I understand your view. Somehow I try to merge the technical and the commercial views that I have about this subject. You’re right, in the example you mention, Clearwire and Sprint could try to implement in urban areas, given the fact that inter-site distance is shorter. However, with 2.5GHz you still need much more sites than with 700 or PCS. Then, the problem in rural is replicated, but in a different scale. Also, consider that the initial network planning done in most of the cities was based on lower frequencies (800-900), when AMPS was a leading technology. Then, the implementation of additional higher frequencies has been done on top and the coverage gaps appear, some are patched, some are still there. Going to higher frequencies, always means you need to invest in additional sites to cover the holes. Then again, it’s more expensive, and difficult to make a business case, and as an operator, you lose competitiveness.

Higher frequencies are required, for traffic off-load. They will be used for handling the massive increases in traffic. However, my point is that in order to implement a MBB network, you can’t rely only on higher frequency bands, as it won’t be cost effective. You need to have a proper spectrum allocation that combines lower frequencies and higher frequencies for traffic handling. Operators trying to implement an MBB network based on higher frequencies only, won’t be able to compete.

Heterogeneous Networks (HetNet) tackle this problem, by trying to make this mix of frequencies and technologies, transparent to the user (at least that’s the objective). However, this ecosystem with multi-technologies and multi-frequency bands isn’t mature yet IMO, and we will still struggle few years deciding which are the best bands for LTE, what are the best mix of technologies in which bands, and which chipsets with certain radio frequency combinations will be cheaper to produce. That’s the reason why I think we should be worried about it and focus on solving it.

This is a complex discussion, with a lot of moving pieces, and I’m under the impression that we all seem to ‘get it’. I think Bode and Burnstein mostly get it, too, but are just bear a little (possibly deserved) anti-carrier vitriol.

In particular, I like Omar comment. “…even though I see how AT&T could be using this in order to support its acquisitions in a convinient way, it doesn’t affect the fact that there is a spectrum issue that we need to worry about.”

Karl Bode wrote more right than wrong, I just think that he lost me with this, “buried below industry histrionics is data noting that there really isn’t a spectrum crisis as much as a bunch of lazy and gigantic spectrum squatters, hoarding public-owned assets to limit competition, while skimping on network investment to appease short-sighted investors.”

Partly true, for sure. There is strategic (monopolistic) advantage in hoarding spectrum. But I think there IS a crisis, but that it can be addressed and mitigated. And I certainly don’t think there has been “skimping on network investment” in the 2007-2012 time frame. If you to discuss skimping on network investment in the USA, lets talk about the 1999-2006 time frame.

I think we agree for the most part, but I also tend to be skeptical of the beachfront spectrum argument. We’re going to need to use every airwave we can find to fuel the mobile broadband revolution and they call can’t all be 700 MHz or PCS. You’re right 2.5 GHz is hardly ideal for a launch outside of dense urban areas, but Sprint and Clearwire aren’t even launching WiMAX or TD-LTE networks in urban areas anymore where smaller cell radii don’t work against them.

If the higher frequencies are really that bad, then maybe we should scrap the auction process and broadband plan and just make everything above PCS unlicensed. Wi-Fi and other technologies could make far better use of it then. That, however, would confine operators to smaller swathes of airwaves making them coverage providers not the key capacity muscle of the network. I doubt they would go for idea.

I would say, though, while you make a lot of good points for the capacity crunch on operators’ current networks, but not necessarily the case for a spectrum crisis.

I agree operators will need more spectrum in the future. But until operators actually launch their own unused spectrum it’s hard to take them seriously when they claim their spectrum problems are immediate, which is exactly what AT&T appears to be claiming (though Sprint and Verizon not so much).

Then, there is a very complex problem with spectrum allocation and ecosystem maturity, that needs to be taken into consideration. LTE has been deployed in different frequencies, but now we see some consolidation in 800EU, 1800 bands, and 700.

Additionally, the spectrum efficiency that was increasing exponentially in the last 15 years, is not increasing anymore. The spectrum efficiency of LTE compared to HSPA+ is very similar, and we have reached a theoretical roof. It’s not impossible to increase efficiency, but it will just be harder and more expensive (256QAM, MIMO4x4).

Then, even though I see how AT&T could be using this in order to support its acquisitions in a convinient way, it doesn’t affect the fact that there is an spectrum issue that we need to worry about.

With all due respect to Bode and Burnstein, I say the facts support the hypothesis that the carriers aren’t lying:

- Why would the carriers spend $19B at the LTE auctions if they were not constrained?

- Why would the carriers be investing constantly to upgrade their networks (AT&T goes about $20B per year) if there were no capacity crunch?

- Why would US carriers deploy LTE among the first in the world if there were plenty of capacity on cheaper, and amortized 3G networks?

- AWS is oddball spectrum, and as you know is the cause of some of the problems T-Mobile faces. 2.5GHZ is bad range spectrum, and Sprint has tried to use it, but hasn’t had market success with Clear or WiMAX.

- Sprint, which you mention has plenty of 2.5GHz, is also quite constrained on their Nextel 800 band, which they agreed to vacate years ago in the spectrum swap because of first responder interference. The scarcity of 800MHz spectrum is what drove the bad quality iDEN service that churned their customers away and gave their brand a massive black eye. So they know well the relationship between spectrum constraints and bad service. AND still, they actually are not a carrier that complains loudly for more spectrum.

Are the carriers making billions in investments just for show? I understand that they could be bidding on spectrum just to hoard it, but that doesn’t appear to be the case with the most recent 700MHz auction. Beyond hoarding, I see billions of dollars spent on building capacity, and that isn’t consistent with the claim that they’re faking.

Next argument, of course AT&T has had a drop in data growth rates. But what else happened in the time period discussed? Wassat you say? A usage cap and tiered services? Well, doesn’t that go a long way towards explaining the mitigated growth? Subscribers got put on the meter, of course growth was affected.

The truth is, cellular bandwidth demand is still massive and growing fast. New users are buying smartphones at a dizzying rate. But there is a list of mitigation strategies, some of which have already been implemented, which work to handle the tide.

- tiered services and caps
- wifi offload
- smaller cells
- better modulation, ex: LTE, LTE-Advanced
- more spectrum
- infrastructure sharing
- DAS, picocells, femtocells
- better signaling chatter in devices
- incentivize developers to produce more data-efficient apps

I’m sure I missed some there. But the fact of the matter is that the data tsunami was spotted by 2008, as AT&T was getting killed by iPhone users, and all carriers started buttressing their defenses against the wave. The tsunami wasn’t overstated, or didn’t go away. It is just being partially managed.

What would have happened if the Army Corps of Engineers had been funded and given time to adequately improve the levees around New Orleans before August, 2005. Would we say that the Katrina storm surge wasn’t so bad after all? Some might. But in fact…we just would have been better prepared.

That’s one of the things that’s always puzzled me about the relentless quest for faster speeds the operators have been on. Considering what the cost of a MB is on a mobile data today pushing toward 50 Mb/s to 100 Mb/s connections seems a bit silly. I understand there are efficiencies to having fatter pipes, but if you offer developers and consumers faster speeds they’ll only fill it — and then complain about the cost of their data bills.