Spectrum auctions hit record highs, and mid-band is expected to become the new golden band

The first phase of the US FCC’s auction of a total of 280MHz of 3.7-3.98 GHz spectrum ended on January 15. After 97 rounds of bidding, bids reached $80.9 billion, the highest spectrum auction price in U.S. history, well above the previous record of $44.9 billion set in the AWS-3 spectrum auction in 2015.

Mid-band helps achieve a good balance of data speed and coverage

The first phase of the US FCC’s auction of a total of 280MHz of 3.7-3.98 GHz spectrum ended on January 15. After 97 rounds of bidding, bids reached $80.9 billion, the highest spectrum auction price in U.S. history, well above the previous record of $44.9 billion set in the AWS-3 spectrum auction in 2015.

The record-breaking auction price shows wireless carriers’ hunger for spectrum assets and the value of mid-band spectrum. User experience tests on live 5G networks also show the huge advantages of mid-band spectrum.

Spectrum auctions hit record highs, and mid-band is expected to become the new golden band

In the chart above, we summarize the results of OpenSignal’s testing of Verizon and T-Mobile’s 5G networks. It can be found that in June 2020, Verizon’s download speed is significantly ahead of T-Mobile, but the network coverage is very low, while T-Mobile’s network coverage is not bad, but the download speed is only about one tenth of Verizon’s. The reason behind this is precisely the choice of spectrum. Verizon initially deployed its 5G network using millimeter-wave bands, while T-Mobile primarily used the 600MHz band.

By January of this year, the test results had changed dramatically. Verizon’s 5G network coverage has improved, but download speeds have dropped dramatically. T-Mobile, on the other hand, has steadily improved its download speeds and network coverage, and its 5G download speeds have even surpassed Verizon. This change can also be explained by spectrum selection. Verizon is starting to deploy 5G in lower frequency bands like 850MHz using Dynamic Spectrum Sharing (DSS) technology, which improves coverage but limits its network speeds. By contrast, T-Mobile is aggressively deploying its 5G network using the 2.5 GHz spectrum it acquired from its acquisition of Sprint. The 2.5GHz mid-band spectrum allows T-Mobile to strike a good balance between data speeds and network coverage that Verizon struggles with lacking mid-band spectrum resources.

It can be seen that the mid-frequency band can help operators achieve a good balance between coverage and system capacity, and is expected to become the golden frequency band in the 5G era. This should also be one of the reasons why this C-band spectrum auction in the United States has set a record price. US operators have fully recognized the value of mid-band spectrum.

Licensed spectrum is critical to guaranteeing high-quality Internet access

During the quarantine period caused by the new coronavirus pandemic, people’s communication needs have driven a surge in Internet usage in many countries and regions. An OECD report states: “Demand for broadband communication services has surged since the onset of the COVID-19 crisis, with some operators seeing a 60% increase in internet traffic compared to before the crisis.” The growth of traffic is briefly summarized.

Spectrum auctions hit record highs, and mid-band is expected to become the new golden band

As can be seen from the graph, not only developed countries, but also developing countries have experienced significant growth in Internet traffic. For example, Chile saw a 10.4% increase in data traffic between September and December 2019, which could be considered a benchmark before the COVID-19 crisis. Between December 2019 and March 2020, data traffic increased by 38.3%, an increase of about 3.7 times the previous quarter. Brazil and South Africa also reported similar trends.

During the epidemic, applications such as working from home, online learning, and remote consultation surged. UNESCO pointed out that at the peak of the epidemic, a total of 1.6 billion children and children in the world could not have normal offline learning. Data from the US Center for Epidemic Control shows that in 2020 In the last week of March, when the U.S. outbreak broke out, the number of remote consultations across the U.S. jumped 154% from a year earlier. These applications have pushed up the demand for video conferencing, video streaming and other services. In March 2020, when the global epidemic spread rapidly, the data traffic of the video conferencing platform Zoom soared by 535% year-on-year. However, a large number of video applications have put forward new requirements for the quality of broadband connections. Traditional broadband access technologies such as ADSL and Cable have gradually been unable to meet the needs of the rapidly developing market. However, the penetration rate of optical fiber broadband in most markets around the world is still significantly insufficient. , which makes mobile broadband technologies represented by 4G LTE and 5G NR play an indispensable role in providing quality broadband. The table below compares the penetration of fibre-optic home broadband and mobile broadband (4G LTE and 5G NR) by key regions of the world.

Spectrum auctions hit record highs, and mid-band is expected to become the new golden band

It can be seen that mobile broadband networks are already an important foundation for providing high-quality broadband connections in both developing and developed markets, and high-quality spectrum resources are crucial to ensuring the healthy development of mobile broadband networks. Sufficient licensed spectrum can help operators expand the reach of mobile broadband networks to provide broadband services to those who do not yet have access to fibre broadband and Wi-Fi connectivity. Mid-band spectrum can provide a good balance of coverage and system capacity, not only providing consumers with basic connectivity services, but also helping to enhance their experience.

6 GHz: An ever-expanding ecosystem for a connected society

The industry is currently conducting extensive discussions on the spectrum allocation plan for the 5925/6425 C 7125MHz frequency band. As noted in Strategy Analytics’ blog (The 6 GHz Band will be Key for 5G Growth; Regulators and Standards Bodies Should Act in 2021), the 6 GHz band is the mobile industry’s “long-term value creation strategy for consumers and enterprise customers” key resources”.

In addition to benefiting the development of the mobile communication industry itself, we would like to stress that the 6 GHz frequency band is also of great value to human and social development.

In July 2016, the United Nations stated that the right to internet access should be considered a fundamental human right. However, providing Internet access to all remains a serious challenge in some developing regions.

In a recent virtual conference co-hosted by Nokia, Ericsson, GSMA, Huawei and ZTE, a representative of Telefonica Latin America said: “Fixed broadband service penetration and data rates are low in Latin America, so 5G applications are The region becomes even more important, such as enhanced mobile broadband and fixed wireless access.” At the same event, Ericsson also noted that “in Latin America, the bottleneck is fixed broadband access” and that “5G-based broadband services do not have the bottleneck of last-mile connections.”

These points are largely consistent with our analysis in the previous section. Mobile broadband networks based on licensed spectrum are essential for people in developing countries to access the Internet and obtain universal services. With the development of the Internet of Things, mobile networks can also help increase the overall productivity of an economy, which will benefit society as a whole.

At present, more than two dozen telecom companies and industry organizations have begun to work together to promote the development of the 6GHz mobile ecosystem. Some large economies are already planning to start testing in the 6GHz band in 2021.

Spectrum auctions hit record highs, and mid-band is expected to become the new golden band

China’s IMT-2020 promotion group has announced that it will test 5G base station prototypes and conduct field trials in the 6GHz band. Russia’s state-owned radio research agency NIIR is also planning to test 5G networks in the 6,425-7,100 MHz band. The work done by these large economies in the 6GHz band will provide a solid foundation for the development of the 6GHz mobile ecosystem.

Looking forward to the World Radio Conference to be held in 2023, we believe that the allocation of the 6GHz frequency band for mobile broadband services will not only benefit the development of the global mobile communications industry, but also promote the protection of basic human rights and the development of an interconnected society. It is necessary to re-evaluate and recognize the value of licensed spectrum in the mid-band. The 6GHz band will surely play an important role in the development of the interconnected society and become a new golden band for mobile broadband networks.

The Links:   FF100R12RT4 6MBP100RTB060

Related Posts