AT&T, Verizon Wireless Underwhelming Plans for 700MHz Spectrum

Last night, winners of the "beachfront property" FCC 700MHz auction were finally permitted to reveal their plans for using the spectrum obtained.  AT&T and Verizon won most of the licenses, spending a combined $16 billion.  As anticipated, the wireless giants aim to build faster wireless broadband networks capable of delivering high-speed data, voice, video and other services.  But those 4G networks won’t be available for at least three years! 

And now for the hype: "This is all about fourth-generation growth," said Verizon spokesman Jim Gerace, referring to the next phase of cellphone technology based on faster networks and more sophisticated devices.

Some of the spectrum Verizon acquired is required to be open to all applications and devices. An open platform will draw application developers to Verizon’s service, which will make it more popular with customers, Mr. Gerace said. Verizon Wireless, jointly owned by Verizon Communications Inc. and Vodafone Group PLC, shelled out $9.4 billion on licenses.

Rival AT&T, meanwhile, said that its newly acquired spectrum will allow it to beef up the quality of its current services as well as transition to faster, more advanced wireless broadband services.

Opinion:  We are very disappointed with the auction results:  No new nationwide wireless network, no new network providers, public safety left out in the cold, and uncertainty on what Dish Network Inc will do with the spectrum they won.   Let’s focus on the failure of the D block auction, with public safety the big loser.

When I was interviewed for a MacNeil-Lehrer Newshour article on the 700MHz auction, I tried to emphasize that the failure of the D Block auction (to attract a minimum bid) was a disaster for public safety. Unfortunately, the writer did not include that info in the article. Here’s the quote and url:

"No one knows what the other players are going to do, because this spectrum doesn’t dictate what wireless technology you use," said Alan J. Weissberger, a Silicon Valley telecommunications consultant with DCT Advisors.

We have previously written about the Fading Hopes for Muni Wireless networks as well as the failure of the 700MHz D Block (public-private partnership) FCC auction. When you combine these two, one realizes that public safety networks have been left in a frozen state, with no opportunity to upgrade to a more efficient, interoperable network architecture.

To recap: Public safety organizations were a big loser in the FCC auction, as the minimum bid for the D block was not achieved. That combined with the failure of Muni Wireless networks to gain market traction nixes any upgrade plans for public safety wireless nets. Many failed muni WiFi networks, like Wireless Silicon Valley, were intended to provide interoperability amongst public safety organizations (police, fire, municipal govts, etc) which currently run their own private networks, often on different

So the failure of the D block auction looms large for public safety organizations. Without public private partnerships for the D block or muni wireless networks serving them, public safety is left with many non- compatible, non- interconnected wireless networks.

Interoperability between public safety organizations are needed at times of regional disasters, such as Hurricane Katrina and the huge bridge collapse in Minnesota.  There are many instances in which joining the disparate public safety networks could save lives of first responders. 
We conclude that public safety networks will continue to be a hodge podge of proprietary and non-interconnected offerings unless a white knight appears that will re-initiate public private muni wireless networks.   Could Google be that white knight?  We don’t think so.


0 thoughts on “AT&T, Verizon Wireless Underwhelming Plans for 700MHz Spectrum

  1. Alan, well put. The $19 Billion may go to the treasury, but ultimately, consumers will pay for this in the form of subscription fees or advertisements. I still go back to the question of whether the public good would have been better off if the spectrum had been opened up like the 2.4 and 5.8 GHz bands.

    On the other hand, Google seems to be the winner and maybe they outsmarted the telecom providers. By getting the telecom rivals to invest billions in spectrum lease, they will be at a disadvantage if Google can open up the white spaces to unlicensed applications. Interesting times.

  2. Ken, you are right on target. Google was the big winner by bluffing. They now admit this on their blog.

    Google talks about their super secret war rooms and bidding strategy at:

    At the CTIA show last week, ATT and Verizon Wireless expressed interest in Google’s Android platform. So Google seems to be winning the hearts and souls of the wireless industry. However, we think devices that comply with Android may be several years away from mass market winners.

  3. RCR Wireless News: 700 MHz to be LTE heavy

    THE NATION’S TOP TWO CARRIERS plan to deploy Long Term Evolution network technology over their recent spectrum winnings. However, Verizon Wireless executives said an LTE rollout won’t happen until 2010 at the earliest, while those from AT&T Mobility pegged a rollout date as far back as 2013.

    Nonetheless, the news sets the stage for 4G network interoperability between what are today the nation’s two largest carriers. Indeed, CDMA carrier Verizon Wireless and GSM operator AT&T Mobility — longtime rivals that currently operate different network technologies — may well sign LTE roaming agreements in the coming years.

    Our take: Wireless competition no longer exists now that AT&T and VZ Wireless have strengthened their hold on available spectrum. If SPRINT proceeds with their mobile WiMAX roll-out, then there won’t be nationwide roaming or interoperability with AT&T or VZ Wireless. Not good for cellular network customers or for a healthy broadband wireless US market.

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