Thursday, April 02, 2009

Putting GSM out to grass?

The decision of the European Parliament to amend the GSM Directive on what technology can be used in the 900Mhz band of spectrum seems to have passed unnoticed by much of the media. The reality is, however, that after years of lobbying, it is a potentially a very significant decision that deserves more attention (and I don't often say positive things like that about EU decisions!).

The GSA has gone on the record as saying that "this groundbreaking spectrum agreement in Brussels enables more Europeans to benefit from mobile broadband services. It is a clear signal to all regulators to prepare the path in their respective markets for a new wave of HSPA deployments in the 900 MHz band." 'Spectrum refarming' as the policy is known will finally enable the rollout of mobile broadband to rural and semi-urban areas because (and excuse my idiot's attempt at physics), the lower frequency of the 900Mhz waves mean they travel further, and so the cells are bigger.

So it's all good news right? The digital divide is going to be bridged.

Well, yes and no. Look at the GSMA site and you'd think all is hunkydory. According to the GSMA, spectrum refarming has a number of potential benefits more mobile operators, including changing the economics of rural mobile broadband, stimulating capital investment (like operators are keen on CAPEX right now) and improved in-building penetration.

Oh, that's right. Weren't femtocells meant to solve the problem of poor in-building coverage with 3G? Well, at 900Mhz, it's not a problem any more. But that's ok, because there's still LTE femtocells...

Or maybe not. The GSA and GSMA both predict a new wave of HSPA deployments in the 900Mhz band ... it begs the question, with HSPA deployed at 900Mhz, the CAPEX has got to be lower than rolling out LTE. Sure, LTE maybe more efficient but if you can deliver mobile broadband services in two bands, the crunch point in capacity where LTE becomes a no-brainer is pushed further out.

The decision over spectrum refarming is important. But the ramifications are perhaps more far-reaching than some are admitting and the law of unexpected consequences will still hold true.

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