3G Interrupted

Service providers in the United States had been drooling in anticipation of the arrival of third generation (3G) mobile wireless broadband services, but they will be disappointed by recent events.

by Patricia Fusco Managing Editor ISP-Planet [August 3, 2001]

You can almost hear the collective sigh of disappointment escaping wireless broadband service providers around the country.

The Federal Communication Commission late last week received a delay on its July 31st deadline for identifying spectrum for third generation (3G) high-speed wireless services. Consider the October 2000 then-president Clinton Executive Order that set forth a timeline to fulfill the promise of wireless broadband access—3G interrupted.

Dead air
Secretary of Commerce Donald Evans asked the FCC, in a letter dated July 19, to extend their spectrum management efforts to "ensure the final allocation decision is the best possible one." FCC Chairman Michael Powell responded with a request for a deadline extension to the Department of Commerce.

As far as we can tell, no new deadline has been set.

To date, three spectrum bands have been identified for possible use for 3G systems: 698 to 960 MHz, 1710 to 1885 MHz, and 2500 to 2690 MHz. Part of the 1710 to 1885 MHz band is currently being used by federal agencies, particularly by the Department of Defense.

The National Telecommunications and Information Administration (NTIA), which is a part of the Department of Commerce, has responsibilities regarding spectrum management for spectrum used by government entities. This includes the 1755 to 1850 MHz band.

The FCC has spectrum management responsibilities for spectrum used by the private sector. This includes the 2500 to 2690 MHz band, which is currently being used for MMDS, MDS, and ITFS.

Generally speaking
According to a report by the General Accounting Office (GAO), the Departments of Commerce and Defense need to do more work before reallocating military spectrum for commercial 3G wireless services.

The GAO reported that the impact of any revised allocations needs to be reassessed, which means that the Defense Department needs to complete a system-by-system analysis to determine its spectrum needs now—and in the future.

The Pentagon also said it could take more than a decade to move off the airwaves in question.

Meanwhile, the nation's biggest wireless carrier, Verizon Wireless, a joint venture of Verizon Communications and Britain's Vodafone Group, said its collective economic growth depended on Capitol Hill's remedy for airwave management during congressional hearings.

What were they thinking?

Rep. Chip Pickering (R-MS) is attempting to balance Verizon's pleas with the Pentagon's problem. The Republican from Mississippi is slated to introduce legislation after the August recess that would guarantee compensation for those government agencies that move off airwaves to make way for commercial services.

Essentially, the Congressional remedy for 3G spectrum limitations is to let commercial enterprises pick up the tab for reallocated government services. Better than the taxpayers in general?

The funding for our nation's wireless security systems could be placed the hands of an East Coast incumbent carrier. Look out New York City—a rate-raising ruckus is heading your way soon.

According to a report from SRI Consulting Business Intelligence, among the continuing problems that are cited as plaguing the worldwide 3G industry is the extremely large investment is necessary to purchase operating licenses and expand infrastructures.

Lacking sufficient operating spectrum and venture capital are barriers to deploying 3G data services. But the SRI report indicated there is a larger issue that the wireless industry will need wrangle—demand. "There is no evidence indicating that consumers are willing to pay premiums for higher-cost 3G services," the analysis reported.

Third-generation wireless data services may promise a wealth of new and improved capabilities for wireless and mobile devices, but the race to roll out 3G offerings has slowed to a snail's pace.

If there is no spectrum plan, then there can be no 3G wireless in the U.S. If there is no venture capital, then there will be no wireless infrastructure. But if there is no demand—what's the point of allocating the spectrum and raising the cash?

— End