WCS spectrum presents major opportunity for broadband wireless access providers

Unlicensed spectrum could alleviate the crunch for fixed wireless services, and fuel a new competitor in the high-speed Internet access market, according to a new report by PricewaterhouseCooper’s wireless practice in Canada. Following years of uncertainty regarding the technical capabilities of wireless communications services (WCS), governments on both sides of the border are now convinced that business demands and the technology are ready to utilize spectrum in the 2.3 GHz range. MDS and MCS operators in Canada have access to a finite amount of spectrum that limits their ability to provide a competitive alternative to high-speed T1 and ISDN lines, as well as cable modems and DSL. Initially set-aside in the U.S. for mobile wireless services, WCS is now considered more suited for fixed wireless applications, given the band’s proximity and similar technical characteristics to MCS and MDS. It would also provide a much-needed return path for two-way services. "In this new environment ADSL will not suffice and T-1s or multiples thereof will still be too expensive," states the report, entitled Broadband Wireless: Industry and Economic Trends Relating to WCS Spectrum. "Clearly there will be a gap in the market for cost-effective symmetrical broadband access services for consumers as well as small- and medium-sized business users." Demand for fixed wireless to reach triple digit growth The demand for fixed wireless services – particularly by home and SOHO customers – is forecast to grow by 150 per cent in 2001 and by nearly 270 per cent in 2002 (see chart on page 1). With the demand for symmetrical Internet and corporate network traffic expected to increase exponentially, large service providers, including AT&T and MCI WorldCom, as well as major equipment manufacturers are now ready to embrace this new technology. "If we consider many of the new and emerging high bandwidth multi-media applications and the potential widespread distribution of these applications by the public, then the utility of small asymmetrical broadband pipes will become virtually obsolete," states the June 22 study, prepared for Craig Wireless International Inc. The study also encourages Industry Canada to move quickly to identify spectrum in the 2.3 GHz band for fixed wireless services. Without additional spectrum, it notes that MCS and MDC operators will be unable to provide the speeds and new services the market is demanding. "In Canada, the recent allocation of MCS spectrum left many applications without the spectrum they were seeking or required to successfully advance their business plans," the study points out. "While some operators have moved to expand their spectrum holdings through acquisitions, others are contemplating or actively providing services using unlicensed frequency bands." Industry Canada plans to make this spectrum available – the only question is when. Advocates for the use of this spectrum for fixed wireless services are lobbying the department to open up the spectrum as soon as possible. The government has already signaled its intention to auction spectrum at the 3.4 GHz frequency bands, and sources close to the department indicate that it will likely do the same for spectrum in the 2.3 GHz frequency range next year. A licensing process will be initiated later this year. "Regulators in North America must balance competing requirements and act in a timely manner to alleviate pending spectrum shortages that could limit the opportunities for fixed wireless operators," the PwC study writes. "Certainly making this spectrum available would help relieve the spectrum constraints experienced by many existing and potential service providers. Allocating spectrum in this and other frequency bands such as the WCS band at 2.3 GHz cannot help but ensure that overall demand for broadband access is met while fostering competition in this rapidly emerging industry."

WCS spectrum presents major opportunity for broadband wireless access providers

News | July 24, 2000

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