It seems like it has taken forever, but the FCC has finally approved the start of the initial commercial Citizens Broadband Radio Service (CBRS) deployments. For those in the industry who have been working on CBRS, it literally has been years of work. There are some happy people in the OnGo Alliance right now. In fact, the original proposal for the shared spectrum dates to 2010, and the FCC’s original proposed rulemaking was issued in December 2012. No one can accuse the FCC of rushing things.
We at iGR have been preparing CBRS deployment forecasts for the last couple of years. We had to keep updating the timeframes as the launch was delayed again … and again … and again. Obviously, this was frustrating for us, but worse for companies that depend on the commercial availability for revenue.
But one especially important development has resulted from the delays: There are now more consumer smartphones available that support the new CBRS band. If CBRS had been launched earlier in 2019 (or even the end of 2018), the devices available for use would have been limited to MiFi routers and embedded modules. This summer, smartphones appeared from Samsung, LG and others.
And on Sept. 12, Apple announced the iPhone 11. Although most people noted the lack of 5G support (not surprising considering the recent switch from Intel to Qualcomm chipsets), the important feature of the new phones is the inclusion of support for Band 48 (3.5 GHz CBRS). In fact, you have to buy model A2111 to get CBRS, but this appears to be the only model available in the United States.
The availability of smartphones from Apple, Samsung, LG and others means that consumers have a wide range of choices for CBRS devices, and the base of potential users will increase far more quickly. Simply put, as consumers upgrade their smartphones, they are more likely to obtain a CBRS-capable device. Someone buying an older model will not have access to the new band.
For the companies, buildings, enterprises, cable operators and mobile operators, the availability of consumer devices means that CBRS can be used more quickly. For example, if a mobile network operator were to deploy CBRS using carrier aggregation to increase capacity in certain areas, subscribers using a new Samsung/LG/Apple/etc. would benefit immediately. And every time a new smartphone is sold, the number of potential users increases. If CBRS had been launched earlier this year, this would not be the case.
iGR has updated its CBRS market forecasts and has included a total addressable market (TAM) forecast for commercial buildings split by vertical industry. We will have more work on CBRS in the near future. CBRS presents a great opportunity for the entire wireless industry, and now, with the availability of consumer devices from major brands, that opportunity will be easier to realize.
Iain Gillott is the founder and president of iGR, a market strategy consultancy focused on the wireless and mobile communications industry. The company researches and analyzes the effect new wireless and mobile technologies will have on the industry, on vendors’ competitive positioning and on its clients’ strategic business plans. Visit www.igr-inc.com.
ExteNet Systems is deploying a Citizens Broadband Radio Service (CBRS) network on the 3.5 GHz band for Mile High Networks, a fixed wireless broadband internet service provider that serves all of Yavapai County, Arizona. The commercial CBRS network is anticipated to be available for customers beginning Q4 2019.
The Mile High CBRS system is part of the FCC’s initial commercial deployment, which is a transitional phase as the FCC checks out the spectrum access system (SAS) providers. The deployment at Mile High makes sense because Arizona is a distance from the coast and won’t interfere with 3.5 GHz incumbent Naval radar. It also makes sense that ExteNet chose fixed wireless broadband internet service as its initial CBRS application, because it currently has 2,000 CBRS-ready wireless internet service provider sites in its portfolio.
“We are doing initial deployments in verticals, such as sporting arenas and manufacturing, but those are in the early trial stages,” Tormod Larsen, ExteNet chief technology officer, said. “Not knowing how quickly the CBRS proceeding would progress at the FCC, we could not commit to those [vertical] customers. In fixed wireless, we could, because we could use Part 90 licensing initially and then migrate them to CBRS when it was available.”
Mile High, which was operating on 50 megahertz of spectrum in the 3.65 GHz band, now will have access to 150 megahertz of spectrum at 3.5 GHz, tripling their available spectrum. As part of the switch over, Mile High employs SAS service from Federated Wireless.
“Besides time-to-market, CBRS delivers much-needed network capacity, speed and bandwidth to serve outdoor and indoor needs for our rural customers,” said Jason Osborne, VP of strategic solutions at ExteNet Systems.
From a business case standpoint, fixed wireless will also be the easiest market to penetrate with CBRS from a number of perspectives, according to Larsen. With additional bandwidth, the fixed wireless broadband internet service provider can either get additional revenue from customers or get additional subsidies from the federal government.
“Fixed wireless provision is an established business model,” he said. “With the additional bandwidth, the provider can add customers or increase the speeds of the existing customers.” With private LTE, on the other hand, it may be more complicated to discern the value proposition.
Nathan Fillmore, CEO at Mile High Networks, said the CBRS spectrum lowers the cost of ownership of the fixed wireless network for his company.
“This deployment will allow us to deliver reliable, high-speed internet that rivals network performances in metro areas,” he said. “We are expecting our customers to have the confidence in our network performance to work on high-bandwidth applications, whether from home or at work or for reliable HD voice and VoIP calls.”
There is still more work to be done on the CBRS initial commercial deployment. All of Mile High’s base stations need to be updated to CBRS, going from Part 90 to Part 96, and made to communicate with the SAS. And each installation must be re-certified.
“There are a lot of details behind the scenes,” Larsen said. “We are on a learning curve, especially communicating with the SAS.”
CBRS is more complex than the traditional, static spectrum allocation scheme. Because the spectrum is shared, the broadband fixed wireless user might not have the same channels one day to the next. The fixed wireless networks previously did not have handoff, but now that has changed. With CBRS, the network can use another tower, in case one tower goes down.
“It changes how you think about designing a network, but also how you configure it,” Larsen said. “You need spectrum access system (SAS) to change the network from a static mentality to a dynamic mentality.”
CommScope’s Ruckus CBRS portfolio and Attabotics’ 3D robotic supply chain automation system were demonstrated as part of Microsoft Azure capabilities for private LTE networks during Microsoft Ignite, the Microsoft annual gathering of technology leaders. held Nov. 4-8, 2019 in Orlando, Florida.
Ross Ortega, partner PM, Azure Networking said, “The Microsoft Azure-based private LTE solution builds on decades of Microsoft enterprise success stories. In collaborating with CommScope and Metaswitch, we see opportunity to enable IoT applications and take advantage of the security, latency and bitrates provided by private LTE networks for our mutual customers.”
CommScope’s Ruckus Citizens Broadband Radio Service (CBRS) portfolio enables enterprises to easily deploy private LTE networks to support innovative Internet of Things (IoT) applications using wireless spectrum recently made available by the United States Federal Communications Commission (FCC). Designed with enterprise IT operations in mind, this new portfolio greatly simplifies the management and deployment of a cellular network. Now, enterprise IT administrators have a new wireless tool that can be leveraged for a wide variety of applications that were not previously possible.
“We are proud that the Ruckus CBRS LTE portfolio was part of this innovative Microsoft demo at Ignite 2019,” said Joel Lindholm, vice president of CBRS Business at CommScope. “Using the end to end encryption of the LTE network, enterprise customers can feel comfortable with the secure nature of this new network. This demonstration highlights how private networks can be used by enterprise customers for automated applications such as Attabotics.”
The Ruckus CBRS portfolio uses separate dedicated spectrum from licensed cellular and Wi-Fi, thus providing cellular-like reliability, mobility, security and quality of service, but with the simplicity of Wi-Fi. Integration of the Ruckus CBRS portfolio with Microsoft Azure’s networking and edge connectivity solutions will enable enterprises to successfully address challenging and critical use cases with dedicated, secure, ultra-high-quality private LTE networks
Ever since the carriers pulled back on deploying additional DAS networks, the in-building wireless industry has been trying to break into the market for enterprises that occupy between 100,000 square feet and 500,000 square feet of space, known as the “middleprise.”
Much progress has been made. Measures have been undertaken to make these systems less expensive, less intrusive and quicker to deploy. Yet the growth expected in in-building wireless (IBW) systems has remained elusive, perhaps until now.
Yet the growth expected in IBW has remained elusive, perhaps until now.
The Citizens Broadband Radio Service at 3.5 GHz could prove to be a great enabler of private LTE systems, which give enterprises something they crave: control. Parallel to the evolution of DAS, quantum leaps have occurred in the area of evolved packet cores, the critical control element of the mobile network that enables the user’s connectivity. Instead of depending on the carriers’ cores, today an enterprise can have a dedicated core on the premises or use one in the cloud providing much of the same functionality as the traditional carriers’ core, but for a fraction of the cost and operational complexity.
I have wondered whether a company could provide service to enough in-building venues to become known as a niche wireless carrier. Is Boingo Wireless a carrier? It is, if you count its Wi-Fi subscribers. Otherwise, leasing indoor wireless infrastructure to an enterprise just makes a firm similar to a tower company.
Then I learned about Geoverse, which is owned by ATNI, a company that owns and operates mobile, fixed and cable television (CATV) providers in Latin America, the Caribbean and the United States. As a result of this relationship, Geoverse can leverage ATNI’s existing roaming agreements with licensed major carriers for its private LTE solutions. In addition, Geoverse’s blockchain transaction platform, known as GeoTrade, presents an opportunity for monetizing the roaming agreements between the public carrier networks and the in-building private LTE network. Geoverse has a relationship with Ruckus Networks and, eventually, will add every major indoor OEM.
Another company involved in monetizing the CBRS spectrum, Syniverse, has teamed with Ruckus Networks and Federated Wireless to develop private, high-speed and secure wireless networks. Syniverse provides the LTE core network, Ruckus Networks provides the LTE access points for the radio network, and Federated Wireless monitors and manages the spectrum.
The key to monetizing these private networks is a blockchain ledger-based billing and settlement system that allows operators manage the logging, clearing and settlement process for the commercial exchanges between parties.
The final piece of the puzzle is the availability of spectrum in the CBRS band, which uses general access licenses to quickly get frequencies into the hands of the enterprises at no cost. If you take access to frequencies, add control over the evolved packet core and the ability to monetize the system, you may just be looking at the future of enterprise in-building wireless.
I am no one to forecast how companies will attack the marketplace, but I have noticed a couple of interesting personnel changes. ExteNet, which has 2,000 CBRS-ready systems in place and can provide its own core, hired Jim Hyde, a man with a rich history on the carrier side (Western Wireless, T-Mobile UK, Ntelos). And then there is Stephen Bye, with more than 27 years of experience with wireless, cable and wireline service providers, who left C Spire to join another CBRS player, Connectivity Wireless Solutions.
Will ExteNet, Connectivity Wireless, Geoverse or Syniverse or some other company become a niche wireless carrier catering to the areas inside of buildings, while the major carriers cover the space outdoors? The market will decide, but the ingredients are there.
SBA Communications came in with good domestic site leasing revenue numbers in the third quarter, thanks to continued 4G densification and early 5G deployments. Delays in the Sprint/T-Mobile merger have put short-term stress on the tower industry, But SBA officials were confident that when the merger is cleared, 5G will take off. And so with the tower industry.
Jeffrey Stoops, SBA president and CEO, also gave visibility to SBA’s plans for involvement in the Citizens Broadband Radio Service, after the auction puts priority access licenses (PAL) into the hands of the carriers and the cable companies.
“We had another solid performance in the third quarter,” Stoops said. “In the United States, we believe we are at the beginning of a long-term 5G deployment cycle that we expect will sustain activity levels for quite some time.”
With all the time and energy carriers are sinking into actively planning the 5G ecosystem, it is only a matter of time before it takes off, according to Stoops. Additionally, commitments by T-Mobile and Dish to build out extensive 5G networks add further proof that the technology will begin growing soon.
“Once there is clarity around the Sprint/T-Mobile merger, tower activity will explode. We believe the 5G iPhone … will prove to be decisive catalyst,” Stoops said. “We anticipate this type of activity to continue for at least the next several years. In the future 5G networks will require the deployment or redeployment of low- and mid-band spectrum further solidifying the importance of macrosites.”
Primarily a macrosite company, SBA also sees a future for growth in in-building wireless. It received one of the first test CBRS licenses and has been trialing new uses primarily for in-building applications where DAS is not economical. In anticipation of CBRS, the company has been growing its portfolio of properties and now manages close to 14,000 properties, in addition to sites it owns. In the third quarter, SBA invested in Federated Wireless, the inventor of the spectrum access system, to further its reach into CBRS.
“We believe the upcoming CBRS auction of priority access licenses [and the General Authorized Access licenses] will unleash a new era of demand for both macro and in-building deployments,” Stoops said.
Domestic Leasing Revenue Increases 6 Percent
All four major carriers were active during the third quarter and accounted for 84 percent of the total leasing revenue. Amendment activity was accounted for 84 percent of newly signed domestic leasing revenue and 16 percent from new leases.
“These amendments represent upgrades to our customers’ existing networks through technological improvements, the deployment of new spectrum bands and the addition of capacity,” Stoops said.
Domestic cash site leasing revenue was $371.4 million in the third quarter of 2019 compared to $350.4 million last year, an increase of 6 percent. Domestic site leasing segment operating profit was $310.9 million, an increase of 8.5 percent year over the year. Sequential quarterly numbers were impacted by the Sprint/T-Mobile merger delays.
“Domestic operational leasing activity, representing new revenue placed under contract during the quarter, was again very solid in the third quarter, although down sequentially from the second quarter because of the delays in the resolution in the Sprint/T-Mobile merger,” Brendan Cavanagh, chief financial officer, said. “Our domestic leasing application backlog continues to be strong, as well, indicating a significant amount of future investment into our customers’ 4G and 5G networks.”
SBA increased its outlook for the fourth quarter site leasing revenue by $4 million, but the outlook also includes some moderation in the services business because of the slowdown from the first half of the year in the activity of Sprint, T-Mobile and Dish Network as they await approval of the Sprint/T-Mobile merger.
“This is logical and expected under the circumstances. We expect an immediate escalation of activity once the outcome of the merger becomes clear and long-term network decisions can be made with certainty,” Cavanagh said.
SBA continued to see churn from Clearwire, Metro and Leap during the quarter as expected. The tower company will churn off $5 million annually for the next two years from these terminations. The churn numbers also include $6 million of annualize churn incurred in the fourth quarter of 2018 from legacy iDEN leases. This is the last quarter where churn numbers will be impacted by iDEN.
During the third quarter of 2019, excluding the sites from the previously announced South Africa investment, SBA acquired 78 communication sites for total cash consideration of $27.8 million. SBA also built 98 towers during the third quarter of 2019.
On August 30, the tower company closed on its option to acquire all but 6 percent of a joint venture in South Africa, including 889 towers, for $140 million. SBA now owns or operates 30,904 communication sites, 16,385 of which are located in the United States and its territories, and 14,519 of which are located internationally.