At the US Telecom Association’s 2nd Annual Executive Business Forum this week in San Jose, CA, Link Hoewing, Verizon’s VP of Internet and Technology Policy, stated that Verizon Wireless plans to roll out LTE in early 2010 (that’s about 18 months from now!) with, "possibily 75M bit/sec downstream rate." 

At the same conference, Robert Brown, Wayport’s Director of Business Development for Strategic Roaming and Managed Services stated that WiFi hot spots are growing very rapidly and that more and more people on the move are using WiFi devices (e.g.cameras, MP3 players, mobile phones) for Internet connectivity. Wayport is largest operator of WiFi hotspots in the U.S. and the largest managed WiFi hot spot service provider (they manage AT &Ts WiFi network).

Note: The agenda and some of the presentations for this excellent conference are at:

http://ustelecom.org/Events/EventSubPages/Second-Annual-USTelecom-Executive-Business-Forum-Agenda.html

Please let me know if you have questions or request for my take on any of the presentations I heard.

So with LTE moving faster than expected at the high end and WiFi hot spots increasing dramatically at the low end, where does that leave mobile WiMAX? We review important take aways from WiMAX World in Chicago and results from SPRINTs XOHM WiMAX launch in Baltimore this week.  Then we offer an opinion and conclusions.   Good reading!

WiMAX World and More….

The 2008 WiMAX World show wrapped up this week in Chicago and offered a nice perspective on the industry and the possibilities of full-mobility, wireless broadband connectivity. This article lists 10 key points from the show.

http://www.wimax.com/commentary/blog/blog-2008/october/Top-10-Key-Take-Aways-from-WiMAX-World-2008

Reaching into WiMAX’s Pocket  By Rhonda Wickham WirelessWeek - October 03, 2008

This week’s WiMAX World wasn’t exactly the all-out enthusiastic trade event you might expect from a technology that launched its first commercial U.S. mobile network the day before the show doors opened. The mood was decidedly tempered as most folks were pondering the economic situation that was playing out on the world stage around them.
What should have been an exuberant time for this new sector was instead tarnished as many conversations were punctuated with financial feasibility questions.

http://www.wirelessweek.com/Reaching-into-WiMAX-Pocket.aspx

Sprint’s 4G Xohm WiMax: How fast is it?

The following link provides an excellent summary of the real world speeds and the real world devices (the Nokia tablet device is especially interesting) available in Sprint’s WiMax deployment in Baltimore. 

http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9116844&intsrc=hm_ts_head 

XOHM WiMAX Broadband Service Debuts in Baltimore

Earlier this week, Sprint officially launched XOHM TM (its mobile WiMAX commercial offering) in Baltimore, MD. “This is truly an historic day with the birth of a completely new Internet-based business model that alters the dynamics of the traditional telecom industry,” explained Barry West, president of Sprint’s XOHM business unit. “Wireless consumers will experience WiMAX device and XOHM service innovation on multiple levels as the computer, Internet, telecom and consumer electronics industries converge to redefine wireless mobility.”

http://www.wimax.com/commentary/blog/blog-2008/september/XOHM-WiMAX-Broadband-Service-Debuts-in-Baltimore-0929

Xohm Could Restrict Usage By Brad Smith, WirelessWeek - October 03, 2008

When Sprint’s Xohm launched in Baltimore earlier in the week, the launch raised some questions about the future. Are there usage restrictions? Are there more devices coming? What about long-term pricing? Where and when will other markets launch?
Atish Gude, senior vice president for mobile broadband operations for Xohm, answered some of those questions Thursday in his keynote to WiMAX World 2008. Others didn’t get answers.

http://www.wirelessweek.com/Xohm-Restrict-Usage.aspx

Alvarion Notches WiMAX Win in the US Heartland with Wisper

Midwest based Wisper chooses Alvarion to supply a dual spectrum WiMAX deployment in both 2.5 GHz and 3.65 GHz. In what is the first dual-frequency deployment of WiMAX radios in the US, Minnesota-based Wisper chooses Alvarion to supply both a 2.5 GHz licensed spectrum solution and a 3.65 GHz lightly regulated spectrum solution.

http://www.wimax.com/commentary/blog/blog-2008/october/alvarion-notches-wimax-win-in-the-us-heartland-with-wisper

DCT/Weissberger Opinion:

For a long time, mobile WiMAX was said to be the first 4G like mobile broadband service with a 3 or 4 year lead time over LTE. However, that window of opportunity for WiMAX is shrinking fast, as the WiMAX commercial rollouts have been delayed while carrier LTE plans and progress have accelerated. There seems to be much more telco focus and endorsement of that technology then WiMAX is enjoying, especially among Tier 1 mobile carriers.

Conclusion:

So it appears mobile WiMAX is being squeezed into a small niche market in developed countries like the U.S. and Europe. In the U.S. we observe expanding WiFi hotspots and WiFi based fixed broadband access putting severe cost pressure on WiMAX. With the financial crisis, how will WiMAX providers justify the high build out and deployment costs when they will have to charge very low rates to compete with free (or almost free) WiFi? What about the cost of mobile WiMAX CPE, especially on PDAs, smart phones, gadgets, etc when WiFi is already built into those for almost no cost?

At the same time, the lead time mobile WiMAX has over LTE deployments is shrinking fast. So where does that leave the market for mobile WiMAX? We have long stated mobile WiMAX would be predominantly used for fixed wireless broadband access in developing countries (without wireline infrastructure) and for DSL substitution in rural areas that can not be cost effectively serviced by DSL. Our opinion has not changed based on this week’s breaking news and conference reports. We also do not see any progress on the "Internet in your pocket" type of Mobile Internet Devices (MIDs) that Intel talked about at our ComSoc SCV January 2008 meeting.

Do you agree with this analysis or do you have a different opinion?

Mr. Largent predicted that going forward, wireless broadband would experience rapid change, higher speeds, and much more choice for consumers. Capabilities such as GPS, video, MP3, photo sharing, location based services (including the ability to get directions to a desired store or restaurant) would be forthcoming.

During the panel session, wireless industry executives indicated that walled gardens were a thing of the past and that wireless networks are opening up. It appeared that some operators would focus on opening the network to devices (Verizon Wireless), while others will likely focus more on applications (Sprint and T-Mobile). AT&T Wireless did not participate in this panel, but was represented in a Mobile Web 2.0 session.
——————————————————————————————————————————-
Definitions:

"Open Networks" is the ability to run an application on all mobile networks (from different providers) without any modification to the software resident in the client device. This is the rationale for the Android platform and Open Mobile Alliance.

There’s also the concept of "Open Applications," which is the ability to publish your application or service without interference from anyone, including the wireless network operator. Example: Google Android (vs. control by Apple over the Apple Store).
——————————————————————————————————————————-

Sprint Nextel

CEO Dan Hesse’s vision of open echoed what Kevin Packingham, Sprint’s Sr. Vice President previously said. Sprint believes that customers want the same accessibility to the Internet from their mobile device that they get from their notebook or desktop PC. But to date, wireless network operators have offered customers their own approved applications running on devices they sell and control. Yet customers ultimately want a choice. Sprint is working hard to help customers get easier access to the mobile Web through personalization and customization.

T-Mobile’s

strategy is a bit less clear. During the keynote, CEO Robert Dotson talked about how important it is to have open devices and open applications. He touted the fact that the company uses GSM-based technology so many consumers can already use third-party devices on the T-Mobile network by putting a T-Mobile SIM card in the device. He also expounded how the carrier hopes to "unleash innovation" through its new developer program and the importance of supporting open source operating systems.

Verizon Wireless

is initially focusing on opening its network to devices. While applications are a big part of the open equation and will likely result in big business for the operator, Verizon believes the key is to first act as a catalyst for the device makers by making it easier for them to get their devices certified and operating on the network. To understand Verizon’s strategy, one needs to broaden the concept of a mobile "device" to think beyond handsets and PC cards. Thermostats, heating and cooling, home appliances, medical devices, airline sensors are all new potential wireless network devices. "Start thinking what it would be like if every thermostat was connected to the network," said Verizon CEO Lowell McAdam. "What if the airline industry put sensors on engines in aircraft to predict failures before they happen? This will impact the way people live and manage their lives."

Sue Marek of Fierce Wireless interviewed Verizon Wireless’ Vice President of Open Development Anthony Lewis, who is charged with developing Verizon’s "open device and application" initiative.  Lewis talked about Verizon’s progress on open networks and why this wireless carrier’s approach is different from its competitors.  Please see:
http://www.fiercewireless.com/ctialive/story/hot-seat-verizons-anthony-lewis/2008-09-17

Conclusions

It seems that operators are finally talking about open networks and open applications. But is it just talk or are they really going to make it happen?  For sure, there is a lot more work to be done to turn the theories and visions into reality.  It would be nice if U.S. wireless networks would become as open as European GSM networks are today.  If it does happen, a much bigger market for wireless data (=non-voice) applications would emerge.  That would surely result in more innovation for developers and more choice for users.  A likely outcome then would be for mobile applications and services to eventually dominate the wireless operator revenue stream, with all participants sharing the revenue in an equitable manner.

References

For CTIA session video clips and photos, please visit:

http://daily.ctia.org/wirelessit08/

For a roundup of SPRINT’s views on open networks, please see:

http://sprintconnection.kansascity.com/?q=node/795

In an opposing point of view:  Skype official calls out carriers on "open" networks

In a strongly-worded letter to the FCC Chairman Kevin Martin, a Skype official complained that the major U.S. wireless carriers were all talk when it came to "open" networks, and that if the Commission wanted to live up to its stated goal of making open networks more accessible, it would affirm that this policy covers wireless networks.

http://www.fiercewireless.com/story/skype-exec-calls-out-carriers-open-networks/2008-09-16?utm_medium=nl&utm_source=internal&cmp-id=EMC-NL-FW&dest=FW

http://www.telecoms.com/itmgcontent/tcoms/news/articles/20017565706.html

• http://www.dot.gov.in/2008/Aug%202008/sprectrum_2.pdf.
• http://www.dot.gov.in/2008/Aug%202008/spectrum_3.pdf

Related Previous Articles:

The Viodi View : : 2nd Update on WiMAX in India article

July 15, 2008 update: More disputes threaten to delay India’s WiMAX 

viodi.com/2008/06/02/update-on-wimax-in-india-article/

[June 19, 2008, Crown Plaza Hotel, San Francisco International Airport] 

 

• Mobile TV Devices: cell phones, notebook PCs, and PND/PMPs equipped with TV tuners
• Home Telecommunications: femto cells for the home, and E911 (E112) for Wireless and VoIP subscribers
• Among recent milestones for the company:
  • Rosum Announces Successful DVB-H Positioning Trial with UK’s National Grid Wireless (6/25/08)
  • 2Wire Selects Rosum TV+GPS Location and Timing Solution for E911/ Home Telecom products using femtocells (3/31/08)
• Rosum Signs Collaboration Agreement with Intel - Will Enable TV-Location on Mobile Devices (10/07)

• Online mapping arms race between Google, Microsoft, Yahoo
• Combination Personal Navigation Device / Portable Media Players (PND / PMPs)
• Convergence of PNDs and Communications devices (i.e., cell phones) 

• Blackberry with Google Maps and GPS positioning
• Apple iPOD Touch with Google Maps and 802.11x (WiFi) based positioning

• Connected (not silo’d) use of location information with two categories foreseen:
  • Groups: self-chosen affiliations, such as Social Networks
  • Swarms: (anonymous) use of location for ITS enhancements
• Resolution of privacy issues (TBD)

• Security and privacy-authentication, authorization, encryption, etc.
• Application integrity - to prevent apps from harming network or users
• Power dissipation and utilization
• Flexibility and customizability
• Integration of new value added services (e.g. location)
• Billing: What to charge for a new service? Flat rate vs. Usage based (metered)

• New York, NY (VZ: 119 MHz)
• Chicago, IL (VZ: 101 MHz)
• Philadelphia, PA (VZ: 99 MHz)
• Boston-Lowell-Brockton-Lawrence-Haverhill, MA-NH (AT&T: 99 MHz, VZ: 97 MHz)
• San Francisco-Oakland, CA (AT&T: 97 MHz)
• Washington, DC-MD-VA (AT&T: 99 MHz, VZ: 109 MHz)
• Dallas-Forth Worth, TX (AT&T: 124 MHz)
• Houston, TX (AT&T: 99 MHz)
• Miami-Fort Lauderdale-Hollywood, FL (VZ: 96 MHz)
• Baltimore, MD (AT&T: 99 MHz, VZ: 109 MHz)
• Minneapolis-St. Paul, MN-WI (VZ: 99 MHz)
• Atlanta, GA (AT&T: 99 MHz)
• Denver-Boulder, CO (AT&T: 99 MHz)
• Tampa-St. Petersburg, FL (AT&T: 99 MHz)
• Cincinnati, OH-KY-IN (VZ: 111 MHz)
• Kansas City, MO-KS (VZ: 114 MHz)
• Buffalo, NY (AT&T: 119 MHz)
• San Jose, CA (AT&T: 97 MHz)
• Hartford-New Britain-Bristol, CT (AT&T: 109 MHz)
• Bridgeport-Stamford-Norwalk-Danbury, CT (VZ: 119 MHz)
• Toledo, OH-MI (VZ: 104 MHz)
• New Haven-West Haven-Waterbury-Meriden, CT (VZ: 99 MHz)
• Syracuse, NY (AT&T: 101 MHz)
• Gary-Hammond-East Chicago, IN (AT&T: 99 MHz)
• Northeast Pennsylvania, PA (VZ: 104 MHz)
• Tulsa, OK (AT&T: 99 MHz)
• Allentown-Bethlehem-Easton, PA-NJ (VZ: 99 MHz)
• New Brunswick-Perth Amboy-Sayreville, NJ (VZ: 119 MHz)
• Springfield-Chicopee-Holyoke, MA (VZ: 99 MHz)
• Youngstown-Warren, OH (AT&T: 117 MHz)
• Wilmington, DE-NJ-MD (VZ: 99 MHz)
• Long Branch-Asbury Park, NJ (VZ: 119 MHz)
• Raleigh-Durham, NC (VZ: 99 MHz)
• West Palm Beach-Boca Raton, FL (VZ: 96 MHz)
• Fresno, CA (AT&T: 115 MHz)
• Austin, TX (AT&T: 104 MHz)
• Wichita, KS (AT&T: 97 MHz)
• Las Vegas, NV (AT&T: 99 MHz)

Questions to Ponder in light of AT&T and VZ Wireless Spectrum Grab

With the two giant wireless companies opting for LTE as a 4G technology, where does that leave Mobile WiMAX (Sprint, Clearwire), which will not have roaming or interoperability with the 2 U.S. carriers which have the most spectrum ? 

Where are the new carriers that were supposed to emerge, e.g. Frontline Wireless? 

Will there be any competition left for rural markets, which are currently underserved?

Will one or more companies build a heterogeneous network  for public safety (aftter the D Block auction failure)?

———————————————————————————————————————————————————————

 Addendum:  Subsequently published articles on this topic:

1.   How much spectrum do AT&T and Verizon have?

"According to analysis from Alan Weissberger with DCT Advisors, AT&T or Verizon exceeds the 95 megahertz threshold in eight of the top 10 U.S. markets, 17 of the top 25 markets and 38 of the top 100 markets. See his chart of these markets here. In the Dallas-Fort Worth market, for instance, AT&T now holds 124 megahertz of spectrum."

http://www.fiercebroadbandwireless.com/story/how-much-spectrum-do-att-and-verizon-have/2008-04-28

2.  SPECTRUM HANGOVER- 
Carriers’ binge on spectrum assets bring competitive concerns

The author interviewed me but was skeptical about the spectrum exceeding the 95MHz Dobson screen, which does not count AWS spectrum.  It is not known whether the numbers in my table include or exclude AWS.

http://www.rcrnews.com/apps/pbcs.dll/article?AID=/20080426/SUB/236962331/1005

And now for the hype: "This is all about fourth-generation growth," said Verizon spokesman Jim Gerace, referring to the next phase of cellphone technology based on faster networks and more sophisticated devices.

Some of the spectrum Verizon acquired is required to be open to all applications and devices. An open platform will draw application developers to Verizon’s service, which will make it more popular with customers, Mr. Gerace said. Verizon Wireless, jointly owned by Verizon Communications Inc. and Vodafone Group PLC, shelled out $9.4 billion on licenses.

Rival AT&T, meanwhile, said that its newly acquired spectrum will allow it to beef up the quality of its current services as well as transition to faster, more advanced wireless broadband services.   

http://online.wsj.com/article/SB120728418087789277.html?mod=rss_whats_news_technology

Opinion:  We are very disappointed with the auction results:  No new nationwide wireless network, no new network providers, public safety left out in the cold, and uncertainty on what Dish Network Inc will do with the spectrum they won.   Let’s focus on the failure of the D block auction, with public safety the big loser.

When I was interviewed for a MacNeil-Lehrer Newshour article on the 700MHz auction, I tried to emphasize that the failure of the D Block auction (to attract a minimum bid) was a disaster for public safety. Unfortunately, the writer did not include that info in the article. Here’s the quote and url:

"No one knows what the other players are going to do, because this spectrum doesn’t dictate what wireless technology you use," said Alan J. Weissberger, a Silicon Valley telecommunications consultant with DCT Advisors.

http://www.pbs.org/newshour/updates/science/jan-june08/spectrum_03-28.html

On Mar. 4, India’s Tata Communications , an emerging broadband wireless service provider, announced the countrywide rollout of a commercial WiMax network in India, the largest anywhere in the world of the high-speed, wireless broadband technology.

Already 10 Indian cities and 5,000 retail and business customers use the product, and by next year Tata will offer service in 115 cities nationwide. The folks at Tata can hardly contain their excitement. "WiMax is not experimental, it’s oven-hot," says Tata’s Prateek Pashine, in charge of the company’s broadband and retail business.

http://www.businessweek.com/globalbiz/content/mar2008/gb20080312_47…

But will this really be one of the largest WiMAX networks in the world?

On Friday evening, March 21st, we heard directly from the Indian IT minister Mr. Raja¹,  that only 10M WiMAX subscribers were expected by 2011.  That was quite disappointing for a country that has over 1 B residents!

So there is obviously a huge disconnect from what is reported in the business/ trade press and what the Indian government knows.  This seems like more hype for the already way over hyped WiMAX market potential.

1. Tamil Manram hosted a dinner reception for Honorable Minister for Communication and Information Technology, Mr. A. Raja. The event took place at India Communicy Center in Milpitas, CA.

"But the excited momentum (of Muni WiFi) has sputtered to a standstill, tripped up by unrealistic ambitions and technological glitches. The conclusion that such ventures would not be profitable led to sudden withdrawals by service providers like EarthLink, the Internet company that had effectively cornered the market on the efforts by the larger cities.  Now, community organizations worry about their prospects for helping poor neighborhoods get online.

 

In Tempe, Ariz., and Portland, Ore., for example, hundreds of subscribers have found themselves suddenly without service as providers have cut their losses and either abandoned their networks or stopped expanding capacity."

Promoted as the most important FCC auction in decades, it appears that the 700 MHz auction has been a failure on several fronts.  We were promised private operator-public safety partnerships (for the D Block) along with a new nationwide wireless broadband network (Frontline Wireless’ initiative), open access for any device and any application (Google’s petition), and new entrants (e.g. start-up carriers and WISPs) that would take advantage of the excellent propagation properties of the 700 MHz spectrum.  There was also talk about regional carriers and WISPs bidding on the spectrum for mobile WiMAX deployment.  But few if any of these visions will be realized, in our opinion.  

However, a big positive we see is that the FCC will raise double the minimum reserve amount of $10B.  That means approximately $20B to the US Treasury.  Do you think that will make a dent in the federal budget deficit?  All blocks auctioned (see next section below), with the notable exception of the D block, have raised more then the reserve requirement.

Objectives and Process for FCC 700 MHz Auction 73

700 MHz spectrum has been occupied by TV broadcasters and is being made available for new commercial wireless mobile and public safety services as a result of the Digital Television (DTV) transition in February 2009 [1].

• License Term is 10 Years, with geographic and service provision obligations
• Auction 73 includes 1,099 licenses in the 700 MHz Band:
  • 176 EA licenses in the A Block,
  • 734 CMA licenses in the B Block,
  • 176 EA licenses in the E Block,
  • 12 REAG licenses in the C Block, and 1 nationwide license in the D Block, to be used as part of 700 MHz Public/Private Partnership
• Aggressive Auction Timing
  •   January 24, 2008 bidding for licenses
  •   June 2008 – payment
  •   February 2009 – Spectrum cleared
• Spectrum Bandwidth – 62 MHz total
  •   Lower 700 Blocks A, B 2 x 6 MHz paired
  •   Lower 700 Block E 6 MHz unpaired
  •   Upper 700 Block C 2 x 11 MHz paired
  •   Upper 700 Block D 2 x 5 MHz paired
• Channelization permits separation of uplink (device to base station) and downlink (base station to device)
• Can use separate frequencies (FDD) or separate timeslots (TDD)
• Anonymous bidding for the first time (no one really knows who is bidding or winning)
• Auction will not close until bidding on all Blocks cease (no one knows when that will be, but the money being raised now is insignificant compared to what’s been committed.)

For a more extensive backgrounder, please refer to our earlier research on this topic:

Speculation Mounts as FCC’s 700MHz Auction Application Deadline Nears

What’s Happening Now- Especially the important D Block

As the auction winds down after 132 rounds of bidding, the commission has raised $19.6 billion.  During the last round held Friday morning, 25 new bids brought in a meager $644,000.  That negligible amount has been the pattern of late as the bids keep dribbling in at lower and lower values. 

Some of the bids during the last round were for E Block slices in Maryland, Delaware, Louisiana, Virginia, Georgia and A Block slices in Georgia, Kentucky, North Dakota and South Carolina. So far, the FCC has auctioned off 1,089 licenses with winning bids on them.  Denver’s E-Block license received the largest bid, drawing an offer of $640,000 to reach $23.1 million. Bidding for the B Block centered in the Eastern U.S. while E Block activity remained in the Midwest and Southwest.

The D Block bidding stalled in the first round and even the FCC admits the reserve of $1.3B will not be met ($472M has been bid to date).  Frontline Wireless was planning to bid for the D Block, but they shut down after failing to raise $1.3B reserve price.  If the auction ends and the D Block falls short of the reserve price, the FCC has two options:

• Rewrite the rules of the auction to eliminate the public safety requirement, or
• Request Congress to give a fully or partially funded mandate to build and operate a dedicated public safety network.

The D Block bidding failure underscores the financing dilemma given the stringent network build out requirements imposed by FCC and limitations of the 20 MHz designated for the shared public/ private network.  Before its demise, Frontline Wireless estimated build out costs to be at least $10B.  This was in addition to costs associated with spectrum acquisition. Licensee is also responsible for cost of relocating narrowband operations, capped at $10M.  Public safety communications today is via a raft of incompatible networks and that does not appear likely to change with the D Block bidding failure.

Our opinion on the D block:  Perhaps the FCC should not even license the D block, but leave it as unlicensed spectrum.  Colleague Ken Pyle writes that FCC Working Report #43 looks at the idea of using market-based mechanisms to designate particular blocks of spectrum as either unlicensed or licensed. Currently, this licensed or unlicensed designation is determined by administrative process that can be influenced by, as the FCC states in their press release, “interested parties.”

Getting the Auction Back on Track (Source: Yankee Group Briefing Feb 27, 2008)

The Yankee Group states:  To revitalize commercial interest, FCC has several options:

• Re-offer the license on the same terms in a subsequent auction- an unlikely scenario
• Re-auction under different terms: Throw out the public-private partnership requirement and/or extend the time frame for completing the build out beyond the current 10 years,  reduce the price and remove the wholesaling rights
• Abolish the requirement that the winner shares its national wireless network with public safety groups. In this scenario, the FCC will need to explore and come up with a new funding model for public safety.
• Allow multiple companies to bid, and jointly build out a network. Note: this is not allowed under the current rules.

Senator Blasts 700 MHz Auction

Sen. Mark Pryor (D-Ark.), a member of the highly influential Senate Commerce Committee, declared the yet-to-be-completed 700 MHz auction a disaster, saying that the FCC allowed dominant wireless companies such as Verizon Wireless and AT&T to control the auction. He said this to some 500 broadcasters at the National Association of Broadcasters’ State Leadership Conference in Washington, D.C.

He also characterized the FCC of being "secretive," with FCC Chairman Kevin Martin carrying "an agenda into their agenda." I don’t really understand what that means, but obviously there are some partisan politics involved.   Pryor was quoted as saying in Broadcasting & Cable that "history will show that the way the FCC structured the auction basically helped the two big wireless companies [Verizon Communications and AT&T] to the detriment of competition in this country."  But how does he know that, as the auction is supposed to be anonymous?

http://lists.fiercemarkets.com/c.html?rtr=on&s=69l,xy1f,8mf,i5zc,16aw,3ma8,9u1c

Additional Fierce Wireless 700 MHz Auction coverage

Yankee Group’s Opinion on Likely Winning Bidders (Source: Yankee Group Briefing Feb 27, 2008)

AT&T is seen winning the A block, which it is likely to use for mobile Internet and mobile TV.  Regional operators (rural carriers and WISPs) taking the B block for mobile WiMAX and mobile Internet.  Verizon is likely to take the C block and use it for3G LTE and 4G mobile Internet.  Qualcomm could be bidding on the E block for Media Flow or other ways of broadcasting mobile content.

Conclusions and Recommendations (Source: Yankee Group Briefing Feb 27, 2008)

• Inherent conflict between auction goals of revenue maximization and increased competition
• Advantage to Mobile Incumbents over Innovative Challengers
• Where are Google and Media/Internet Bidders?
• Broadcasters lose in the Future of Mobile TV (assuming they have not submitted winning bids)
• Advantage to 3G LTE over Mobile WiMAX;  Verizon and AT&T over Sprint/Clearwire (who probably did not bid)
• Questionable commitment to Open Access
• Big loser is Private Operator- Public Safety Partnership [2]
• Watch for the last minute surprise????

Summary and Conclusions (this author)

We agree with the Yankee Group, except we don’t expect any last minute surprises.  Until the license awards are made public, we don’t know who the actual winning bidders are.  However, we expect Sen. Pryor has credible information that AT &T and Verizon will control much of the spectrum.  Hopes for public-private partnership, as well as a nationwide broadband wireless network have been dashed with the failure of the D Block bidding process.  The big wildcard is what Google has done and will do.  If it has submitted a winning bid, will they contract with a network operator to build out a wireless broadband network in any parts of the U.S.  How will they get their “any device connected to the network and any application,”  if they don’t control the network itself?

[1]The Digital Television and Public Safety Act of 2005 established February 17, 2009, as the cutoff date for over-the air analog transmissions. It will force broadcasters to vacate spectrum in the 700 MHz band. 24 MHz has been designated for interoperable communications systems for first responders, with the remainder will be available for commercial wireless services.

[2] Another big loser, in our opinion, is the vision of a new nationwide broadband wireless network.  Since there are no new entrants to fund such a build-out, we think LTE will be a big winner, with mobile WiMAX being a big loser.