Broadband and Spectrum Allocation Policy

ARTICLE

Broadband and Spectrum Allocation Policy

By Julien Regoli, Vice-president Operations
Contact the author at julien@maravedis-bwa.com

Broadband wireless technologies have been deployed for over a decade, while WiMAX is still an emerging technology. How does the demand for these broadband wireless technologies compare to the overall booming demand for broadband technologies worldwide?

The regions with the greatest percentage disparity between the two categories are APAC, CALA, and North America.

Although the APAC region received a boost from Korea Telecom’s subscriber additions (resulting in an estimated 60,000 total subscribers at end of September), the region has a disappointing BWA/WiMAX penetration relative to total broadband. China’s lack of support for 802.16e (also known as mobile WiMAX) is impacting the region’s deployment rate. The Chinese government has been pushing the country's home-grown standard, TD-SCDMA, and has a vested interest in its competing effectively with the more mature 3G technologies, WCDMA and EV-DO.
On the positive side, there are some spectrum allocation activities in Japan, Thailand, and New Zealand that should eventually translate to more WiMAX deployments in the APAC region. In Japan during October 2007, final applications were made to the Ministry of Internal Affairs and Communications for the right to bid on 2.5 GHz WiMAX spectrum licenses. The key players that are expected to participate in the upcoming auction have apparently committed almost US$4 billion of capital to invest in WiMAX.
In Thailand, the National Telecommunications Communications (NTC) agency expects to issue WiMAX operating licenses by the end of 2007 in the 2.5 GHz and 3.5 GHz frequency bands. One company eager to offer WiMAX is the ISP Pacific Internet Thailand. As a first phase, the company has earmarked an investment of up to THB1 billion (US$30 million) to build a wireless broadband network covering major urban and industrial areas including Bangkok. The company intends a second phase to expand the service across provinces, with a focus on residential customers.

In New Zealand, the government plans to auction two blocks of wireless spectrum for the provision of nationwide WiMAX broadband services in December 2007. The country has pushed back the sale of spectrum in the 2.3 GHz band until the end of the year, when it will coincide with a separate auction of frequencies in the 2.5 GHz band. The state hopes to award national WiMAX licences to at least six companies.

European BWA/WiMAX penetration has been lagging world broadband penetration because ADSL and cable have dominant market positions offering great speeds at low cost to both residential and business users. However more spectrum allocations are under way.

In Italy, the Minister of Communications is looking to auction 3.4–3.6 GHz spectrum in January 2008, hoping to address the digital divide by offering wireless broadband in areas where DSL and fiber optic are not available. Mountains and parts of the south were among the specific regions mentioned by the Minister. The auction guidelines, which were published in October, allow the spectrum to be used for the provision of mobile services. However, the extent of mobility isn’t clear, which may further delay the auction process.

Sweden’s telecom regulator, the PTS, is planning to auction licences for WiMAX broadband wireless access in the 3.6–3.8 GHz frequency band in Q4 2007 to improve nationwide access to broadband services.

In Norway, the Norwegian Post and Telecommunications Authority (NPT) intends to auction off the frequency bands within 2.5–2.69 GHz in the fall of 2007. The NPT will implement a “spectrum cap” during the auction, which is intended to limit the amount of spectrum any one bidder can purchase. A high degree of competition for the spectrum is expected.

The strong BWA/WiMAX subscriber penetration in CALA is mainly due to the region’s BWA spectrum policy being more flexible than other countries’. Rather than limiting or restricting WiMAX, governments in the CALA region are pushing its adoption. The Latin American broadband leaders are Brazil, Mexico, Argentina, and Chile. In early 2007, these four countries accounted for around 80% of all broadband subscribers in the region. Latin America is also at the forefront of global WiMAX deployment. WiMAX Forum certified networks have been launched in Argentina, Brazil, Chile, Colombia, Ecuador, Guatemala, and Venezuela, while pre-WiMAX systems are operating in Costa Rica, the Dominican Republic, Jamaica, Mexico, Peru, Puerto Rico, and Uruguay.

In North America, US operators have taken advantage of unlicensed spectrum in the 2.4, 5.3, 5.4, and 5.8 GHz bands. 2008 will see the emergence of a recently reclassified light-licensed band at 3.65 GHz. This region is a clear demonstrator of how reduced restrictions on spectrum use encourage subscriber penetration.

The next year will be a turning point for WiMAX. Certification of IEEE 802.16e equipment by the WiMAX Forum will give WiMAX deployments a boost. Also, the success stories of leading operators will bring credibility to WiMAX technology, and sizeable capital investments should follow. These success stories along with BWA/WiMAX’s demonstrated economic and social benefits will also influence laggard countries to liberate spectrum policy and stimulate BWA/WiMAX investments.

For more information you can contact the author. julien@maravedis-bwa.com