T-Mobile’s Business Push, Technology Advantages, and 5G Slicing with Daryl Schoolar

Full Transcript

0m10s Speaker 0

Hello, and welcome to the two hundred and thirteenth episode of the week with Roger, conversation between analysts about all things telecom, media, and technology by Recon Analytics. I'm Don Kellogg. With me as always is Roger Antner. How are doing, Roger?

0m22s Speaker 1

Hey. I'm good.

0m24s Speaker 2

So, Roger, I thought we could talk about CBRS today, specifically about a proposal from AT and T to switch the CBRS band from 3.55 to 3.7 over to 3.1 to 3.3 gigahertz. Seems to have honestly triggered a lot of folks. Yeah. Can you tell us about it?

0m43s Speaker 1

Well, we will point on the dolly where the bad man touched them, right?

0m48s Speaker 2

Right.

0m49s Speaker 1

One of the interesting things about the three gigahertz spectrum is that it basically came in like slices. And as a result, the CBRS spectrum is sandwiched right between the C band spectrum and the 3.45 to 3.55 spectrum. And it's a little bit like, depending on who you ask, somewhere between a sore thumb and a proud beacon of light sticking out. One of the important characteristics of this whole band is like The US Military has traditionally used this for radar. And like everybody, including the other parties that we will talk about, you know, change is hard, people don't want to change, you know.

1m43s Speaker 1

I also don't want to give up my candy, and I should better, but I don't want to. And so, they don't want to change, right?

1m51s Speaker 2

Maybe the military as well as the incumbent CBRS.

1m55s Speaker 1

As well as the incumbents. In order for CBRS to work, the US military had to vacate some areas and had to there had to be cohabitation. The US military in the beginning said like, no, we cannot give up the spectrum nationwide. And like people on Congress said like, why? You know, and then they said like, okay, we can't give it up because we're using this ban for aircraft carriers.

2m26s Speaker 1

And The United States has 27 aircraft carriers, for traffic management and how to land planes on the ships, and if we have interference, you know, planes might crash. They didn't necessarily say that countries like South Korea, and Spain, and other countries in Europe are using that exact spectrum for licensed usage. And we haven't heard of American carrier based aircraft crashing into the sea because the evil Spaniards who are our allies, or the evil South Koreans who are our allies have interfered with them. Nevertheless, that's why we have like that exclusion zone in the area. The funny thing is, they gave up then the spectrum over like the inside part of the country, because the reason why they wanted to keep that spectrum for their radar was that whenever a US military plane was flying from the East Coast to the West Coast, or vice versa, or up and down from the Mexican border to the Canadian border and back, They used that radar to do bombing trial runs against US cities.

3m36s Speaker 1

And when Congress heard that, they basically said like, guys, knock it off. That's really bad PR move that the reason why you can't vacate is, because you're simulating bombing your own cities. So now we're with that thing and the coasts. People on the show who are around know that there were changes, because the US Navy is changing out the radars on these 27 aircraft carriers, from a spin 43 to a spin 50, and then suddenly it's no longer using that spectrum. So that's why CBRS restrictions on the coast are getting less, because the Navy moved away from that spectrum.

4m14s Speaker 1

Having said that, there are other areas where you use the radars, and that's in the 3.1 to 3.45. And so why not take the CBR rest regime which worked, which apparently worked really, really well when you listen to the people who are using it. Why are you not using that in 3.1 to 3.45? Give them more spectrum, and hopefully make it happier, and basically give them money to migrate it and enough time to migrate it. This worked, by the way, really well with the television incentive auction.

4m52s Speaker 1

The television broadcasters got billions and billions of dollars for the spectrum that they never paid for, to migrate and condense the stuff, and we all made it work, and no TV stations went out, because they were able to migrate and got paid for it. And basically AT and T from what it looks like are basically proposing the same thing of like, look, the spectrum is becoming unencumbered, why are we not using it for full power?

5m24s Speaker 2

Well, let's talk about the power requirements on CBRS too. You know, if I were to make a devil's case for this, right, I would say, well, you know, anybody can use it. Why can't AT and T or the other national carriers just use CBRS in conjunction with their three, four, five and c band spectrum if they have it. What's the problem with that?

5m43s Speaker 1

Because a, it is low power.

5m46s Speaker 2

So this is unique to CBRS, so explain this.

5m49s Speaker 1

CBRS is low power. The reason why it's low power is so that you don't interfere, ideally that you don't interfere with anybody else. The more antennas, the more transmitters are together, the more there's interference and the network quality goes down the drain. CBRS does not have an interference mitigation mechanism. Even Wi Fi has an interference mitigation system.

6m20s Speaker 1

When you and your neighbor are broadcasting on the same Wi Fi channel, the system automatically powers you down or switches you to a different channel, so that you don't interfere with each other. In CBRS, the interference management system is why don't you figure out who your neighbor is and talk to them. And ask them pretty, pretty please, use less power.

6m44s Speaker 2

And by the way, you can have a, you know, GA license, so you don't need to have be approved to use us.

6m50s Speaker 1

You need a license so they know who you are, right? But if I have a reasonable neighbor, A, it's cumbersome. Ideally you have a technical solution that takes care of it. CBRS does not have that. If I find my neighbor, you know, and they might be I don't know how far down, right?

7m7s Speaker 1

And I talk to them, and if they're reasonable people, we can find accommodation. And if they're not reasonable people, and there are more than enough not reasonable people out there, they say, well, I have no problem, too bad you have a problem, go pound sand. And then you as a GAA licensee are looking pretty sad, right? Then people say like, yeah, yeah, yeah, but PAL licenses and Verizon is using this.

7m40s Speaker 2

Right. So, GA is general access and PA is priority access.

7m44s Speaker 1

Exactly. Priority access and there was an auction and the licenses were predominantly bought not by enterprises. I could be wrong the exact number, but they're like ten, twenty enterprises that bought PAL licenses. Everything else was bought by communication service providers, WISPs, the cable companies, folks like that. And so, the idea that this is, oh my God, enterprise and everything.

8m14s Speaker 1

And I still maintain the people who are in this, they're like, oh my God, this is like a revolution. We have so many enterprise customers on CBRS. I still maintain that there are more articles written about CBRS by industry analysts than there are CBRS networks. Dior, who bought PAL licenses, as it like on five or six of their factories. That's it.

8m38s Speaker 1

Out of their more than 20 factories. But then it's a he said, she said. Regardless, but by the way, the reason why Verizon bought CBRS is because they had no other spectrum. And if the only thing you have is a hammer, then everything is a nail, right? Verizon made a mistake sometime back of not buying enough cellular spectrum, because they have the least amount of cellular spectrum.

9m2s Speaker 1

That's why they had to get the AWS-three spectrum from the cable company, and had to do MVNO with cable, which publicly they're very happy about. I'm not sure if they're really that happy about it. That's why they bought CBRS, that's why they bought millimeter wave, all not ideal solutions.

9m23s Speaker 2

And that's why they spent $47,000,000,000 on C band too.

9m27s Speaker 1

That's why they outspent everybody on C band because, oh my God, finally we have better spectrum, right? And let's make sure we do this. I always say like, I'm not listening to what people say, I look at what people do. And the actions speak louder than words. And I'm happy that Verizon and the cable companies are so happy with each other and hold hands and dance around the fire and sing Kumbaya.

9m51s Speaker 1

I'm very happy about that. Still, they're buying that stuff.

9m56s Speaker 2

So the argument for, right, is that you would have what I think like five thirty megahertz of contiguous mid band spectrum.

10m3s Speaker 1

Yeah.

10m3s Speaker 2

If you were to move folks off of CBRS or move them down.

10m7s Speaker 1

Move them down and pay them for it, right. And give them enough time to do this, and give them more spectrum. But change is hard, right?

10m16s Speaker 2

Well, the argument against is it costs lots of money, there are a lot of incumbents or some incumbents, right?

10m21s Speaker 1

But they get paid for it. So the mid band spectrum would be auctioned off, and the proceeds would be used to compensate the people to move. I would imagine they only have to move when there is the equipment there and all of that stuff. And so they would get paid to get new equipment to use more spectrum, and if necessary also put new equipment in their customers' premises. Take care of all of that.

10m52s Speaker 1

And yes, you have to do it, but you get paid for it. And no, that's too hard, right? Because no, I like what I have, and no, I don't want to move, and no, I don't want the wireless carriers to have more spectrum that would allow them to use this for FWA to take my customers away, because I'm not growing my broadband customers right now. So it's obvious that the cable companies are against it, because this is the prime weapon to give customers choice and give them more FWA.

11m26s Speaker 2

Well, I'll let you be fair though. Some of them are already operating CBRS networks, right? It's not like they're just sitting on the spectrum.

11m32s Speaker 1

Well Verizon and Verizon barely is it, right?

11m35s Speaker 2

Right, right.

11m35s Speaker 1

People guys are using CBRS to supplement their MVNO agreement. For them, CBRS is working or is working well. I don't know if it's working really really well, but it's working well because it's small licenses, and they can really tailor this to their cable footprint which is like very discombobulated, right? A wireless operator would like to have large licenses. So CBRS in the current construct works really well for cable and works really well for them to offload the mobile traffic from Verizon or whoever their wholesale provider is onto their own network in the places where there's the most coverage, right?

12m20s Speaker 1

So it works for them. And why should they, even if they get more, vacate this and hand it over to Verizon, AT and T, T Mobile just to stab them with more FWA. I get it why cable is against it.

12m35s Speaker 2

Well, it against us all against the backdrop of, you know, the FCC still doesn't have spectrum authority. So even if this was a slam dunk, we still wouldn't be able to do it anytime soon.

12m43s Speaker 1

Yeah, no, this is like a five, ten year plan.

12m46s Speaker 2

Right, right.

12m47s Speaker 1

Nothing works here quickly, right? I was exchanging tweets with Dean Bubly and he's like, yeah, and they don't even have a number for this as a five gs plan, there's no equipment. I'm like, yeah, all ideas start without a number and without equipment. That's how CBRS started too. It was an idea by Google and the FCC liked it for really small licenses that innovation could happen.

13m16s Speaker 1

Well, didn't happen, right? And then they redid it because this is the second the system that they don't want to let go is like a reformed system. So this is we're on CBRS two point zero. And so this would be then CBRS three point zero. And we've done this before.

13m33s Speaker 1

It worked before. And at least in the past the people were happy. We're at the point in this country where nobody is happy. Somebody is always feeling that somebody is doing bad things with their conflicts in the morning.

13m47s Speaker 2

All right, well we'll keep an eye on it. I think it's an interesting proposal. I can see the arguments on both sides, right? Regardless, we're not going to figure it out anytime soon. This is a, you know, way, way, way far in the future sort of thing.

13m58s Speaker 1

Well, because it takes a long time, and on average, it takes seven years between identification of a band and the band actually being released. That's the average. And so if the government is behind it like in 03/2004 or five, it takes like a year, year and a half. If there is a will, there is a way. DOD to their great credit, when the White House said, you move, they move, right?

14m25s Speaker 1

So they can if they want to. But every other band, it took like seven years on average, sometimes ten years. So just like with any other topic, I think we're gonna talk a lot more about it. And I hope that in the future we will get somebody who is for this, and somebody who is against this, and then we can have a really cool conversation. And I think there are plenty of people who are for it and against it, and they're not shy.

14m51s Speaker 1

So here's an open invitation for you to come on the show, and tell us everything you want the world to know.

14m58s Speaker 2

All right, well we'll talk to you next week. Thanks Roger.

15m0s Speaker 1

Next week, bye bye.