NEW STARTUP: Rambus and Chromatic Research, Inc.
Date: 01/08 00:30 EST
FCC spectrum ruling nudges wireless to 'last mile' -- Startup floats plan to
bring broadband home
Jan. 07, 2000 (Electronic Engineering Times - CMP via COMTEX) -- PALO
ALTO, CALIF. - A startup formed by executives from Rambus Inc. and
Chromatic Research Inc. is proposing a national wireless network that
it thinks could solve the "last-mile problem," bringing broadband
service to the home. But the fate of the 1-Mbit/second technology
described by FreeSpace Communications Inc. could hinge on plans
finalized late last week by the Federal Communications Commission to
auction off 6 MHz of spectrum.
That 6-MHz chunk-part of a 36-MHz block that the FCC will auction-has
been targeted by FreeSpace for new broadband wireless Internet access.
The spectrum to be auctioned is at a frequency of 700 MHz, falling
within UHF TV channels 60 through 69.
At the heart of the auction controversy is whether special
"guardbands" (buffering spectrum) should be created surrounding
existing police radio bands and whether those guardbands can be used
for new services. There are 30 MHz of spectrum in the 700-MHz range
that are uncontested and would be used for new digital radio services.
Last week's decision is not the FCC's final word on guardbands; a
second ruling is planned.
FreeSpace has amassed high-powered backing from Intel Corp.,
Microsoft Corp. and @Home Inc. and has already faced off with Motorola
over its plan to use the new spectrum once the bands become available.
FreeSpace proposed In October a series of guardbands similar to what
the FCC ruled on last week. The FreeSpace design would use handsets and
modems that transmit both data and packetized voice to small antennas
co-located on existing transmission towers and base-stations. The
stations then could be linked to telco central offices through digital
subscriber line connections.
A minimal system could be implemented in 4 MHz of spectrum, though
8-MHz chunks would be optimal. Within that 8 MHz, channels as small as
500 kHz could provide broadband service. Michael Farmwald, interim
chief executive officer of FreeSpace, stressed that approval of the
channels would still leave 28 MHz of the proposed auction open to
higher-power SMR and trunked radio services, including the entire bands
from 748 to 762 MHz and from 778 to 792 MHz.
"It's not an either/or," said Farmwald. "The larger revenues from the
auction would still come from the more traditional radio services."
FreeSpace is not limiting its interests to hardware; rather, the
company wants to be a nationwide carrier as well as provide hardware
reference designs so that OEMs can design compatible systems. "The low
power at which this network operates allows for very low capital costs
in building out a nationwide network," Farm-wald said. "We truly want
to go beyond just developing reference designs. We want to be owners
and operators of a new type of wireless access network."
But FreeSpace faces a growing array of competitors, ranging from the
digital subscriber line (DSL) and cable modem services already gaining
a market foothold to the GHz-class wireless services now ramping up.
Some analysts estimate the number of consumer Internet connections in
the United States alone at nearly 100 million, though costs are
expected quickly to become a key issue.
"There's been a lot of skepticism in the industry as to how much
consumers will pay for broadband service," said Rick Miller, senior
analyst for Internet services at Cahners In-Stat (Scottsdale, Ariz.).
If FreeSpace can show a sustained 1-Mbit/s network in a multichannel
700-MHz frequency, the company may be able to carve a niche in wireless
Internet access that will prove viable against wireless local loop
(WLL) and multichannel multipoint distribution service (MMDS) systems.
At such low frequencies, FreeSpace signals won't face the interference
issues that dog MMDS providers running at frequencies in the tens of
GHz and offering higher data rates. But the startup will need to eke
out an attractive cost structure in an already highly competitive
environment, analysts said.
"In [the 700-MHz ] band, signals penetrate pretty damned well," said
Ray Jodoin, a senior analyst with Cahners In-Stat (Scottsdale, Ariz.).
"But with cable coming to so many homes, wireless is still not the most
cost-effective solution."
Business evolution
Farmwald said FreeSpace's business plan has evolved considerably
since he was approached by Stanford professor Tom Lee with a new
business concept. Lee and fellow FreeSpace co-founders Arvin Shahani
and Derek Shaeffer are experts in CMOS RF design and pioneers in
developing single-chip global system receivers. The executives knew
they wanted to do a relatively low-frequency receiver design for
consumer broadband wireless access, but they lacked a fully formulated
business plan.
Farmwald said he had envisioned two directions in which Lee's work
could head. One led to a new semiconductor concept related indirectly
to the wireless work; that effort was spun off into Matrix
Semiconductor. The system-level concepts for wireless access required a
focus on both reference hardware development and nationwide carrier
infrastructure. "An end-to-end architecture for a totally new service
seemed the way to go," Farmwald said.
FreeSpace has revealed that its system will be packet-based, using
Internet Protocol for both data and voice, but it's keeping mum the
modulation methods, antenna infrastructure and transceiver design.
"Frankly, if it wasn't for the FCC decision, we wouldn't be talking to
the press at all yet," Farmwald said.
Changing of the guardbands
FreeSpace had to fight off an attempt by Motorola Inc.'s trunked
radio business to have the special guardbands reserved for private use.
Motorola had argued that use of the bands could affect public-safety
uses of the spectra. But that argument lost support Dec. 27, when Joe
Hanna, president of the Association of Public Safety Communications
Officials International, wrote FCC chairman William Kennard to say that
FreeSpace's most recent proposals for low-emission attenuation levels
had erased APCO's concerns.
Hanna said that "APCO continues to oppose suggestions from the
commercial wireless and broadcasting industries that the commission
reject any guardband proposal." APCO officials met with FCC
commissioner Gloria Tristani and FCC Wireless Telecommunications Bureau
chief Thomas Sugrue last week to emphasize their confidence that
FreeSpace could operate its system with no interference to public
safety.
The main 30 MHz of spectrum that the FCC ruled on last week is not a
matter of controversy. The FCC set up rules creating six Economic Area
Groupings (EAG) nationwide and said that one carrier could win both
spectrum chunks in one region-a significant difference from personal
communication services (PCS). Companies bidding on these bands also are
not subject to a total cap of 45 MHz of spectrum (a limit used in PCS).
Congress is depending on the application of auction revenues toward
the fiscal year 2001 Defense Department budget, meaning that proceeds
from the auction must be in the Treasury by Sept. 30.
In any event, letters of support for the FreeSpace proposal, which
came to the FCC from several large computer com-panies (including
Intel, Microsoft and @Home) in late December, appeared to sway the FCC
even further toward approving independent use of the 6-MHz channels.
One industry association, the Cellular Telephone Industry Association,
threatened to sue if the FCC accepted the Motorola set-aside proposal.
Nevertheless, FreeSpace is not out of the woods as it prepares for
the FCC's second ruling. In a statement Thursday, commissioner Harold
Furchtgott-Roth challenged the very need for guardbands and said that
even if they are accepted, the bands "should be open to all bidders
willing to accept our interference limits ... It seems to me the
Commission should not be dictating business models to our licensees. In
essence, our limitation would say, 'If you want this spectrum, here is
what your company needs to look like.' "
Other competitors are in the wings. There is a gap in performance
between the systems targeting sub-10-GHz bands (wireless local loop and
MMDS) and the millimeter-wave, non-line-of-sight local multipoint
distribution service systems at 28 and 38 GHz, which primarily target
business customers. While such LMDS players as Wavtrace Inc. and
Ensemble Communications Inc. plan to target consumers, they face the
challenge of lowering costs for RF and baseband components.
Lining up support
A new breed of players wants to improve performance at lower
frequencies through the use of better modulation algorithms. Cisco
Systems Inc. is lining up Texas Instruments Inc. and Broadcom Inc.
behind its Orthogonal Frequency Division Multiplexing code, while
Wi-LAN Inc. and Monterey Networks Inc. are promoting their own flavors
of OFDM.
Add to that such WLL-like offerings as Adicom Inc.'s Wireless IP and
ArrayComm Inc.'s iBurst (see Dec. 20, pg. 31), and there is a rich stew
of new sub-10-GHz last-mile broadband access offerings in the market.
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By: Loring Wirbel
Copyright 2000 CMP Media Inc. |
