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23 August 2018

Altice joins cableco trials of CBRS as band comes closer to live services

In the USA, the CBRS band in 3.5 GHz – with its three-tiered system of access and sharing – could be more disruptive, in the short term, than early 5G. This is because it gives non-spectrum holders the opportunity to enter the mobile market for the first time, and leverage cellular technologies as well as WiFi.

In particular, the cablecos are interested in using the spectrum to deploy their own localized small cell networks, to improve their control over their own mobile offerings and potentially to support enterprise and city networks. Industrial IoT players like GE are also showing an interest in using CBRS for specialized vertical market applications. In both cases, the organizations would be able to have their own cellular networks in targeted locations, rather than relying only on MVNO deals, while not having to build a nationwide system. That would transform the economics of bringing 4G, and future 5G, to many industries, cities and consumers, and create new challenges to the telcos (see lead item).

There are two licensing schemes in which these new entrants can participate – buying a licence and becoming a priority access licensee (PAL), or using shared spectrum in the general access layer. GE and others are calling for the PAL licences to have short terms and small geographic areas to suit enterprise and industrial use cases, and to make them viable for non-MNOs to acquire.

And the FCC is still reviewing the final rules for the tiered scheme, and as well as disputes over the auction rules for the PAL tier, there is contention over the key use cases to which CBRS should be devoted. Various stakeholders are arguing that the spectrum should mainly be used for fixed wireless, for industrial IoT, for private networks, or for 5G (instead of 4G).

Disputes over such issues mean the CBRS spectrum is not becoming available as quickly as some supporters have wished, but the FCC did start, at the end of last month, to accept initial commercial deployment proposals for CBRS. It outlined the parameters and guidance for those deployments, and will accept proposals until September 10.

With commercial roll-outs on the horizon at last, Dave Wright, president of the CBRS Alliance, said the organization is boosting efforts behind its OnGo CBRS certification scheme – expanding its authorized test labs to eight, which now have their first devices ready for testing, and putting the final touches to its Certified Professional Installer program.

“Looking forward, the Alliance will ensure that we are fully prepared to prove out the various systems, interfaces and programs that will make full commercial service a reality as quickly as possible,” Wright wrote in a blog post.

Also, the FCC has conditionally approved a group of administrators of Spectrum Access Systems (SAS), which will be needed to assign priority and avoid interference, ensuring that the top tier (federal incumbents) are protected and that PAL holders take priority over general access users. Google and Federated Wireless have been the most prominent SAS developers and have demonstrated interoperability between their respective systems, but others with conditional approval are Sony, Amdocs, CommScope and Key Bridge.

Last month, Boingo launched a private LTE network in the 3.5 GHz band at Dallas Love Field Airport, with Federated Wireless providing the SAS, and Ruckus Wireless the devices.

And Altice is the latest cableco to talk about its tests of CBRS technology to complement its plans for an MVNO-based mobile launch next year. The company’s US CEO, Dexter Goei, told the most recent earnings call that he believed Altice could make a mobile business more profitable than Comcast and Charter could.

“We want to make this a profitable standalone business,” he told analysts. “So, we don’t anticipate, even in our first year of operation, to lose money on this. There may be working capital timing differences relative to handsets and how we treat those, but in terms of losing money, we are not going to lose money.”

By contrast, Comcast has lost about $1.2bn so far on its Xfinity Mobile launch, according to calculations by analyst Walter Piecyk of BTIG. And Charter has spent $116m on its MVNO-powered Spectrum Mobile offering, which launched at the end of June, including $33m in operating expenses and $53m in capital expenses.

Altice will launch its own MVNO-based service, via a deal with Sprint, next year and has hired a mobile CEO, Jean-Charles Nicolas, formerly deputy CEO and CFO of Altice’s Dominican Republic unit. It has agreed a ‘thick MVNO’ deal with Sprint, under which it will build out some infrastructure itself, giving it greater flexibility to launch differentiated services than on a simple MVNO agreement – for instance, to deploy small cells to improve indoor coverage or to add capacity for a certain user base. This can also improve costs by keeping some traffic on the cableco’s own network, reducing MVNO fees.

Goei said: “Recall we have a full infrastructure-based MVNO, which has attractive economics and flexibility features for us. We have a dedicated and experienced mobile management team which will lead the development, launch and ongoing mobile strategy. In terms of network development, the densification of Sprint’s network, which we’re helping with our AirStrand deployment, is comfortably ahead of schedule as are the upgrades to and expansion of our WiFi network. We are also testing CBRS spectrum with equipment in a 3.5 GHz band as this may be good complementary capacity for us.”

Sprint’s said recently that it has deployed “tens of thousands of strand-mounted small cells” with Altice since making the deal late last year.

According to Altice’s application to the FCC for a Special Temporary Authority Licence to test CBRS, the cableco will run tests of a new class of spectrum allocation servers to prevent interference with incumbent users. It will run trials in three towns, two in New York state and one in Arkansas, between September and next February, with equipment from Ericsson, Nokia, Airspan, Ruckus (now part of Arris) and Berkeley Vaitronics.