Wireless spectrum remains a major stumbling block for mobile operators in meeting consumer demand for mobile broadband services. RCR Wireless News spoke with long-time industry analyst Roger Entner, who in conjunction with wireless trade association CTIA, recently released a report, “Spectrum Fuels Speed and Prosperity,” looking at how the United States stacks up compared with established European countries in terms of mobile broadband services, and the impact a lack of new spectrum resources is having on service levels.
In the report, Entner, who is founder and lead analyst at Recon Analytics, noted that the mobile industry remains a key contributor to the domestic economy, “creating jobs and [gross domestic product] as well as providing countless economic and social benefits.” This, Entner adds, despite recent reports suggesting that mobile broadband speeds being provided by U.S. operators lag behind those offered in other developed countries.
The report found that unlike some European countries, U.S. operators don’t charge a premium for access to LTE services, which has driven significantly more traffic onto domestic LTE networks. Operators have attempted to meet this increased data demand by deploying additional spectrum assets, including T-Mobile US tapping into spectrum acquired when it purchased MetroPCS, Verizon Wireless through its XLTE program and Sprint through its Spark network initiative. Entner added that despite higher peak speeds being generated in some countries that charge a premium for LTE access, median speeds are often lower.
“In other words, despite the average speed difference, more U.S. subscribers experience high download speeds than people in other countries,” the report states. Despite the faster peak speeds provided by foreign operators, Entner found that consumer satisfaction with their mobile service and their devices was higher in the United States.
The report also notes that U.S. operators compared with its G7 counterparts spend the second most on capital expenditures per inhabitant, and that U.S. consumers devour more bandwidth-hogging applications like video than consumers in the foreign markets covered in the report. These challenges moved Entner to develop the Urban Agglomeration Index, which is used to “quantify population concentration. Using this metric, the report found much higher UAIs across the other G7 countries than in the United States, “which means that operators in those countries can focus investment on significantly fewer places to make a large impact on average network performance.”
The report concludes that for the United States to remain a leader in mobile broadband services, the government must produce new spectrum resources in which to feed what is a continuing growing consumer demand. Entner notes that the planned AWS-3 and scheduled 600 MHz incentive auctions are steps in the right direction, but that the domestic industry is going to continue to need more spectrum in order to meet demand.
“Additional licenses need to be made available quickly so that the United States shores up the fundamentals it needs to maintain leadership in innovation and customer satisfaction as well as increase the prosperity of the country,” Entner said in the report.
A similar conclusion was drawn earlier this year by Kevin Thompson, director of Deloitte’s National Telecommunications Practice, who spoke with RCR Wireless News about the growing need for more spectrum to be made available to domestic operators in order to maintain a high level of service quality, as well as to maintain the country’s position as a world leader in wireless broadband communication services and innovation.
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