Night Writer,
Here is an interesting article about the cost,and penetration of different broadband services. I hope that the spectrum is not going to be bought,hoarded,and then sold in 3-5 years to a RBOC. I hope those that bid,are actually willing to develop the market.
FCC Gets Ready For LMDS Auction / February 11, 1998
WASHINGTON, DC, U.S.A., The Federal Communications Commission (FCC) is looking forward to another successful bandwidth auction, with some $350 million in upfront payments already collected for 986 Local Multipoint Distribution Service (LMDS) licenses to be auctioned off starting next Wednesday, February 18.
But LMDS still faces some steep challenges from Asymmetric Digital Subscriber Line (ADSL), which is expected to deliver to consumers high- speed modem communications over existing phone lines, a recent report from Allied Business Intelligence, Inc. an Oyster Bay, New York, telecommunications consulting firm, says.
The study, "Broadband Delivery in the Local Loop: The Access War Begins.
Competitive Technology Assessment and Market Outlook," predicts that by 2003, ADSL will hold 36 percent of the broadband local loop market, while service revenues from LMDS are expected to be about $598 million, representing nine percent of the subscriber market.
Second to ADSL, the report notes, will be cable modems, with a market share of 26 percent, satellite technology and BRI (basic rate interface) only ISDN (integrated services digital network) each holding about 12 percent. ISDN will take the biggest hit
from the emerging technologies, the report says, declining significantly from its 95 percent market share in 1997.
The study also predicts that US broadband subscribership will grow from 2.6 million in 1998 to 14.5 million by 2003, with ADSL having the advantage over other services in its "cell of deployment" number.
According to Andy Fuertes, senior analyst at Allied Business Intelligence, Inc., cell deployment represents the number of premises which need to be passed in order to supply a broadband service. For ADSL, he said, the magic number is one -- cable modems range from 500 to 1,500, while LMDS is roughly 10,000, and satellite can be millions to tens of millions.
LMDS does have a cost advantage over ADSL, Fuertes said. Currently, ADSL ranges from $800 to $1,500, although Alcatel is reported to be getting close to the industry "sweet spot" of $500, he said, while LMDS acquisition costs may be as little as $150 per home passed. Cable modem access, by contrast, will run from $300 to $500 per home passed plus modem costs, and satellite systems will cost from $60 to $90 at ten percent penetration, plus customer premises equipment, he said.
Market share projections notwithstanding, the LMDS auction is set to begin next Wednesday, February 18, after a mock auction set for this Friday, February 13. The mock auction, which will include all 986 LMDS licenses up for bid, will allow bidders to familiarize themselves with the electronic bidding software and the new bidding procedures.
According to the FCC's Mark Bollinger, a software tool for tracking the progress of the auction will be made available on Tuesday, February 17, 1998, via the Internet at
fcc.gov and the FCC Auctions Bulletin Board System.
Bidders wishing to familiarize themselves with the tracking tool software are encouraged to try the tracking tool software for the 800 megahertz (MHz) SMR auction at fcc.gov he said. Although this tool cannot be used for the LMDS auction, Bollinger said it has similar functionality and provides a useful tool for practice.
Hiram |
