March 17, 2010

Broadband plan good for carriers, equipment makers

Category: Press Releases

Wireless carriers and equipment companies should benefit from the Federal Communications Commission’s National Broadband Plan while smaller local exchange carriers and TV broadcasters may be vulnerable, according to consultants Global Medley Advisors L.L.C.

However, the details of the plan – how it is implemented and executed – will determine whether the government can meet its goal of broadband access for all Americans.

The best part of the plan is simply that it recognizes the role of the wireless industry, noted PCIA’s Michael Fitch in an interview with RCR Wireless News. “The most significant aspect is the recognition of the importance of wireless broadband competition as the real sweet spot of opportunity for expansion,” said Fitch, who is CEO and president of the infrastructure trade organization. “Wireless really has the ability as a practical matter to reach people it can’t reach now.” In its report, the FCC said while nearly 200 million people have broadband access, 100 million people don’t. Many of those 100 million people live in places where connecting via fiber would be too expensive. Thus, wireless broadband connections are a viable alternative to getting them broadband access.

“In theory, companies in the telecom service sector (Verizon, AT&T, Qwest, Sprint Nextel, T-Mobile), the

infrastructure sector (Crown Castle, American Tower, SBA Communications, Alcatel-Lucent) and the tech sector (Qualcomm, Cisco, Intel, Juniper, Corning) stand to benefit from expanded, higher-speed

broadband deployment and adoption, with TV broadcasters and smaller local exchange carriers

(particularly those serving rural areas) appearing most vulnerable to coming changes,” according to a report from Medley Global Advisors.L.L.C. “Satellite operators such as SkyTerra, TerreStar, Inmarsat, ICO and Globalstar could benefit from the NBP’s emphasis on giving licensees greater spectrum flexibility.”

The National Broadband Plan delivered to Congress calls for another 500 megahertz of spectrum to be freed up for wireless use by 2020, as well as an auction of D-Block spectrum and use of unlicensed spectrum. Federal Communications Chairman Julius Genachowski has been releasing parts of the plan during the last few months so most of the broad policy goals included in the plan, including releasing more wireless spectrum and a nationwide public-safety initiative, have already been made public. How Congress reacts to the 376-page plan will be watched closely by industry going forward.

The problem with the plan, of course, is that a 10-year program cannot take into account the technological changes that will alter the industry, said Openwave CEO Ken Denman. Any bandwidth that comes to market will be used creatively, and as such spur new services and create more demand for more spectrum.

While spectrum is likely to continue to be an issue as more and more things connect to wireless networks, PCIA said it was encouraged that the broadband plan recognized the importance of infrastructure. Recognizing that low and more uniform rates for access to poles, as well as speeding the process of siting antennas on utility poles should benefitv the industry, said PCIA’s Mike Saperstein, director of government affairs. For example, the FCC could implement a procedure to certify that wireless equipment can be attached safely to utility poles, which would speed up the deployment process. Utility companies sometimes are slow to allow a Distributed Antenna System to attach to a pole because it’s not the utility company’s core business.

The FCC doesn’t have jurisdiction over some infrastructure deployment issues at the local level, but the broadband plan can help educate some local authorities that the plan is important to national policy, Fitch pointed out.

The call to find 500 megahertz of spectrum in the next 10 years could lead to “an epic lobbying battle as those whose spectrum is identified for reallocation gear up to fight against any loss of their turf,” said Thomas Stroup, CEO of Shared Spectrum Co. “Fortunately, the plan also calls for ongoing measurements of actual use of the spectrum, so any decisions that are made can be based on how the spectrum is used, not to whom it is allocated. Spectrum measurements performed by SSC and others repeatedly have shown that a fraction of the spectrum that is allocated is used. … I was also delighted to see the focus on ‘opportunistic uses’ as a means of solving this imbalance between spectrum allocation and spectrum use. Whether it is called cognitive or frequency agile radios, dynamic spectrum access, or any other description, these new technologies provide the ability to more fully utilize spectrum without engaging in the costly, time consuming process of reallocating spectrum.”

Posted by theresa