Providers Eye Midband Spectrum, Face Financial Pressures

The upcoming 3.45 GHz auction and yet-to-be-scheduled 2.5 GHz sale are likely to get broad interest from smaller carriers, industry officials said during a Competitive Carriers Association virtual conference Wednesday. They warned that holding three midband auctions in a short time poses financial issues.

The C-band auction was “the 800-pound gorilla” for 5G spectrum, and UScellular went big, spending almost $1 billion, said Vice President-Federal Affairs and Public Policy Grant Spellmeyer. Offering 10 licenses of 10 MHz rather than five 20 MHz licenses makes 3.45 GHz more attractive to smaller carriers, he said. Spellmeyer considers the band “equally viable” as the C band. The FCC “got the power levels right” and “the auction structure right” in 3.45 GHz, he said: “It’s going to a very popular auction.”

In the C band, “the reality is the three big guys got almost all of it,” said Dish Network Executive Vice President-External and Legislative Affairs Jeff Blum. In 3.45 GHz, Dish hopes the FCC increases citizens broadband radio service power levels so the bands can be used in concert, he said. Asked if the C band was too expensive for his company, Blum said “the record shows” that after the action hit $40 billion-$50 billion, Dish stopped bidding.

The FCC got the rules right for the 3.45 GHz auction, and “we’ll be building to those standards,” said Nokia Vice President-Legislative Affairs Grace Koh. The biggest question is how cooperative planning and periodic use areas will work, she said: “That’s one area where we feel that there can be some improvements.” The 2.5 GHz band is “good spectrum,” Koh said. Questions remain whether a 2.5 GHz auction will come “too soon” for carriers after the C-band and 3.45 GHz auctions, she said. “Midband spectrum is scarce, and it’s going to be hard to get more.” If the FCC offers cleared spectrum in any midband, “there will be bidders,” she said, saying Nokia is discussing the swath with customers.

The 2.5 GHz band is different than 3.45 because “not every area in the country will be up for auction, and T-Mobile holds lots of it, especially in urban areas,” Spellmeyer said. The band should be attractive to some small rural carriers, and his company is also looking, he said. “There’s a real question about when it happens and what the capital resources are to participate in that auction,” he said: “It’s an open question as to how much is left when we get there.” Spellmeyer said he discussed financial issues on 3.45 GHz with all four FCC commissioners. “All four of them brought up that issue," he said. "It’s a real issue.”

One of the big focuses of the virtual show was open radio access networks. CCA President Steve Berry said as rural carriers replace Chinese equipment in their networks they want choice, not mandate, to embrace ORAN.

ORAN is “a strategic shift in the way industry sees the future of telecoms,” said Vish Mathur, Telecom Infra Project global head-engagement. Providers “need choice,” he said. ORAN “needs to be tested and validated and matured in the market, and it needs to be tested in such a way that we’re looking for interoperability, interchangeability and deployability in the future.”

Each carrier faces unique challenges, and ORAN means “flexibility,” said Executive Vice President Chip Damato of Inland Cellular, a regional carrier based in Washington state. “We’ve got to be able to assess the … needs for a particular market or a particular area or a particular demographic, and be able to address that.” Inland serves flat areas, plus rural communities and recreation areas in the mountains, he said: ORAN “allows us to be creative” and “serve those different markets.” Rural carriers are under pressure to serve more areas, and “we couldn’t accomplish that without open source,” he said.

OptimERA spent the past four years deploying a wireless network in Alaska using ORAN, said CEO Emmett Fitch. “We’ve always been based on open standards.” Interoperability is the most important attribute for his company, he said. “I’m paying higher and higher prices, year after year, for more and more software services,” he said: ORAN “allows us to say, ‘OK, I don’t like your pricing,' or, 'You’re not giving me the service that I want; I’m going to go ahead and dump you.’”

CCA Notebook

A light-touch regulatory regime and cutting red tape led to networks that kept people connected during the pandemic, said Rep. Cathy McMorris Rodgers, R-Wash. “Republicans on the Energy and Commerce Committee want to continue advancing the framework to promote continued deployment and innovation.” She warned that some smaller carriers have encountered regulatory delays in replacing Huawei and other nonsecure equipment. Republicans recently unveiled their agenda for boosting broadband connectivity, Rodgers noted: “These bills are just a starting point for the larger conversation we hope Congress will have in light of how important reliable connectivity has become during the pandemic.” Congress is “paying close attention” to how broadband maps “are coming along and how the 5G Fund will be implemented,” she said. Rural carriers need access to “the right spectrum” for 5G, she said: “We continue to examine ways to keep this spectrum pipeline full as auctions become more and more difficult.”

Ligado sees ORAN as a big part of its deployment, said Scott Wiener, chief marketing and strategy officer. The company is working with Rakuten Mobile on using ORAN technology for private networks (see 2102120005). “We’re launching trials with them, and we think it’s just a great combination” pairing Ligado spectrum with ORAN technology, he said. Wiener predicted deployments in manufacturing, healthcare and energy. Unlicensed CBRS spectrum is part of the pilots, he said: “What that brings to the table is wider channels to support higher bandwidth and low latency.”