América Móvil strengthens its position in Brazil with Nextel acquisition

The Latin American mobile heavyweight América Móvil has agreed to acquire its competitor Nextel in the Brazilian market for $905 million.

Shortly after the deal was announced by América Móvil on Monday, and the board of NII Holdings, which owns 70% of Nextel, announced that it would propose to the shareholders to accept the offer. The other 30% of Nextel is owned by AI Brazil Holdings, the local operation of Access Industries, an American private company whose portfolio includes natural resources, telecoms, internet services, as well as Warner Music, among other media interests.

The nature of the deal, “cash free / debt free”, will let NII and AI Brazil keep all the cash while América Móvil will not assume Nextel’s debts. Although the total transaction value is less than 1.5 times of Nextel’s annual revenues in 2018 ($621 million), it represents almost four times NII’s market capitalisation on its latest trading day on NASDAQ ($229 million), indicating the buyer’s relatively strong confidence in the business prospect.

Brazil is a highly competitive market. According to research by Ovum, by Q4 2018, Vivo (owned by Telefónica) led with one third of the total mobile market, while TIM and Claro (América Móvil’s existing operation in Brazil) were vying for the second place, each serving about a quarter of the total mobile subscribers. Nextel had slightly over 1% market share. The rest of the market is served by Oi (a JV between Altice Portugal, formerly Portugal Telecom, and Telemar, Brazil’s largest integrated telecom operator).

After the acquisition, América Móvil plans to combine Nextel with Claro to “consolidate its position as one of the leading telecommunication service providers in Brazil, strengthening itsmobile network capacity, spectrum portfolio, subscriber base, coverage and quality, particularly in the cities of São Paulo and Rio de Janeiro, the main markets in Brazil.”

For NII, selling Nextel in Brazil represents the end of an era. The company once operated mobile services in multiple North and Latin American markets, including the eponymous professional radio service in the US, which was later acquired by Sprint. Brazil is its last operation, where it has been struggling in a classic four-operator market. Not only has it not been able to break into the leader group, but also seen business declining fast. The revenues in 2018 were a 29% decline from 2017 ($871 million), which itself was a 12% decline from 2016 ($985 million).

“The announcement of this transaction marks the culmination of an extensive multi-year process to pursue a strategic path for Nextel Brazil and provides our best opportunity to monetize our remaining operating assets in light of the competitive landscape in Brazil and long-term need to raise significant capital to fund business operations, debt service and capital expenditures necessary to remain competitive in the future,” said Dan Freiman, NII’s CFO. Earlier potential buyers included Telefónica Brasil, Access Industries (NII’s JV partner), though the most concrete case was TIM, which, according to Reuters, approved a non-binding offer in November last year. None of these negotiations has come to fruition.

“Management and our Board of Directors believe the transaction is in the best interest of NII’s stockholders,” Freiman added.

KT and Nokia will join hands to launch first ‘true’ 5G this month

Korea’s mobile operator KT is going to launch nationwide 5G service this month and will collaborate with Nokia to provide services and tools for the business and the public sectors.

Hwang Chang-Gyu, KT’s Chairman and CEO, recently announced that KT’s nationwide 5G network will be switched in March to cover 24 major cities, key transport routes such as expressways, subways, high-speed railways, large universities, and neighbourhood shopping areas. This will be an upgrade from the synchronised launch of 5G services with limited scale on 1 December 2018 by all the three national mobile operators.

“In March, KT will be the first in the world to introduce ‘True’ 5G mobile services,” said Hwang. “In the 5G era, neckband cameras, AR glasses and all kinds of devices will be connected to 5G, contributing to a better life for mankind.” That this was a personal historic moment should not to be lost. Exactly four years ago at MWC 2015, Hwang predicted a commercial 5G network by 2019. “Today, I would like to announce that the promise I made four years ago has finally been fulfilled,” Hwang added in his MWC speech.

The current 5G service that KT, SKT, and LG Plus are offering is fixed-wireless access targeted at business users. During the recent MWC, KT demonstrated plenty of 5G gimmicks for the consumer market, from a 5G connected robot butler bringing a bottle of water to the doorstep to a 5G and AI powered robot barista fixing cocktails.

KT is clearly banking big hope on 5G. Its Economic and Management Research Institute predicted that the socioeconomic value created by 5G will contribute to 1.5% of the country’s GDP by 2025. To realise such potential and to achieve serious monetisation of 5G, KT is looking towards the enterprise market and the public sector. The company announced that it plans to focus on five key areas with its 5G offers: smart cities, smart factories, connected cars, 5G media, and the 5G cloud. It says it is collaborating with various businesses as well as the Korean government to develop 5G services for both Business to Business (B2B) industries and Business to Government (B2G) sectors.

This is an echo to what Marcus Weldon, Nokia’s CTO and the President of Bell Labs, called for during his own speech at MWC. Weldon suggested the telecom industry should focus more on serving other verticals instead of on consumer markets, to deliver the true value of 5G. He did concede that it would need three to five years before telcos can see meaningful revenues from enterprise 5G. But when they do, Weldon predicted the business will soon equal that being made in the consumer 5G segment.

It just happened that KT and Nokia are going to collaborate closely in 5G. During MWC the two companies signed a Memorandum of Understanding (MoU) to collaborate on various 5G technologies. “We are excited to partner with Nokia to conduct these path-breaking trials,” said Jeon Hong-Beom, KT’s CTO. “This collaboration will ensure that we are able to leverage Nokia’s proven solutions and best-in-class professional services to provide a superior and differentiated experience to our subscribers.”

“With Korea, one of the lead countries in the early deployment of 5G, we are delighted to be working with KT to help them build a future-ready network,” added Bhaskar Gorti, President of Nokia Software. “Nokia’s end-to-end portfolio will empower KT to improve its customer experience and network efficiency.”

The key areas of the collaboration will include Service Orchestration and Assurance for the 5G era, with the aim of delivering end-to-end automation and new revenue opportunities for KT’s enterprise customers. This will be supported by the enabling technologies like NFC and network slicing. The joint work will start in Seoul later this year.

Unlocking value in B2B at MWC

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece Anders Lindblad, Communications & Media Industry Lead for Europe at Accenture, looks at unlocking value in B2B connectivity.

Growth in the communications industry has stalled and competition continues to intensify. CSPs know they must act and rethink their business models, but for too long there has been a lot of debate and very little action. We expect the buzz will continue on this topic at MWC. While some have put some form of change programs in place before, most of those have failed because they have been trying to patch up specific problems rather than taking a much bolder move to reinvent the way the whole business works.

Right now, CSPs are trapped, stuck in current operating models and the same old ways of doing things which make it hard to monetize investments and drive new growth. They are not ready yet to get rid of their legacy network and services since they still generate most of the (declining) revenue. This is preventing them to leverage their biggest asset: the capillarity and proximity to the customer. But the roll out of fibre and 5G could be the catalyst that encourages them to make drastic changes in the way they function and the products and services they provide.

The route to new growth is most likely to be in the B2B space, so expect to hear more about connected B2B possibilities and the importance of collaboration across vertical industries and value chains than ever before at the show. Discussions will be about the most efficient way to move from their legacy network and infrastructure and transition to a hybrid (cloud and on premise) software defined services portfolio, how to push the network intelligence at the edge, while embedding the OTT platform at the edge instead of being “embedded” by OTT, reinventing the device ecosystem leveraging the ‘decade of device divergence’ we are facing. Connected cars, connected health, augmented and virtual reality, is the prize of the game – the entire organisation will need to become much more agile and flexible to allow for front and back office supporting processes and technology to keep up with the possibilities.

The biggest B2B opportunity for CSPs could be in the SME segment. To succeed, they must adopt a bundling approach to services towards the customer, paired with intelligent pricing of their core services and drive simplicity through a digital-first approach and self-service capabilities. CSPs may have tried this approach in the past without success, but this time they can take a digital, platform-based approach to allow them to successfully simplify and standardize their offering portfolio, enable their own and third-party sales and services to effectively go to market and significantly bring down the cost to serve these customers. CSPs must have the courage to act now and renew their service portfolio quickly if they are going to retain and win market share.

Transforming the operating model toward customer centricity and agility, pushing the intelligence at the edge of the Network and injecting automation (Robotic Process Automation, AI) into the core culture, will provide a future-proofed foundation for communications companies to scale the value of their service portfolio for the B2B market and re-gain a central orchestration role in the device ecosystem that they currently don’t have.

The CSPs that understand the huge potential that B2B brings and move fast on new agile ways of working to adapt to these new capabilities will take the biggest share. If the opportunity is not captured NOW, using the newest and most innovative technologies available, and before the 5G ecosystem power game is settled, the market will find different winners, mostly coming for each vertical industry from over the top players.

 

Lindblad_300dpiAnders Lindblad is Accenture’s Communications & Media industry lead for Europe, responsible for business development and operations in the region and for helping clients form and deliver large-scale transformation programs.

IBM Vodafone partnership wins its first clients

IBM and Vodafone announced during Mobile World Congress 2019 that their $550 million cloud and AI partnership has signed its first heavy-weight clients.

SEAT, a Spanish sub-brand of the Volkswagen group, and KONE, a world leading lift and escalator supplier from Finland, have become the first customers of the open cloud and AI technologies offered by the IBM and Vodafone Business partnership.

SEAT is going to use the cloud, AI, and 5G technologies to facilitate its transformation into a “mobility services provider”. KONE’s main interest is in the IoT domain. With the new technologies it aims to move its customer service from reactive to proactive then predictive mode as well as to improve the efficiency of the monitoring and fix operations.

The partnership between IBM and Vodafone Business was announced last month. Although billed as a “joint venture”, Michael Valocchi, IBM’s General Manager of the new venture, clarified to Telecoms.com that it is not a formal joint venture or a separate organization but an 8-year strategic commercial partnership and $550M managed services agreement. IBM and Vodafone Business are going to put in equal amount of investment.

“IBM’s partnerships with global telco companies like Vodafone will help speed up the deployment of 5G and provide easier access to new technologies such as AI, blockchain, edge computing and IoT,” said Valocchi in a statement. “This is because the promise of 5G doesn’t just depend on fiber, spectrum and gadgets, but on advanced levels of integration, automation, optimization and security across the ever more complex IT systems that companies are building in a bid to transform.”

“By providing the open cloud, connectivity and portable AI technologies that companies need to manage data, workloads and processes across the breadth of their IT systems, Vodafone and IBM are helping to drive innovation and transform user experiences across multiple industries – from retail to agriculture,” added Greg Hyttenrauch, Co-leader of the new venture for Vodafone Business.

The partnership will become operational in Q2 this year. IBM told Telecoms.com that by that time Vodafone Business customers will immediately have access to IBM’s entire hybrid cloud portfolio to optimise and enhance their current solutions. These solutions and services are not dependent on 5G. In the future, clients will benefit from new solutions and services that the new venture will develop, combining IBM’s multi-cloud, AI, analytics and blockchain with IoT, 5G, and edge computing from Vodafone.

Considering that Vodafone is going to start with a non-standalone approach to 5G, the use cases for verticals that demand extreme low latency are hard to realise in the near future. The engineers at IBM’s stand also conceded that although Watson can be deployed and trained to support many scenarios, the implementation of mission critical cases will have to wait till end-to-end 5G network is in place.

Vodafone CEO bemoans Jio effect on India

The Indian consumer might be surging into the digital economy at an unprecedented speed, but the telcos are certainly not reaping the rewards according to Vodafone CEO Nick Read.

Speaking at Mobile World Congress in Barcelona, Read pointed towards consumers which are consuming more data every single day (12 GB a month on average), as well as unsustainable business models and regulations which favour no-one except the disruptive influence of Jio. It isn’t necessarily a picture which creates an encouraging view of the market.

“We only ask for a level playing field,” said Read, bemoaning regulatory and competition rulings made in the country.

It seems Reid believes there has been an institutional preference towards the newest entrant into the Indian telco regime. This is also a company which is forcing the market to create artificially low tariffs, an unsustainable position for the market to maintain. What impact this has on the long-term prospects of India’s digital dream remain to be seen.

While it is hardly unusual for the CEO of a losing telco to moan about unfair market conditions, there have been some credible points made. Jio did certainly disrupt the market, helping the country move into the digital era, but there was certainly consequence. The aggressively low tariffs saw numerous telcos exit the space, either closing-down operations, merging with a rival or declaring bankruptcy.

Vodafone was one of those victims, currently in the process of merging its operations with long-term rival Idea Cellular. Reid highlighted he has been over to India to review the plans recently, and the team has managed to reduce the integration process from four years to two, but it is still losing money. That said, it is not alone.

The issue which remains here is what happens if this trend of Jio destruction is allowed to continue. How many more telcos will disappear from the landscape (there are only effectively four left, including government owned BSNL) before the government steps in to do something. The current position is not exactly ideal.

As it stands, India currently have four major telcos to provide connectivity services for roughly 1.3 billion people. Europe has roughly 160 telcos for a population of 500 million. Although many would argue there needs to be consolidation in the European space, the shortage of options in India is not exactly ideal. The risk of regionalised monopolies is certainly present.

Of course, the newly merged Vodafone Idea business is not lying down while Jio runs riot throughout India, Reid highlighted a Rights Issue is currently underway with the business hoping to raise $3.5 billion. Not only will this help the businesses merge and update infrastructure, it would be fair to assume some pretty aggressive counter-strikes against Jio.

India is one of the most interesting markets worldwide right now, but there is certainly a risk of the landscape devolving into chaos. Whether the Indian government is sympathetic to Reid’s plight remains to be seen, though current trends should not be allowed to continue.

Germany’s 5G auction has not got off to a flying start

Telefónica Deutschland has filed an urgent appeal against the country’s 5G auction terms. Deutsche Telekom may follow suit.

Telefónica Deutschland was seeking to halt the country’s 5G auction by filing an appeal for injunction at an administrative court in Cologne on Tuesday 5 February. Germany was scheduled to hold the 5G auction by the end of March and was expecting to raise up to €5 billion. The key items on the terms issued by the Federal Network Agency being contested are concerning the coverage requirements, especially the coverage in rural areas and along motorways, and the mandated network sharing with competitors (the so-called domestic roaming).

Telefónica Deutschland argued that the coverage obligations could not be fulfilled with the spectrum at auction, while the frequency in its possession is already being used by other expansion requirements.

“This legal uncertainty is extremely unhelpful for the necessary massive investments in future network expansion. Billions in 5G cannot be invested on the basis of unclear rules. It must be in the interest of all involved that clarity and planning security are created here before an auction,” said Markus Haas, CEO of Telefónica Deutschland.

Telefónica was also unhappy that politicians should demand network sharing between competitors. “We have already invested €20 billion in infrastructure in Germany. We have always said that we will continue to invest if the conditions are right,” Haas told the German publication Handelsblatt late last year. However, as a condition to approve its merger with E-Plus in 2014, EU regulators already required Telefónica to make 30 percent of its capacity available to MVNOs, in this case 1&1 Drillisch.

Meanwhile Telefónica insisted that even if there would be a delay in the auction, “this would not have any influence on a large-scale launch of 5G in Germany. This is because the spectrum available for auction for this purpose will not be allocated to the successful participants until the end of 2020 anyway,” the company said in a statement.

Deutsche Telekom may also consider its position differently now. It first told Handelsblatt “we have not yet made an urgent request, to avoid delaying the auction schedule.” But in light of the new appeal from Telefónica, “we are therefore examining all legal options,” the spokesperson added.

It is not the first time the telcos have resorted to legal measures. By the end of December, Deutsche Telekom, Vodafone, Telefónica, as well as the challengers United Internet and Freenet had all filed lawsuits against the government’s rules over the upcoming auction, but none was successful in halting the process.

Deutsche Telekom, Vodafone, Telefónica, and United Internet (trading as “1&1 Drillisch”) filed applications before the deadline of 25 January to participate in the upcoming 5G auction.

US operators belatedly act to protect user location data

AT&T and Verizon announced that they will terminate all remaining commercial agreements that involve sharing customer location data, following a report exposing the country’s mobile carriers’ failure to control data sharing flow.

Jim Greer, a spokesman for AT&T, said in a standard email to media: “Last year, we stopped most location aggregation services while maintaining some that protect our customers, such as roadside assistance and fraud prevention.” Referring to the Motherboard exposé, Greer continued, “In light of recent reports about the misuse of location services, we have decided to eliminate all location aggregation services — even those with clear consumer benefits.”

This is similar to the position T-Mobile’s CEO John Legere adopted when responding to the criticism from the US Senator Ron Wyden (D-Ore.). Verizon also announced that the company will sever four remaining contracts to share location data with roadside assistance services. After this Version will need to get customers’ explicit agreement to share their data with these third-party assistance companies. Sprint, which was also caught out by the Motherboard report, is the only remaining nation-wide carrier that has not announced its plan on the issue.

This is all good news for the American consumers who are concerned with the safety of their private data. On the other hand, mobile operators have hardly been the worst offenders when it comes to compromising the privacy and security of customer data. Earlier, Google was exposed to have continued tracking users’ location even after the feature had been switched off, while Facebook has been mired in endless privacy controversies.

Monetising user data is only a side and most likely insignificant “value-add” business for the mobile operators, because they live on the service fees subscrbers pay. But it is the internet heavyweights’ lifeline. This may sound fatalistic but it should not surprise anyone if the Facebooks and the Googles of the world come up with more innovative measures to finance the “free” services we have benn used to.

Qualcomm pumps Snapdragon 855 in Hawaii

The chipset company Qualcomm just unveiled the newest Snapdragon SoC product to power 5G mobile devices.

On the first day of its annual “Snapdragon Tech Summit” in Hawaii, Qualcomm introduced its first commercial 5G chipset, branded as Snapdragon 855. The system is compatible with Qualcomm’s X50 modem with antennae supporting 5G on both sub-6GHz and mmWave frequency bands. On a 7-nm silicon will also be its 4th-generation multi-core on-device AI engine (said to deliver 3X faster AI performance than its predecessor the Snapdragon 845), Computer Vision Image Signal Processor (CV-ISP) for new photo and video features (“true 4K HDR video capture, cinema-grade photography capabilities”), and 3D Sonic Sensor. The sonic sensor can be used for under-display fingerprint reading using ultrasonic waves (instead of the current optical under-display sensors using light), which, Qualcomm claims, is safer and more accurate.

Qualcomm expects the first smartphones using the new chipset to hit the market in the first half of next year. “The Snapdragon 855 will define the premium tier in 2019,” said Alex Katouzian, SVP and GM of Mobile for Qualcomm, who unveiled the new chipset. Earlier Cristiano Amon, Qualcomm’s President, said he expected to see a lot of phone announcements at CES in January and a lot of actual phone launches at MWC in February.

“Today marks a massive and exciting step forward underscoring how Qualcomm Technologies and ecosystem leaders are driving 5G commercialization, a journey that went from R&D, accelerated standardization and trials, the launch of innovative products and technologies, to the imminent launch of 5G networks and smartphones across the globe starting in early 2019,” said Amon at yesterday’s event. “Together we are demonstrating our role in transforming the mobile industry and enriching consumer experiences with 5G mobile devices on live 5G networks at this year’s Qualcomm Snapdragon Technology Summit.”

Executives from mobile operators including AT&T, EE, Telstra, and Verizon were present at the event, so were representatives from Ericsson, Samsung, Motorola, NETGEAR, and Inseego. The 5G smartphone from Samsung to be launched by both Verizon and AT&T is likely to be the first of its kind to be built on Snapdragon 855.

“At Samsung, we have a vision of a connected world powered by 5G that will benefit consumers, communities, industries and governments,” said Justin Denison, SVP for mobile product strategy and marketing at Samsung Electronics America. “5G will fuel collaboration, connectivity and productivity worldwide, and we’re excited to be at the forefront working alongside partners like Qualcomm Technologies to make the transformation to 5G a reality.”

The event will last three days till Thursday, and Qualcomm promised more announcements and more details will be released.

Mobile data could get even costlier after T-Mobile and Sprint merger

Report by Rewheel showed Americans already have the most expensive mobile data among all four-operator markets. A move to reduce the number of them could make it worse.

According to the 2H2018 release of its mobile data price monitoring report, the Finland-based research firm Rewheel focused on the US market, which is likely to see the proposed merger of T-Mobile and Sprint closing in the first half of 2019. The report showed that among the 41 countries it analysed (OECD34 + EU28, with seven EU countries not being OECD members), the median gigabyte price of a smartphone deal (nominal price + VAT) in the US is among the highest. Rewheel told Telecoms.com that Greece and Cyprus topped the table, followed by Korea and Canada. The median gigabyte price of a mobile broadband deal in the US is the most expensive among all.

Rewheel mobile data prices

The research compared two groups of markets, those with effectively four mobile operators and those with three. The mobile data price in the four-MNO markets is shown to be about half as expensive as the three-MNO markets, but the US is an outlier. The median US mobile data price per gigabyte is four times higher than the EU four-MNO markets, and sixteen times higher than the big EU markets with four MNOs.

To look at it from another angle, a 30€ monthly deal comes with unlimited data plans (and at least 1000-minute talk time) on smartphones in 13 markets (Korea, Mexico, and 11 EU countries) but can only buy 6GB in the US. Similarly, a 30€ monthly wireless broadband deal can buy unlimited data in 11 EU markets but can only get 40GB in the US.

The effect of the “magic four” driving price down is most telling in Italy: after Iliad launched its mobile service, the price per gigabyte fell by 70% in half a year. On the other hand, the research showed data price stopped falling in the Dutch market after the announced merger of T-Mobile and Tele2, and the price drop has visibly slowed down in Austria after it became a three-MNO market.

The researcher therefore argued that the Americans are already paying more than other four-MNO market users, it could get even worse if the US market became a three-horse race. However we can see in the data that North America is generally more expensive, with Canada, a four-MNO market, is as expensive as the US. Admittedly though, Freedom Mobile is still weak.

An additional angle to examine data price is to look at what is offered to contract users vs. prepaid users, which is excluded from the Rewheel research. The discrepancy is probably most obvious in Africa. According to the analysis published by the research firm Ovum, South Africa’s mobile data is among the highest in the world. This is largely down to the high prices PAYG users face when buying smaller data packages. Rob Shuter, the CEO of MTN, corroborated with his comments at the recent AfricaCom that, despite the average price per gigabyte for postpaid users in Africa is comparable to that of the US (around $3), data prices for prepaid users are prohibitive. The large majority of mobile users in Africa and other emerging markets are on prepaid services.

FCC modifies frequency policy to encourage 5G investment

Changes to licence regulations on 3.5 Ghz have been approved by the FCC in an effort to encourage the 5G rollout.

The 150 MHz wide spectrum on the 3.5 GHz (3550MHz to 3700MHz.) band, or Citizens Broadband Radio Service (CBRS), is very busy. Following the rules of the FCC established in 2015, three tiers of users are sharing this band. There are the Incumbent Access Users, in particular the US Navy Radar Operators; the Priority Access Licenses (PALs) which are mainly commercial users like the telcos; and dinally, General Authorized Access (GAA) users which are permitted to use any portion of the 150 MHz frequency so long as it has not been granted to the other two tiers.

FCC Commissioner Michael O’Rielly, who was tasked to lead the review of current regulations and deliberation of new policies with special focus on PALs, claimed the old rules “would not support large-scale deployments, such as mobile or 5G networks… The rules in place favored small-scale, fixed networks, by making it unattractive for any other type of deployment. Basically, the rules were designed so that a select group could get licenses on the cheap.”

The Report and Order published by the FCC on Tuesday October 23 has kept the three tiers in place, but has made modifications to the specific implementations, including:

  • Changes the size of PAL license areas from census tracts to counties;
  • Extends the PAL license term to ten years and makes these licenses renewable;
  • Establishes end-of-term performance requirements;
  • Ensures seven PALs are available in each license area;
  • Allows the use of bidding credits for rural and Tribal entities;
  • Permits partitioning and disaggregation of PALs;
  • Updates information security requirements to protect registration information; and
  • Facilitates transmission over wider channels while maintaining protections for other services

In addition to extending the license term from three years to ten years and changing it from unrenewable to renewable, the new rules also did away with the limitations on the number of PALs a single applicant can have in one licence area (currently capped at four) and the bandwidth a PAL can use (currently limited to 10 MHz).

Ajit Pai, Chairman of FCC, admitted there has been debate on the new size of PAL licence, with different entrenched interest either arguing for maintaining the current census tract-sized licence, or demanding vastly enlarged areas. He had to cite support from Rural Wireless Association and Competitive Carrier Association, which represents smaller carriers, to defend the Commission’s  decision to opt for county-size license.

“We find that county-based licenses are just right,” said Pai. “This compromise will allow most interested parties, large and small, to bid on 3.5 GHz spectrum in order to provide 5G services. License sizes aside, we make other necessary changes today to promote investment and innovation in the 3.5 GHz band, including extending the license terms and giving an expectancy of license renewal.”

Pai also reassured the GAA users that “even after PALs are granted, General Authorized Access users can provide service in the PAL spectrum until licensees deploy. Taken together, these reforms will help make this band a sandbox for 5G and represent another aspect of our comprehensive 5G FAST plan to secure American leadership in the next generation of wireless connectivity.”

The rule modifications might not look revolutionary, but they should prove positive for more aggressive 5G rollout in the US. With the extended licence term and the possibility of renewal the new regulations provide more confidence to investors looking at long term. Meanwhile, it also strikes a balance both to encourage scale and to protect operators with local ambitions only.