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8/7/2019 rysavy-spectrum-effects-301611
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TheSpectrumImperative:
MobileBroadbandSpectrumandits
ImpactsforU.S.Consumersandthe
Economy
AnEngineeringAnalysis
March 16, 2011
Copyright©2011RysavyResearch,LLC.Allrightsreserved.
http://www.rysavy.com
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Table of Contents
EXECUTIVE SUMMARY ............................................................................................ 3
INTRODUCTION ...................................................................................................... 3
SPECTRUM AND CAPACITY ..................................................................................... 5
APPLICATION AND USER DEMANDS ....................................................................... 9
ADVERSE APPLICATION EFFECTS ......................................................................... 17
MARKET EFFECTS.................................................................................................. 20
CONCLUSION ........................................................................................................ 21
Rysavy Research provides this document and the information contained herein to you for informational
purposes only. Rysavy Research provides this information solely on the basis that you will take
responsibility for making your own assessments of the information.
Although Rysavy Research has exercised reasonable care in providing this information to you, Rysavy
Research does not warrant that the information is error-free. Rysavy Research disclaims and, in no event,
shall be liable for any losses or damages of any kind, whether direct, indirect, incidental, consequential, or
punitive arising out of or in any way related to the use of the information.
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3
ExecutiveSummary
Thepurposeofthisreportistoanalyze,fromanengineeringperspective,theconsequencesoffailingto
makenewspectrumavailabletoconsumers,theeconomyandthewirelesssector.Thisreportdiscusses
howspectrumrelatestocapacity,howdifferenttypesofapplicationsanddevicescanconsumeavailable
capacity,andtheeffectsofinsufficientspectrum.
For consumers, these effects include unreliable service and performance and potentially higher
connectivity costs—adevelopmentthatwould placeanessentialmodern serviceout of thereachof
manyAmericans, includingthosewhostandto gain themostfromallthatmobileconnectivityhasto
offer.Totheextentthatserviceprovidersrespondtocapacityconstraintsbylimitingdemandthrough
usagecapsandsignificantlyhigherpricing,consumers’abilitytoaccesstheInternetmaybelimitedor
comeatahighercost.Theseeffectswillparticularlyharmthose,includingmanyminoritiesandlow-
incomeAmericans,whoprimarilyrelyontheirmobiledevicestoaccesstheInternet.Thisinturnrolls
back the promise of mobile connectivity and innovation, denying access to critical services and
opportunities.
Themarketconsequenceofsuchanenvironmentwillbelessincentiveforbusinessestoinvestinnew
applications, services anddevicesbecauseperformance,andthuscustomerenthusiasm,will likelybe
subpar.Thisjeopardizesthe2.4millionAmericanjobscurrentlysupportedbymobileinnovation.And,
theultimatepriceofthisdownwardspiralisalossofU.S.leadershipintheglobalinnovationeconomy.
Introduction
U.S. mobile innovation continues to surge forward, fueled by a combination of faster networks,
powerful next-generation wireless devices, including smartphones and tablets, and innovative
applications that take increasing advantage of our constant state of connectivity. Lifestyles areenhancedandworkismoreproductive,asthefullandgrowingvalueoftheInternetisincreasinglyever-
presentandaccessibleinthepalmsofourhands.
Compellingdataalreadyexiststoillustratetheimportantrolethatmobiletechnologyplaysinpowering
our innovation economy and empowering American consumers and businesses. And, we see clear
evidencetodaythatwirelessbroadbandishelpingtobridgethedigitaldivide,withminorityandlower-
incomeAmericansincreasinglyturningtomobileservicesastheirprimaryconnectiontotheInternet.
The number ofU.S. consumers with broadband access on theirmobile device has risen from three
millionin2006to73millionin2008.1Asearlyas2014,morepeoplemaygoonlineviamobiledevices
than PCs.2 And,within this decade an estimated 10 billion devices—from themedical tablet at the
1Source:“USBroadbandRanking:DoesitMatter?,” PCWORLD,June5,2009.
2Source:MobileInternetReport,MorganStanley ,December2009.
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hospital, to thetextbookin yourchild’sschool to thethermostat inyourhome—will beperpetually
connectedthankstoubiquitouswirelessbroadbandtechnology.3
Mobile broadband is providing new business opportunities across vertical markets, including the
automotive,banking,consumerelectronics,transportation,andutilitiesindustries.Already,thereare
vehicleaccidentrecoveryapplications,mobilepaymentandonlinebankingapplications,remotehealthmonitoringdevices,smartutilitymeters,refrigerators,pictureframes,pillbottlecaps,trafficlights,and
parkingmetersthatusemobiletechnology.Mobile connectivity ispoisedto transformvirtually every
sector of the U.S. economy—from commerce to health care, education to energy efficiency. This
mobility-enhanced world, however, depends on a constant, reliable flow of bits between people,
devicesandtheInternet.Asmobiledevicesbecomemorepowerful,asdeviceresolutionincreases,as
usersemploymoreapplicationsandasconnectivityincreasinglyisembeddedinvirtuallyeverymanner
ofmachine,thisflowofbitsisincreasingatadramaticrate.
Theamountofbandwidthavailabletoeachuserdependsonmanyfactors.Butoneofthemostcritical
is the amount of radio spectrum available. As FCC Chairman Julius Genachowski has stated, “theexplosivedemandforwirelessinnovationistestingthelimitsofafundamentalresource:spectrum.Itis
theoxygenofthewirelessworld—fuelingeveryaspectofourmobilebroadbandecosystem.”4
Ciscorecentlyreportedthatin2010,globalmobiledatatrafficgrew2.6fold,nearlytriplingforthethird
year ina row.5Within three to fouryears,RysavyResearch estimates that ournation’sappetite for
wirelessconsumptioncouldoutstripexistingcapacity.Whilecarrierswillattempttoalleviatecongestion
in the short-term by offloading traffic using femtocells and picocells, mobile innovation will falter
without access to the substantial additional spectrum that American consumers and businesseswill
soonneed,andtheconsequencesofinactionforthenationareunacceptable.
Recognizingtheurgencyofthesituation,theObamaAdministrationandtheFCCplantomake300MHz
ofnewspectrumavailableoverthenext5yearsand500MHzoverthenext10years,6almostdouble
the547MHzofspectrumcurrentlylicensedformobilebroadband.7
3Source:Id .
4Source:TheHill ,“Spectrum:oxygenofwirelessworld,”JuliusGenachowski,September24,2009.
http://thehill.com/special-reports/technology-september-2009/60265-spectrum-oxygen-of-wireless-
world.
5Source:Cisco,“CiscoVisualNetworkingIndex:GlobalMobileDataTrafficForecastUpdate,2010-2015,”
February1,2011.6Source:FCC,“ConnectingAmerica,TheNationalBroadbandPlan,”March2010;TheWhiteHouse,
PresidentialMemorandum:UnleashingtheWirelessBroadbandRevolution(June28,2010).
http://www.whitehouse.gov/the-press-office/presidential-memorandum-unleashing-wireless-
broadband-revolution.
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Asconsumers race toembraceall thatwireless broadband connectivity hasto offer andU.S.mobile
innovationcontinuestoadvanceatanastoundingpace,thereisaclearandcompellingnationalinterest
inensuringadequatespectrumisavailabletocontinuethisprogress.Unfortunately,wecannotsimply
flipaswitchandmakemorebroadbandspectrumavailable;ittypicallytakesseveralyearsforspectrum
toberepurposedandreleasedintothemarketplace.8Andtheclockistickingwithrisingdemandrapidly
closingthegapwithexistingsupply.Theconsequencesof inactionaresevere,widespreadandwholly
negative forconsumersandtheU.S.economy.Equallytrue, thesesubstantialadverseimpactscanbe
avertedwithboldandtimelyleadershiptoday.
SpectrumandCapacity
Tounderstandwhyadditional spectrum is so crucial, onemustunderstandhowspectrum relatesto
capacity and how quickly users can consume what is available to them. This is especially true for
consumers who live in population-dense urban environments, where the upper limits of current
spectrumcapacityarelikelytofirstbereachedandtested.
Modernwirelessnetworksaredigital,meaningtheycommunicatebinarydata.Theamountofdatathat
aradiochannelcancarrydependsonthewidthoftheradiochannel,themodulationused,andhowthe
dataisencoded.Eachwirelesstechnologyusesradiochannelsofcertainwidth.Forexample,CDMA2000
(asusedbySprintandVerizon)radiochannelsareeach1.25megahertz(MHz)widewhereasHighSpeed
Packet Access (HSPA as used by AT&T and T-Mobile) radio channels are 5 MHz wide. Long Term
Evolution(LTE)radiochannelscanrangefrom1.4MHzinwidthto20MHz.
Toderivecapacity,wemustlookat thiswidthof theradiochannelandconsidertheaveragespectral
efficiencyof thetechnology intypicaldeployments.For this purpose, spectral efficiencyis definedas
howmanybitspersecondagivenamountofspectrumcancarryandismeasuredasbitspersecondper
Hzof spectrum. HSPA in typical deploymentshas a downlink (base station tomobile user) spectral
efficiency value of about 1.0 bps/Hz.9 This means a 5 MHz HSPA radio channel has an aggregate
downlinkcapacityof5millionHzmultipliedby1.0bps/Hz,whichequatesto5.0millionbitspersecond,
or5.0Mbps.10Thisisthetotalcapacityinacellsector
11forthatradiochannel,acapacitythatmustbe
7Source:FCC ,“ConnectingAmerica,TheNationalBroadbandPlan,”March2010,at85,Exhibit5-F.
8Source:Id .at70,Exhibit5-C.
9Foradetaileddiscussionofspectralefficiencyandspectralefficiencyvaluesofdifferenttechnologies,
refertopage51ofRysavyResearch,“Transitionto4G,”September,2010,http://www.rysavy.com/Articles/2010_09_HSPA_LTE_Advanced.pdf .1.0bps/Hzassumesahighlevelof
technologyenhancementandmostexistingHSPAnetworksoperateatspectralefficienciesonlyhalfor
twothirdsofthisvalue.10 In general, modernwireless technologies operatemore efficientlywith wider radio channels. This
effectisnottakenintoaccountinthecalculationsofcapacityinthispaper.
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sharedbymultipleusers.The5MHzradiochannelactuallytranslatesto10MHzofspectrumusedsince
thereisaseparate5MHzradiochannelfortheuplink.
LTEhasahigherspectralefficiencyandcanoperateinwiderradiochannels.Forexample,anLTEradio
channel of 10 MHz has a downlink spectral efficiency value of 1.5 bps/Hz and would thus have a
downlink capacity of 15 Mbps. There is also an uplink channel of 10 MHz with a typical spectralefficiencyvalueof.65bps/Hz,equatingtoanuplinkcapacityof6.5Mbps.Together,theLTEdownlink
anduplinkchannelsconsume20MHzofspectrum.
The question then is how much total capacity an operator actually has for mobile broadband. This
dependsonhowmuchspectrumtheoperatorhasandthedistributionofcellsites.Morecellsitesmean
fewerpeoplehavetosharetheradiochannelsincethatradiochannelisservicinga smallerarea.But
therearelimitstohowmanycellsitescanbepracticallydeployed,withmostoftheeasiest-to-deploy
locationsalreadyinuse.
Inaddition,whenevaluatingthetotalcapacity, thespectrumanoperatorneedsto supportvoiceandlegacyservices,suchas2G,willreducethetotalamountofspectrumavailableformobilebroadband.
12
RysavyResearchestimatesthatforatypicaloperator,roughly20MHzisneededforvoiceserviceinany
coveragearea.Subtractingthisspectrumrequirementforvoicefromtotaltypicalamountsofspectrum
thatoperatorshave,mobile-broadbandtechnologiessuchasHSPAorLTEcouldbedeployedtosupport
mobilebroadbandserviceinabout30to80MHzofspectruminacoveragearea,assumingatypical
upperlimitofabout100MHzoftotalspectrumavailabletooperatorsinanymarket.Sixchannelsof
HSPA,each5MHzwide(usingseparatechannelsforthedownlinkanduplink),wouldrequireatotalof
60MHz.Alternatively,three10MHzLTEchannelswouldrequire60MHzandfour10MHzLTEchannels
wouldconsume80MHz.Note,however,thatanoperatoronlydeploysasmanyradiocarriersasneeded
tomeetcapacityrequirementsforthatcellsector.
Table 1 shows how cell sector capacity relates to different technology configurations, including the
numberof radiocarriersthatmightbedeployed.Forexample,anHSPAoperatorthathasdeployed2
HSPA radiocarriers in a cell sitewouldconsume 20MHz of spectrumand wouldhave 10Mbps of
aggregatedownlinkcapacityineachsectorand5Mbpsofuplinkcapacityineachsector.Notethatother
currently deployed broadband technologies such as EV-DO andWiMAX havea comparable spectral
efficiencytoHSPA.
11Mostcellsitesaredividedintothreesectors,soeachcellsector(pie-sliceshape)representsonethird
ofthecoverageofacelltower.12Forexample,operatorswithHSPA,a3Gtechnology,alsoneedsomespectrumavailableforGSM,a2G
technology.
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Table1:SpectrumUsedandSectorCapacityforDifferentConfigurations
Technology
RadioCarrier
Width(MHz) Carriers
TotalSpectrum
Used(MHz)
Downlink
Spectral
Efficiency
DownlinkSector
Capacity(Mbps)
UplinkSpectral
Efficiency
UplinkSector
Capacity(Mbps)
HSPA 5 1 10 1.0 5 0.5 3
2 20 10 5
3 30 15 8
4 40 20 10
5 50 25 13
6 60 30 15
LTE 10 1 20 1.5 15 0.65 7
2 40 30 13
3 60 45 20
4 80 60 26
Note:LTEcanbedeployed inradiochannelsrangingfrom1.4to20MHz.10MHzisatypicaliniti alconfigurationforsomeoperators.
Nowlet’sexaminemarketconditionswithrespecttospectrumintwoU.S.cities,PhiladelphiaandSan
Diego.Inthosetwomarkets,thereareatleastfivewirelesscarrierswith40MHzormoreofspectrum,
accordingtotheFCC’sSpectrumDashboard.13
InPhiladelphiaandSanDiego,AT&TandT-MobileofferGSMandHSPAservice.14Clearwireoffersa4G
WiMaxmobile servicein Philadelphiaandhas plans to launch4Gservicein SanDiego this year.15In
Philadelphia,SprintNextel,throughitsrelationshipwithClearwire,hasa3GCDMAEV-DOandWiMAX
service offering and offers 3G service in San Diego.16 Verizon launched its 4G LTE service this past
DecemberandalsooffersCDMAEV-DOserviceinbothmarkets.17
UsingthemobilewirelesspenetrationratedeterminedbytheFCCinitslatestcompetitionreportforthe
PhiladelphiaandSanDiegoEconomicAreasagainsttheU.S.CensusBureau’slatestpopulationdata,the
13TheSpectrumDashboardmaynotfullyreflectallofthespectrumandownershipelementsinthetwo
marketsbutprovidesausefulproxyforthisanalysis.Source:FCC ,“SpectrumDashboard,”
http://reboot.fcc.gov/spectrumdashboard/searchMap.seam(lastvisitedonMar.9,2011);Morgan
Stanley ,“TheMobileInternetReport,”2009.14Source:AT&T,http://www.wireless.att.com/learn/why/network/index.jsp?wtSlotClick=1-00245D-0-
1&WT.svl=calltoaction(lastvisitedJan.27,2011);T-Mobile, http://t-mobile-coverage.t-mobile.com/4g-
wireless-technology?uid=Coverage_2 (lastvisitedJan.27,2011).15Source:Clearwire,http://www.clear.com/coverage(lastvisitedJan.27,2011);CraigHowie,“Tech
Trends:ClearMobileDeviceLetsYouTake4G(or3G)InternetAccesswithYou,” L.A.T IMES,Nov.29,
2010,http://articles.latimes.com/2010/nov/29/business/la-fi-clear-4g-20101130 .16Source:SprintNextel,http://coverage.sprintpcs.com/IMPACT.jsp?INTNAV=ATG:HE:Cov (lastvisited
Jan.27,2011).17Source:VerizonWireless,“VerizonWirelessLaunchesTheWorld’sLargest4GLTEWirelessNetwork
OnDec.5”(Dec.4,2010),http://news.vzw.com/news/2010/12/pr2010-11-30a.html ;VerizonWireless,
http://aboutus.vzw.com/bestnetwork/network_facts.html(lastvisitedJan.27,2011).
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estimatednumberofmobilewirelesssubscribersinPhiladelphiaisabout1.45millionandinSanDiego,
about1.3million.18Thereareanestimated1,450cellsitesinPhiladelphiaand1,200sitesinSanDiego,
witheachsitecoveringabout1,100subscribers.19Withthreesectorscommonlyusedatcellsites,we
will assume there areabout 360 subscriberspercell sector. In Philadelphia, there arean estimated
660,000adultsthataccesstheInternetwirelesslyandmorethan570,000inSanDiego.20
Thedemographicmakeupofthesetwocitiesisasfollows:
• Ofthemorethan1.5millionresidentsinPhiladelphia,53.2%arefemale;43.5%white;42.7%
blackorAfricanAmerican;11%HispanicorLatino;5.5%Asian;76%are18yearsandolderand
12.7%are65yearsandolder.21ThemedianhouseholdincomeinPhiladelphia is$36,669,and
thepercentageoffamiliesandindividualsthatarebelowthepovertylevelare19.2%and24.2%,
respectively.
• Of San Diego’s 1.3 million residents, 49.7% are female; 66.7%white; 6.8% black or African
American;27.3%HispanicorLatino;14.8%Asian;77.6%are18yearsandolderand10.7%are65yearsandolder.
22Themedianhouseholdincomeis$61,962,andthepercentageoffamilies
andindividualsthatarebelowthepovertylevelare8.8%and13.1%,respectively.
18Source:AnnualReportandAnalysisofCompetitiveMarketConditionsWithRespecttoMobile
Wireless,IncludingCommercialMobileServices,WTDocketNo.09-66,FourteenthReport,25FCCRcd
11407,11644TableC-3(2010);USCensusBureau, http://factfinder.census.gov (searchusing
“Philadelphia”and“SanDiego”)(lastvisitedJan.27,2011).Noteweareusingestimatesbasedon
generallyavailablenumbers.19Source:Dr.RobertF.Roche&LesleyO’Neill,CTIA,“CTIA’sWirelessIndustryIndices,”161,November
2010,at161(providingmid-year2010resultsandcalculating1,111subscriberspercellsite).Cellsite
estimatesbasedontheestimatednumberofsubscribersinPhiladelphiaandSanDiegoagainstthe
averagenumberofsubscriberspercellsite.Source: Id .at8.20EstimatesbasedonpercentageofAmericanadultsthathaveawirelessconnectionandusealaptop
orcellphonetoaccesstheInternetasdeterminedbythePewInternetandAmericanLifeProject(Pew
Internet),i.e.,57%,comparedtotheestimatedpopulationofpeopleinPhiladelphiaandSanDiegothat
are18yearsorolder.Source:SusannahFox,“MobileHealth2010,”PewInternet(Oct.19,2010),
http://www.pewinternet.org/Reports/2010/Mobile-Health-2010.aspx ;U.S.CensusBureau,
http://factfinder.census.gov (searchusing“Philadelphia”and“SanDiego”).21Source:USCensusBureau, http://factfinder.census.gov (searchusing“Philadelphia”)(lastvisitedJan.
27,2011).22Source:USCensusBureau, http://factfinder.census.gov (searchusing“SanDiego”)(lastvisitedJan.27,
2011).
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Accordingto arecentreportreleasedby thePewResearchCenter’sInternet&AmericanLifeProject,
minoritygroupsaretheleadingdemographicsegmenttoadoptmobileservices.Pewfoundthat63%of
Hispanics and 64% of African Americans access the Internet wirelessly,more thanwhites at 57%.23
Lower-incomepeople,independentofrace,alsoareincreasinglylikelytoaccesstheInternetwirelessly,
accordingtoPew.24ANationalHealthInterviewSurveyshowedmorethan26%ofhomesarewireless-
onlyanddonothavealandlinetelephone,withadultslivingatornearpovertymorelikelythanhigher-
incomeadultstoliveinwireless-onlyhouseholds.25Moreover,Hispanicadultsat34.7%andblackadults
at 28.5% were more likely than white adults at 22.7% to be living in a wireless-only household.26
Assumingthesetrendsholdtrue,thereisahigherpercentageofresidentsinPhiladelphia,andahigher
percentageofHispanicsandLatinoslivinginSanDiego,whorelyonmobilebroadbandastheirprimary
connectionthanthenationalaverageduetothedemographicsofthesemarkets.27
Aswewillseein thenextsection,arelativelysmallpercentageof thesubscribersinPhiladelphiaand
SanDiego,and/orseeminglysmallshiftsinthekindsofdevicesand/orapplicationscommonlyused,can
easilyoverwhelmtheavailablecapacityofagivencellsiteantennasectorbasedoncurrentlyavailable
spectrum.
ApplicationandUserDemands
InmarketslikePhiladelphiaandSanDiegoandaroundthecountry,evermoresophisticatedapplications
presentfast-growingdemandsonthenetwork.Wherease-mailandwebbrowsingofrelativelystatic
contentpresent aminimal load, streaming applications, such as the PandoramusicorNetflixvideo
applications, can consume large amounts of available bandwidth because this more data-intensive
content has to be continually and reliably delivered. Over the last four years, consumers have
increasinglycometorelyontheirwirelessbroadbanddevicesforhigh-bandwidthapplications.Evena
seeminglysubtleshiftintimeandconsumptionhabits—orevenupgradingadevice—candriveupdata
usagebyseveralordersofmagnitude.
23Source:AaronSmith,“MobileAccess2010,” PewResearchCenter’sInternet&AmericanLifeProject ,
3,9(July7,2010),http://www.pewinternet.org/Reports/2010/Mobile-Access-2010.aspx (“Mobile
Access2010).24Source:MobileAccess2010at9.
25Source:StephenJ.BlumbergandJulianV.Luke,“WirelessSubstitution:EarlyReleaseofEstimates
fromtheNationalHealthInterviewSurvey,January-June2010,”NationalCenterforHealthStatistics,
CDC ,at1,3,Dec.21,2010,http://www.cdc.gov/nchs/data/nhis/earlyrelease/wireless201012.htm .
26Source:Id .27ThepopulationpercentageofblacksandAfricanAmericansandHispanicsandLatinosfortheentire
U.S.is12.1%and15.1%,respectively,comparedto42.7%and11%inPhiladelphiaand6.8%and27.3%
inSanDiego.FamiliesandindividualsbelowthepovertylevelfortheentireU.S.are9.9%and13.5%,
respectively,comparedto19.2%and24.2%inPhiladelphia.Source:USCensusBureau,
http://factfinder.census.gov (searchusing“Philadelphia”).
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Table2showsthetypicalthroughputrequirementsofvariousstreamingapplicationsthatmightinclude
increasingly popular applications for telemedicine, education, social networking, entertainment, field
service, business collaboration, andso forth.Thetable includestheamountofdata eachapplication
consumesperhourmeasuredinmegabytes,andhowmanygigabyteseachindividualapplicationwould
consumeina30-daymonthbasedondailyconsumptionamountsof.5hours,1hour,2hoursand4
hours.
Table2:DataConsumptionofTypicalApplications
Application Throughput(Mbps) MByte/hour Hrs./day GB/month
Audioormusic 0.1 58 0.5 0.9
1.0 1.7
2.0 3.5
4.0 6.9
Smallscreenvideo 0.2 90 0.5 1.4
1.0 2.7
2.0 5.4
4.0 10.8
Mediumdefinition 1.0 450 0.5 6.8
video 1.0 13.5
2.0 27.0
4.0 54.0
Higherdefinitionvideo 2.0 900 0.5 13.5
1.0 27.0
2.0 54.0
4.0 108.0
Highdefinition, 4.0 1800 0.5 27.0
fullscreenvideo 1.0 54.0
2.0 108.0
4.0 216.0
Videoapplications:telemedicine,education,socialnetworking,entertainment.
Thetabledemonstrateshow relativelydiscrete usepatterns canquicklyresultin largemonthlydata
usagetotals.Forexample,anhourofaudioadayaddsupto1.7gigabytes(GB)overamonth.And,30
minutesadayofmedium-definitionvideoconsumes6.8GB.
Actual amounts of data being consumed in the marketplace validate these estimates. Clearwireindicatedin2010thatsubscriberswerealreadyconsuming7GBpermonth.
28TeliasonerainFinland,the
28Source:FierceWireless,“Clearwireupgradesnetworkmanagementsystemtobetterthrottlespeeds,”
October11,2010,http://www.fiercewireless.com/story/clearwire-says-it-will-throttle-data-speeds-
during-high-usage/2010-10-11.
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firstLTEoperator,reportedLTEdata-cardsubscribersusing14GBto15GBpermonth,threetimestheir
3Gdata-cardusers.29Thismonthlyamountisconsistentwithaveragefixedbroadbandconsumptionof
14.9GBpermonth,asreportedbyCisco.30Ifmobilebroadbandnetworksexistedinisolation,operators
mightbeabletomanageperformanceexpectations.Butwirelinenetworkswithmuchhighercapacities
often setuser expectations, resulting inusers frequentlywishing todo thesame thingsovermobile
networksastheydooverwirelinenetworks.Withpolicymakersworkingtoextendbroadbandtoalarger
percentageofthepopulationwhileatthesametimepromotingbroadbandcompetition,itiscrucialthat
mobile broadband be a competitive and viable alternative. This is particularly important if mobile
broadbandistoplayanimportantroleinsectorssuchashealthcare,educationandenergy.
Datausageacrossalldevicetypesisgrowingquickly.Forinstance,RysavyResearchprojectssmartphone
dataconsumption increasing fromabout0.3GBpermonthtoalmost10times this amountwithin5
years,asshowninFigure1.31
29Source:Gigaom,“OperatorSaysLTESubscribersUsing15GBPerMonth!,”November15,2010,
http://gigaom.com/2010/11/15/wireless-vs-wired-broadband/ .
30Source:Cisco,“CiscoVisualNetworkingIndex:Usage,”October25,2010,
http://www.cisco.com/en/US/solutions/collateral/ns341/ns525/ns537/ns705/Cisco_VNI_Usage_WP.ht
ml.
31Source:RysavyResearch,“MobileBroadbandCapacityConstraintsandtheNeedforOptimization,”
February24,2010,
http://www.rysavy.com/Articles/2010_02_Rysavy_Mobile_Broadband_Capacity_Constraints.pdf .
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Figure1:SmartphoneDataProjection
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
2010 2011 2012 2013 2014 2015 2016
MonthlyGigabytesPerSubscriber
Year
Smartphones
RysavyResearch 2010
Consumersareincreasinglyusingmobilefortelemedicine,distancelearning,andsocialnetworking.In
addition, there is a growingdemand for mobile business applications byenterprise users. With the
expectedrapidgrowthinusageofnew,data-heavyservicesandapplications,itiscriticaltomakemore
spectrumcommerciallyavailable toaccommodategrowingconsumerdemand.Itis importantto note
thatemergingwirelessapplicationssuchasmachine-to-machinecommunicationsandtabletcomputing
couldresultinfargreaterdemandforcapacitythanamountsanticipatedbysimplyextrapolationsof
currentusages.
Avarietyof factorsare fuelingcontinuedgrowth inusage,including: fasternetworks,morenetwork-
enableddevices,increasingcomputingspeedsthatenablemorecomplexdata-consumingapplications,
gaming,largerdisplays,andhigherscreenresolution.
Takingjustoneofthesefactors,screen resolution,Table3showshow increasingresolutionresultsin
highervideoencodingratesandincreasedbroadbandcapacityconsumption.Assumingtypicaladvanced
videoencodingandfull-screenvideo,going fromtheiPhone3toiPhone4quadruplesthevideodata
consumption rate. Thethird rowpresents a high-definitionstream forcomparison. Thepoint is that
even though devicesare relatively small, increasing video resolution forces them to consume larger
amountsofdata.Thus,evenifaconsumer’susageofmobilevideostayedconstant–whichishighlyunlikely–bandwidthdemandswouldskyrocketsimplybecauseoftheshiftinscreenresolution.
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Table3:TypicalVideoUsageRateBasedonTypeofDevice
De vice Vertical Horizontal Me gapixe ls TypicalVide oRate (Mbps)
iPhone3 320 480 0.2 0.4
iPhone4 640 960 0.6 1.6
1080pHD 1080 1920 2.1 5.4
To put theseusage rates into a wireless-networking perspective, Figure 2 below takes the network
capacitiespresentedinTable1andshowswhatdownlinkthroughputratesareavailable,basedonthe
number of simultaneous users, assuming an operator is using 20 MHz for mobile broadband, e.g.,
Verizonuses20MHzforLTE.
Figure2:AvailableThroughputPerUserBasedonNetworkLoading
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
1 2 5 10 20 50DownlinkT
hroughputPerUser(Mbps)
SimultaneousUsersinCellSector
ThroughputBasedonLoading(20MHz)
2HSPACarriers
LTECarrier
RysavyResearh2011
Thefactisthatifusersareengagedin1Mbpsor2Mbpsstreamsordownloads,ittakesarelatively
smallnumberofuserstoconsumesectorcapacity.ForLTE,ittakesonlyabouteightuserswitha2Mbps
streamtoreachthe15Mbpssectorcapacitythatoneoperatormayhavedeployed.Asnotedearlierin
thisreport,thereisanestimatedaverageofabout360subscriberspercellsectorperoperator.Denser
cellsitesincities,likePhiladelphiaandSanDiego,couldhavetwoorthreetimesasmanysubscribers.Toputthisintoperspective,cell-sitespacinginanurbanareacouldbe1,000feetbetweencellsites,with
eachcellsitecoveringabout10cityblocks.Sinceeachsitecomprisesthreesectors,thismeansasector
hastocoveraboutthreecityblocks.Thissectorcapacityhastobesharedacrossalltheusersinthis
area. Operators will augment capacity with additional radio channels, but doubling the amount of
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spectrumto40MHzusingLTEwouldstillonlyaccommodate16simultaneoususersconsuming2Mbps
streams.
Evenifanoperatorwith100MHzoftotalspectrumholdingshad80MHzofspectrumallocatedtoLTE,
thiswouldstillrepresentonlyabout60Mbpsofaggregatedownlinkcapacityinacellsectorforthose
threecityblocks,accommodating30simultaneoususersconsuming2Mbpsstreamsinagivensector.However,unlessmorespectrumismadeavailable,itishighlyunlikelythatevenfourproviderscould
reachthesespectrumholdingsinagivenmarketlikePhiladelphiaorSanDiego.
TheFCCstatesthatthereis547MHzofspectrumcurrentlylicensedthatcanbeusedtoprovidemobile
broadband.32 In Philadelphia, this licensed spectrum is divided up among more than 20 different
spectrum holderswithno oneentityholding100MHz.33 Threemajor providers inPhiladelphiahave
between75and99MHzandthenext4havebetween10and50MHz.InSanDiego,therearemore
than30spectrumholders.34ThetopfourprovidersinSanDiegohavebetween70and104MHz;andthe
nexttwohavebetween30and40MHz.35Unlessmorespectrumismadeavailable,therewouldneedto
besignificantconsolidationinthePhiladelphiaandSanDiegospectrummarketplacefortheretobeatleastfourproviderswithsufficientspectrumtoreachthe60Mbpsofcapacitynecessarytosupport30
simultaneoususersofhigherdefinitionvideointhethreecityblockscoveredbyagivenantennasector.
Incontrast,asinglecable-modemusercanreadilyobtain15to50Mbpsofdedicatedservice.
RysavyResearchprojectsevenanoperatorwith100MHzofspectrumand60Mbpsofaggregatesector
capacitywillnotbeable,absentadditionalspectrum,tomeetthedatademandsofconsumersinthree
tofouryearsifconsumersusetheapplicationstheydesire.36
Ofcourse,notallusersarenecessarilysimultaneouslyengaginginhigh-bandwidthstreamingactivities.
Users doing e-mail or browsingWeb pageswith relatively static content consume far less data. So
operators can accommodate larger numbers of those kinds of users. The point, however, is that
broadbandusers ingeneralare increasingtheirdataconsumptionat asteadyrate.Atthesametime,
thepercentageofsubscriberswithdevicesthatcanconsumelargeamountsofdataisgrowingsteadily.
Forexample,theNielsenCompanyfoundthat31%ofAmericanmobileconsumersownedsmartphones
32Source:FCC,“ConnectingAmerica,TheNationalBroadbandPlan,”March2010,at85.
33Source:FCC ,“SpectrumDashboard,”http://reboot.fcc.gov/reform/systems/spectrum-dashboard (last
visitedonMar.9,2011).ManyofthespectrumholdersinPhiladelphiaandSanDiegoareEducational
BroadbandService(EBS) licensees.Commercialoperatorsareallowedto leaseexcesscapacityonEBS
systemsbutarenoteligibletoholdEBSlicenses.34ThesespectrumamountsareroughestimatesbasedontheFCC’sSpectrumDashboard.Source: Id .
35Source:Id .
36Source:RysavyResearch,“MobileBroadbandCapacityConstraintsandtheNeedforOptimization,”
February24,2010,
http://www.rysavy.com/Articles/2010_02_Rysavy_Mobile_Broadband_Capacity_Constraints.pdf .
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asofDecember2010andmoreconsumerswillownsmartphonesthanbasicfeaturephonesbytheend
of2011.37Alreadytoday,thesenimbletoolsgenerate30timesthedatatrafficofbasic-featurephones.
38
It is the combination of bandwidth-consuming devices and increasing penetration that is placing so
muchstressonmobilebroadbandcapacity.Thistrendisnowclearlyacceleratingwiththearrivalofnew
device categories, such as tablets,which are being enthusiastically embraced by consumers – 10.3
milliontabletssoldalreadywithsalesexpectedtoexceedlaptopsby2015. 39
To accommodate rapidly rising volumes of data-rich traffic, operators will need to employ multiple
approaches. One is to continue deploying more advanced wireless technologies as they become
available.40 Another is tooffload data traffic onto alternate networks such asWi-Fi and femtocells,
whichhaveinherentlygreatercapacityduetotheirmuchhigherfrequencyreuse.Theothertactic,of
crucial importance, is todeploy greater capacity inmore spectrum, though this isonly anoption if
spectrumisavailabletothem.
Figure3showshowthethroughputperusercandramaticallyincreasethroughacombinationofoffload
andmorespectrum.
37Source:DonKellogg,“AmongMobilePhoneUsers,Hispanics,AsiansareMost-LikelySmartphone
OwnersintheU.S.”,NielsenWire,Feb.2,2011,http://blog.nielsen.com/nielsenwire/consumer/among-
mobile-phone-users-hispanics-asians-are-most-likely-smartphone-owners-in-the-u-s/# ;RogerEntner,
“SmartphonestoOvertakeFeaturePhonesinU.S.by2011,” NielsenWire,Mar.26,2010,
http://blog.nielsen.com/nielsenwire
/consumer/smartphones-to-overtake-feature-phones-in-u-s-by-2011/# .38CiscoReport ,2009.
39
Source:“TabletstoSurpassLaptopSalesIn2015,OneThirdOfUSConsumersWillOwnOne,”MobileMarketingWatch,Jan.5,2011, http://www.mobilemarketingwatch.com/tablets-to-surpass-
laptop-sales-in-2015-one-third-of-us-consumers-will-own-one-12356/ .40Forexample,theevolutionofLTE(throughLTEAdvanced)employscontinuallymoreadvancedforms
of smart antennas. Rysavy Research projections for required spectrum takes these advances into
account.
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Figure3:GreaterCapacityThroughMoreSpectrumandOffload41
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
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ThroughputPerUser(Mbps)
SimultaneousUsersinCellSector
ImprovedThroughputswithMoreSpectrumandOffload
LTECarrier(20MHz)
LTECarrier(20MHz),
Offload
2LTECarriers(40MHz),
MoreOffload
RysavyResearch2011
Additionalspectrumwillplayapivotalroleamongproviders:
• Existingserviceproviderswithrelativelylargeamountsofspectrumhavehugesubscriberbases
already generating tremendous broadband demand. Thisdemandwill only increaseand can
onlybeaccommodatedwithmorespectrum.
• Serviceproviderswithsmalleramountsofspectrumhavesubscriberbasesthatareincreasingly
generatingdata traffic in addition tohigh, legacy voice demand.Networkcapacity based on
these smaller spectrum amountswill be rapidly exhausted as these providers increase their
subscriberbaseandastheirsubscribersconsumemoredata.Forexample,thereareatleast
threemajor commercialwireless broadband providers inPhiladelphia,and two inSanDiego,
withlessthan50MHz.42Allproviderswillneedmorespectrumtooffercompetitivewireless
broadbandservices.
• Iftherearetobenewentrantsintheindustry,theywillalsoneedspectrum.
Theneed fornew spectrum isnodifferentwhen lookingat individualoperatorsor theindustry asa
whole.Onewaytoassessthebenefitofnewspectrumistocomparethetotaldemandforspectrum
acrosstheindustryrelativetocapacity,asshowninFigure4,whichnormalizescapacityandspectrumto
avalueof 1in 2010. In2010,thefigureshows demand atabouthalfof capacity. The figure depicts
41Assumption:asmuchdataoffloadedascarriedontheLTEnetwork.
42Source:FCC,“SpectrumDashboard,” http://reboot.fcc.gov/spectrumdashboard/searchMap.seam .
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demandincreasingatafairlyrapidratethrough2017thenslowingdownthereafter.Ifnonewspectrum
becomesavailable,demandwilllikelyexceedcapacitywithinfouryearsinhigh-trafficmarkets.“Partially
increased”spectrumisbasedona50%increaseofspectrumrelativetocurrentlyavailableamountsby
2020.Butinthisscenario,demandstillexceedscapacitywithinthisdecade.Fullyincreasedspectrumis
based on an approximate 100% increase in spectrum by 2020, as intended by the FCC’s National
Broadband Plan and the President’s Memorandum. It is only through this aggressive allocation of
spectrum that demand can possibly bemet. Even with this substantial added spectrum, the figure
assumesthatoperatorsdeployaggressiveoffloadandsmall-cellarchitectures,suchasfemtocellsand
picocells.
Figure4:DemandVersusDifferentSpectrumScenarios
0
0.5
1
1.5
2
2.5
DemandVersusSpectrum(Normalized)
NoNewSpectrum
PartiallyIncreased
Spectrum
Fullyincreased
Spectrum
Demand
RysavyResearch2011
Clearly, additional spectrum contributes directly to increasing capacity. But what does it mean for
consumersandU.S.innovationifthisspectrumisnotmadeavailable?
AdverseApplicationEffects
The effects of insufficient spectrumare multiple and all negative. One immediate effect is network
congestion.Toomanyuserscompetingfortoofewnetworkresourcescausecongestion.Thisleadstoa
varietyofsignificantadverseeffectsintermsofthefunctionalityofthemobileInternetforconsumers,
including:
• Sluggishbehavior(e.g.,slow-loadingWebpages)
• Stalls(e.g.,failuresofstreamingvideolikeremotehealthmonitoring)
• Completefailure(applicationorcomputersystemhastoberestarted)
• Communicationsprotocolsbehaveerratically(e.g.,undeliveredpacketsofdata)
• Unpredictableapplicationbehavior(e.g.workssometimesandnotothers)
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Sluggishbehavioris easytounderstandby takingsome typicalnetworkconfigurationsand lookingat
differentnumbersofuserssimultaneouslyloadingWebpages.AtypicalWebpagetodayisover1MBin
size. Assuming a 1MB size, Figure 5 shows how page load time increases with higher numbers of
simultaneoususers.Apageloadtimeofgreaterthan10secondsrepresents“sluggish”behavior.For
example, this occurs with about 15 users simultaneously accessing Web pages in a 2-HSPA carrier
scenarioandwithabout20usersinanLTEscenario.DoctorsinSanDiegomightbeintheofficewith
theirwireless tablet trying to access a patient’s vital statistics ormedical history using the Medical
Information Anytime Anywhere application developed by Palomar Pomerado Health officials.43 In
Philadelphia, practitioners might be earning continuing medical education credits through their
MedPageTodayMobile application,which containsarticles peer-reviewed under thedirection of the
UniversityofPennsylvaniaSchoolofMedicine.44StudentsattheUniversityofCalifornia,SanDiegomay
beaccessing informationabout courses or listening topodcastsof prior lectures using the school’s
iPhoneapp.45APhilliesfanmightbetryingtoorderfoodanddrinksatCitizensBankParkusingtheAt
Bat2010application.46Slowpageupdatetimeswillfrustratetheseusers,anddrivethemawayfrom
theseapplicationsandotherinnovativeofferings.
Greatercapacitywillminimizesuchsluggishperformance.Thisisnot,however,aone-timeadjustment.
Operatorswillneedtocontinuallyaugmentcapacitytoaddressescalatingdemand.
43Source:JanetLavelle,“WirelessApplicationWouldGiveDoctorsAccesstoReal-timeRecords,”S AN
DIEGOUNION-T RIBUNE ,Feb.20,2011,http://www.signonsandiego.com/news/2011/feb/20/wireless-
device-would-give-doctors-access-real-tim/# .44Source:MedPageToday.com,http://www.medpagetoday.com/iPhone_promo.cfm(lastvisitedJan.
27,2011).
45Source:DianSchaffhauser,“UCSanDiegoOffersFreeiPhoneApp,” C AMPUST ECH.,June25,2009,
http://campustechnology.com/articles/2009/06/25/uc-san-diego-offers-free-iphone-app.aspx .46Source:MLB.com,“MLBAM,PhiladelphiaPhillies&AramarkjointodebutMobileFoodOrderingApp
atCitizensBankPark”(Sept.23,2010),
http://mlb.mlb.com/news/press_releases/press_release.jsp?ymd=20100923&content_id=14992180&vk
ey=pr_mlbcom&fext=.jsp&c_id=mlb.
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Figure5:WebPageLoadTimesforTypicalWebPages
0.0
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45.0
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PageLoadTime(Seconds)
SimultaneousUsersinCellSector
WebPageLoadTimeBasedonLoading
2HSPACarriers
LTECarrier
RysavyResearch2011
Beyondsluggishperformance,thereisalsotheriskthatnetworksthathaveinsufficientcapacity(dueto
insufficientspectrum)haveto significantly delay orultimatelydrop packets. Packetsarriveata base
stationorotherradio-accessnetworkinfrastructurenodeoverahighspeedconnectionsuchas fiber.
Thebasestationthentransmitsthepacketsovertheslowerradioconnection.Iftherearetoomany
incomingpacketstheresultwillbepacketsbeingdroppedorsignificantlydelayed.Thisisaninevitable
consequencewhenthereisgreaterdemandthancapacity.Itistheequivalentofacloggedfreewayon-
rampduringrushhour.Itdoesnotreflectanyimproperdesignormanagementbytheoperatorbuta
simpleoverwhelmingofthesystemasitexiststoday.
Inadditionto slowerperformance,outrightapplicationfailureswouldbecomemorewidespreadand
commonplace. Most communications protocols implement timeouts on their operations, including
Transmission Control Protocol (TCP) itself, the fundamental packet-transport protocol used in the
Internet.Withlargedelaysordroppedpackets,communicationsprotocolswillattempttodeliverdata
reliably.Butatsomestageofcongestion,theycannolongercopeproperly.Atthatpoint,applications
willeitherindicateafailure,orworse,terminatetheapplicationandrequireafull-systemrestart.This
meansausercouldbeinthemidstofbookingaflightandsuddenlytheylosetheirentiresession.Or
studentscouldbetakingexamsandlosealloftheirdata.
Theworstproblemwithcongestionisthatitisunpredictable.Alightlyloadednetworkwillfunctionfine,
butwithmoreusersgettingonthenetwork,applicationswillbecomeunreliable.This“on-again,off-
again”modeofoperationis frustratingforusers,whowouldgrowdissatisfiedwiththeservice.When
peopledependonservice,theyfinditstressfulwhentheycannotrelyonitandmaywellabandonthe
serviceifitprovesunstable.
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MarketEffects
Manyserviceproviders,likethoseinPhiladelphiaandSanDiego,lackthespectrumcapacitytomeetthe
risingdatademandandwill increasinglybecomecapacityconstrainedasmoreandmoreusersadopt
mobilebroadbanddevices.Theresultingeffectsofcongestionwillnotbeisolatedtospecificindustries;
rather they will have widely felt adverse effects across finance, telemedicine, education, socialnetworking,research,machine-to-machine connectivity, online gamingand entertainment.
47Without
additional spectrum, anoperator’s response tocongestioncaneitherbe toallow it tohappen or to
implementpricingorotherschemesthatlimitdemand.48Forexample,usagecapscanlimithowmuch
datausersconsume.Intoday’smarket,userscanconsumeamodestamountofstreamingcontent,but
theymaybe reluctant tousea mobile-broadband connectionas a substitute fora fixed connection.
Userswho find the limits tobe insufficient to conduct the tasks they wantwill become frustrated.
Highermonthlybillscouldcauseconsumerstogrowdissatisfiedandpotentiallystopusingtheservice.
Moreover, when usage limits are so restrictive that usersare uncertain aboutwhat they can door
cannotdo,theytypicallyopttodonothing.Allofthisgreatlydiminishesthevalueandappealofmobile
connectivity.
Ultimately,congestionwillhavea significantlynegativeeffecton thewirelessmarket.Consumerswill
use theservice less.49Minorities and lower income groups that increasingly rely onlyonwireless to
accesstheInternetwillbeparticularlyaffectedbyapproachesthatcouldlimitdemandincludingusage
caps, higherpricingand other tools that place a heavy emphasison dataoffload,which requires an
47Source:ColemanBazelon,“TheNeedforAdditionalSpectrumforWirelessBroadband:TheEconomic
BenefitsandCostsofReallocations,”Oct.23,2009,at22(“Broadbandconnectivityhasmeasurable
impactsonoutputoftheentireeconomy,wellbeyondthetelecommunicationssector.”).48Source:SwarupMandal,DebashisSaha,&MainakChatterjee,DynamicPriceDiscoveringModelsfor
DifferentiatedWirelessServices,1J.COMM.50(2006)(“[S]erviceprovidersusepricingasatoolto
resolvethisconstraintonthebandwidth.”);AndrewSeybold,“DataCongestionandNewPricing
Models,”AndrewSeybold.com(June10,2010)(statingthatwhilecarriersaremakingtechnological
improvementstoincreasebandwidthcapacity,theystillneedto“useallofthetechnologytoolsthatare
availablealongwithmanagementtoolsincludingpricing.”),http://andrewseybold.com/1635-data-
congestion-and-new-pricing-models ;AaronBlazar,“AT&TWirelessDataPricingChangesAnalysis,”
Atlantic-ACM(June11,2010)(“Althoughtrafficmanagementeffortshaveloggedsomesuccess,the
continuedgrowthofusage,andincreasedpenetrationofsmartphonedevices,isdrivingcarriersto
reevaluatedataplanpricingineffortstoreshapeend-userbehavior.”), http://www.atlantic-
acm.com/index.php?option=com_content&view=article&id=534:d
ataline-06-10-10&catid=7:datalines&Itemid=5.49Source:FCC,“ConnectingAmerica,TheNationalBroadbandPlan,”March2010,at77(“[S]carcityof
mobilebroadbandcouldmeanhigherprices,poorservicequality,aninabilityfortheU.S.tocompete
internationally,depresseddemandand,ultimately,adragoninnovation.”).
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underlyingwirelinebroadbandsubscription.50Thiswillbeespeciallytrueinurbanareaswherethereare
ahigherpercentageofminoritiesandpeoplelivingbelowthepovertylevelthanthenationalaverage.
Lowerusagealsowilldetractfromtheinvestmentcaseacrossthewirelesssector,curbingthegrowth
potentialofapplicationdevelopers,mobiledevicevendors,serviceprovidersandoperators.51
ConclusionWithexponentiallyincreasingconsumerdemand,today’smobilebroadbandmarket issurgingahead.
But the progress is advancing so rapidly that it threatens to quickly exceed the capacity of today’s
wirelessnetworks.Operatorshaveseveralmethods available toaugmentcapacity, suchasincreasing
thenumber of cell sites, offloading onto other networksanddeploying more efficient technologies.
Thesemeasures,however,arenotsufficienttomeetgrowingmarketdemand.Theonlyviablesolution
istoallocatemorespectrumfortheseservices.Morespectrumwillallowoperatorstocontinuetomeet
explodingconsumerdemand,enablenewservices,andbringevenmorecompetitiontothemarket.
Withoutadditional spectrum, technical andmarketeffectswillbe calamitous.Networks incities,like
PhiladelphiaandSanDiego,willbecomecongestedwithapplicationsbehavingunreliablyanderratically.
Operatorsmay have nochoicebut totry tolimit demand.Asa result, promising advances, like the
innovative mobile applications already available to consumers, may not reach the marketplace,
investmentlevelswilldrop,andthemarketwillnotrealizeitsfullpotential.TheU.S.willfacethereal
possibilityoflosingitsgloballeadershippositioninthiscruciallyimportantsegmentoftheeconomy.
Mobile broadband is not amarket unto itself. Rather, it is the intersection of the leading edgesof
computing,Internettechnologyandcommunicationstechnology.Mobileinnovationinthiscountryhas
thrivedin anenvironmentofminimalgovernmentintervention.But,today,governmentleadershipis
urgentlyneededtomakeadditionalspectrumavailabletopowerthenextwaveofconnectedinnovation
andgrowth.Nurturingandexpandingthisdynamicsectorisofvital,strategicimportancetothisnation.
50BothfemtocellsandWi-Fioffloadassumeafixed-Internetconnectionfortransportingdatatothe
Internet.51Source:GeraldR.Faulhaber&DavidJ.Farber, InnovationintheWirelessEcosystem:ACustomer-
CentricFramework ,4INT’LJ.COMM.73,82(2010)(“CustomersdemandaccesstotheInternetandother
dataservices,soInternetapplicationsaredeveloped,devicesbecomeInternet-enabled,andcore
networksensurethatcapacityisavailableforhighspeeddatathroughspectralefficiencyinnovation.All
ofthisinnovationisdrivenbycustomerdemand;itiscustomer-centricinnovation.”);FairviewCapital,
“WirelessInnovation:BridgingtheMobilityGap;IndustryOverviewfromaVentureCapitalPerspective,”
(notingthatconsumerdemandformobilewirelessisdrivinginvestmentinnewdevices,applications,
advertising,mobilepaymentservices,gaming,andinfrastructuredevelopment),
http://www.fairviewcapital.com/images/IndustryReport_Wireless.jpg.