Our mobile, or cell, 'phones operate in one or more frequency bands to provide us with voice, text and data service. Depending on our particular carrier and device, it may operate on several different frequencies. My own particular network operates a 2G network on the 900 MHz frequency (some areas have a 1,800 MHz 2G coverage), a 3G network on 900 MHz and 2,100 MHz and a 4G network at 800 MHz. Within each frequency band, my carrier will have a given amount of spectrum or bandwidth. We've seen that the UK carriers don't want to share their networks and this means, in simplistic terms, it's this spectrum that ultimately determines the capacity of the network for a given network technology: the greater the spectrum, the wider the pipe available to subscribers for their calls, text messages and data. My own particular handset and carrier arrangement is not particularly special and this multi-frequency approach is adopted across most of the developed world. And the carriers have to jostle for their spectrum, lining up for periodic Government auctions to gain more.
We're going to see a couple of interesting and important spectrum auctions in the US over the next year or so. Firstly, in November we're going to see the the AWS-3 (Advanced Wireless Services) auction and next year the low frequency spectrum will be sold off. Let's take a look at the AWS-3 auction first to see why this is both interesting and potentially important. Here, the US Government is selling off spectrum at the 1,700 MHz, 1,760 MHz and 2,165 MHz ranges, which will involve an indefinite period of sharing these frequencies with a number of federal systems. These frequency ranges are used by US DoD (Department of Defense) and weather satellite links. All told, any successful bidders for spectrum within the AWS-3 auctions will have to negotiate with up to seventeen different government agencies across 2,500 frequency assignments. It turns out that most AWS-3 frequencies are in use by the US military and in many cases, the actual use is not given the public. One example is an air combat range (do you remember the 1980s Top Gun movie? Most of this was filmed at one such air combat range), where the flight information pods need a low-latency, high speed uplink back to base to transmit the data. These ranges are moving off the AWS-3 frequencies but there will be a period of time and an exclusion zone for a up to three hundred miles from the area. From a customer perspective, this means that even though your carrier has purchased spectrum in a given range, it may be unable to deploy the spectrum at your location until it has negotiated with all relevant interested parties.
Next year's auction for the lower frequencies is complicated because the FCC is asking TV broadcasters to release frequency in these frequency ranges, perhaps to share with competitors or even go off the air, so that mobile operators can buy up the frequency. We've already seen a number of US television companies lodge a complaint at the courts regarding this action. The lower frequencies are considered especially important to the carriers because the lower the frequency, the greater the penetration of buildings and solid objects, which means that a given cell tower has a longer effective range and it can therefore cost less to build the necessary infrastructure to provide coverage over a wider area. We've already seen that the FCC has voted to limit how much spectrum the major owners of the lower frequencies are able to bid for, thus ensuring that the smaller players (Sprint, T-Mobile USA being the two obvious candidates) can buy up coverage. Verizon and AT&T already control approximately two thirds of the low frequency spectrum.
With many executives from the American carriers and the FCC chairman at Las Vegas for the Super Mobility Week CTIA trade show, it's a good bet that the spectrum auctions are a topic of conversation. We'll keep you posted!