Story corrected to clarify description of 600 MHz incentive auction “set aside” provision.
President Obama renominated Rosenworcel to FCC with chairman Wheeler set to step aside and 600 MHz incentive auction scheduled for important milestone.
Leadership at the Federal Communications Commission remains in flux as the government agency nears an important mark in its attempts to unleash potential low-band spectrum support for “5G” services.
Late last week, President Barack Obama reappointed Jessica Rosenworcel to serve a second term on the commission, following the lapse of her previous term, which ended on Dec. 31. However, Congress still needs to approve Rosenworcel’s nomination before she can reassume her seat.
The FCC currently has four sitting members, including Democrat chairman Tom Wheeler, Democrat commissioner Mignon Clyburn, and Republican commissioners Ajit Pai and Michael O’Rielly. The FCC typically has five members, with the party of the presidential administration represented by the FCC chairman.
Wheeler is set to resign his post on Jan. 20, the day President-elect Donald Trump is set to be sworn into office. Wheeler announced the expected move last month, but had reportedly been lobbying for Rosenworcel’s renomination, with some reports citing an offer by Wheeler to give up his position immediately in exchange for Rosenworcel’s confirmation.
“I applaud President Obama’s reappointment of Jessica Rosenworcel to the FCC, and hope that Congress will act quickly to confirm her nomination,” Wheeler said in connection with Rosenworcel’s recent renomination.
Trump has so far not tilted his hand as to who he might nominate to replace Wheeler at the FCC, though reports suggest he has asked Newscorp Chairman Rupert Murdoch for his suggestions.
600 MHz incentive auction set for important step
The leadership upheaval at the FCC comes in the midst of the government agency preparing for a potentially important point in its ongoing 600 MHz incentive auction process, which is expected to eventually unleash sub-1 GHz spectrum support for next-generation mobile communication services.
The FCC is currently looking to wrap up the reverse bidding in the auction’s stage four, which has television broadcasters bidding to give up 84 megahertz of spectrum in the 600 MHz band. The FCC has said it expects this part of the process to conclude by the end of this week.
Once concluded, the FCC will repackage the spectrum into 70 megahertz of clean spectrum as part of the proceeding’s forward auction, which is open to bidding by telecommunication providers.
Assuming a successful completion to stage four’s reverse auction process, the forward auction is set to include a total of 2,912 “category one” spectrum blocks, each containing 10 megahertz of spectrum with no impairment. Each of the 416 partial economic areas used to divide up the spectrum licenses will include seven blocks of spectrum, with a total of 70 megahertz of spectrum up for grab in each PEA.
Analysts going into the auction process had highlighted the 84-megahertz stage as one with the highest likelihood of finding some common ground due to the relatively small amount of impaired spectrum. Each of the previous stages failed to find that match, with the past two stages failing to find any real excitement from the likes of Verizon Communications, AT&T and T-Mobile US.
The 70-megahertz mark is also seen as the magic number for T-Mobile US and other carriers with a dearth of sub-1 GHz spectrum holdings. Pre-auction rules included a provision designed to prevent carriers with a dominate position in holding sub-1 GHz spectrum from bidding on licenses in certain markets unless certain milestones were achieved. This provision is ofter referred to as a “set aside” and can include up to 30 megahertz of at least 70 megahertz of spectrum in some markets.
AT&T and Verizon are expected to be most aggressive for the 40 megahertz of spectrum open to all bidders, with each perhaps going for as much as 20 megahertz each in some markets.
Once completed, the FCC has set a 39-month timeline for television broadcasters to clear their operations from the 600 MHz spectrum band, which would put full spectrum availability into early 2020, or about the time most expect commercial 5G services to be coming on air. Initial 5G deployments are expected to focus on higher band spectrum licenses in the 3.5 GHz band as well as millimeter wave bands higher than the 15 GHz band.
Telecom operators and their vendor partners are currently trialing 5G services using technology they hope will be included in the 5G standards and using various high-band spectrum resources. Initial 5G standards are not expected until mid-2018, though most see 5G deployments relying heavily on current LTE deployments using low-band spectrum in order to meet coverage demands.
Low-band spectrum link to 5G
Despite the robust support, some analysts are questioning the business model behind the use of millimeter wave spectrum. Research firm Mobile Experts recently released a case study on broadband-based 5G services focused on return on investment for deployments, noting current technology tied to the limited propagation characteristics of the 28 GHz band come up short in terms of supporting a business case.
The firm said it calculated the potential ROI for operators investing in a pre-5G network using the 28 GHz band compared with LTE costs and “the potential costs for a sub-6 GHz network using 5G technology,” and found at “historical prices, 5G will not be successful.” To reach the necessary ROI, Mobile Experts said the market would need inexpensive access to large spectrum blocks.
“The business case for 5G fixed broadband is not a slam dunk,” said Joe Madden, principal analyst at Mobile Experts. “We expect pre-5G deployment to be a very targeted investment by mobile operators, addressing very specific neighborhoods instead of nationwide deployment.”
Madden noted millimeter wave links at 50 meters created a “challenge to the business case, because the number of customers served by each radio will be too small.” The firm noted links of at least 200 meters would be required to reach enough users to support sufficient ROI.
“Link distance is a key factor in the pre-5G business case at 28 GHz,” Madden explained. “We’ve conducted some in-depth link budget calculations and compared our results to trial results reported by Samsung, Ericsson, Intel and others. Based on this deep technical work we have some concerns about the power, linearity and heat dissipation in pre-5G infrastructure. The laws of physics will limit these pre-5G networks.”
Mobile Experts noted the 28 GHz band and fixed wireless broadband services will be a starting point, “but a combination of low-band and high-band spectrum will be important to reach mobile gigabit performance.”
Carriers have acknowledged the challenges of high-band spectrum for commercial wireless services.
“If you put a hand in front of a transmitter you will see degradation of performance,” said Thomas Keathley, SVP of wireless network architecture and design at AT&T, during a panel discussion at the recent CTIA Super Mobility event. “It’s going to be a very different implementation than traditional cellular networks.”
Adam Koeppe, VP of access technology planning at Verizon, noted that indeed propagation characteristics of high-band spectrum will be a challenge, but those “issues are not anything new.” Instead he noted what is different is the use of beamforming and beamtracking technology that allows the use of those bands in access-type deployments.
“Our trials have been to take those out of the lab and into real world scenarios,” Koeppe said of the carrier’s 5G network trials.
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