GE, Others Say FCC Shouldn't Change Rules for 3.5 GHz Shared Band

Companies interested in using the 3.5 GHz band made the case for leaving FCC rules largely as they are, rather than making changes proposed by CTIA and T-Mobile (see 1706200081), said speakers at a panel Wednesday sponsored by New America’s Wireless Future Program. Rules are expected to change, especially on the licensed portion of the shared band, and Commissioner Mike O’Rielly is leading an initiative to rewrite them. O’Rielly said he wants to leave the three-tier structure for the band in place, while making the licensed part more attractive for investment (see 1708010058). The three tiers are federal incumbents, priority access licenses (PALs) and general access, akin to Wi-Fi. O’Rielly believes the census-tract levels for the PALs are too small.

Michael Fitzpatrick, General Electric head-regulatory advocacy, said the industrial IoT is the future. All machines today are effectively supercomputers throwing off vast amounts of data that can be used to make them work more efficiently, Fitzpatrick said. “Our customers understand that.” Companies are interested in buying PALs but only in small geographic units, Fitzpatrick said. “It provides us and our customers with the opportunity to economically purchase bandwidth that works for our purposes.”

To be usable for small companies, the licenses have to cover just the territory the company is willing to serve, said Jill Canfield, NTCA general counsel. “When you put something out for auction, our members are competing against AT&T, Verizon or even T-Mobile -- they will not win,” she said. “They just simply don’t have the resources.” Because of uncertainty, companies are pulling back their plans for the 3.5 GHz band, she said.

The commercial real estate world has seen little focus on the 3.5 GHz band so far, said Cris Kimbrough, CBRE Telecom Advisory Services managing director-in-building solutions. But real estate management companies are looking for ways to deploy smart building technology and building automation systems in a way that's secure. “We’re trying to help our clients and right now it’s a struggle,” she said. The potential for the 3.5 GHz band is “phenomenal,” she said. With 3 billion square feet of commercial real estate, “there’s a lot of room for innovation,” Kimbrough said.

Patrick Dunphy, chief information officer of Hospitality Technology Next Generation, said hotels also are interested in the PALs. If the band is available only to companies “with billions of dollars to spend on spectrum, we’re going to lose out,” he said. The PALs as currently structured would also attract investment by cable operators, said Colleen King, Charter Communications vice president-regulatory affairs: “We have power, backhaul, location. We’re already there.”

Steve Sharkey, vice president-government affairs, defended T-Mobile’s request that the FCC change the 3.5 GHz rules. The comments of other panelists just confirm the importance of licensed spectrum, he said. “Our proposal came out of what we are seeing around the globe of this band being one of the key bands for 5G technology,” he said. “We were really missing an opportunity to be a leader.” The current structure has too much uncertainty for PALs because of the short license terms, lack of renewability and limited amount of spectrum for licensed service, he said: Those factors “really undermine the value.” T-Mobile is asking that most of the band be licensed, with 10-year licensed terms and renewal expected, and in larger areas than census blocks, Sharkey said. “What we don’t do is propose to get rid of the three-tier structure.”

Michael Calabrese, director of the Wireless Future Program, told us he's hopeful the FCC will leave rules intact. As Fitzpatrick argued, “the FCC just needs to hear and understand the outpouring of new users and innovation that is emerging,” Calabrese said. “We have five commissioners, four of whom voted for the current rules, and a record of comments on CTIA’s petition that overwhelmingly supports the small licensing areas adopted unanimously by the commission in 2015.”

GE made clear it developed “very localized and valuable use cases” for the spectrum for critical infrastructure,” Calabrese said. The hotel and real estate industries also are interested and wireless ISPs want to use 3.5 GHz for rural broadband, he said. “I am hopeful that a majority of the commissioners will want to maintain the current rules rather than adopt an industrial policy favoring only the big mobile carriers.”

Other attendees told us they consider some changes to the rules inevitable and are waiting to see what the FCC proposes in the next few months. “O'Reilly has been very clear that he detests the census-tract model,” said panelist Patrick Leary, president of Baicells North America. “I hold out no hope for census tracts.”