Regulators in the US and UK blaze trails for a new 5G spectrum deal

Regulators in the US and UK both made strides towards a new regulatory environment for 5G last week, with the US FCC planning a millimeter wave spectrum auction in November, and the UK’s Ofcom seeing two new entrants engaging in its own midband spectrum sale.

The FCC chair, Ajit Pai, said during his keynote speech at Mobile World Congress that he plans to hold an auction for 28 GHz spectrum in November, followed immediately by another for 24 GHz – though he must get the approval of Congress, by May 13, to implement his plan.

If it goes ahead, it will be one of the first sales of millimeter wave spectrum in the world, and will set precedents for regulations elsewhere. The FCC, as part of its Spectrum Frontiers program, has set the pace in identifying high frequency bands for 5G, and Verizon and AT&T are already trialling prototype 5G fixed wireless equipment in 28 GHz and 39 GHz frequencies.

They are using spectrum which they have acquired from former owners of LMDS licences, previously used for fixed broadband or backhaul and now enjoying a resurgence in value. The auctions will add more high band spectrum to the pot, with T-Mobile, Dish and some cablecos tipped to bid as well as the big two operators. However, the FCC is out of step with the International Telecoms Union on the exact bands – at World Radio Conference 2015, the ITU identified several study bands for 5G, including 26 GHz, but not 28 GHz. Regulators such as Ofcom have chosen to play safe and stick with the ITU choices, though many expect the US and its supporters to present an effective fait accompli to WRC-19 next year, and have 28 GHz included on the list of bands to harmonize for 5G.

However that works out, the US is blazing a trail in 5G millimeter wave and prompting a high level of interest, and vendor developments of the equipment that will be essential to make these high capacity, low range frequencies usable – such as Massive MIMO antennas with advanced beamforming.

“We aspire to lead the world in 5G,” Pai said at MWC. “I am hopeful that we’ll be able to kick off a major spectrum auction in November.”

“The race to 5G is a sprint, not a marathon, and the proposed spectrum auctions will help ensure the United States remains at the forefront of this emerging technology,” said US House Energy and Commerce Committee chair Greg Walden, and Representative Marsha Blackburn, in a joint statement.

Another FCC commissioner, Brendan Carr, has unveiled a new plan to advance 5G deployment in the US, while calling for a reform of site regulations. Carr, speaking at the Consumer Technology Association’s (CTA) 5G Day, said 5G could add 3m new jobs, $275bn in private sector network investment and $500bn to US GDP.

However, that will require more streamlined regulations, especially for small cell sites. He said: “Capital is finite, and capital is smart. It will flow to those countries that have updated and modernized their regulatory structures. A key obstacle is our country’s outdated infrastructure regulations, which were written for previous generations of wireless technology.”

The FCC published some new guidelines last year, seeking to introduce faster and more uniform processes for local authorities to approve site access and small cell equipment, but these have faced hostility and legal challenges from some cities, keen to keep their power to make their own processes. Carr is now proposing a plan to streamline the federal historic and environmental review procedures, and exclude many 5G cells from these, to make it cheaper and easier to deploy 5G base stations.

“The fees associated with these procedures have risen dramatically in recent years, spiking by as much as 2,500% in parts of the country and needlessly costing millions of dollars that could have been put toward infrastructure deployment,” he wrote in a statement of his position last week. “This threatens our 5G leadership.”

The FCC will vote on the plan at its open meeting on March 22. It has strong support from the internet and wireless sectors. The Telecommunications Industry Association (TIA) said in a statement: “Small cells are different, and the FCC’s recognition of that fact will help avoid massive and unnecessary regulatory obstacles and permitting costs that threaten US leadership in the race to 5G.” And the Internet Innovation Alliance added that the proposals would help the FCC “take a major step towards a uniform policy that will accelerate advanced broadband deployments of all types”.

Pai was also focusing on reduced regulatory burdens for wireless deployments. He said in his MWC address that the US needs a “light touch” regulatory framework to accelerate development of next generation networks and pave the way for highly automated 5G systems. “To realise the full promise of 5G we will need smart networks, not dumb pipes. Dumb pipes won’t deliver smart cities. Dumb pipes won’t enable millions of connected, self-driving cars to navigate the roads safely at the same time,” he said.

Over the pond in the UK, Ofcom could kick off its latest spectrum auction as early as the end of this month. It will offer 40 MHz of spectrum in the 2.3 GHz band and 150 MHz in 3.4 GHz. The former will mainly be used to supplement current LTE networks but the latter is more significant, because of the amount on offer and because it is likely to be used for 5G.

The band between 3.4 GHz and 3.7 GHz – and up to 4.2 GHz in many countries in future – is seen as the most important spectrum for initial 5G. It will be offered by many countries in the first phase of the 5G era – driven by high momentum from China, whose operators will start deploying 5G in 3.5 GHz from 2020, ensuring a broad ecosystem.

Though most regions will make it technology-neutral, it will effectively be the first midband spectrum to be awarded for 5G, even ahead of WRC-19 – where harmonized band plans should be drawn up. It is less experimental than millimeter wave spectrum and is likely to enjoy a wider range of affordable equipment and devices in the first phase of deployment, but it still offers significant capacity.

The majority of non-US operators, according to Rethink’s recent survey of about 70 MNOs, will stick to well-understood bands for their first wave of 5G, turning to mmWave later when demand for high data rates and high density demands that. In many cases, operators will use a combination of new midband spectrum; refarmed 2G, 3G or even 4G frequencies (and repurposed fixed wireless airwaves in 3.5 GHz); and new sub-1 GHz spectrum. Many regulators are auctioning or preparing a ‘second digital dividend’ – the 600 MHz incentive auction in the US was an example, while European regulators will be selling 700 MHz licences over the next few years.

The added significance of the UK auction is that there are two new entrants on the list of bidders for the 3.4 GHz licences, along with the country’s four MNOs. This highlights the need for a more flexible regulatory environment if 5G is to fulfil its potential to support many new industries and services, on top of the core mobile broadband model. Some regulators are considering regional or vertically-specific allocations to enable specialist service providers targeted at particular industries with specific connectivity requirements.

The high capacity of bands like 3.5 GHz make it more practical to open up the spectrum to a wider range of operators. Airspan, an established equipment vendor in broadband wireless and small cells, has already secured a 3.5 GHz licence in Ireland, and will be participating in the Ofcom auction also. With Softbank as an investor, it is able to take a creative approach to the market, and has the potential to enable new service provider customers via control of spectrum. Airspan is currently most renowned for providing Sprint’s Magic Box base station as well as equipment for Reliance Jio’s huge 4G roll-out in India.

The six companies approved to bid in the auction are EE (BT), O2 (Telefonica), Vodafone, Three (Hutchison), Connexin (a broadband wireless provider based in the city of Hull) and Airspan Spectrum Holdings.

“We’re pressing ahead with the auction to make these airwaves available as quickly as possible. This will benefit today’s mobile users by providing more capacity for mobile broadband use. It will also pave the way for 5G – allowing operators to launch the next generation of mobile technology,” said Philip Marnick, Ofcom’s spectrum group director.

The auction had previously been delayed by legal action brought by Three, the smallest of the four MNOs. Three wanted the current spectrum cap reduced by 37% to even the playing field, but it failed in the UK Court of Appeal.