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Citigroup Questions Whether US Spectrum Shortage Exists
alphadogg writes "For more than two years, the U.S. mobile industry has warned of an upcoming spectrum shortage, but two analysts at Citigroup don't buy it. AT&T, trade group CTIA and even officials with the U.S. Federal Communications Commission have talked frequently about a coming spectrum crunch, as mobile customers move to data-sucking smartphones and tablets. Smartphones use 24 times the spectrum compared to standard mobile phones, and tablets use 120 times the spectrum, FCC Chairman Julius Genachowski said in a speech on Tuesday. But Citigroup analysts Jason Bazinet and Michael Rollins questioned what has become the conventional wisdom in the mobile industry. The U.S. has plenty of spectrum for mobile broadband, but much of it is in the wrong hands, they said."
In bribes.
They should have sold the frequencies by market area (city, zip-codes, etc.) and not nation-wide.
That's the real crux of the problem.
Now we have large nation-wide companies holding up frequencies in large swathes of the country because they're dedicating their efforts in specific markets where they can charge more.
Had the FCC sold the frequency on a market basis and required it to be used within a reasonable time frame, we wouldn't have these issues.
According to the report, the "wrong hands" with control of spectrum that isn't being used or is underutilized are:
Almost all of the above spectrum is in the less-desirable 2 GHz+ ranges. Clearwire may be underutilizing, but Lightsquared and Dish haven't gotten to launch their services yet so you can't really say it's underutilized when it's still in process of being developed.
All in all, this report actually seems to make the case of the big carriers that there is still a shortage of "good" (especially less than 1 GHz) spectrum for broadband. Much of that is locked up by the broadcasters for stuff that is comparatively useless (anyone watching UHF television still these days?) versus having it available for mobile broadband.
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To the people who make the decisions, that's the exact same thing as a shortage. They don't see a changing of hands as a viable option. They are not generally willing to consider it. If something is perceived as finite, limited, and scarce then you can continue to justify what you charge for it. The rest is a matter of regulatory capture by the proxy of campaign contributions.
It is a miracle that curiosity survives formal education. - Einstein
Citi's report is not wrong, but how they go about counting things is naive at best. The crux of the matter is that there's a lot of crap spectrum that carriers basically got for free or close to it. But before we get too far ahead, let's answer an easier question: what is good spectrum.
Case in point, 194MHz of the spectrum Citi says is available is above 2GHz: "Citigroup's description of 194 MHz available in the Broadband Radio Service (BRS) and Educational Broadband Service (EBS) bands between 2.4 and 2.7 GHz". This also goes hand-in-hand with Citi's weird method of counting spectrum in use: they're multiplying it by the percent of the population that the spectrum covers. "The two used averages to come up with spectrum use estimates; if a carrier has a 10 MHz nationwide block, but is only delivering service to half the U.S. population, the report considers that 5 MHz of used spectrum, Rollins said."
Ultimately the carriers are being wasteful at times, but not nearly to the degree that Citi says they are. The carriers need more national allocations if they're to run a 3rd network simultaneously, and those allocations need to be at least 40MHz wide so that they can operate two sets of wideband (10MHz) LTE channels. Smaller allocations mean that they're going to have to use smaller channels, and that's going to greatly limit network performance.
All they need to do is borrow some spectrum and lend it out to 9 different entities, and they've created 10 times the spectrum!
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No, "spectrum" is not measured by the amount of information sent or received. It refers to "electromagnetic spectrum," and in this context, it means the range of frequencies suitable for wireless communication.
I vote based on politicians' actions, unless contrary to my preconceptions. Often wrong, never uncertain. #iamthe99%
Photons don't interact with each other, and don't "fill up" anything. What is at issue, is our poor usage of the spectrum, and insistance on treating it like exclusive property. Any number of people can communicate on the very same frequencies, and in the very same space, just as long as there is a way to distinguish the communications. Fortunately, nature provides each device with a unique "address": its location in space. As technology improves, we can continue to make ever better use of the same spectrum--or at least we could if legislation didn't actively prevent it.
In essence, it comes down to building more towers, and I'm not aware of any unsurmountable barriers to a company with the will and cash. Of course, it is easier to just prop up the model of artificial scarcity with prices to match.
Rather than clinging to the outdated concept of a scarce spectrum, regulatory agencies should start giving it back to the public, and encourage the proper use of it. Highly dense, low-power, ultra wide-band communications. It is the natural evolution of wifi: per-home micro-cells attached to home fibre, running open Internet protocols. We could easily have extremely high-performance ubiquitous wireless networking, if massive corporations weren't so busy propping up artificial scarcity and walling everything off.
Is shitty bank planning on starting a shitty internet service to go with their shitty wok and shitty airline?
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
From the article,
U.S. carriers have 538 MHz of spectrum dedicated to mobile data and voice and are only using 192 MHz, the two analysts said in a report released Sept. 22.
That strikes me as roughly 2.5x, not 24.
...I'm quite aware of the move to reclaim bandwidth from the USA terrestrial stations. I've seen the cry and hue that the NAB (and members) and put forth, but I've always wondered why they just don't come out and say "You bastards MANDATED that we change over to digital, and now you want us to give back bandwidth on a capability and capacity we had to spend millions on.", or something similar.
Why haven't they just come out with that tack? It is the unspoken sentiment, yet no one seems to have the balls to say it.
I have been seriously considering lobbying my Congressman to consider changing the top 20 channels of Citizens Band radio to a digital Citizens band format, where every device that uses the bandwidth would have to function like a WiFi AP Bridge. This sort of network would still function even when there is a disaster and the local Cell towers go down. It would also create some competition to the CelPhone companies and eventually the Cable companies. It's just a thought at the moment but I'm planning on doing research into it's feasibility and if it looks possible starting a grass roots political movement.
Woosh for not getting fractional reserve banking!
Yep, but available bandwidth is directly proportional to spectrum, and the amount of data you can transfer is directly proportional to bandwidth.
The reasoning is: we consume exponentially more data, so we need more bandwidth to move that data, so we need more spectrum to unlock that bandwidth.
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It would strike me that way if that's what the article said. Alas, it doesn't.
What the article said is that smartphones USE 24 times as much as dumbphones. And tablets USE 120 times as much as dumbphones.
TFA doesn't discuss how much more is needed, really. It implies we need a great deal more, but we'd really need to know the fraction of the users that have smartphones and tablets already to be able to estimate exactly how much more bandwidth might be needed.
It will almost certainly be more than 2.5x, since TFA said we have enough, but it's misallocated.
It will also almost certainly be less than 24x, since a significant fraction are already using smartphones.
It is faintly possible it will be as much as 120x, since tablet takeup isn't nearly as high as smartphone, but, on the other hand, fewer of us actually want/need tablets....
"I do not agree with what you say, but I will defend to the death your right to say it"
There is no spectrum shortage. Europe and Asia have no spectrum shortage, despite being more densely populated (generally), and all having the same handsets work on all networks. The decisions to buy a handset and the decision which network to subscribe to are totally separate. You buy the handset outright. No subsidy. No strings attached.
The urge to have balkanized networks is driven purely by networks wanting to fragment the market and put obstacles to their customers leaving for some other network.
I wrote about this re: Canada, and it applies to the USA as well. The only two markets that tie customers this way, and people accept it.
Read Mobile phone carriers lobby for more balkanization by asking for more "spectrum" and More balkanization and monopoly in Canada's mobile phone market.
This should be stopped!
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... just a shortage of infrastructure. One of the basic principles of cellular networks is that you can increase capacity by building more cells and reusing spectrum in the spatial dimension. You can repeat the process almost infinitely; when you reach the point where walking around a room would switch you to a different cell you have gone too far. And for moving vehicles the limit is reached a bit sooner because the handoffs have overhead; a cell handoff every second would probably bring the network to a standstill. But the vehicles are probably using less bandwidth than the stationary users (even if you ARE watching a movie in your car you're probably not watching it in HD), so you could built a mixed network with high-bandwidth, high-density cells for stationary users and larger-range, lower-bandwidth cells for mobile. Before anybody says "but that would cost too much!", I'm only talking about TECHNOLOGICAL feasibility. It might cost too much to build the additional cells and/or be politically infeasible to build them. But note that RF exposure from the new smaller cells isn't as serious a problem as it might seem; they will be closer to your house (bad) but operate at lower power levels (good).