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Sliver of spectrum could open floodgates for sharing and neutral host

A proposal by the US regulator, the FCC, to open up a small sliver of midband spectrum for sharing between government incumbents and commercial operators, has caused a stir far greater than its 5 MHz size seems to warrant.

This is for two reasons. One, it indicates a willingness to push the sharing model, pioneered in the CBRS band and the TV white spaces, into more of the midband spectrum which is so prized for 5G. The USA is at a serious spectral disadvantage compared to China and many other markets, because so much of its midband airwaves are occupied by federal, local government or satellite users, and moving these incumbents to alternative bands would take many years. Sharing, then, is an attractive solution.

The second reason concerns Ligado, the US operator which emerged from the ashes of bankrupt terrestrial/satellite venture LightSquared. It is still fighting to be able to use its mid-band (L-band) mobile satellite spectrum, in 1525-1559 MHz, for 4G or 5G networks. It has an ongoing satellite communications business, but – like its former incarnation – wants to expand its reach with a terrestrial cellular network, which would support a wholesale-only model mainly focused on the IoT. The 5 MHz slice at stake is close to Ligado’s holdings and would enable it to aggregate a 40 MHz band, adding to the capacity to support a wide range of 5G services and service providers.

This is important because the US market would certainly benefit from a wholesale platform – like the 5G networks envisaged by the large cablecos, this could accelerate adoption of 5G in vertical industries by supporting specialized MVNOs and private operators; and that could, in turn, spur the large MNOs to pay more attention to industries. Ligado could also, potentially, be an interesting partner for the cloud giants – Amazon AWS, Microsoft Azure and Google all have a strong interest in closer ties to a network which would support enterprise cloud and edge services, and reduce their reliance on telco connectivity. An alliance with Ligado, similar to the one often rumored between AWS and Dish, would be an interesting counterpoint to the established telcos.

First, Ligado needs to be able to build out its network. Its attempts have been repeatedly scuppered by objections from the occupiers of nearby bands, including GPS operators and government users. They claim the higher signal strength of a terrestrial system, compared to satellite, would create interference. It was the GPS community’s opposition which prevented LightSquared building out its network, even after the FCC had, perhaps prematurely, granted it leave to use satellite spectrum for LTE.

Now Ligado has shifted its attention to 5G, and it is hailing the latest FCC move as a step forward. The FCC’s chairman, Ajit Pai, has announced that the regulator will vote this month on a proposal to reallocate the small piece of spectrum – between 1675 MHz and 1680  MHz – for shared use between federal and commercial users. Ligado took this as a sign that the FCC is warming to the idea of allowing sharing in many of the midrange bands – particularly valuable for 5G – where government users are incumbent.

More broadly, this suggests that the FCC is confident about the success of its biggest spectrum sharing venture so far, the CBRS band in 3.5 GHz, even before those airwaves are in commercial use (see separate item). It is certainly looking to apply the technology which prevents interference in CBRS – the database-driven spectrum access system (SAS) – to other bands to increase the capacity available for 4G and 5G by sharing underused public sector airwaves.

Of course, it remains to be seen whether the US government continues to allocate portions of these bands for unlicensed use, as it has in CBRS, or succumbs to the lure of new revenues, as the value of midband spectrum rises. A government analysis estimates that the 5 MHz chunk of spectrum between 1675 MHz and 1680 MHz is worth about $600m.

The lure of a boost for the Treasury should be resisted, since sharing will help to open up the service provider ecosystem as well as providing more beachfront spectrum for 5G. This is much needed in the midband ranges. Even the CBRS scheme has been 4G-focused on the unlicensed side, a decision heavily criticized by T-Mobile and others for putting the USA behind in the ‘5G race’.

The licenses which will be awarded later this year can be used for 5G, but are more fragmented than the large chunks of 3.5 GHz airwaves which some regulators, including China, are allocating. The company in the best position is Sprint, whose 2.5 GHz band has been accepted as an official 3GPP 5G allocation – it has over 100 MHz in most markets, with much of that not yet fully used for LTE.

Ligado said in a statement: “This NPRM [Notice of Proposed Rule Making] has significant potential to free up critical midband spectrum that will help ensure the United States commercializes the wireless spectrum necessary to accelerate, strengthen, and secure 5G networks across the country.”

Ligado’s chairman of the board, Ivan Seidenberg (a former Verizon CEO), added: “As a company, we are ready to invest in this spectrum and help deploy the 5G technologies that will not only improve all our lives but also give our economy a competitive edge against the rest of the world.”

The company has pledged to spend $800m to build a national 5G network based on both terrestrial and satellite and said this will create 8,000 jobs as well as giving US businesses and service providers an additional platform. Like Dish, it will kickstart its build-out with 4G-based IoT systems and then move to 5G.

Ligado insists that its midband spectrum will be optimal for emerging IoT applications. It said in a recent interview: “In order to accelerate delivery of innovative services in such verticals as healthcare, automotive, industrial, shipping, home and municipal sectors and to more broadly fulfill the promise of next generation mobile networks, more mid-band spectrum is needed. Midband spectrum is part of the solution to deliver ultra-reliable, highly secure and capacity-rich connectivity.”

One of the decisions the FCC must make is whether to auction the 5 MHz or allocate it to a particular company such as Ligado. If it goes for an auction, that will be at least a year away.  And Ligado is still waiting for a final verdict on whether it can use all its 35 MHz of L-Band spectrum for 5G –  nine years after LightSquared came up with its original plan.

Last November, Ligado announced one step towards commercial reality, signing deals with Ericsson, and with device chipmaker Sequans, to supply equipment and chips for its planned network. The plan is reminiscent of Dish’s – take the quick and low cost deployment option of 4G IoT networks first, to establish a beach-head for 5G. Ligado said it would roll out 4G LTE-M and NB-IoT technologies first to “take advantage of the broad ecosystem that is developing around LTE-M and NB-IoT specifications”.

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