GSMA reckons spectrum might come in handy for 5G

In a new ‘industry position’ mobile trade association the GSMA warns that clever new 5G tech won’t be much good without the spectrum to carry it.

The executive summary is the standard stuff about a new generation of wireless tech opening up a bunch of new opportunities, but this is just the setup. We won’t be able to do any of this cool stuff, you see, unless governments and regulators do a better job of giving operators the swathes of spectrum they will need to deliver on the promise of 5G.

“Operators urgently need more spectrum to deliver the endless array of services that 5G will enable – our 5G future depends heavily on the decisions governments are making in the next year as we head into WRC-19,” said Brett Tarnutzer, Head of Spectrum at the GSMA.

“Without strong government support to allocate sufficient spectrum to next generation mobile services, it will be impossible to achieve the global scale that will make 5G affordable and accessible for everyone. There is a real opportunity for innovation from 5G, but this hinges on governments focusing on making enough spectrum available, not maximising auction revenues for short term gains.”

WRC-19 refers to the World Radiocommunications Conference 2019. It will be the first one for four years and it’s the event at which the world has a think about things like allocating radio spectrum according to current needs. So it’s a rare opportunity for organisations such as the GSMA to try and get their members some more of that precious resource.

“Governments and regulators have a major role to play in ensuring that consumers get the best outcome from 5G,” said Tarnutzer. “Once spectrum is allocated to mobile at WRC, licensing that spectrum at a national level, as history has shown, can take up to 10 years. Therefore, it is essential that governments take the right action now.”

The fact that the GSMA still feel the need to spell out the importance of radio spectrum to governments and regulators is faintly depressing, considering what a redundant point that should be. But this sort of thing is where such organisations earn their keep, by packaging the bleedin obvious into things like industry positions, which presumably increases the chances of bureaucratic types taking it seriously.

Here’s the GSMA’s list of demands:

  1. 5G needs wider frequency bands to support higher speeds and larger amounts of traffic. Regulators that make available 80-100 MHz of spectrum per operator in prime 5G mid-bands (e.g. 3.5 GHz) and around 1 GHz per operator in vital millimeter wave bands (i.e. above 24 GHz), will best support the very fastest 5G services.
  2. 5G needs spectrum within three key frequency ranges to deliver widespread coverage and support all use cases:
  • Sub-1GHz spectrum to extend high-speed 5G mobile broadband coverage across urban, suburban and rural areas and to help support Internet of Things (IoT) services
  • Spectrum from 1-6 GHz to offer a good mix of coverage and capacity for 5G services
  • Spectrum above 6 GHz for 5G services such as ultra-high-speed mobile broadband
  1. It is essential that governments support the 26 GHz, 40 GHz (37-43.5 GHz) and 66-71 GHz bands for mobile at WRC-19. A sufficient amount of harmonised 5G spectrum in these bands is critical to enabling the fastest 5G speeds, low-cost devices and international roaming and to minimising cross-border interference.
  2. Governments and regulators should avoid inflating 5G spectrum prices (e.g. setting high auction reserve prices) as they risk limiting network investment and driving up the cost of services.
  3. Regulators should avoid setting aside spectrum for verticals in key mobile spectrum bands; sharing approaches, such as leasing, are better options where vertical industries require access to spectrum.

Iliad threatens Italy with legal action over 5G spectrum extensions

Iliad is reportedly on the verge of taking Italian watchdog Agcom to court over licence extensions in the valuable 3.5 GHz band which were offered to various WiMAX operators back in 2008.

After having to defend the almost laughable prices operators will be having to fork out for 5G spectrum, Agcom is now under-fire for considering cut-price extensions for four companies in the 3.5 GHz range. With Iliad Italia forking out €1.2 billion 20 MHz of 3.7 GHz and 10 MHz in the 700 MHz band, you can see why the team has issue with the extensions being offered.

The licenses in the 5G-applicable frequencies were initially granted to Linkem, Tiscali, Go Internet and Mandarin back in 2008, with the option of a six-year extension once the initial license expires in 2023. According to Corriere delle Comunicazioni, all of Italy’s operators are irked at the situation, but Iliad is leading the charge with the threat of taking the regulator to regional courts to dispute the decision.

What is worth noting is this is not taking any of the spoils away from the victors of the expensive auction. Not all of the valuable assets in the 3.4-3.6 GHz frequency range were released for auction, with the remaining licenses being used to honour the extensions. Whether these extensions will be allowed to stand is unknown for the moment, as aside from Iliad protests, Italian Senators have requested an investigation by Ministry of Development boss Luigi Di Maio.

One company which will certainly benefit from the saga is Fastweb, a Swisscom subsidiary which primarily offer broadband services in Italy. Fastweb came to a €150 million wholesale agreement with the cash-strapped Tiscali in 2016 for 40 MHz in the 3.5 GHz band, an absolute steal when you compare to the inflated prices for 5G-capable spectrum in the recent auction. Fastweb might be looking pretty now, but the convergence plans will certainly come under-threat with Iliad legal ambitions.

For those who are of a logical disposition, and considering the inflated figures being discussed in the recent Italian auction, one would think the Italian government would decide against renewing the extensions and offer the available spectrum in an auction. Legacy-agreements are certainly something to consider, though the landscape has seemingly evolved enough over the last decade suggest these extensions are no longer viable.

This certainly will not be the only legacy-agreement in place around the world which will come back to bite, though the saga does not add credibility to the Italian government’s ability to operate in a fair and just manner.

Trump set sights on spectrum strategy

US President Donald Trump has unveiled plans to create a National Spectrum Strategy to prepare the country prepare for the introduction of 5G wireless networks.

The presidential memorandum, which was signed last week, directs the Secretary of Commerce to work with agencies and policy makers on all levels to develop a National Spectrum Strategy. As part of the strategy, the Secretary of the department will report annually to the President on efforts to repurpose spectrum, while a Spectrum Strategy Task Force will also be created which, including representatives from the Office of Management and Budget, the Office of Science and Technology Policy (OSTP), the National Security Council, the National Space Council, and the Council of Economic Advisers.

“American companies and institutions rely heavily on high-speed wireless connections, with increasing demands on both speed and capacity,” the memorandum states. “Wireless technologies are helping to bring broadband to rural, unserved, and underserved parts of America. Spectrum-dependent systems also are indispensable to the performance of many important United States Government missions. And as a Nation, our dependence on these airwaves is likely to continue to grow.”

Within 180 days, executive departments and agencies are required to report to the Secretary of Commerce on their anticipated future spectrum requirements, while the OSTP shall submit a report to the President on emerging technologies and the expected impact on spectrum demand. Once these reports have been submitted and assessed, the Secretary of Commerce will have to brief the White House on the status of existing efforts and planned near- to mid-term spectrum repurposing initiatives, as well as a long-term National Spectrum Strategy that includes legislative, regulatory, or other policy recommendations to rework the approach to spectrum management.

While work on spectrum has been underway for some time, this intervention from the White House demonstrates the importance of 5G to the US economy, and perhaps its long-standing battle with the Chinese to maintain control of the global economy.  Although Silicon Valley still maintains the leadership position on the worldwide technology and telecommunications industry, this grip is not quite as ironclad as it was in previous years. With digital taking over in the cockpit as the driver for almost every ‘developed’ economy around the world, a flexible, future-proofed spectrum policy is critical.

“We commend the administration for recognizing the importance of establishing a national spectrum strategy,” said CTIA President Meredith Baker. “With the right approach based on licensed wireless spectrum, America’s wireless carriers will invest hundreds of billions of dollars and create millions of jobs to deploy next-generation networks and win the global 5G race.”

“Spectrum has become one of the most critical inputs for the communications and information technologies that are driving America’s economic growth,” a statement from the NCTA reads. “The services that rely on unlicensed spectrum alone generated more than $525 billion in value for the U.S. economy in 2017. We look forward to engaging in constructive dialogue with the White House, NTIA, and the FCC on the development of a balanced national spectrum policy that will meet the growing need for both licensed and unlicensed spectrum to support next-generation wireless technologies.”

The attention from the White House will certainly be welcomed by the industry, though some have questioned why it has taken so long. With the Trump administration focusing on other areas, in particular looking outwards, some critics have questioned why it has taken so long for the White House to take a firm position in the 5G world. Democrat FCC Commissioner Jessica Rosenworcel is one who has questioned the sluggish nature of the administration, particularly focused on reports and action, suggesting it has allowed other countries such as China and Korea to steal valuable yards in the 5G race.

While specifics are relatively thin for the moment, the spectrum strategy might go some way to settle bickering in the industry. A good example is the battle between the autonomous vehicles camp, which is currently guarding largely unused spectrum reserved to allow vehicles to communicate, and telcos who want the assets opened up for wifi. This is only one example, but without a comprehensive, forward-looking, strategy in place, these arguments will not be settled.

Such a policy will provide much needed clarity in the industry, though six months is a long-time to wait with the 5G world fast approaching.

TIP 2018: what’s in it for Facebook?

At the Telecom Infra Project Summit 2018 we spoke to the Facebook execs behind the initiative to find out why they decided to get involved.

When Facebook first started talking about getting involved in in the telecoms industry via TIP and even developing novel wireless technologies such as Terragraph, it felt like a frustrated OTT going through the motions to light a fire under the sector. Facebook’s vested interest was clear: the better and more ubiquitous the connectivity, the more people will use Facebook.

As we explained earlier, a big part of this involves efforts to make telecoms infrastructure cheaper to buy, roll-out and maintain. In that respect TIP is a direct threat to the traditional big kit vendors, not only because tower networking costs probably equate to lower profits for them, but a major aim of TIP is to expand the whole telecoms ecosystem, thus creating additional competition for them.

In a couple of small media gatherings at the event we spoke to Jay Parikh, Head of Engineering and Infrastructure at Facebook, and VP of connectivity Yael Maguire. Parikh explained that TIP is not just a product of Facebook’s own connectivity needs but also of conversations he was having with operators two or three years ago in which they implored Facebook to get involved.

The biggest mutual problem faced by Facebook and the operator community is the exponential growth in traffic over networks combined with the increasing difficulty and cost of providing it. “We were worried that innovation was slowing down,” said Parikh, in reference to the collective concern felt at the time, one which the big kit vendors were failing to sufficiently address.

In response to persistent questioning about the return Facebook expects to get on its significant (but unspecified) investment, Parikh insisted that this isn’t a short term thing for his company. The strategic objective is to catalyse the telecoms industry and ROI will be gauged by the presence of novel connectivity innovation, as opposed to direct financial considerations.

It’s easy to be sceptical any time a company claims to be doing something for the greater good, but equally this would be a strange area for Facebook to diversify into if it was only looking for a new profit centre. Having said that the world’s dominant etailer now makes much of its profit from its cloud business so you never know.

Parikh kept his cards pretty close to his chest regarding any TIP financial metrics but it’s relatively easy to believe that a cash-rich Silicon Valley company might be prepared to spend money a bit more speculatively than a traditional outfit. Facebook considered its own fortunes to be intrinsically allied to those of the global telecoms industry, so helping it innovate is viewed as sufficiently self-interested by itself, for now at least.

When asked what the top priorities are for Facebook from TIP, Parikh cited the connectivity insights programme, which aims to give operators additional data to help operators make informed decisions derived, in part, from anonymised Facebook user data. Rural access work is also important as Facebook seeks its next billion users, and Telefónica’s work in Peru was cited as an example of this.

The third priority is Terragraph, which is positioned as an alternative to fixed wireless access delivered over unlicensed 60 GHz spectrum, of which there is plenty, with an emphasis on backhauling wifi. This is a key concern of Maguire’s, who noted that average video speeds are declining across the board thanks to the aforementioned imbalance between demand and supply.

Maguire explained that Terragraph started as a project designed to look into the viability of using the 60 GHz spectrum for backhaul. At such a high frequency there are a bunch of propagation challenges, with even oxygen itself contributing to signal degradation. But it turns out that if you get the precise line of sight alignment right and don’t try to transmit any further than 200m, then it can be used in much the same way we’re talking about FWA over mm wave for 5G.

In keeping with Facebook’s general tone on this stuff Maguire played down any direct antagonism between Terragraph and mm wave FWA, insisting they just wanted to offer up alternatives. I was also keen to stress that this technology is specifically intended for high bandwidth wireless backhaul. “It’s not a solves all problems technology,” he said.

So, in summary, Facebook says it’s not looking for any immediate return from its involvement and investment in TIP. Instead it expects to benefit from the telecoms industry innovating as a faster pace than it would have if Facebook hadn’t decided to get involved. Aside from justifiable scepticism about any company being so sanguine about immediate, demonstrable ROI there’s little reason not to take Facebook at face value on this, while also keeping a watchful eye out for mission creep as things progress.

Italian 5G spectrum orgy reaches its climax

The frenzy of bidding for mid frequency 5G spectrum in Italy has come to a climax with operators’ cash reserves apparently spent.

The hot action took place around the 3.7 GHz band, where the relatively small amount of spectrum on offer – 200 MHz – and the presence of a new fourth player – Iliad – ensured supply outstripped demand. When we last checked in the bidding had already become frenzied, but they still managed to keep it up for another nine days.

As you can see from the final table published by Italy’s Ministry of Economic Development below, the final amount of cash trousered by the Italian government was €6.5 billion, around three times more than was expected at the start of the process. In hindsight that seems pretty naïve, especially when it came to demand for 3.7 GHz spectrum, but then again Italian operators have paid way more than any other European country for this decidedly limited spectrum.

We could go through all the European 5G auctions ourselves in order to calculate the average price per MHz paid for mid frequency spectrum, but why bother when Iain Morris from Light Reading has already done so and we can just rip off his work?

In Finland’s recent auction 390 MHz of mid frequency spectrum was offered up to three operators. At least in part due to there being so much more spectrum on offer the Finnish operators only shelled out the equivalent of four cents per MHz, according to Morris. The traditionally exuberant UK operators dropped 15 cents per MHz in their equivalent auction but the Italians dwarfed that in dropping 42 cents per MHz.

Telecom Italia seemed happy with the outcome in a press release. “By securing all three band frequencies put on auction, TIM strengthens its network leadership in Italy,” said CEO Amos Genish. “The new frequencies acquired represent a core asset for the Group’s future development and, at the same time, for the ongoing digitization of Italy.” The release also said the 26 GHz block was 200 MHz wide, which was presumably the case for everyone.

Italy 5G auction final

Telia pays the most in Finnish 5G auction

Finland offered up nearly 400 MHz of mid frequency 5G spectrum to its MNOs and Telia bought the most expensive block.

The whole of the 3410-3800 MHz frequency range, split into three blocks of 130 MHz each. After just a few days of bidding Finland’s three MNOs concluded their business as follows:

Frequency band 3410–3540 MHz (A)

Telia Finland

€30,258,000

Frequency band 3540–3670 MHz (B)

Elisa

€26,347,000

Frequency band 3670–3800 MHz (C)

DNA

€21,000,000

The slightly lower frequency stuff apparently has a bit more value than the rest and it’s worth noting that Elisa is the market leader by subscriber number so it looks like Telia has decided to make a strategic move to close the gap in the 5G era. While Finland is admittedly a much smaller country, €77 million seems like a small return for the government when you compare it to the frenzied bidding we’re seeing in Italy.

Italian operators throw money at 3.7 GHz spectrum

Italian politicians must be loving the country’s ongoing 5G auction, with operators bidding on the 3.7 GHz band like they think they’re still using lira.

One of the fun things about Europe before the euro was the existence of currencies that, due to historical hyperinflation, operated at crazy exchange rates to the pound. Italy was one of the best examples of this and who doesn’t miss going over there and stuffing their wallet with billion lira notes?

That same longing seems to apply to the Italian operators, who have decided to compete with each other, over relatively useless mid frequency spectrum, with such fervent abandon that it’s hard not to conclude they still believe the bill will be settled in the long-abandoned national currency.

A week ago they agreed to pay the going rate for 700 MHz spectrum that is especially handy due to its long range and superior propagation qualities. They also had a few rounds of bidding on higher frequency spectrum and we noted that Wind might want to make sure it gets a nice lot of 3.7 GHz band, since it didn’t get any 700 MHz, and that new-entrant Iliad might also want to grab more than just 20 MHz of 3.7 gig.

The ensuing days apparently saw frenzied bidding for the 3.7 GHz band to roughly triple the level it was a week previously (see table). This means the Italian state is already set to pocket billions of euros more than was forecast at the start of the auction process and there’s still plenty of time to go.

For context read this Light Reading analysis of the auction orgy thus far, which notes that the Spanish and Irish were far more parsimonious than the Italians are being and even the spectrum-hungry UK operators were positively reticent by comparison. The fun starts again this week and who knows what levels it could reach after a weekend on the Grappa.

Italy 5G auction table 2

German 5G auction set for early 2019, with some strings attached

2 GHz and 3.6 GHz frequency bands are to be auctioned out in the first quarter of 2019 to build 5G networks in Germany, there is no universal coverage requirement but something close.

In May the German telecom regulator BNetzA (Bundesnetzagentur, or Federal Network Agency) announced that a 5G spectrum auction will be held in early 2019. The delay from the original plan of this year was down to the disagreement between politicians who required future successful bidders should provide universal coverage, and the more pragmatic stance of BNetzA.

On Monday 17 September, BNetzA published the consulting paper for the auction. It does not require successful bidders to provide nationwide 5G coverage, but does ask for coverage of 98% of the households as well as sufficiently good coverage along the federal and state motorways.

“We need to be ambitious but also realistic,” said Jochen Homann, President of BNetzA, in the press release. “We are already setting demanding conditions to improve mobile networks. For example, we demand data transfer speed be doubled (in 3 years).” The guideline requires successful bidders to provide coverage to 98% of household with 100Mbits/s speed by the end of 2022 and 300Mbits/s by the end of 2025. “National coverage of 5G will be excessively expensive,” added Homann.

German 5G data rate requirement (002)

Source: BNetzA consulting paper, p.112. 17 September 2018

Apparently, this does not look to have gone far enough for the politicians. In addition to the requirements for universal coverage, the politicians also demand the national operators (Deutsche Telekom, Vodafone, and Telefonica Deutschland) should provide access to competitors who do not have their own coverage. If this were to be implemented, it would open door to challenger MVNOs like United Internet (operated under the brand “1&1 Drillisch”) to 5G, offering a 4th operator legislators have long craved for.

“Attaching national roaming obligations to spectrum does help to support smaller operators and stimulate competition. So it would be an interesting addition to the license obligations to encourage a new entrant to participate in the auction,” Phil Kendall of research firm Strategy Analytics told Telecoms.com. “But politicians looking to plug a digital divide can’t just assume this is more about the stick than the carrot.”

The guidelines will go through BNetzA’s advisory board, which is composed of elected lawmakers, on 24 September, and final decisions will be made in November. The auction will take place in the first quarter of 2019, and lower band frequency more suitable for broader coverage will be auctioned in the next few years, according to the consulting paper.

 

Italy trousers €2 billion in pre-5G 700 MHz auction

A spectrum action in Italy covering a bunch of bands has concluded its first phase with prices roughly in line with expectations.

Bidding is underway on spectrum in the 700 MHz, 3.7 GHz and 26 GHz bands, but only the former has concluded. The starting price was €338 million per 2×5 MHz block of 700 MHz spectrum and TIM, Vodafone and Iliad all got 2×10 paired. Iliad apparently didn’t need to bid but the other two don’t seem to have craven the price up much as you can see from the table below.

Wind didn’t get any 700 MHz spectrum, but seems to be pretty keen on some 3.7 GHz action, having bid €338.5 mil for an apparently pre-specified 80 MHz block of it. TIM is leading the chase for the only other 80 MHz chunk, with Iliad apparently content with 20 GHz and Wind the front runner for the other 20 MHz. A contiguous 100 MHz block of 3.7 GHz would come in handy but it seems likely that Wind is bidding against Vodafone for that bit.

TIM issued an announcement gloating about the fact that it now has spectrum in every sub-1 GHz band available. “This important result increases the frequencies available to TIM which are essential for the 5G services,” said the TIM statement. “The new spectrum will be added to the 20+20 MHz that TIM has in the low frequency 800 MHz and 900 MHz bands, which already ensure the supply of UBB services to more than 98% of the population.”

It seems sensible to have a great big auction of a bunch of different spectrum, given the imminence of 5G in the wild. Iliad has been guaranteed a nice lot of 700 MHz, which will help a lot with coverage, but it might want to have another bid for that bigger block of 3.7 GHz if it want to be a significant 5G player. You can read further analysis on this at Light Reading here.

Italy 700 MHz auction table