Spectrum sharing and small cell strategies need to adjust with the times in order to benefit carriers and consumers
Hope is not a strategy, said someone wiser than me. Yet mobile network operators across the world appear to be adrift in an asteroid field of fast-moving, life-threatening hazards, hoping for something to rescue them. Average revenue per user is static or falling. Roaming charges, in Europe at least, are set to disappear during 2017. External threats are growing with the emergence of unlicensed – Wi-Fi and LTE-Unlicensed/license assisted access – and shared-license access – CBRS and LSA – undermining the value of their unique asset: spectrum.
Yet mobile data demand continues to grow exponentially. The traditional answer to such demand is “more spectrum,” so it’s understandable there are covetous glances directed at the ITU World Radioconference scheduled for 2019. Up for discussion at the conference is 30 gigahertz of spectrum between 6 GHz and 100 GHz – 10-times more than is currently in use below 6 GHz – and operators are hungry for this spectrum to relieve the pressure. However, the reality is that accessing this spectrum usefully in a commercial setting is still a long way off.
So, isn’t it imperative in the short term for operators to make more efficient use of the spectrum they already have? Operators undoubtedly need to continue to invest in their networks to meet the growing demand, and densification rather than more spectrum is the way forward. You cannot break the laws of physics, as someone else wiser than me once said. But you can’t break the laws of finance either. How do you support that investment in the face of falling revenue? Only by using the lowest possible capital expense and operating expense configuration of small cells – multioperator small cells with shared spectrum.
To date, the deployment model for small cells has followed exactly the model established at the macro network level: small cells have simply been a scaled down version. However, it is clear the economics of infrastructure investment simply don’t work if we continue to follow this model. Small cells will never reach the scale they need to in order to deliver the commercial return in terms of capex reduction with the performance improvements that operators need. A whole radio access network per operator just doesn’t make economic, commercial or technical sense any more.
If operators are to overcome these challenges and reverse the profitability trends of the last five years, we need to radically redraw the commercial map in order to unblock the pipe when it comes to infrastructure investment.
The need for spectrum sharing
At the heart of solving this challenge is a need for shared infrastructure and spectrum, multioperator solutions, and creating more opportunities for third-party service partners to offer managed “as-a-service” solutions, or for end users to deploy their own coverage.
Spectrum sharing is perhaps the most controversial element of this picture. Although the market drivers are all pointing toward spectrum sharing, operators are pushing back as they see spectrum as their key asset, the crucial thing that differentiates them from their competitors. However, the costs of not sharing spectrum are simply too great.
By way of comparison, the argument for sharing infrastructure was won many years ago. Most operators already routinely share infrastructure because it is simply too expensive for all of them to build their own networks. We are having the same argument about spectrum. Shared-access small cells are simply the next logical step in a path that began 20 years ago with the first tower-sharing agreements. I believe the same cost arguments that won out then over the “cell site as differentiator” proposition will win out over “spectrum as differentiator” today.
The significant change in the market dynamics that really invalidates the spectrum as differentiator argument is now there is a large group of stakeholders prepared to pay for their own infrastructure – business and building owners who don’t care about coverage from operator A or operator B. They need service from all of the operators to serve all of their customers. As has been documented by Mobile Experts, “many enterprises are getting desperate for improved mobile coverage and are ready to buy their own infrastructure.”
This desire to deploy their own coverage solution can completely refashion the deployment model of small cells. It has the potential to make “enterprise cellular” comparable to the existing enterprise Wi-Fi market and give operators access to the sort of volumes and scale Wi-Fi vendors already achieve.
These enterprises need a solution that serves all of their customers, not just those on one carrier. This means a multioperator solution, making spectrum sharing an absolute necessity.
Delivering multioperator small cells
Providing multioperator coverage from a single access point reduces the capital and operational cost for each operator by allowing it to share active infrastructure and spectrum. And it must ensure each operator doesn’t lose control of the capacity it is able to offer its customers.
While a single access point can broadcast multiple public land mobile network identities – the access point is seen by all users as a cell within their home network – the key component is a policy-based resource scheduler in the access point that allocates capacity and bandwidth according to predefined rules that are managed by service level agreements. This gives each operator guarantees of resource availability, coverage and quality. Virtual gateways then route the calls and data to the appropriate operator and provide virtualized per-operator traffic reporting.
And if the traffic is too great for a single carrier the same argument still applies. With spectrum sharing – and managing resources across multiple carriers – the quality and performance of the network is maximized. A traffic burst from one carrier doesn’t block the base station, it simply uses underused allocations from another carrier, subject, of course, to the right commercial agreement being in place. When the tables are turned, it can return the favor. The customer wins, every time.
Virtual gateways also are crucial in terms of minimizing the impact on the mobile operator’s existing macro network of deploying more small cells in a network. The virtual gateway wraps all the small cells into a single “underlay” cell, managing handovers to and from the existing macro network as well as handovers between small cells.
This makes the deployment of additional small cells into the network a simple plug-and-play process, enabling cost-effective self installation by smaller businesses, and allowing access point roll outs to be funded by the network operator, channel partners or the end users themselves for a truly scalable small cell network.
And this technology strategy works in spades with the new LTE-U, CBRS and LSA spectrum, turning them from a threat into an opportunity. With spectrum sharing-capable infrastructure in place, the new spectrum can be shared as easily as the old, and used to augment operators’ reach, improving their network performance and customer satisfaction in the key markets they find hard to reach individually.
Nick Johnson founded Ip.access in 1999. Having established Ip.access’ industry-defining GSM product line, he led its 3G technology into partnership with Cisco and the world’s largest residential W-CDMA small-cell deployment with AT&T. Now leading Ip.access’ next-generation technology vision, he has been behind its LTE small cell success and the drive toward Wi-Fi/cellular convergence. Also active at an industry level, he chairs the Radio and Physical Layer Working group and represents Ip.access as part of the Forum’s executive board. Johnson has a PhD in Microwave Scanned Imaging Techniques from University College, London, and an MA in Physics from the University of Cambridge.
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