Now That We Know The Telcos Exaggerated About The 'Spectrum Crunch'; How About Some More Open Spectrum?

from the pretty-please? dept

For years now, the big telcos have been whining and complaining about a supposed "spectrum crunch," saying how they were going to run out of useful radio spectrum and wouldn't be able to set up new wireless services if they couldn't control more and more of it. And yet... as FierceWireless has noticed, the big guys all seem to think they have plenty of spectrum now:

Executives from the nation's largest wireless carriers now seem to be pretty pleased with their spectrum positions. AT&T CEO Randall Stephenson recently said the carrier has a solid spectrum position for the next three to five years if it gains approval for its pending spectrum purchases. Verizon Communications CFO Fran Shammo said that with its recently completed $3.9 billion purchase of nationwide AWS spectrum from cable companies, Verizon Wireless now has enough spectrum to handle its capacity needs for the next four to five years. Sprint Nextel CEO Dan Hesse said the carrier's Network Vision plan will give Sprint a strong spectrum position through the end of 2014 and that date will be extended to 2016 with the addition of spectrum from Clearwire. And T-Mobile USA CTO Neville Ray said the carrier is busy refarming its 1900 MHz PCS spectrum and now has enough 1700 MHz AWS airwaves to deploy 10x10 MHz channels across 90 percent of the top 25 U.S. markets when it launches LTE next year.

The report quotes analyst Tim Farrar explaining what many had been arguing for years -- that the so-called "spectrum crunch" was basically a myth to get access to and control of ever-greater swaths of spectrum to keep it from others:

"I think it [the spectrum crunch] was overblown. And everyone had an interest in pumping up a spectrum crisis," said TMF Associates analyst Tim Farrar. He said the FCC wanted to promote itself as the agency that could spur innovation and expand broadband access; Verizon and AT&T didn't want the FCC to cap the amount of spectrum available to them; companies that speculated with spectrum did not want the market to think they had worthless assets; and smaller carriers wanted more spectrum on the market to lower the price of all spectrum. "Everybody had an interest in talking it up and no one had an interest in saying the emperor has no clothes," he said.

And yet... one area where spectrum could be really useful? New open wireless offerings. But there we're left stranded. Rather than looking for new ways to provide open spectrum, the government has continually focused on figuring out ways to give more to the big telcos. In fact, just as I was finishing up this story, I saw reports on the FCC's new plans to release more spectrum -- but most of it via auctions. Very little appears to be ticketed for openness. Unfortunately, part of the problem is that the government seems to value spectrum solely based on how much someone will pay for it -- rather than the beneficial uses it might create. Thus you have fewer advocates willing to "pay" for open spectrum, and many who don't understand the importance assume that open uses have no value. This, of course, ignores just how much open spectrum has enabled, from cordless phones to garage door openers to really powerful things like home automation and WiFi.

So, if we can see that the big telcos' current spectrum appetite is satiated, and we can recognize how much open spectrum can enable amazing new innovations with tremendous benefit way beyond the price of the spectrum, shouldn't there be a big focus on getting more open spectrum out there and available for use?

Filed Under: auctions, open spectrum, spectrum, spectrum crunch, wireless

AT&T Threatens To Cut Off Phone Service For Guy Who Beat Them In Small Claims Court Over Throttling

from the playing-dirty dept

As you may have heard over the last couple months, AT&T has gone to war with customers who bought its "unlimited" data plans. While the company no longer offers such plans, existing users were grandfathered in. And they like those plans. AT&T, however, would prefer to move them over to tiered plans under which they'll pay more. So it began throttling their connections. If they were using a fair amount of data (really not that much), it slowed their connection down to the point of being basically useless. This is a pure bait-and-switch tactic, where the company sold customers something that it then failed to deliver.

A guy named Matt Spaccarelli felt that this was a clear breach of contract and sued in small claims court... and won $850 ($85 is his monthly fee, and the judge felt that there were 10 months left on the contract that was violated... so, $850). Spaccarelli then also set up a website with all the details, so that others could file their own lawsuits. Apparently, AT&T is none too pleased about this and is playing hardball with the guy, threatening to cut off his phone service after determining that he used the phone to tether.

How nice, right? Beat AT&T in small claims court, and they'll potentially cut off your phone service.

Separately, they're trying to "settle" with him, but are pissed off that he's been public about the settlement attempts so far, as the key thing in the mind of AT&T lawyers and execs is getting a gag order in place to stop others from going down the same path. Of course, there's no requirement that Spaccarelli settle or agree to any gag order, and it sounds like he's not planning to:

Spaccarelli has posted online the documents he used to argue his case and encourages other AT&T customers copy his suit. Legal settlements usually include non-disclosure agreements that would force Spaccarelli to take down the documents.

In its letter, AT&T asked Spaccarelli to be quiet about the settlement talks, including the fact that it offered to start them, another common stipulation. Spaccarelli said he was not interested in settling, and forwarded the letter to The Associated Press.

Good for him.

Filed Under: bandwidth, bandwidth hogs, business model, caps, data hogs, matt spaccarelli, small claims court, spectrum, throttling, usage
Companies: at&t

Study Confirms What You Already Knew: Mobile Data Throttling About The Money, Not Stopping Data Hogs

from the it's-all-about-the-$$$ dept

Of the four national mobile operators, only Sprint still offers an "unlimited" data plan -- and most industry watchers expect that to go away soon. When the operators talk about this stuff, they complain about how unlimited plans are abused and the amount of data being used by so-called "data hogs" is crippling network bandwidth. Of course, the alternative story is that they just want to charge people higher rates, and putting a toll booth on data usage makes that possible. A new study by Validas confirms that the latter theory seems to match with reality. The company looked at 11,000 mobile phone bills of users on both throttled (tiered) plans and unlimited data plans and found... data usage was effectively the same. In other words, for all the talk about how tiers and throttles are needed to stop bandwidth hogging... reality shows that these plans have little impact on actual data usage. Or, to put it really simply: these plans are all about the mobile operators making more money and have nothing to do with network capacity.

Of course, as I've argued in the past, this is a pretty short-sighted strategy by the mobile operators. While they have every right to set up whatever business models they want in order to maximize profit, this might come back to haunt them. The problem with a tiered or throttled data plan is that it actually makes the mobile data service less valuable. Not only does it cost more for the same usage, it adds mental transaction costs as users have to keep track of their usage. That's only going to make people value alternatives much more. The carriers can get away with that if there are no alternatives (as is the case some of the time), but as more alternatives hit the market, expect people to shift their usage to networks they can actually use without fear.

Filed Under: bandwidth, bandwidth hogs, business model, caps, data hogs, spectrum, throttling, usage
Companies: at&t, sprint, t-mobile, verizon wireless

Why You Should Regret LightSquared's Setbacks

from the competition-is-good dept

LightSquared is a new wireless carrier that has been trying to launch a wholesale 4G network across the USA. Funded by private equity firm Harbinger Capital, it sought to re-purpose satellite communication frequencies to build a nationwide cellular-satellite hybrid network, and then re-sell the network capacity to other brands. In January 2011, the FCC, eager to foster new competitors in the mobile space, gave LightSquared the green light to launch using their spectrum with one provision - that their network equipment NOT interfere with GPS signals and devices. Well, over a year has come and gone, and despite incredible effort and wrangling, the independent testing keeps indicating that LightSquared's terrestrial towers are not compatible with GPS device use. As such, the FCC has basically rescinded LightSquared's request to launch service on their 1.5GHz L-Band spectrum.

Note that, while LightSquared DID knock out GPS devices, it was not LightSquared that transmitted on the GPS frequencies, but rather the GPS devices that sloppily "listen" to the adjacent LightSquared frequencies. The GPS chipsets were generally cheaply made with inadequate filtering. That said, who is at fault is irrelevant: it remains LightSquared's problem to solve if they want to launch their network. A long history of spectrum policy states that new entrants must not mess up the existing radio devices.

What we've lost here is the chance to have a truly innovative wireless carrier which would have stimulated competition, energized the vendor community, and provided a white-label network for MVNOs. LightSquared had, in fact, signed up dozens of partners who would offer LTE wireless services as cellular companies, CE makers, and store brands like Best Buy, for example, who could sell connectivity in a bundle with laptops. Maisie Ramsay over at Wireless Week explains how a vast community of over 30 technology vendors have also lost a valuable path to market.

What strikes me, as someone who works with wireless carriers (LightSquared included), is that we may lose one of the scrappiest players out there. And markets thrive when a scrappy player stirs up the pot. Hutchison Whampoa stirred up the UK markets when it launched 3G in 2003, Free is currently doing the same in France. In the USA, we have regional players like Metro PCS, but nothing at the national level. My role at the Telecom Council of Silicon Valley is right where innovators meet with the telcos, and it was gratifying to see the tornado of new ideas, vendors, and possibilities that came about with a new network. Without legacy systems nor legacy thinking, lots of great ideas are free to emerge.

For now, with LightSquared's options dwindling, we may have to have to look elsewhere for new competition and open creativity. The WiFi space is fairly promising, as the spread of hotspots continues to soar, and new versions (802.11ac) promise greater range and throughput. Chipsets are cheap, and billions of WiFi devices have been produced. Republic Wireless exemplifies the possibilities of leveraging WiFi in mobile phones to the limit. Lots of people are hoping that the "white spaces" frequencies in between TV channels will be offered up to a WiFi variant, which will mean low-frequency spectrum that penetrates walls and buildings much better than today's WiFi. I like what the US carriers have done with the (globally) early launch of LTE, but there's no doubt that with increased competition we'd have a more dynamic market.

Filed Under: competition, gps, interference, spectrum, wifi, wireless
Companies: lightsquared

Surprise! AT&T Admits Defeat, Withdraws T-Mobile Takeover Attempt, Pays $4 Billion Breakup Fee

from the wow dept

This is definitely a surprise, but it looks like AT&T finally read all the writing on the wall, and realized it was unlikely to win its fight with the DOJ and FCC and has officially killed its plan to try to purchase T-Mobile... meaning that it now has to pay the $4 billion breakup fee. While the trend of where this was heading was becoming increasingly obvious over the past few months, it's still pretty shocking on the whole. Getting big mergers like this through had become pretty standard, and AT&T (especially) excelled at the political dealing to make such things work. However, the growing public outcry and concerns over the lack of competition that would result seemed to finally have had a real impact.

Filed Under: competition, doj, failure, fcc, lobbying, merger, mobile, spectrum, wireless
Companies: at&t, t-mobile

AT&T Accidentally Reveals That It Doesn't Need T-Mobile At All

from the oops dept

One of the key talking points from AT&T in support of the T-Mobile merger is that it "needs" T-Mobile's spectrum in order to expand its planned 4G/LTE networks to cover 97% of the population. And, there's no doubt that having T-Mobile's spectrum will make it easier, but that's not the same as it being necessary. As Broadband Reports has been pointing out for a while, Verizon has less spectrum than AT&T but can cover the same 97% of the population with it. Apparently a lawyer for AT&T accidentally posted a document to the FCC's site that more or less admits that AT&T doesn't need T-Mobile's spectrum, and that it could invest $3.8 billion to catch up to Verizon in terms of LTE coverage. $3.8 billion is a fair bit of money, but it's a hell of a lot less than the $38 billion that it's spending for T-Mobile. Yes, AT&T also gets T-Mobile subscribers with that, but it certainly raises questions about AT&T's claims that it would be too "costly" to invest to get to 97% coverage with its existing spectrum. As BBR notes, the timing of the letter also suggests that AT&T knew it was planning to buy T-Mobile when it decided to claim that it would "not" build out its network, perhaps recognizing that this would help give it a talking point for why the merger should be allowed.

Filed Under: costs, merger, spectrum
Companies: at&t, t-mobile

FCC Planning To Crack Down On Cellular & GPS Jamming Devices

from the get-your-last-jam-in dept

Over the years, we've noted that mobile phone jammers were getting more popular in the US, even though they're completely illegal. However, it looks like the FCC has had enough and has announced plans to start cracking down on both mobile phone jammers and GPS jammers. The initial crackdown appears to be targeted at companies selling such jammers, but it hints at going further than that. The concern, of course, is that these jammers don't discriminate and block all sorts of legitimate communication among others. Still, the usual excuse about how it may prevent emergency responders rings a little hollow. It wasn't that long ago that no one had mobile phones and emergency responding still seemed to work. Obviously, having working mobile phones can be quite beneficial, but the FCC shouldn't overplay its hand here. Just stick with the truth: a jammer interferes with a public resource.

Filed Under: jammers, spectrum
Companies: fcc