[NOTE TO READERS: This is Part II of a two part post. If you haven’t read part I, here it is)
No business that is based purely on regulation is sustainable. This is a thought that came to mind at the recent IWPC conference in San Diego. In this two part blog post, much of it inspired at the IWPC, and propelled by what appears to be a trending item in telecom circles of late; namely CBRS. We’ve seen a number of announcements near and far, next door in Sweden and in Japan. Most recently Germany announced the granting of the 100MHz frequencies for 5G for big corporations. No doubt, the CBRS value proposition is a strong one, light to hands off vis a vis regulation and well supported by end users, but what makes CBRS such a disruptive model? Or better yet, does it need anything to be?
CBRS – The Best of Both Worlds?
To start with, CBRS spectrum is generally dolled out for free with a small co-ordination charge. Hearkening back to our First Post, we posit the “free” label on WiFi being the prime driver of its winning marketshare. Secondly, and to the glaring disadvantage of WiFi, CBRS is and acts like cellular in providing significantly higher power output. Even more importantly, and to the availability/reliability axis, it is co-ordinated to reduce interference. To this end, CBRS employs a centralized unit called a Spectrum Access System (SAS) that can flip basestation frequencies to avoid or reduce interference as required. These are some pretty compelling, if not entirely disruptive features, particularly as they point straight to the Private LTE model that traditional mobile carriers are now eyeing with great interest.
In the US, the CBRS spectrum plan calls for some seven portions of 10 MHz to be allocated for county-level coverage. In total, there will be ten channels which will provide for some flexibility when and if specific allocations need to be made. I am simplifying this considerably here, with a focus on the high level opportunity, but those interested in a deeper dive can consult the neighborhood Wiki.
With all of this in mind, the bottom line is that CBRS provides a a ready path for corporations to enjoy the low- to no-cost business model of WiFi ,with the significantly better performance and reliability of cellular. Moving from this G2B2x model to B2B or B2C model, and one in direct competitive territory with carriers is the ability for small scale, local operators to build Fixed Wireless Access offers for customers. If we only take these two business models into account, it is plain to see the competitive, and even disruptive impact CBRS portents for the mobile landscape today dominated by operators.
Understanding that CBRS is a Radio only capability, and while the highest paying customers (think enterprises), will quickly engage with the lower-cost, local, more agile competitors that will arise. But still, CBRS will require backhaul and that brings us back to the WiFi model, which will put Cable operators, (with their own backhaul), into a good position to commence vertical convergence via CBRS.
But before we get too excited about this all but unprecedented open opportunity, running a mobile network is no mean feat, and requires a skill set that few enterprises have in house. That said, the arrival of SDN /NFV provides the opportunity to virtualize a centralized cloud based core, leaving only this and the basestations in the owner’s wheelhouse, and a close match to WiFi from an operational standpoint.