admit there are issues, ranging from propagation distances to atmospheric issues (rain fade) and even oxygen absorption. But at millimeter wave frequencies, extremely high bandwidths are possible, if distance is limited.

Without question, Wi-Fi and other local distribution applications will make sense. But many are even more intrigued by access applications to support mobile phones and other untethered devices, including any number of machine-to-machine or Internet of Things apps.

Shared Spectrum: Who Wins, Who Might Not?

Spectrum always is valuable because it provides the foundation for firms and business models. That is as true for new shared spectrum capabilities as for traditional Wi-Fi, mobile service provider, TV broadcast and satellite broadcast businesses.

So it will come as no surprise that advocates of shared spectrum likely have different assessments of the value. App providers probably see nothing but upside. Mobile service providers probably see both advantages and disadvantages. 

The U.S. National Telecommunications and Information Administration is looking at ways to enable spectrum sharing between government and commercial users in the 3.5 GHz band, hopefully freeing up as much as 500 MHzfor shared access, eventually. 

At the moment, the U.S. National Telecommunications and Information Administration is working on a plan that would make about 100 megahertz of spectrum available for shared small cell use in the 3.5 GHz band currently used primarily for military radar systems.

NTIA also is evaluating additional unlicensed use in the 5 GHz band.

The plan has not been universally well received. Traditional telecom, cable TV and satellite firms prefer the exclusive licensee approach, for reasons of quality of service control, and, some would say, for reasons of promoting communications spectrum scarcity.

Others, including many application providers, prefer unlicensed and shared access because that lowers the cost of doing business.

Some have noted that signal propagation issues in the 3.5-GHz and other similar bands would likely mean that shared spectrum is most helpful in urban areas, where small cells are practical.

But that might suit some mobile service providers just fine. Illiad’s Free Mobile relies on Wi-Fi access where it can, as a way of reducing the cost of sourcing capacity from other mobile operators. Republic Wireless and Scratch Wireless do the same.

Virtually everybody agrees that licensed and unlicensed, exclusive and shared spectrum appraoches will coexist. But dramatically different business models can be built along that continuum.

What is good for app providers might not be so good for ISPs, and vice versa. But shared spectrum provides one key tool for efficiently using available communications spectrum without costly efforts to move existing users.

Mobile Service Providers in Developing Markets Now Have Hard Choices to Make

One fundamental element of competition in most communication markets these days is that contestants have to have a strategy for competing not only against the expected contestants, but also disruptive new contestants formerly "outside" the industry. 

For fixed and now mobile service providers, VoIP was a challenge launched by firms outside the traditional business, and forced every service provider to figure out whether to fight, cooperate or ignore the threat. 

"Ignoring" threats from competitors that essentially destroy both markets and profit margins might seem a pointless strategy, but is a rational "harvesting" strategy often used by firms facing long term decline. 

With the advent of new competition from additional Internet service providers, mobile service providers are going to have to make big choices. Most observers expect that mobile networks will continue to drive Internet access in many developing markets. 

Mobile Internet access, for example, grew between 40 percent and more than 80 percent in Asia, Africa and other regions between 2010 and 2013. Most expect high rates of growth to continue. 

But the unmet need is what is spurring huge new investments in satellite-based Internet access in those same markets.

So mobile service providers have to decide whether to spend much more on new network footprint to reach new areas, or allow the satellite providers to grab the market. Much depends on how mobile service providers answer.

But the new low earth orbit satellite networks also emphasize a key element of the business model, namely that affordability and network cost are big issues, says Mark Bass, Bell Laboratories Advisory Services partner. 

The new satellite contestants believe they will be able to deliver Internet access more affordably than existing satellite networks, and more affordably than mobile networks or fixed networks. 

In that sense, the strategic choices mobile operators have to make are similar to earlier decisions made by telcos facing VoIP competition. 

Are We Really Running Out of Spectrum?

Are we really "running out of spectrum" for communications? You can always get a huge and immediate debate about that. 

Mobile service providers tend to argue that of course we are running out of physical spectrum, as people consume video content that represents two to three orders of magnitude more bandwidth than voice or text messaging. 

Others argue mobile service providers could do more with their current spectrum, or charge carriers with warehousing spectrum just so competitors cannot use it. 

"We are not really running out of spectrum," says Jeff Yan, Microsoft director of technology policy. "We are inefficient."

That's why some argue the mobile industry has yet to prove it needs more spectrum. or as much as mobile industry proponents insist is required. "The mobile projections are wrong," says Bob Horton, Horton Consulting owner. 

In some cases, spectrum that already is designated for communications use has not been released for use by service providers, notes Bob Pepper, Cisco VP. 

"In one sense, we might need 1,000 times more capacity, in one sense," notes Nigel Cassmire, Caribbean Telecommunications Union specialist. "But we can be more efficient."

"When you are and where you are matters," he says, pointing out that peak load can be quite spikey, as when a big cruise ship pulls into port. 

Most will agree a range of tactics are likely, where it comes to addressing capacity growth. Small cells, spectrum sharing, new spectrum allocation, better air interfaces, better backhaul and traffic offload all will play a part. 

But huge fights over raw spectrum are coming, as some amount of additional spectrum is required, even if all the other techniques are used as well. 

Reallocation of Satellite, Broadcast Spectrum is Controversial. Is it Necessary?

One of the issues regulators and service providers at Spectrum Futures 2015 2015 will debate is the reallocation of existing spectrum from one type of use to others. 

The big theme is reallocation of television broadcast spectrum (TV white spaces and UHF spectrum) for mobile and untethered use.

The other big issue for 2016 will be reallocation of former satellite spectrum for mobile and untethered access. 

As you might expect, with so much potential or existing revenue contingent on access to blocks of spectrum, there is lots of controversy. The satellite industry's position, as you would expect, is "don't take our spectrum if you don't need it," says Bob Horton, Horton Consulting owner. 

The other issue is the increasingly tough position mobile and fixed service providers are in. 

"There's no money in carriage," says Horton. What he means is that the basic "service provider" function--access to voice, messaging and Internet access--is an increasingly difficult proposition.

On the other hand, virtually every projection calls for orders of magnitude more bandwidth consumption over the next decade. Many predict 1,000 times more consumption will happen over the next decade. 

That might seem like a wildly over-optimistic projection. But a requirement for three orders of magnitude more bandwidth arguably is a simple extrapolation of how bandwidth consumption or consumer access speeds have developed over several decades. 

For all those reasons, and especially at the 2015 meeting, we will be adding a new content track specifically looking at spectrum reallocation--satellite to mobile and television to Internet access. We are looking for subject matter experts in those areas. 

Regulators will play a huge role in setting the stage in 2016.  

Satellite Suddenly Threatens Mobile Internet Access in South Asia, SE Asia

Ask anyone how it will happen that Internet access comes to most people in South Asia and Southeast Asia, and the answer is almost certainly going to be "mobile access," since mobile adoption for voice and text messaging in January 2014 already had reached 72 percent in South Asia, 109 percent in Southeast Asia and 94 percent in Oceania.

But there are potentially blockbuster new developments. Elon Musk's SpaceX has gotten a $1 billion investment from Google to create a huge fleet of new low earth orbit satellites intended to provider Internet access across the globe.

Only days before, WorldVu Satellites announced funding from Virgin Group and Qualcomm for a proposed global satellite internet company also focusing on potential users in developing countries that cannot be reached by fixed or mobile networks, as well as to supply Internet access to flying aircraft.

The proposed network will cost between $1.5 billion and $2 billion, backers believe.

WorldVu Satellites founder Greg Wyler said. Wyler, formerly of satellite firm O3b, has been touting this idea for some time.

Virgin Group and Qualcomm also are investors in the WorldVu “OneWeb Ltd.” service, which hopes to launch a constellation of 648 satellites. Investor Richard Branson thinks the total could eventually be higher than that. Branson also says voice service will be part of the core service.

Some might note that others have tried in the past, without much success, to create such networks based on huge fleets of low earth orbit satellites.

But among the new contenders is Elon Musk, who wants to shake up the business in the same way he wants to shake up the auto business, satellite launch business, the Hyperloop transportation system and SolarCity, the retail solar power business.

Some might be skeptical that the new venture will succeed at one of its potential business models, namely providing retail Internet access to billions of people globally. Iridium and Teledesic, other touted LEO satellite networks, did not get off the ground, or survive.

Musk says the entire fleet might include up to 4,000 satellites. He believes the satellite system could start providing data services by 2020, though the full constellation could be in place by 2030, possibly. The cost of the venture could amount to $10 billion or more, Musk said.

Separately, WorldVu Satellites Ltd. has raised funding from Virgin Group and Qualcomm for a proposed global satellite internet company focusing on potential users in developing countries that cannot be reached by fixed or mobile networks, as well as to supply Internet access to flying aircraft.

The proposed network will cost between $1.5 billion and $2 billion, backers believe.

WorldVu Satellites founder Greg Wyler said. Wyler, formerly of satellite firm O3b, has been touting this idea for some time.

Virgin Group and Qualcomm are investors in the WorldVu “OneWeb Ltd.” service, which hopes to launch a constellation of 648 satellites. Investor Richard Branson thinks the total could eventually be higher than that. Branson also says voice service will be part of the core service.

Lower cost is touted as a key enabler.

Virgin Galactic’s “LauncherOne” program will be used to make frequent satellite launches at lower cost. Other launch partners. might be added, the press release announcing the venture hints.

The first launches are supposed to happen in early 2017. OneWeb controls a block of radio spectrum that it will use for the Internet service, but has to begin deploying the network to retain use of the frequencies, a typical requirement for spectrum grantees.

OneWeb’s satellites will weigh about 285 pounds and operate in a low-earth orbit about 750 miles above the planet’s surface. That has significant positive implications for potential bandwidth and latency performance, allowing much-lower latency than possible for geosynchronous satellites.

The deployment challenges will be significant for such a large fleet, but backers hope lower satellite and launch costs will help the venture provide consumer Internet access at far-lower prices than possible in the past.

Should both fleets be built and create sustainable business models, the task of getting billions of people Internet access for the first time will become a reality. That has implications for other existing satellite providers, as well as for mobile service providers providing Internet access.

So there is at least a reasonable possibility that one or more brand new mobile internet access networks could be commercially deployed in several years. What that means for mobile service providers is the issue.

For that reason, satellite Internet access will be a new content track at Spectrum Futures 2015.