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Arqiva bulks up its 28 GHz holdings as FWA bubble inflates

The race for high frequency spectrum, suited to fixed wireless access (FWA), is not just a US phenomenon. UK towerco Arqiva is following other site and fiber providers round the world in snapping up millimeter wave licences, in this case a 28 GHz licence covering London.

The company, which is up for sale, bought 2 x 112 MHz of spectrum in the 28 GHz band from FWA and enterprise services provider, Luminet (formerly Urban WiMAX). This will supplement Arqiva’s existing nationwide 28 GHz franchise. The company has already announced trials, planned for this summer, for FWA services based on pre-standard 5G New Radio technology. It will work with Samsung, which is trialling mmWave 5G technologies, for both fixed and mobile use, with operators in the US, South Korea and elsewhere.

From its statements, it seems that Arqiva’s main aim is to enter the FWA market, supporting wholesale connectivity for the MNOs and so add to its existing sites business with them.

Nicolas Ott, MD of telecoms and M2M at Arqiva, said in a statement: “5G FWA is an exciting opportunity to deliver true ultrafast broadband above 500 Mbps to millions of households; this is especially relevant in the UK where so few households are connected by fiber-to-the-home [FTTH] or fiber-to-the-cabinet technology. In purchasing this additional license we are able to further our ambitions in this area, standing ourselves in good stead to deliver a compelling 5G FWA wholesale service to UK mobile and fixed operators across the country, and with even more capacity in greater London.”

Ott explained that London would need greater density than other cities, hence the purchase of additional spectrum for the capital.

He estimates that fewer than 1% of UK premises are connected to FTTP/H networks today and that penetration in London is not significantly higher, and he claims that fixed 5G will deliver “comparable performance with far easier roll-out” compared to fiber, and will superior to G.fast, the souped-up DSL technology in which BT is investing heavily.

In reality, a more promising approach might be to use the spectrum mainly to offer backhaul. One use case for mmWave 5G will be to backhaul small cells since wireless offers better flexibility and cost-effectiveness than fiber in very dense networks where the base stations are close to the ground.

BT’s own mmWave trials which will be conducted with NEC and the University of Salford, are concentrating mainly on small cell backhaul rather than access. As BT put it, a primary concern of the trials will be to see “how these links may stand up to the rigors of the British weather”. The partners will test the performance of V-band point-to-point mobile backhaul, using the 60 GHz band and a testbed based at the University. This testbed has been created to measure the performance of the V-band radio system over a 12-month period when exposed to rain, wind, fog and ice.

According to a study conducted for Ofcom in 2013, 85% of fixed wireless market value in the UK derived from backhaul. Even with 5G, the FWA opportunity in the UK looks limited. Rural areas underserved by decent wireline broadband are limited, despite the failings of the government-driven broadband plan. FWA operators working in towns, such as UK Broadband (now part of 3UK) and Luminet itself, have tended to focus on enterprise back-up, or groups requiring rapid set-up, such as students. These are niche markets – Relish gained only 15,000 subscribers for a service launched in London in 2013.

The purchase of UK Broadband’s 3.6 GHz and mmWave licences by 3UK does show that fixed wireless is having the latest of its occasional booms, and can appeal to mobile-only providers as a way to offer fixed/mobile and quad play bundles and compete with BT and Vodafone – though UKB’s midband holdings will also be valuable for small cell densification and mobile 5G.

This would, to some extent, mirror the activities of the two largest US telcos, which are very interested in fixed 5G in their 28 GHz and 39 GHz spectrum to bring fixed and converged services outside their wireline footprints. However, the scale of the opportunity in the US, with its large rural areas and considerable base of ageing DSL telco connections, is not reflected in the UK. And a bundle with no fiber or enhanced DSL in it will increasingly become second class, and therefore cheap, in a market where wireline expansion is proceeding and prices are tumbling. Virgin Media is spending £3bn ($3.9bn) to extend its broadband networks to about two-thirds of the population, from a previous level of one-half, while some smaller players like CityFibre (see separate item) are also planning FTTH deployments.

Arqiva did not disclose the terms of its purchase from Luminet, but in the US the 28GHz spectrum has been attracting large sums – Verizon paid up to $3.1bn for Straight Path, a 28 GHz license holder. This is despite 28 GHz not being an official band designated by the ITU to be discussed for 5G potential, at the 2019 World Radio Conference. Official ITU bands drive global harmonization and therefore broad ecosystems, though many initial pre-standard 5G deployments will be starting before the WRC has been held.

Though the US and South Korea are working with 28 GHz, and may hope to present the WRC with a fait accompli, most European regulators are focusing on ITU-earmarked bands such as 26 GHz. UK regulator Ofcom told LightReading: “When it comes to the pioneer bands for 5G, we have identified 26 GHz and not 28 GHz as the high frequency band. In a February discussion document, Ofcom identified three pioneer bands – 700 MHz, 3.4-3.6 GHz and 26 GHz.

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