The emergence of shared spectrum in the form of CBRS is transforming the wireless industry by toppling traditional barriers to entry and enabling the development of entirely new use cases.
Among those is an opportunity for cable operators and MVNOs aspiring to make a foray into wireless network infrastructure. Through leveraging CBRS, they can cost-effectively provide additional coverage and capacity where it is needed most, reaching new customers without being at the whim of the host mobile operator.
Cable and Wireless: Why the convergence?
In recent years, cable operators have sought to diversify their business by entering the wireless market. The manifestation of this trend can be seen in Comcast’s Xfinity Mobile and Charter’s Spectrum Mobile, both of which are based on a Mobile Virtual Network Operator (MVNO) agreement with Verizon.
There is considerable momentum too. In the first quarter of 2020, for example, Comcast added 216,000 wireless subscribers, bringing its base to 2.3 million and increasing revenues by 52% to $343 million.
This diversification has been attractive to cable operators because it spawns opportunities in two key areas: revenue generation and network experience enhancement. In effect, it is the next stepping stone in a strategy that has seen the operators invest heavily to extend the availability of their broadband networks.
Up until recently, their network-related investments have been concentrated on deploying branded WiFi hotspots across public spaces. In the home, they have been implementing dual SSIDs on operator-supplied CPE. The goal was to extend access to their network beyond the realm of the home or office, positioning it as a cheap but secure alternative to expensive data tariffs with WiFi offloading.
But there were holes in this strategy. The cost of deploying and maintaining a dense network of WiFi access points (APs) to achieve broad coverage is simply enormous. Even with a dense network, cable operators are restricted by the limitations of WiFi itself, which can suffer from quality of service (QoS) problems due to limited channel bandwidth in unlicensed spectrum.
Add to this the fact that unlimited data plans have now become ubiquitous across mobile operators in the US. Consumers no longer seek out WiFi hotspots as actively as they once were accustomed to because the financial penalty of not doing so has effectively evaporated.
It is the culmination of these factors that is spurring cable and wireless convergence.
Where CBRS fits into the convergence equation.
CBRS and the promise of shared spectrum is aligned closely with the interests of cable operators that are pursuing an MVNO service. As a lightly licensed medium of spectrum, it represents an equilibrium between WiFi and traditional cellular networks, exhibiting the favourable economics of the former but also the wide-area performance advantages of the latter.
Thanks to the versatile nature of CBRS, cable operators can acquire and exploit the band in a number of different ways. In the General Authorised Access (GAA) layer or Tier 3 of the Spectrum Access System (SAS), they can leverage the spectrum free of charge to potentially augment existing fixed assets.
Alternatively, they can gain access to spectrum in Tier 2 through the FCC’s Priority Access License (PAL) auction or through a wholesale agreement from a third-party such as a mobile operator, tower company or even a systems integrator. Either way, access to this mid-band spectrum is extremely cost-effective relative to traditional licensed spectrum.
Equipped with CBRS, cable operators can deploy coverage and capacity where it makes the most sense commercially. This will be determined by the nature of the venue or location and its suitability for cellular and/or WiFi, along with the revenue opportunity that it presents. A large hospital, for example, may be more suited to cellular than a small hotel.
In every scenario, it is critical to remember that cable operators will be seeking to maximise the amount of time that their subscribers spend on their native network. This is something that can only be achieved through a mixture of WiFi (for cellular offloading) and native CBRS capacity.
Keeping traffic “on-net” is important because it provides enhanced control over the customer’s network experience, dynamically shifting traffic between WiFi, CBRS and the host mobile operator’s cellular network based on resource demands.
Think of the benefits of controlling the traffic flow at a densely populated venue, where both WiFi and the public mobile network (including DAS) may be overloaded.
In addition, the economics of maximising the share of traffic generated on the native network are likely to be very advantageous. Wholesale MVNO agreements tend to discourage high levels of data usage, leading to a progressive increase in expenses for the cable operator. This, after all, is a leading reason why public WiFi hotspots were deployed in large numbers.
From a revenue enhancement perspective, CBRS may enable cable operators to develop value-added services and charge a premium for access to a converged network. This is particularly notable in the enterprise segment, where there is a groundswell of demand for enhanced indoor coverage and capacity with small cell solutions.
They may be able to provide an integrated and optimised CBRS/WiFi solution to enterprises that require dual means of connectivity, reducing the need to depend on the public mobile network. Hotels, for example, could charge a premium to guests for access to a high-quality hybrid network at and around conference venues.
Conclusion: CBRS enables cable operators to diversify with wireless.
Cable operators are pursuing wireless as an opportunity to enhance the network experience and generate new revenue streams. To achieve this, they must go beyond the limitations of WiFi offloading and MVNO agreements, deploying coverage and capacity in the CBRS band where it makes the most commercial sense.
By complementing existing fixed assets with targeted wireless coverage and capacity, they can extend the reach of their networks with favourable economics. This provides them with a lever to control the movement of traffic across their converged fixed and mobile infrastructure, reducing costs in the long run while improving performance.
Underpinning all of this is CBRS. The spectrum sharing framework radically lowers the barriers to offering wireless services, negating the need to participate in an expensive auction for licensed spectrum. By virtue, it paves the way for a seamless future in which the boundaries between fixed and mobile networks disappear.