Analyst Angle: The emerging role of wireless broadband

Editor’s Note: Welcome to our weekly feature, Analyst Angle. We’ve collected a group of the industry’s leading analysts to give their outlook on the hot topics in the wireless industry.
With all the talk of 4G technologies and the U.S. national broadband plan, it seems like a good time to step back and take a look at the broader role that wireless technologies can play in extending broadband services and their importance for delivering high-speed bandwidth to the world.
The first thing to note is that wireless technologies are already being used around the world to deliver broadband (lower-speed, admittedly) services to end users. While operators and vendors are increasingly dedicating resources to LTE and WiMAX, there’s a considerable installed base of 3G technology in use, and it continues to grow rapidly. Operators are offering not only more capable handsets, but also a growing number of 3G-enabled data cards and USB modems, plus laptops and netbooks with embedded 3G capabilities. In addition, new 3G licenses continue to be issued in markets large and small. China, for example, issued its long-awaited 3G licenses in early 2009, as did Chile and Vietnam. It is expected that India, Mexico and Thailand will award 3G licenses in 2010.
But that’s just the beginning, as LTE and WiMAX are already starting to roll out. By one estimate, there are now 519 WiMAX deployments in 146 countries. And the first commercial LTE networks have just launched in Sweden and Norway. The speeds these networks can offer will make wireless broadband a totally different experience than it is today and provides the potential to link many users who may not have access any other way.
Meanwhile, numerous countries have developed or are working on national broadband plans intended to deliver high-speed connectivity – preferably in an affordable fashion – to their citizens. In the United States, we have seen the FCC issue a series of public notices (28 at last count) and holding more than 45 workshops and field hearings to gather inputs and work out the details of the NBP that must be submitted to Congress by Feb. 17. The U.S. government has also set aside $7.2 billion of stimulus funds for broadband projects, and began announcing the recipients of the first round of funding in mid-December. Other governments are developing NBPs, such as Australia, Brazil and Ireland. The approaches may vary, but the goals generally include universal or significantly expanded population coverage and vastly increased speeds.
Many, if not most, of these NBPs focus on speeding the deployment of fiber-optic networks, either directly to the home/business or to the curb. What is often missing, however – despite the maturity of 3G technologies and the recent and impending deployments of high-capacity wireless technologies such as WiMAX and LTE – is prominent mention of wireless technologies as a key tool for expanding broadband access. There are some notable exceptions, such as Australia and South Korea, as well as several European states and guidelines adopted by the European Commission. But there are also a number of countries where wireless is only nominally included in the plan or is not mentioned at all. For example, Austria, Canada, France, Hong Kong, Japan, Kenya, New Zealand, Nigeria and Singapore have all, in various fashions, briefly mentioned wireless in their NBPs or have identified plans to leverage wireless technologies but have not yet committed the necessary resources.
Given the speeds that are possible with nascent 4G technologies, this seems somewhat curious – and near-sighted. Wireless technologies should be an integral part of any NBP. This is especially true in developing countries, where wireline penetration is often very low and where mobile technologies have become the main communications link for the vast majority of the population. But more generally, it is simply not economically feasible to deploy fiber to all unserved and underserved areas, regardless of the level of economic development. With emerging wireless broadband technologies and services, operators can leverage their existing infrastructures and economies of scale to more widely deploy broadband-enabled wireless devices and cost-effectively expand access to broadband services. However, without a plan to serve the most difficult-to-reach populations, many NBPs will likely fall short of goals that often include accelerated progress toward “knowledge societies” or “knowledge economies,” increased online access to government services or educational resources, or simply ubiquitous broadband coverage. While the appropriate mix of wired and wireless broadband technologies will vary from market to market, it seems short-sighted not to at least incorporate support for both approaches in order to ensure that the widest array of tools is available to meet broadband connectivity and service goals.
As wireless broadband technologies and services emerge, however, there are challenges that must be overcome if wireless is to play a significant role in broadband deployment, adoption, and use. The biggest medium- to long-term challenge is availability of sufficient spectrum. In the United States, FCC Chairman Julius Genachowski and his fellow commissioners have recently placed great emphasis on the need to quickly identify additional spectrum in order to maintain and increase the capacity of wireless broadband networks. The U.S. wireless industry has indicated that it would like to see an additional 800 megahertz of spectrum made available for commercial wireless use within the next six years. Other countries have pending plans for 3G or 4G license tenders in a variety of bands, and many are looking at how the “digital dividend” of spectrum being transferred from broadcasters to other uses might be harnessed to support wireless broadband growth. Given the time often necessary to clear and reassign spectrum or to tender licenses, it is all the more critical that governments factor wireless into their NBPs at the early stages, so as to identify the spectrum-related actions that will need to be taken in order to ensure the growth of this rapidly emerging industry and allow it to take its rightful place alongside fiber as we work to extend the benefits of broadband to all.
Jeffrey Bernstein is Senior Business and Policy Analyst for Telecommunications Management Group Inc. Bernstein is currently preparing an update to TMG’s 3G Licensing Around the World publication, available at http://reports.tmgtelecom.com. Bernstein can be reached directly at jeff@tmgtelecom.com.