Will Shared Spectrum Benefit Mobile Operators?

It is not yet clear which participants in the internet ecosystem will benefit the most from access to shared spectrum in the U.S. market, starting with the 3.5 GHz Citizens Broadband Radio Service (CBRS ). Google clearly believes it wins, while users of licensed spectrum for mobile service lose, as CBRS shared spectrum is made available.  

The outcome might not be that clear, since mobile operators will be able to use CBRS as well. To be sure, CBRS access might well help new providers of internet access more than mobile operators. Cable TV operators and other non-traditional entities might well benefit most from unlicensed or lower-cost spectrum access. But mobile operators also should benefit, if not to the same extent as newer entrants.

Technology advancements sometimes confer business advantage, when other contestants cannot use the tools. DOCSIS 3.1 allows operators of hybrid fiber coax networks to supply gigabit connections over existing networks.

Telcos and others using telco industry standard platforms are unable to make use of the technology, as DOCSIS is HFC-specific.

Other tools and platforms are company agnostic, or industry agnostic. Wi-Fi, for example, can be used by any firm or user. Shared spectrum is more like Wi-Fi than DOCSIS, even if some believe some companies will benefit more than others.

Dynamic spectrum access is an agnostic development, though arguably most valuable for well-heeled firms that want to bundle access with other products.

The 150 MHz of spectrum for mobile broadband to be made available in the 3.5 GHz band, in the U.S. market, will allow either lower-cost or unlicensed use.

Some argue shared spectrum is a tool mobile companies and others can use to their advantage. Google tends to believe shared spectrum helps it more than mobile operators, as it will devalue licensed spectrum.

Nor, for example, is it entirely clear how the “infrastructure” (radio networks) will be provided. As with Wi-Fi, it is possible that enterprises, service providers or capacity wholesalers will provide the radio network. As Wi-Fi acts as a “neutral host” for users, so it is possible that at least some 3.5-GHz shared spectrum networks will act in that capacity.

In other cases, service providers or enterprises might use a “licensed” approach outdoors or in large venues, to support small cell operations. In some cases, there will be direct benefit, such as lower capex, better indoor coverage or faster deployment. In other cases there will be indirect benefits, including higher quality of experience.

That noted, it is clear that the CBRS shared spectrum will allow new entrants to offer 4G services at lower cost than would have been the case. So there will be more competition.