As the major US carriers spend millions of dollars to boost their spectrum arsenals, operators outside the big four have to look for more creative options to meet rising capacity demands ‘ sharing, offloading and an increasing use of Wi-Fi in its delightfully free frequencies. The Competitive Carriers Association (CCA), which represents smaller operators in the US, has signed a deal with crowdsourced Wi-Fi provider Devicescape, though its members are also being wooed by T-Mobile, which claims it has enough capacity to share with the localized cellcos.
“Don’t forget T-Mobile. We have a huge network out there,” CTO Neville Ray told the 2013 CCA conference. “We have capacity.” This sees TMo, like Sprint, exploring various wholesale and network hosting options to expand its revenue streams in areas where it will not meet AT&T and Verizon head-on. More broadly, that and the Devicescape deal point to the increasingly complex mesh of spectrum ownership and partnership, which will inevitably develop as all US players scrabble for extra capacity on one hand, and new sources of income on the other.
Ray said T-Mobile could be a valuable ally in helping small players to extend outside their footprint. The fourth cellco has increasingly ranged itself with rural operators against the big two ‘ along with Sprint, it actually joined the CCA last year, and now it is competing with its nearest rival for CCA favors. In April, Sprint CEO Dan Hesse said his firm wanted to be the preferred roaming partner for tier two and three cellcos, and announced an LTE roaming deal, across multiple bands, with C Spire Wireless.
Like Sprint, TMo is accelerating roll-out of LTE coverage and capacity after a slow start and looking for new business models to ensure return on its investment. It says it will cover 200m POPs with 4G by the end of the year, deploying in 2x10MHz of spectrum, and it will migrate to 2x20MHz and LTE-Advanced (carrier aggregation) across most of its footprint next year. Now it sees CCA members as a route to increase the business from that new network, as well as allies in clipping the wings of the big two carriers.
In particular, he called on the CCA to support TMo’s proposed band plan for the incentive auction (also supported by Verizon), which would provide a single 3GPP band class, supporting interoperability across paired blocks of spectrum throughout the 600MHz of frequencies. That would avoid the fragmentation in the 700MHz band, which has caused significant challenges for the rural operators’ LTE business models by preventing them roaming with AT&T or Verizon (though AT&T has now accepted a compromise that will allow interoperability). Ray also wants to join with CCA carriers in pushing for spectrum caps on AT&T and Verizon in the incentive auction, which would make it more possible for small players to win some licences.
The CCA, since renaming itself (it was formerly the Rural Carriers’ Association) and broadening its membership, has become an increasingly loud collective voice for small operators, taking a ‘me and you against the world’ approach against the big two. It is valuable to its members since it can lobby more strongly than they can individually, as well as negotiating more effectively with suppliers and partners, including roaming allies. Wi-Fi could be an increasingly important weapon to operators which, even collectively, cannot hope to acquire the spectrum and network capacity of the national carriers. Like the cablecos, they could invest in hotspots or partnerships and pool their infrastructure to create national wireless coverage, at least in unlicensed spectrum, and this could be further topped up with the use of community Wi-Fi and homespots ‘ a tactic already used, courtesy of the FON platform, by several European operators, and potentially by the US cablecos too.
The CCA put Wi-Fi at the heart of its shared strategy last year when it set up its Ecosystem Development Program. This houses a number of initiatives where the Association can make up for its members’ individual lack of scale with shared platforms on which they can all draw. The Program includes a white label app store, a consumer loyalty offering, parental control platform, and combined schemes for handset leasing and purchasing.
Importantly, it also includes common negotiation of Wi-Fi offloading deals. This resulted in a deal, a year ago, with Boingo Wireless, providing CCA members with a white label Wi-Fi service based on the aggregator’s combined base of over 500,000 hotspots worldwide. This can be leveraged to offload data from cellular networks and add value for customers with free or subsidized hotspot deals.
‘With the ever increasing demand on wireless networks, it is absolutely critical for competitive carriers to have an offload solution,” said CCA CEO Steve Berry. Now the organization has added Devicescape to its platform. Devicescape is one of a growing band of virtual Wi-Fi networks and has tracked a global database of over 16m hotspots. Its client-installed software offers automatic access to this Curated Virtual Network (CVN) of access points, each of which has passed an assessment of service quality. The CVN leverages crowdsourced data from the millions of supporting devices ‘ gadgets with the software installed can sniff out suitable hotspots and add them to the network.
Devicescape then partners with operators to offer the service to end users on a variety of pricing plans, although many offer it for free to add value. Devicescape also works with carriers to link them to its virtual network ‘ France’s third cellco, Bouygues Telecom, has signed such a deal as it tries to fend off competition from Free Mobile and now it has signed the CCA as well as an individual deal with Leap Wireless (soon to be part of AT&T). It also has alliances with Microsoft, for WP8, and Intel, for Ultrabook.
The CCA agreement does not give every member operator automatic access to the curated network, but it provides a common framework contract which will make it quicker and easier for a small cellco to sign up.