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Municipal Wireless History

History of Municipal, Community, City Wide, or County Wide Wireless

History of the 2.5GHz Community Educational Broadband Spectrum – Sprint/Nextel & Clearwire
The 700MHz Spectrum
FCC Debacle


At some point over the past 5 to 8+ years or so almost all major Cities, Municipalities or Counties within the U.S. have issued RFI’s or RFP’s initiating projects that would attempt to bring wireless infrastructures to their Citizenry, Local Businesses, and Government in their Urban, Suburban and Rural markets. City and County Officials, Network Providers, and numerous proponents of these necessary components for our Communities have worked tirelessly to bring these broadband wireless networks to fruition.
 

Kudos to Minneapolis and their staunch efforts with USI Wireless to not only come up with a working and scalable wireless network, but aggressively negotiating for substantial funding that would support local digital access, inclusion and literacy for low-income households and other community outreach programs.
 

Also, Brookline, MA, and the level of excitement that was generated by local city officials, IT staff, public safety and the overall commitment from the community to launch their wireless services.
 

There are other sporadic deployments, however these types of success stories are few and far between in the new U.S. broadband wireless arena and many City, Municipal or County issued RFI’s and RFP’s have found the circular file.
 

We only need to look as far as the past FCC (Federal Communications Commission) and Federal Legislators to understand why the United States has fallen behind in broadband wireless deployments (17th in the World). The FCC’s and Federal Legislator’s lack of vision and direct support of large incumbent network operators and service providers have only tied the hands of Local Governments, Cities and/or Counties and made it impossible for cash-starved Cities, Municipalities and Communities to realize the full benefits and revenue generation by developing and deploying broadband wireless infrastructures for their constituents in Urban, Suburban and Rural markets.
 

Large incumbents in this marketplace have no specific plan or business case and have not invited public participation in their efforts on how to best identify the public need, deliver broadband communications and services, and collaborate with Communities and Local Governments to present a workable operating and revenue model that will enable Cities, Municipalities, and Communities to define their own path towards their broadband future. The United States is an extremely internet savvy base, and they want their say in this matter.
 

It is a fact that there is no room for a middle man in the offering of core network access and services as evidenced by Earthlink’s and AT&T’s retreat from the Muni-Wireless marketplace.
 

As a result Municipalities have run into constant road blocks attributed to the limitations of viable solutions, created by the FCC and Federal Legislators, and their rule changes in the 2.5GHz EBS spectrum (formerly the ITFS) and the mediocrity that was the 700MHz auction held in January of 2008. All the FCC did was allow ‘du-opolies’ to be created during these processes representative of Sprint Nextel and Clearwire in our Community EBS spectrum arena and ATT and Verizon in the 700MHz spectrum arena.
 

This will all change with the advent of the new American Recovery and Reinvestment Act and newer broadband wireless technologies and will allow Cities, Municipalities, and Communities to fully exploit the synergies available between their Citizenry, Businesses, Constituents, Local Government and their new high speed broadband wireless network using 3.65GHz, 5.nGHz, 4.9GHz and 2.4GHz spectrum.
 

The stakes have never been higher for Cities and Counties exploring the broadband wireless opportunity and they should seize control of their broadband futures right now.
 

At the same time, the path to viable implementation remains complex, only due to the FCC’s biased decision making that benefited large incumbent network operators and service providers. Municipalities, Communities, Businesses and their Citizenry are going to have to forge their efforts in order to get what they have wanted for years… a plan for their broadband future.
 

There is a viable solution to all of this that will benefit Cities, Municipalities and Counties in Urban, Suburban and Rural markets to promote competition in the marketplace, expedite and fund build-out of available spectrums, without effecting large incumbent network operators and service providers and their ability to maintain their strength in the marketplace and sustain their bottom line profits.
 

But before we get to that it is important to lay out the brief history of the questionable rule changes in the Community 2.5GHz EBS spectrum and the mediocrity that was the auction of the 700MHz spectrum, which the FCC facilitated, that will inevitably change the way we live our lives, conduct business, receive our entertainment, interact and communicate on a social level, and address socio-economic issues that plague our Local Governments and Communities on a daily basis.


History of our 2.5GHz Community Educational Broadband Spectrum – Sprint/Nextel & Clearwire
 

Back in the 1960’s and 70’s the FCC assigned the 2.5GHz spectrum to non-profits such as local colleges, universities, churches and school boards. It was called the Instructional Television Fixed Spectrum (ITFS). This community asset was to be used to broadcast television signals within their community that would offer educational content and to support on-going distance learning for students and faculty within their coverage area. This coverage area normally blanketed a 35 mile radius.
 

In 2004, the FCC changed the rules on this under-utilized spectrum to allow for commercial broadband wireless service to be offered. They even had the gumption to change the name to the Educational Broadband Spectrum (EBS). Needless to say, this spectrum real estate went from swamp land to ocean front property immediately. These EBS licensees were then approached by Sprint Nextel and Clearwire with checkbooks in hand, as EBS licensees clamored to check on the status of their current EBS license with the FCC. In most cases, these licenses needed to be renewed and in some cases the licensee was not even aware they had rights to this community asset.
 

This is representative of how the FCC did not educate the ITFS or the licensees, prior to the rule changes, on the capabilities of the asset which in turn would have led to more due diligence on the part of EBS licensees to assess the capabilities and value of their asset at that point and in the future.
 

At this time Sprint/Nextel and Clearwire aggressively pursued long term lease arrangements with then current licensees of the EBS spectrum. This licensed spectrum was well suited for Wi-Fi’s big brother WiMAX, which was gaining strength in the marketplace as the next generation wireless technology.
 

These non-profits were told by Sprint Nextel and Clearwire that the costs involved in building out development and deployment of their spectrum would be very high so in the eyes of the decision makers, namely Boards of Trustees (who, in most cases, are dis-attached from newer technology), it made sense to adhere to the lucrative offers (in their eyes) from these large companies.
 

If the current 2.5GHz licensees would have performed more due diligence on their asset they would have realized that the costs involved in rolling out their spectrum would have been very expensive at that time, based on product availability and standards of that time.
 

All they would have had to do is look at the current Wi-Fi (802.11) market to realize that more equipment manufacturers would be entering the WiMAX marketplace in the future and that costs would be reduced dramatically, much like Wi-Fi is inexpensive now. On a more simple level, due diligence could have been done by searching ‘WiMAX’ and researchers would have had all the information they needed to get started on a proper due diligence processes.
 

However, this did not happen and the lure of the cash was to tempting. This also led to a snowball effect that gathered these EBS licensees in groves throughout our Country, all falling prey to questionable business tactics by Sprint Nextel and Clearwire. In fact, these lease deals are also going to be investigated by congress and consumer advocacy groups and patent law suits are pending.
 

To paraphrase eminent outside Counsel that advised upon and completed many of these lease deals “it is all about who is offering the most money [Sprint/Nextel or Clearwire] and addressing the immediate needs of cash starved non-profits, their faculty, students, or constituents”.
 

You can hardly blame counsel for pushing these deals through because of the amount of money they would receive for their services. As goes the money, so goes the so called community “Educational Broadband Spectrum”.
 

As these lease deals represented a significant windfall for non-profits, it is dwarfed by the amount of revenues that will be generated through WiMAX services within any geographical service area (GSA).
 

Recently Time Warner, Comcast, Sprint, and Clearwire (Google, BrightHouse, and others involved, also) announced that they have come together to pony up $3.2 billion dollars to expedite WiMAX roll out. This is great for Sprint/Clearwire and our cable company incumbents as they needed a wireless strategy as we migrate away from being tied to their wired RG6 (cable). Now (not surprisingly) Sprint and Clearwire have cut a deal, approved by the outgoing FCC and Fedral Legislators (on election day, 2008) that all spectrum assets will fall under the new brand "Clear" managed by Clearwire.
 

The big difference here is the blatant attempt of these large, incumbent Cable and Telecom companies to assume that we will look to them to provide ALL of our core access services and applications as well as enhanced entertainment, audio, video, communications, and so on.
 

Cities and Communities will welcome large incumbent enhanced entertainment and communications services, which everyone that can afford them will want, but let our Communities, Municipalities and Cities design, implement, and generate revenue from our core network access, community, and municipal based peripheral applications.
 

The Cities, Communities, Businesses and Citizenry are the asset here. Large Telecom and Cable incumbents are now just a few of many service providers that will be entering the market in 2009 and beyond. Therefore, Cities and Communities need to leverage their asset they maintain (their businesses and populous), promote competition, and discourage large incumbents from competing for core access and services to pull every dollar possible from our Communities and Cities. As a society, we will be migrating from wire line (cable, twisted pair) to the airwaves and these airwaves already exist for everyone to benefit from.
 

The big question in this environment is "Why these non-profits are not building out there core 2.5GHz network in conjunction with local municipal 3.65GHz WiMAX public/private partnerships and establishing core infrastructure and operating/reveune models in their 2.5GHz spectrum before leasing to these companies?"

With all of that said, incumbent Telco’s and cable companies should be concentrating on developing stronger relationships and strategies with large digital media and content distributors (Viacom, Sony, Paramount, MGM, EMI Publishing, etc.) instead of trying to figure out how to monopolize the core access and services market.
 

Sprint/Clearwire is just another service provider that the FCC allowed to monopolize our Community 2.5GHz Educational Broadband Spectrum. This is the definition of “discriminatory practices” and the FCC allowed it to happen. This spectrum would have been a great asset for BTOP and private sector investment would have been lining up to invest in projects that would have built out this spectrum in our Counties, Cities and Communities.  


As of now, Sprint Nextel and Clearwire have ‘negotiated’ long term lease deals (15-30 years) and locked up 85%+ of the 2.5GHz EBS… and Sprint has now partnered with Clearwire to offer ‘CLEAR’… thus the status of WiMAX using our Community 2.5GHz Educational Broadband Spectrum.


The 700MHz Spectrum

There is no doubt that most everyone is aware that “free” TV will be going digital in June of 2009. There are advertisements on television today that say people without cable or satellite will need special converter boxes to view their local programming. Good job FCC, but where is the education and what does this actually mean for the American public?
 

Well, one thing is that this spectrum will be used for commercial broadband and greatly enhanced entertainment and communications services. Another is the fact that “channel surfing” will become much more channel specific as selective programming, downloads and digital streaming will become common place and directed to set top monitors where our televisions used to reside. Don’t worry, your remote will change but you will not have to get off your couch! This will also lead to households requiring terabytes of local disc storage. (Please visit H.R. 2738: Family and Consumer Choice Act of 2007)
 

But enough of the wishful thinking and let’s get down to the brass tacks as to how the FCC handled the licensing and sale for this spectrum.
 

As with the 2.5GHz Community EBS, the FCC was hoping for a competitive marketplace in the development and deployment of the 700MHz spectrum. It was also the goal of the FCC to receive bids on the 700MHz D Block that would have provided a much needed nationwide public safety network to be implemented during times of a national emergency or terrorist attack. None of this happened.
 

AT&T and Verizon were the big winners and the D Block did not meet the reserve price of $1.33 billion so it is still out there. Congress is now involved and will have a say as to how the D Block will be auctioned or assigned.
 

There is also some controversy surrounding the D Block auction in that Frontline Communications was ready to work with the PSST (Public Safety Spectrum Trust) but all of the sudden ended up closing their doors just weeks before the auction was to take place. This left little time for other companies to pull resources and bid.
 

Then rumors surfaced that this piece of spectrum would be auctioned as commercial broadband thus firing up the interests, once again, of the incumbent winners in the A,B,C, and E blocks of the spectrum.
 

But the fact still remains that a ‘du-opoly’ came out of the 700MHz commercial side, very similar to what happened with the 2.5 EBS spectrum. So when this spectrum is ready for market, they will be facing the same challenges as 2.5GHz WiMAX is facing now, and will look to the operating and revenue models put forth by Comcast and Time Warner as the ‘first-to-market’ marketing arm for Sprint and Clearwire’s licensed, exclusive (expensive) leased spectrum.
 

Rather than go on about the FCC’s role in the outcome of the 700MHz auction please visit the testimony of Harold Feld on behalf of the Public Interest Spectrum Coalition as presented to Congress on April 15, 2008. He provides an honest appraisal of what this auction represented. Here is an excerpt:
 

“The 700 MHz Auction was both the most successful auction in FCC history and perhaps the worst failure in Communications policy in recent memory. The paradox is possible because the FCC, and sadly, not a few members of Congress as well, have reduced the entire public interest analysis for auctions to four words: “show us the money.” The auction statute gives a lengthy list of public interest goals: increasing competition and avoiding “undue concentration of licenses;” promoting ownership opportunities for small businesses – especially rural, woman owned, and minority owned businesses; and providing to all Americans the economic and social benefits of wireless.

To these we added to the hopes for the 700 MHz auction the creation of a wireless “third pipe” broadband provider to keep with the broadband cable modem service and DSL duopoly that controls over 90% of the residential broadband market. Finally, we expected the D Block public/private partnership with public safety to build the national, interoperable broadband public safety network that the 9/11 Commission and everyone else agrees we need…None of that happened.”

One other important aspect to consider relative to both spectrums is the CPE (customer premise equipment) or other devices that will be required and more than likely purchased from “the Big 4” however we are to early into the processes to wager an opinion on how this will present.
 

Again, large incumbent Telco’s and cable companies should be concentrating on developing stronger relationships and strategies with digital media and content distributors (Viacom, Sony, Paramount, MGM, EMI Publishing, etc.) instead of trying to figure out how to monopolize the core access and services market. 


The FCC Debacle over the Past Eight+ Years


In their efforts to protect large incumbents the past FCC administration seems to have forgotten that there is plenty of spectrum that is available for broadband wireless deployments. 3.65GHz WiMAX is getting a lot of publicity lately. This spectrum requires licensing from the FCC but is non-exclusive.


That means that once spectrum use is approved for use by the FCC or other license holders in a specific geographical service area (GSA), only that licensed operator can establish a footprint in that GSA. 3.65GHz WiMAX has a legitimate shot at becoming the core spectrum of choice for Municipalities, Counties, Cities and Communities desiring broadband wireless infrastructures and when coupled with 5.8GHz, 4.9GHz and other licensed and non-licensed spectrums can develop and deploy very robust wireless network infrastructures for their Local Governments, Businesses, Residents and Tourists.