Despite the challenging backdrop presented by the coronavirus pandemic, 2020 will forever be remembered as a breakthrough year for the wireless industry. Not only did operators make significant strides in deploying 5G networks more widely with low-band spectrum, but the market landscape continued to evolve with the consolidation of the third and fourth largest operators and rise of cable competition.
The defining feature of last year, and the one that will shape the future of wireless most profoundly, however, was the successful completion of the CBRS auction. In releasing a prime portion of mid-band spectrum on a shared basis, the Federal Communications Commission (FCC) triggered a step-change in spectrum policy that is now reverberating across the world, with similar initiatives being pursued in markets such as Germany and the United Kingdom.
This concept of shared spectrum, whereby commercial use is founded on use-it-or-lose-it thinking and an opportunistic basis, has toppled barriers to entry in the wireless market and is now fostering a diverse ecosystem of users and applications. The participation of “outsiders” such as utilities, private enterprises and wireless Internet service providers (WISPs) in Auction 105 exemplified this burgeoning space.
Looking to the year ahead, it is clear that momentum in the CBRS market will continue, and even accelerate, with device and equipment support for the band maturing and use cases including deployments of Fixed Wireless Access (FWA) and private enterprise networks becoming more widespread.
Fixed Wireless Access: Connecting the Disconnected.
From the outset, fixed wireless access has been recognised as a cornerstone use case of CBRS. The trifecta of wide channel bandwidth, favourable signal propagation and good economics has garnered the attention of WISPs, each of which play an important role in connecting the disconnected across some of the most rural areas in America.
Prior to Auction 105, some WISPs were already deploying LTE in the unlicensed portion of the band. As many now begin to exploit licensed spectrum through PALs, previous interference-related issues will decline in occurrence and users will benefit from higher quality of service (QoS).
These advantages have been reaffirmed in the field, with WISPs such as Watch Communications (which serves midwestern states) touting downlink speeds in excess of 100Mbps over distances greater than six miles in rural areas. Similar optimism has been voiced by others including Ohio-based Amplex Internet, which is seeing coverage over four miles with line of sight (LoS).
Many of these commercial deployments are being supported by state and government-backed subsidy programmes, which recognise the socio-economic value of fixed wireless access as means to provide cost-effective broadband access. One such example is the planned CBRS deployment in Botetourt County in Virginia, which will serve hundreds of rural homes and businesses where no current alternative exists.
Over the course of this year, deployments of a similar nature to those outlined above will continue, and other PAL-enabled opportunities for WISPs such as the potential to generate roaming revenue from Tier 1 operators, including AT&T and Verizon, may emerge. It is also possible that cable operators such as Cox and Charter will leverage their PALs to support fixed wireless access-based expansion of their respective HFC footprints.
Private LTE: Education Networks were the Dark Horse of 2020.
Perhaps the CBRS use case that has been accelerated most by the pandemic are private wireless networks for enterprise and education campuses. The latter, in particular, has seen a flurry of activity over recent months as millions of American students switched overnight to distance learning, with classrooms being delivered through Internet-enabled tools such as Zoom.
The existence of a digital divide, which disproportionately impacts students in economically disadvantaged areas, has acted as a significant barrier to distance learning for some, however. In recognition of this, a growing number of school districts are leveraging public funds (through the CARES Act) to finance CBRS-based wireless networks where large concentrations of underserved students reside.
Examples of these initiatives can be found in the Fontana Unified and Patterson Unified schools districts, where CBRS antennas provide a supplementary coverage and capacity layer atop existing fixed and wireless networks. The initial Patterson network is already live with traffic being routed back to the district central office through its firewall, and the Fontana rollout will cover more than 36,000 students with 400 radios.
Beyond private LTE for education, there has been notable progress in the enterprise space too. For instance, Verizon recently debuted “On Site LTE”, a new network platform based on the deployment of small cells and an on-campus Evolved Packet Core (EPC) network. This dovetails with the operator’s ongoing collaborations with Microsoft (Azure) and Amazon (AWS) to develop edge compute solutions for enterprises.
These trends will continue over this year, and private LTE with CBRS will likely permeate other sectors such as agriculture, where initial trials have exploited sensors to enable precision monitoring of moisture and temperature levels, as well as the automation of processes like irrigation.
Utilities: CBRS paves the way for a “Third Grid”.
In Auction 105, ten utilities were successful in securing 375 PALs across 150 counties. Of these, Southern California Edison emerged as the largest bidder in terms of its gross spend ($119 million), Alabama Power won the largest number of PALs (271 across 103 counties) and San Diego Gas & Electric splurged the most in terms of $ per MHz-pop ($0.5748).
The allure of CBRS for utilities has been based on the pursuit of highly secure and extremely reliable private LTE networks, now enabled by the wider channel bandwidth available in the 3.5GHz band. Specifically, they will be able to cater to higher bitrate and mobility-focused applications including hardened tablets, two-way radios and vehicle tracking.
Static applications, on the other hand, will be able to take advantage of the CBRS band as a medium for low latency backhaul to complement existing fibre and microwave links. This may serve supervisory control and data acquisition (SCADA) systems, distribution automation (DA), advanced metering infrastructure (AMI) and distributed energy resources (DERs).
While the 900MHz band will remain a cornerstone of many utilities’ networks for some time, they will also begin to leverage their PALs over the coming year. This licensed anchor can be supplemented with additional capacity in the GAA tier, which could unlock a new array of use cases such as the provision of fixed wireless access broadband as an upsell to their existing rural subscriber base.
Cable and Wireless Operators: Fulfilling the “Layer Cake” strategy.
To little surprise, mid-band-strapped Verizon was the foremost bidder in Auction 105, forking out $1.9 billion for 557 PALs which cover circa 46% of the US population.
In securing at least 30MHz of spectrum across the regions in which it purchased licenses and an average of 34MHz, Big Red is now able to complement its ongoing densification strategy in urban markets with the layer cake of low (through dynamic spectrum sharing or DSS), mid (through CBRS and the C-Band) and high-bands (through mmWave spectrum such as 28 and 39GHz).
As a budding carrier, many analysts were surprised by Dish’s strong showing in the CBRS auction, in which it obtained a significant number of licenses (5,492) across a very large geographical area. While progress has been slower than anticipated, this spectrum should enable the carrier to provide in-fill coverage with its ongoing greenfield network buildout over this year.
This pursuit of “breadth and not depth” will aid in the realisation of some of Dish’s other aspirations such as the expansion of its wholesale and enterprise Internet of Things (IoT) offerings.
Beyond wireless carriers, cable operators such as Charter, Comcast and Cox will begin to meaningfully leverage their respective CBRS winnings in the coming year. Both Spectrum Mobile and Xfinity Mobile enjoyed continued quarterly subscription growth in 2020, despite the challenging backdrop of retail store closures.
These operators are now eager to reduce their wholesale MVNO costs by offloading traffic onto their own CBRS-based wireless infrastructure where it makes commercial sense to do so. In addition, they hope to leverage the spectrum to wirelessly extend the cable footprint, expanding broadband access to underserved premises with favourable economics.
Conclusion: The Wireless Ecosystem is no longer Carrier-Led.
The successful completion of the CBRS auction in 2020 initiated the transformation of the wireless market from being exclusively carrier-led to becoming a diverse ecosystem of private enterprises, systems integrators and others such as utilities and neutral hosts.
Over the coming year, the fruits of this democratisation of access to spectrum will become more apparent, with real consumer value set to be delivered through a myriad of use cases including enhanced fixed wireless access broadband, more cost-effective private enterprise and education networks and improved utilities grid monitoring.