Analyst: Spectrum Control is Constraining Supply
Majority of airwaves assigned to data are unused
September 26, 2011
NEW YORK: Squatting is the main
problem with spectrum, not a looming shortage.
That’s the conclusion of a pair of analysts at Citigroup.
“Too much spectrum is controlled by companies that are not planning
on rolling out
services or face business and financial challenges,” wrote Jason
Bazinet and Michael
Rollins. “We do not believe the U.S. faces a spectrum
The Federal Communications Commission is using the specter of a looming
to push through the redesignation of 120 MHz of broadcast spectrum for wireless
broadband. The commission cites the exploding growth of smartphone and table
usage for crowding airwaves devoted to cellphone services. Even so, plenty of
remains undeveloped, Bazinet and Rollins said.
“Today, U.S. carriers have 538 MHz of spectrum, and an additional 300
MHz of additional
spectrum waiting in the wings. But only 192 MHz is in use today,”
A majority of that spectrum is devoted to legacy service not likely to deliver
than 1 Mbps during usage peaks, compared to 5 Mbps for 4G, the latest data
technology. Bazinet and Rollins said if the full 538 MHz was converted to 4G,
could support 5 Mbps at 10 percent simultaneous usage. They noted, however,
the larger carriers couldn’t just sweep in with 4G because their
networks are so
occupied by legacy users. Consequently, incumbent carriers do need more
to launch 4G services--both because of legacy occupancy and because 4G technology
performs best in blocks of 20 MHz or more, the analysts said.
Verizon and AT&T, the nation’s two largest carriers, are most
those constraints, potentially giving an edge to new players such as Clearwire,
LightSquared or Dish, particularly if they join forces.
Clearwire is short on cash and LightSquared is in political crosshairs for
with global positioning systems. But both control substantial swaths of
Clearwire has 133 MHz; LightSquared has 59 MHz, and a deal to use
Sprint’s 51 MHz.
Dish Network has 47 MHz of undeveloped spectrum, with which it could offer 3 to
5 Mbps to as much as one-fifth of the U.S. population using 4G technology, the
said. Dish Network, with its solid satellite TV revenue stream, is shopping for
a wireless provider, and said to be looking at Sprint and Clearwire.
“Unless incumbent carriers accelerate their 4G migration plans, or
underutilized spectrum, upstart networks like Clearwire, LightSquared and Dish
have a material speed advantage over incumbent carriers provided that they can
meaningful hurdles for funding and distribution,” Bazinet and Rollins
~ Deborah D. McAdams