As a division of InSite Wireless Group, Agile Network Builders is in charge of forming public/private partnerships and connectivity services, providing its customers with a package of siting solutions on macrotowers, DAS and roof tops. In its first transaction since joining InSite three months ago, Agile has created a new partnership with the Pennsylvania Department of General Services to rent excess and underutilized wireless capacity on towers, land and assets owned by the state of Pennsylvania.
“It really helps our anchor customers, like the carriers, to achieve a quicker time-to-market with the involvement of fewer parties and a quicker on-air time,” Agile President Kyle Quillen said.
Agile is now an operating entity owned by InSite Wireless Group, an owner, developer, operator and manager of wireless towers and in-building DAS.
“The Pennsylvania contract didn’t happen overnight,” Quillen said. “It was a long and detailed procurement process. Agile had been negotiating the deal for some time before it was purchased by inSite, which now will bring its resources and expertise to the table, so we can maximize the revenue generation for Pennsylvania.”
Agile is hardly new to public/private partnerships, having worked in Ohio since 2010 with governments at the state, county and municipal levels.
“I think that is one of the reasons Pennsylvania was attracted to us,” Quillen. “We have the expertise and a track record of success working with agencies and leveraging public infrastructure for monetization and expansion of services.”
Through various public partnerships, Agile has connected more than 500 public safety tower sites across Ohio. The hybrid Agile network uses vertical infrastructure along with fiber and wireless technologies to provide data solutions to wireless carriers, among others.
“We built a network in Ohio and we, hopefully will bring that same solution to Pennsylvania in order to drive lease up opportunities across the board,” Quillen said. “We look forward to success as a steward of public infrastructure and a partner tasked with an awesome responsibility.”
Ranked sixth largest in term of population and nine in terms of density, Pennsylvania has a great deal of infrastructure in place.
“It is a large state in a number of ways, which is a positive in showing an example to other large organizations of what can be accomplished. This is absolutely do-able to engage the private sector with public agencies in a win-win scenario,” Quillen said. “Pennsylvania had the foresight and the willingness to go somewhere that few have ventured into, yet.”
Other states have entered into public/private partnerships with telecom companies, but none of those agreement have been as comprehensive as the Pennsylvania contract.
“What is unique about what we have done is we’ve opened up a broad subset of Pennsylvania state infrastructure both in service and operational today, as well as undeveloped lands and assets. That creates a different kind of asset base, which can be leveraged for a variety of purposes,” Quillen said. “We think we have a good model that other states can learn from and we stand ready to help them.”
The creation of the Office of Enterprise Wireless Management is the result of a 2016 study by the Wolf Administration and a Pennsylvania research university that reviewed the state’s wireless communications infrastructure and benchmarked the value of excess and underutilized wireless capacity on those assets to serve as a viable new revenue stream for Pennsylvania.
The newly established Office of Enterprise Wireless Management within the Pennsylvania Department of General Services and Agile will enhance telecommunications systems, consolidate the management of wireless assets, and generate revenue for the state.
The process of marketing preexisting space on state-owned towers and telecommunications assets also will streamline the process of locating broadband equipment on assets across Pennsylvania. This market-based initiative will lower barriers to entry for all market participants and may further promote broadband expansion using those towers and telecommunication assets located in remote and rural areas.
“This development by the leadership in Pennsylvania is an important and proactive step in an on-going effort to ensure all residents, in every part of the state, have better access to wireless services,” Quillen said. “We’re excited to partner with Department of General Services and the Office of Enterprise Wireless Management to utilize our expertise in municipal and government telecommunications, ensuring the right solutions are implemented in markets across the state.”
InSite Wireless Group has expanded its broadcast tower portfolio through a management agreement with TEGNA, a TV broadcast group, to provide operational support, as well as marketing services, for TEGNA’s wholly owned broadcast towers.
InSite had already been adding to its broadcast tower portfolio. Of its 2,000 total towers, 180 have broadcasters as tenants. The addition of TEGNA’s portfolio brings asset from 51 television stations and four radio stations in 43 markets. It is the largest owner of the top four affiliates in the largest 25 markets.
“The TEGNA tower sites are a large portfolio and a great complement to our already robust broadcast tower facilities across the United States. There is not a lot of overlap. They have extended our reach,” said David Denton, senior vice president for broadcast, who manages InSite’s existing owned and managed broadcast tower assets.
TEGNA will maintain ownership of the towers, while InSite will add revenue, marketing to new tenants, and manage operations by taking care of existing tenants and maintaining the facilities.
“Working with InSite will improve our ability to support, maintain and monetize our TEGNA owned broadcast towers,” said Robert Lydick, vice president, information technology and station operations, TEGNA. “We chose InSite for its industry expertise and we look forward to working with the InSite team to drive value for TEGNA and our portfolio of broadcast towers.”
In another bonus of the tower management agreement, as the TEGNA tower portfolio continues to grow so will InSite’s. In fact, on June 11, TEGNA purchased television stations WTHR, in Indianapolis, IN; WBNS, the Columbus, OH; and WBNS Radio, central Ohio. Before that, in March, the broadcaster added 11 more TV stations to its holdings.
Broadcast Spectrum Repack
With the additional towers, InSite will become even busier. The TEGNA agreement comes during phase four of the 10-phase broadcast repack, which began following the conclusion of the broadcast television incentive auction in April 2017. Certain broadcast TV stations are required to move from their pre-auction channels to new channels in the reorganized broadcast television bands. Many markets are still in the process of changing out broadcast antennas and some have not yet begun.
“We are full speed ahead in the repack in markets across the United States. It puts a lot of strain on tower crews that can do this type of work,” Denton. “We love towers. We love the broadcast business. We are excited to take on this additional responsibility.”
July 18, 2017 —
Speaking in Orlando, Florida, on May 23, executives of five large tower companies answered questions at a session named “The View From the Top.” The occasion was the Wireless Infrastructure Show, and the executives were Steven C. Marshall, executive vice president of American Tower and president of its U.S. tower division; Jay Brown, president and CEO of Crown Castle International; Jeffrey A. Stoops, president and CEO of SBA Communications; Alex Gellman, CEO and co-founder of Vertical Bridge; and David E. Weisman, president, and CEO and co-founder of InSite Wireless Group. Jonathan Adelstein, president and CEO of the Wireless Infrastructure Association, was the moderator. The following are highlights from the session, edited for length and style.
Adelstein: Could you reflect on how you thought the FCC’s broadcast incentive auction came out and what it means for wireless infrastructure?
Marshall: The incentive auction has been a really great success. It obviously makes available additional low-band radio-frequency (RF) spectrum that will be deployed in the next three years or so.
American Tower will be working to decommission and reinstall our broadcast tenants where appropriate. We’ll see some churn from some of the broadcasters that are exiting the market. We see an upside from auxiliary broadcast antennas.
Brown: To have another band of spectrum and more opportunity for us as infrastructure providers represents long-term growth. I encourage people on the investment side to think about the long runway of growth. Whether the new RF spectrum band is built this year, next year or later, the demand curve suggests that it is needed. When it does get built, it will be good for our industry.
Stoops: Given the characteristics of the SBA Communications portfolio, network deployment in the 600-MHz band will be quite positive. I’m encouraged by the actions of the leading winner, T-Mobile US. It would not surprise me if they really got a good jump on things and got a lot done well ahead of the 39-month targeted timeframe. They’ve already done an excellent job of getting ready.
Gellman: My view is slightly different. If you look at the FCC Auction 14 for Wireless Communications Service spectrum, if you look at the incentive auction, and then if you look at the bidding between AT&T and Verizon for Straight Path Communications and its spectrum holdings, we’re seeing real differentiation and a change in perception of the value of spectrum. Before FCC Auction 14, beachfront real estate was considered to be at 800 MHz, 700 MHz and even 600 MHz. Now, I think it’s more mid-band because of the demand and the density of demand. And then you have this bidding for Straight Path, which is obviously for millimeter-wave spectrum. There’s a clear evolution in the value of different spectrum bands. The next step we’ll see will be carriers rationalizing their use of spectrum by geography and density.
Weisman: It is all good news in terms of utilization of the 600-MHz band by the wireless telecommunications carriers, particularly now with more spectrum being purchased by Dish Network, building up the inventory of undeployed, future-use spectrum, which is great for the wireless infrastructure tower side. For those who own broadcast towers — and I know American Tower and InSite Wireless Group do — it finally broke a wait-and-see attitude that has prevailed in the telecom broadcast TV industry until these auctions took place. Now, we have a much more robust, active broadcast market that is adding value to our infrastructure assets in the broadcast world.
Adelstein: The First Responder Network Authority (FirstNet) network shows signs of getting up and running. What effect will it have on your companies, and what do you see in the timing?
Marshall: The FirstNet contract winner, AT&T, has a clear plan that will be great for the United States and great for the wireless infrastructure industry. The American Tower portfolio of towers will be extremely important for AT&T to achieve its goals.
Brown: It’s a new network build. It’s been a long time in the industry since we had a full new network build that happened nationwide.
Stoops: Not only will the FirstNet network be deployed at 700 MHz, but AT&T, to its credit, spoke publicly about waiting for this to deploy a lot of the undeployed AWS3 spectrum, the Wireless Communications Service spectrum. It is a smart move on AT&T’s part to piggyback this with the FirstNet rollout, for which they are receiving a big check from the government to help with facilitating the construction. FirstNet will be a good thing for our industry for many years to come.
Gellman: It was three years ago at this show when AT&T basically pulled the plug, literally in real time. It’s great that for the market that AT&T is returning to invest in the United States in wireless, and it’s a great thing for AT&T. Having healthy carriers is good for all of us. AT&T deploying 16 megahertz of pretty much clean spectrum will give them a tremendous capacity boost. That can’t be anything but good for all of us.
Weisman: FirstNet is not just an urban play; it’s a rural play as well. The benefit and the build out will be felt nationwide. It’s going to take place where there is a need for coverage, and that will be a catalyst for growth for the infrastructure builders.
Adelstein: How are your companies preparing for fifth-generation (5G) wireless technology? Are you involved in some testing? What effect will 5G have on towers?
Marshall: The wireless infrastructure business is at the sweet spot at the moment, with T-Mobile on the 600-MHz band, and FirstNet, and then a new technology coming along. With 5G, the standards are still evolving. It’s highly unlikely that we’ll see significant deployment of 5G-specific equipment into the network for a few years, probably not until 2020. There may be some early testing and some fixed broadband. But for truly mobile 5G, it’s going to be post-2020 before we see anything significant. Meanwhile, there is much work to be done to understand the siting requirements and help the carriers prepare for the transition from 4G to 5G.
Brown: 5G brings an opportunity for our carrier customers to increase average revenue per user (ARPU) with wearables, autonomous cars, smart cities and other applications. They need a financial return for the investment of capital that they are making in their networks. 5G looks like it presents a real opportunity to be a game-changer for their returns and, therefore, it justifies a significant investment in the network.
Whether we think about macro towers or small cells, carriers will invest in them to take advantage of a new revenue stream. In the early days, what drove the first several years of the massive investment in wireless infrastructure was the opportunity for wireless carriers obtain a terrific return on investing in infrastructure and spectrum by building out of their networks. 5G may be the next big wave in the investment cycle.
Stoops: At SBA Communications, we have been watching how 5G is developing. The 5G millimeter-wave application primarily for use in dense urban markets seems to have attracted the most attention. What’s not receiving as much attention and what’s exciting for us because of the nature of our tower portfolio is mobile 5G. T-Mobile and some others have spoken of plans to use some 600-MHz spectrum for mobile 5G, which would roll out nationwide. It will take several years to accomplish the frequency changes and other things that will make 5G what it’s expected to become. What we’ve been told by many folks is that the carriers will need all new radios and probably mostly new antennas.
Gellman: A year ago, we were thinking about 5G as achieving some mobility by 2020. What’s different a year later is more expectation of deployment of fixed 5G as an onramp for mobile 5G. That means there’s something to expect before 2020 that will require significant investment to deliver over-the-top content
The original wireless application took the phone and made it wireless. The carriers monetized it well, making a profit and replacing landlines. Next came the internet. They didn’t do as good a job at monetizing it, and they suffered a little. Now, with video, which is even more competitive, they haven’t really monetized it. Their ARPU is falling.
The 5G ecosystem with the internet of things and connected devices gives wireless carriers an opportunity to expand the revenue base. The most recent results are pretty bleak. It didn’t give any of us in the wireless infrastructure business much comfort to see ARPU falling. We like unlimited data plans, but wireless carriers have to have the money to support the network to support unlimited data plans. Thus, opening up new frontiers of revenue opportunity is important.
Weisman: As 5G rolls out and develops, an infrastructure provider goes through a number of iterations, trying to understand the variance of the “what ifs.” What are the networks going to look like? What are the deployments going to look like? How is it going to affect our existing infrastructure?
The second item is how is it going to add to more opportunities to layer in additional places for our infrastructures? InSite Wireless Group has acquired portfolios of real estate assets or other sites that may work in a densification strategy, as well as taking steps to understand the backhaul or fronthaul opportunities at our sites.
Adelstein: Another aspect of 5G is smart cities. How will your companies fit in with the smart city movement, and what is needed to support it?
Marshall: In smart cities, many new services and capabilities will be deployed that will lead to improvements in efficiency and effectiveness. Ninety-five percent of American Tower’s assets lie in urban and suburban areas outside of the dense urban areas of smart cities. Thus, the smart city movement doesn’t offer an immediate opportunity for us. However, because of the opportunities that exist, we continue to evaluate whether there are types of shared infrastructure where we can bring our model and add value for the carriers, and help them with an acceleration of deployment. That’s somewhat in the future for us.
Brown: I put the smart city movement in the category of enterprise opportunity for wireless. For the past 20 years, most wireless telecommunications growth came from consumer applications. Smart cities present a new enterprise revenue opportunity for wireless carriers Smart cities will require additional wireless infrastructure and are likely to lead to additional returns for wireless carriers.
In smart city initiatives, small cells will benefit greatly. Meanwhile, in dense urban areas, macro sites, including rooftop sites, will be incredibly valuable as hub sites in providing overall macro coverage for mobility and other things. To place wireless access points closer to the application base requires significantly increased site density, and small cells will be a big part of that.
Stoops: SBA Communications focuses on macro sites outside of urban markets. Smart cities will be another extension of urban architecture, primarily consisting of fiber-fed small cells. Where macro sites are involved, we’ll be involved. But the smart cities will develop alongside some of the efforts of our customers as they build out these dense urban quarters.
Gellman: The Vertical Bridge portfolio looks more like SBA Communications’ portfolio than the others, so my answer is similar. Ancillary opportunities, the internet of things and smart cities will place carriers in competition with one another to offer instant availability and ubiquity versus more niche-integrated plays that offer specific savings and efficiencies to specific enterprises. It’s going to be difficult for the niche players to succeed if they can’t find verticals [customers with specialized needs] to penetrate that market and really establish a presence versus the already-there, giant footprint and ubiquity of the big carriers. Some will make it. I just don’t know how.
Weisman: Outside of urban areas, InSite Wireless Group’s portfolio is similar in a macro sense, but we have in-building wireless projects. And, we built out the Boston subway system with 22 miles of underground tunnels and 39 train stations. We’re building out Los Angeles and Atlanta. During that process, you can see what happens. The municipal authority comes to us with additional asks. We had no Wi-Fi offering when originally building in Boston. We now have Wi-Fi provided by one cable company on all the platforms, inside and outside.
In Atlanta, we were awarded the project, and they came back to us and said, “We want free Wi-Fi deployed in a certain timeframe.” The mayor of Los Angeles came to us and said, “We have a 75-year history with Union Station. I need free Wi-Fi in 30 days.”
What we find is the dangers in the ask. The smart city is a great desire, and it will be a great add-on, but the implementation will be complicated.
Adelstein: Are small cells a substitute for macro sites, or are they more of a complement or supplement? What do you see as the future for the small cell business?
Marshall: Small cells inside buildings differ from small cells outside buildings. Small cells deployed in open areas outside buildings are complementary to the macro overlay. They add capacity in dense urban areas where there’s a lot of demand for data coverage. American Tower has not attacked that market.
The growing need for in-building coverage to meet wireless data levels expands the need for more buildings to have a discreet wireless capability. We see opportunity there.
Brown: Crown Castle has built more than 20,000 small cells, mostly in the top 10 U.S. markets. We have 25,000 nodes under contract to build, the majority of which are in the top 20 U.S. markets. Those systems are being built relatively near existing macro sites. We don’t perceive the small cell roll-out as a threat to the macro sites because the macro sites continue to be the most cost-effective, efficient way for the carriers to deploy their networks
Given the current data use with 4G and the anticipated data use with 5G, it wouldn’t be possible to place enough macro sites into the environment and reuse the RF spectrum in ways that would fully meet the demand for wireless services.
Think of it as small cells being the lamp in a room, and macro sites are large overhead lights. Large overhead lights do what towers do — they provide broad coverage and cover large geographies, and you also need lamps in the room in order to accentuate a room and improve the wireless coverage. That’s what wireless carriers use small cells for, and we see it as complementary.
Where macro sites will meet the need and small cells won’t be needed, you won’t see carriers deploying small cells. For large portions country for some time to come, macro sites will support the wireless networks. In more urban and dense urban areas, you will see a combination of macro sites and small cells.
Experience seems to support this view. All wireless infrastructure companies use long contractual terms with the macro sites. At the same time we see carriers commit to using towers for 10 to 15 years, we’re working with them in the same neighborhood on small cells. They don’t view small cells as anything other than complementary in accomplishing their network goal. We expect that pattern of network development to continue.
Stoops: Jonathan (Adelstein), the SBA Communications investor base has been keenly interested in the answers to your questions about small cells almost since the dawn of small cells. To speak to that point, I’m unaware of a single macro site that has been taken down and replaced by small cells.
Carriers use macros to provide basic coverage, and then add small cells for capacity where necessary. That’s how our customers think about it. That’s how all the engineers that we speak with think about it. I am more convinced than ever that small cell use is complementary architecture and not competitive.
Gellman: To date, small cell use has complementary, unquestionably. You always need the umbrella within which the small cells operate. Where small cell architecture is competitive is on the margins. In certain geography, small cells make the most sense for the cost per megabit and density delivered. In the vast majority of the U.S. land mass, using small cells will never make sense. But on the margin, where carriers seek the lowest cost per megabit delivered, there will be some competition to deploy small cells instead of macro sites. What the size of that geography is will be a function of the relative cost of the two types of sites.
I agree with Jeff (Stoops) that you won’t see small cells replacing existing macro sites, not for a long time, if ever.
Weisman: The use of small cells is completely complementary. The competition is probably for the capital allocation dollars — what the carrier is going to spend in a particular year. The pie of allocation is but so large, and they’re going to now allocate X for macro, Y for DAS and Z for small cells.
Gellman: I’ve seen geography where one carrier will have a DAS and another carrier says, “Please build me a tower here.” That tells me ultimately there is some layer where there’s a choice. The carriers believe there is a choice.
Adelstein: Speaking of capital expenditures, where do you see that heading for the carriers? They are in a difficult situation in which prices are dropping dramatically, yet they’re competing with one another on network quality. How can they make the necessary capital investments to keep up with the huge growing demand? What do they expect to see in capital spending by carriers?
Marshall: We’re seeing historically that the carriers in aggregate are spending around about $30 billion a year. We’re seeing that data growth across the network has been growing about 40 percent a year. There are projections widely quoted that show data consumption continuing to grow at 35 to 40 percent a year up until 2021.
Carriers recognize they have no option but to continue to invest at that level to meet the growing needs of the marketplace. Carriers also see a future in the wider applications and revenue sources that Jay mentioned. On top of that, they complement existing capabilities with content, availability and delivery that increase the appetite to use their networks and services, and to consume their content. We will see a continuity of investment, and we might even see a slight pickup.
Brown: In the wireless infrastructure business, on our worst day, we had really good growth, and on our best day, we had really good growth. Within that experience, the return for investors has long been terrific. The reason is because carriers have invested within a reasonable band of activity, a similar amount over many different economic cycles as they follow the consumer and the usage on their networks. The investment they make is justified.
Where carrier capital expenditure budgets are concerned, there’s a long trajectory and runway of investment. At times, maybe we see variations of plus or minus 10 to 15 percent, but I expect to see as much opportunity and growth in the next 10 to 15 years as there has been in the past. The wireless infrastructure business does best when we think about the investment over a long period, rather than trying to judge the right inflection point that may or may not occur in the next six to 12 months.
Stoops: The past 20 years have shown that there’s always more to do on the networks, whether it’s technological change or keeping up with wireless demand. Variations in our customers’ capital spending are purely financial as opposed to operational or anyone feeling like, “Okay, I’m ahead of the game on the network.”
All of us in the wireless infrastructure business would like to see our customers as healthy as possible. I’m optimistic about the current prospects for tax reforms that would be good for our customers. What happened in May with net neutrality could possibly help our customers monetize their networks to maximize the value that a number of other folks in the ecosystem have been somewhat riding on for free.
Those are two important things that will help our customers, who are involved in difficult price wars. I don’t know that the price wars can last forever. It’s hard to believe how much more we receive for our money today compared with what our wireless builds were and the quality of the service three and four years ago. We should all pay more for our wireless service. At least, the people in this room would be happy with that.
Gellman: Another factor is scale. Carriers are trying to gain the scale that would allow them to squeeze efficiencies out, create more free cash flow and use it to invest in the network. An ultimate example could be Sprint and T-Mobile. If they combine, prices will go up and unlimited data plans will go away.
Weisman: Today, two of the four largest carriers are deploying capital, and we’re still receiving an excellent increase in returns and organic growth. If we had three robust carriers building out their networks, we would have much more ability to sell them access to wireless infrastructure.
The other matter is undeployed RF spectrum and network capacity demand that flows from new service offerings in mobile data. The carriers won’t all stop spending capital at the same time. As long as one or two continue to build out, the others will be forced to take steps to remain competitive.
The next Wireless Infrastructure Show is scheduled for May 21–24, 2018, in Charlotte, North Carolina. Photography by Don Bishop.
June 27, 2017 —
An analysis of the small cell market conducted by Mobile Experts concludes that the market is evolving rapidly. Kyung Mun, a senior analyst, said small cells will become an integral part of mobile networks as operators make the move toward hyperdense networks with 5G services.
Technology choices range from frequency-division duplex/time=division Long Term Evolution (FDD/TD-LTE) modulation, unlicensed and licensed-assisted access LTE (LTE-U/LAA), LTE and wireless local area network aggregation (LWA), Citizens Broadband Radio Service (CBRS), and even carrier Wi-Fi (self-organizing and self-optimizing Wi-Fi). The study found that although major mobile infrastructure suppliers, including Ericsson, Huawei and Nokia, take larger shares of the carrier outdoor segment through macro-parity small cells that take advantage of macro footprints, smaller companies, such as Spidercloud and Airspan, are finding success in enterprise and indoor segments at several Tier 1 mobile operator accounts.
By 2022, Mobile Experts predicts small cells’ revenue to triple, reaching more than $4.5 billion over the forecast period. Mun said that although the overall market includes residential femtocells, the growth for nonresidential small cells is more dramatic.
“We expect carrier and enterprise segments to grow at more than a 30 percent compound annual growth rate from 2016 to 2022,” he said.
DAS and Wi-Fi
The long-suffering mobile network and Wi-Fi service at the Las Vegas Convention Center now works well, thanks to an $18 million upgrade by Cox Business and InSite Wireless Group.
Hugh Sinnock, vice president of customer experience for the venue operator, the Las Vegas Convention and Visitors Authority, said the indoor DAS and Wi-Fi system boasts more than 2,200 access points and a capacity equal to 14 cell towers. During the International Wireless Communications Expo (IWCE) conducted in March, Sinnock spoke about the installation.
DALLAS — May 25, 2016 — One of the sessions at the Wireless Infrastructure Show dealt with emerging technologies and their implications for wireless infrastructure. Ron Mudry, president of Tower Cloud, led the session. He described how backhaul is evolving to meet the needs of emerging technologies, saying there is adequate backhaul in most markets and even in rural areas.
“What we’ve seen lately is Verizon moving from lit service to dark fiber,” Mudry said. “Many dark fiber builds are going on around the country. It’s a big initiative that is putting a lot of infrastructure in the ground. The previous fiber build is nearly 20 years old, dating to the dot-com era.”
Mudry said wireless carriers have been densifying their networks because of capacity constraints. “They’ve added a lot of macro towers,” he said. “That’s provided a lot of the growth for backhaul providers and others in the industry. Now we’re seeing that shift a little to bringing capacity with small cells and mini-macros and centralized radio access network (C-RAN) technology.”
Dr. Rikin Thakker, a research assistant professor at the University of Maryland, said that cellular network operators have enough RF spectrum to serve their networks, for now. He said that operators say they need more spectrum because of a forecast rise in data demand. But research indicates other substitutes for spectrum.
“Macrosites are not going away, even though we are talking about the Internet of Things, 5G cellular technology and small cells,” Thakker said. “Macrosites will play an important role, and that could be a good substitute. Increases in efficiency with technology decrease the burden on spectrum. Wi-Fi offloading has kept the demand on licensed spectrum lower. Just increasing macrosites by 5 percent could lower the need for licensed spectrum by 98 megahertz.”
Aaron Blazer, a senior partner at Atlantic ACM said the network operators’ end-user revenue comes under pressure as competition increases. The result trickles down into infrastructure. “Operators pay attention to operating expense and the ability to deploy capital on infrastructure,” he said. “When spectrum is tapped, you look for the most efficient way to boost the network. Deploying more macrosites is a business model that carriers understand. The economics of backhaul and macrosites are well understood.”
Blazer said that when macrosites aren’t enough, non-macro densification emerges in the form of small cells and outdoor distributed antenna system (DAS) networks. He said another alternative is C-RAN technology, where operators use remote radio heads with a centralized baseband unit to make more efficient use of spectrum. He explained that a heavy fiber component changes the cost structure, especially a dark fiber component, and sometimes fiber is not available.
“After that, we see operators looking to Wi-Fi and other offloading strategies to support the network,” Blazer said. “But Wi-Fi comes third because it is not always seen as a carrier-grade technology.”
Rich Grimes, the chief operating officer of the DAS and Small Cell Group at InSite Wireless, said the carrier market for in-building DAS is finite. According to Grimes, from a carrier perspective, venue revenue-sharing is questionable. He said there is higher scrutiny for lower-capacity venues, and more cost-effective solutions will be used.
“In the forecast for DAS, capital spending for this year is pegged at about $4.8 billion and rising about 28 percent per year to more than $16 billion in 2020,” Grimes said. “A focus we’re all seeing is on reduced cost for in-building wireless systems. Also, fiber will become increasingly available to commercial buildings, and third parties in the enterprise will take a greater role in deploying DAS with the carriers’ focus being more on the capex for the LTE-Advanced roll out and small cell preparation for 5G.”
Kishore Raja, director of strategic programs at Boingo Wireless, categorized emerging technologies in three domains.
“Number one is the process of natural evolution within the licensed spectrum,” he said. “You have macro towers, and you have DAS, which augments existing towers. You have small cells, which augment by adding capacity and coverage. Number two is emerging technologies on unlicensed spectrum, such as seamless Wi-Fi access to networks. Number three is emerging technologies in the area that bridges licensed and unlicensed spectrum, such as LTE-U[unlicensed], LAA [License Assisted Access], LWA [LTE – Wi-Fi Link Aggregation] and muLTEfire. MuLTEfire provides LTE-like performance with Wi-Fi-like simplicity.”
Robert Long, director of sales at Crown Castle International, said that regardless of the path it takes, the need for more infrastructure will continue. “By 2018, 4G data use is expected to increase by a factor of 10,” he said. “Cell phone data use will increase by a multiple of six. Add the Internet of Things, smart cities and autonomous vehicles. Providing a solution that’s sharable, whether it’s fiber, towers or small cells, if it’s sharable, it’s much more economical for the service providers.”