European rules may encourage Google to step up WiMAX efforts
Published: Wednesday 9 July, 2008
Just a week after Ericsson slammed UK regulator Ofcom for its flexible approach to its upcoming 2.6GHz spectrum auction, the European Commission looks to be taking a similar stance across the region on how the band should be split between TDD and FDD spectrum. This could be a major boost for WiMAX operators, and the increasingly positive climate in western Europe, once assumed to be a closed market to mobile WiMAX, may lure big players to invest in operators in the region – Clearwire has already hinted at this; NextWave has made plays in various countries; and now Google is reported to be looking at its own WiMAX investments, alone or with its other partners in the Clearwire venture.
The EC has decided to allow regulators to be flexible in how much FDD and TDD bandwidth they allocate – Ofcom is leaving it up to winning operators to decide this question, in the interests of full service and technology neutrality. Ericsson’s interest reflects that of the LTE community as a whole – at this stage, WiMAX is the strongest mobile broadband technology for TDD spectrum, with its FDD profile only just in the works, while LTE is the natural choice for FDD, despite the demonstration of a TDD version by Ericsson and others. So the flexibility to use substantial spectrum in TDD mode could make the licenses more appealing to WiMAX operators, and bring carriers into the market that will compete with the traditional cellcos. These, by contrast, would naturally choose LTE and start their 4G roll-outs with a strong focus on FDD – which accounts for almost 90% of currently allocated mobile spectrum – adding in data-oriented TDD services as the LTE platform evolves in this direction.
While Ericsson may be frustrated, the WiMAX Forum welcomed the EC and the move away from the more rigid 2.6GHz spectrum guidelines set out by CEPT/ECC in 2005. These stipulated that two 70MHz chunks of spectrum should be allocated to FDD (one for the uplink and one for the downlink), but only 50MHz t be awarded for unpaired TDD spectrum. The 2005 rulings also stipulated that the guard band between FDD and TDD technologies (the 50MHz TDD chunk sits between the two 70MHz FDD allocations) should be taken out of the TDD allocation,which also seemed to disadvantage a TDD-oriented network. Of course, individual regulators do not have to implement the new EC recommendations, but they are coming under increasing pressure from operators – as the initial 2.6GHz auctions in Scandinavia showed – to increase TDD allocations or at least offer greater flexibility. Although most mobile services are currently FDD-based, TDD technologies are better adapted for asymmetrical data and IP offerings.
Tim Hewitt of BT – a possible major bidder for a UK license, and likely to use WiMAX – is , director of regulatory and spectrum policy for the WiMAX Forum. He commented: "The acceptance of the 2.6GHz decision provides a great deal of regulatory clarity for administrations. The EU administrations can now justifiably, and with the knowledge they are backed by the full weight of European Union policy, question the now inappropriate ECC Decision (05)05, which is holding back the development of a fully competitive European mobile broadband market.”
Ericsson argues that slicing and dicing the band according to individual operators’ or regulators’ policies will lead to fragmentation, interference and roaming difficulties, and so devalue the band. For instance, where cellcos are allowed to refarm their GSM spectrum for mobile data, they could use that as a stopgap until new mobile broadband options like 700MHz come along – an outcome that would allow WiMAX players to slip into the European market, which was once seen as a closed territory for 802.16e because of the power of the 3G operators, for a lower cost of entry.
This could benefit not just BT and other majors that need to gain a mobile broadband system – such as Rupert Murdoch’s BSkyB and some cable carriers – but also smaller players looking to expand across the region. Clearwire has hinted at its desire to replicate its US partnership model in other territories where it holds 3.5GHz licenses, and this could drive it to bid for 2.6GHz spectrum too (see Wireless Watch July 2 2008).
Google is one of the Clearwire participants that is also rumored to be interested in repeating its experiment in Europe. Although there has been no confirmation, French newspaper Les Echos is reporting that Google is putting together a WiMAX joint venture in the country, where the regulator recently tried to light a fire under progress in WiMAX, pushing license holders to accelerate their programs. This has sparked a string of partnerships and activities in the nascent French wireless broadband sector, and two of the three largest licensees - Free (the broadband ISP arm of Iliad) and Bollore Telecom – are said to be gearing up to create the venture with Google. Free is the only holder of a national 3.5GHz license, which its parent Iliad acquired along with Altitude Telecom, and the Bollore Group subsidiary has 20 regional licenses and is acquiring more from HDDR. A nationwide network in France is estimated to require $1.5bn in investment.
Such sums, in high risk territories where 3G mobile internet services are already strong, will often require financial support from industry players. Intel has injected funds and equipment into many WiMAX operators round the world in its bid to spur uptake of its pet technology, and the US Clearwire venture saw the chip giant, Motorola and Google all chipping in to spark WiMAX roll-out. The same pattern is likely to be repeated in other potentially major mobile broadband markets, although in Europe, the main partners have 3.5GHz spectrum, and some backers may prefer to wait and see whether WiMAX providers get a shot at 2.6GHz, which, if not too expensive, would support mobile broadband business models more easily than higher frequencies. However, if the French reports lead to real world deals – and even if they don’t – there is a strong prospect of an Intel/Google/Clearwire alliance taking its money and carrier expertise around the world, supporting WiMAX initiatives and spurring expansion of the technology.
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