Amparo Canaveras, MIT: TV White Spaces
A lot is going on with wireless dynamics in the US. There are a lot of business drivers including a new
spectrum that will become available requiring new protocols. (Best Buy considering becoming a new
entrant.)
Why might we see new devices companies (Best Buy) enter wireless market?
1. Access to customers (need to connect while they use devices).
2. Access to Advertisers (advertisers would need specific messaging for each platform).
3. To provide a complete end-to-end service (accept transactions by phone)
Due to these market pressures there is going to be a new regulatory framework. The FCC seeks to
confront new high demand for radio transmissions and make more of the spectrum available: Their
broadband plan is to make available an additional 500 MHz of spectrum. They will enhance the spectrum
efficiency with regulatory frameworks for: cognitive radios, geo-location devices, etc. (See slide).
We will have new enabling technologies: LTE, IEEE, etc.
In our work we have assumed the conditions to include a new entrant wireless operator: We have
modeled the potential demand for new operators to enter the market. The model can calculate the
required capacity ad network costs based on available technologies. We have simulated potential
network revenues based on different assumptions. We have performed break-even study analyses of
TWO new entrants (case studies).
Case Study #1: New entrant exploiting new features of LTE
We can think of the healthcare industry, games industry, etc. They need to provide connectivity for a
large percentage of total US customers.
Our main conclusions: Regardless of strategy the cost of building a network and acquiring the necessary
spectrum will always be higher than the breakeven.
At what CAPEX per base station can a new LTE entrant be profitable yet remain aggressively priced? What
is a good combination of improvements? So, the first calculation is what is the Base station cost?
Case Study #2: New entry opportunity due to a new policy change: the availability of TVWS. (Google for
example) They would use the unlicensed spectrum with a combination of technologies: 802.22, 8011.11,
HF and standard Wi-Fi. Unlicensed wireless technologies were not meant to connect NETWORKS but
devices instead--capacity vs. range. In the US there are TV frequencies that are not being used. With these
frequencies available we can consider broader spectrum and better quality in the lower range. New
standards are coming to allow new types of networks in the lower range. There will different protocols for
different places. Wi-Fi modifier and 802.22 and WLAN 2.4 – 5 GHz Wi-Fi.
We came up with models of how to deploy profitable networks with unlicensed technologies. Depending
on demand and population density different technologies will be used. It is difficult for new entrants into
the existing Wi-Fi spectrum in urban areas. Modified Wi-Fi provides more opportunity, especially 802. 22.
There are issues with unlicensed spectrum: Interference avoidance but no QoS.
We have assumed that the user will pay the same price for both LTE and unlicensed services. Further
scenarios of service price reductions are needed.
Main conclusion: New regulatory scenarios are needed to pave the way.
Considerable reductions in LTE costs are required to make new telecom entrants possible. Commercial
unlicensed networks are already viable (Boingo) and TVWS can enhance their business case by providing
more coverage. The existing political scenario will induce many countries to sell the upper part of the TV
spectrum.
QUESTIONS:
Two questions:
1. Looking at value chain. Apple is in different universe but the rest…. Sometimes they make money
sometimes they lose. Operators make the most money. If I have an opportunity to be an
operator I would, if someone funded me. The satellite domain is being financed now. You touch
on, at the end, that it’s hard to find bandwidth in urban areas—enough to make profit. For rural
areas, TV white space is available there; so that is attractive. Governments will need money and
will lease TV white space and the existing companies will gobble up that white space.
2. The promise of TV white space might change the ecosystem of mobile service providers that are
willing to enter.
ANSWER: Yes, either new entrants or increased use of TV whitespace in rural areas. The high frequencies
require line of sight. The technologies differences will change business plans.
COMMENT: I still don’t think that space will be used like we would hope.
ANSWER: While you have existing provider, if somehow the industry is able to overcome the range of
higher frequencies problem then we will see new entrants.
3.
Could you go back to Case 1 Scenario? Are the costs you are looking at base solely on spectrum?
The hardware price is based on? The available hardware that is used.
ANSWER: Here is that slide. Okay?