We attended the CBRS Alliance event in Washington DC today, and by our rough estimate, about 350-400 people were in attendance representing groups such as regulators, legislators, lawyers, technology vendors, property owners, service providers, investors, media and analysts. We were impressed with the widespread interest in the new shared spectrum technology and services running in the 3.5 GHz band that is now called “OnGo.” We have researched CBRS for many years and found several acronyms and CBRS-specific terminology to be blossoming. We found several themes at the CBRS Alliance event and a follow-on event at Federated Wireless, a SAS service provider, of special note: a) the OnGo experience will serve as a mold for regulators, operators and other interested parties not just in the US, but also the rest of the world, b) Tier 1 operators and WISPs appear focused on Fixed Wireless Access (FWA) deployments in CBRS spectrum, at least initially, c) many presenters focused on the “OnGo backhaul to gateways” use-case, at least as an initial opportunity, d) interested parties have a concern that PAL licenses may become very expensive when the auctions occur, and e) there were a very large number of devices supporting OnGo at this event.
Acronym soup. The CBRS Alliance did its best to explain the various acronyms and how the various players work together. It would take at least six pages to cover just the top-level details. The idea here is that the 150 MHz of spectrum in the 3.5 GHz range was previously used exclusively by the US Department of Defense and is now going to be shared using a three-tier process, where the military (the incumbent) will have use of it when it needs, then private license holders will get next dibs (PAL), followed by general users (GAA). Starting today, GAA users will begin use of the spectrum in the Initial Commercial Deployment (ICD) that was announced today, starting at 9 AM Eastern. A group of service providers called Spectrum Access System (SAS) providers have been authorized to install radios on the US coastline that sense when the military is using the spectrum and send channel-use information to equipment that is operating in the CBRS spectrum. These SAS providers will, therefore, coordinate the frequencies between incumbent, PAL, and GAA users.
Our view on why OnGo and “Shared spectrum” matters. We expect that by sharing spectrum amongst various parties, more traffic can move across a smaller range of frequency than by using the more common method of auctioning off frequency bands to be used exclusively by one entity. We estimate that shared frequency will carry ten-times more traffic than frequency bands licensed for the exclusive use of single entities. Thus, it is for the greater good that this OnGo / CBRS experience go the distance and allow a public demonstration of whether multi-tiered shared spectrum can succeed or not. Already, we have the experience of shared spectrum in the 2.4 GHz and 5 GHz bands used by WiFi – there is no doubt this has been successful; in fact, most public estimates show about 80% of smartphone traffic is carried by WiFi rather than cellular systems, all of which as of yesterday was carried on licensed spectrum. At the CBRS Alliance event, guest speaker, US FCC Commissioner Michael P. O’Reilly said that based on the success of OnGo, he expects similar models could be applied to additional spectrum (and he implied this might the sequential order of launch): C-band (3.7-4.2 GHz), 3.45-3.55 GHz, 3.1-3.45 GHz and 7 GHz (which we understand is meant to be the same thing as what is being discussed at 6 GHz by the WiFi community).
FWA opportunity is front and center. Charter and AT&T focused their comments on their plans to deploy fixed broadband systems. AT&T shared some impressive statistics about the performance of recent trials using Massive MIMO cell sites using distributed RAN over CBRS spectrum, which is connected to indoor baseband over fiber optics to the radio sites and then connects wirelessly to customer premises equipment mounted at the roofline: it said it achieved 140x12 Mbps at slightly over one mile over line of sight using 20 Mhz channels. Charter discussed it had deployed its first commercial FWA in Davidson City, NC to rural locations. It also discussed how it uses dual SIM systems to allow customer coverage to Verizon’s cellular network. Charter also discussed private LTE, neutral host, and Industrial IoT use cases. The Wireless Internet Service Provider’s Association (WISPA) President spoke about its members’ enthusiasm for OnGo and explained that 100’s of WISPs used the 3.65 GHz spectrum and expects more will use the 3.5 GHz / CBRS spectrum. Currently, WISPA says WISPS in the US have 6 million customers.
OnGo as a backhaul. We detected a theme that seems durable: CBRS spectrum can be used by enterprises with far-flung operations to save costs by reducing the installation of wired / optical cables and associated infrastructure. There was an impressive list of vendors who had equipment at the show, a number of which were gateway devices that made connections between CBRS and other well-known protocols such as Ethernet and WiFi, to name a couple. While OnGo/CBRS support is not as widespread on devices today, IoT devices supporting other wired and wireless systems certainly are, the list of which includes WiFi, Zigbee, Bluetooth, Ethernet and more. We were taken by how compelling some presenters made a case for using CBRS simply assuming a reduction in new cabling to enable new systems such as kiosks, surveillance, digital signage, farming, and so on. Many of these examples would increase the deployment of existing protocols like WiFi, Zigbee, Bluetooth, and Ethernet, instead of reducing their demand. The idea that OnGo/CBRS competes with existing systems may be incorrect.
PAL auctions. Commissioner O’Reilly said PAL auctions are scheduled for June 25, 2020. In our formal and informal interviews, we understand there is a growing concern that CBRS spectrum auctions could be aggressively pursued not only by existing Tier 1 mobile operators but also by other players, not least of which could include MSOs and maybe even “Big Tech” companies. Since the 3.5 GHz spectrum is where many countries besides the US have begun deploying 5G services, making equipment in these frequency bands commonplace, there is ample reason to want to use this spectrum in the US. Bidders may raise the price high enough that enterprises will choose not to compete, and won’t view the CBRS spectrum as attractive as they had hoped. In this case, PAL would look quite a bit more like a typical licensed spectrum, similar to other auctions.
OnGo devices abound. At the show, the following vendors had devices on show (see pictures): Sercomm, MultiTech, Sierra WIreless, Zyxel, Encore, Cradlepoint, AMIT Wireless, Commscope / Ruckus, Accelleran, Bai Cells, Cambium, Samsung, Google, LG Electronics, Sequans, Telit, JMA Wireless, Motorola Solutions, Cisco, BEC Technologies, Ericsson, ip access, BLINQ, Comba Telecom, and Westell.
We attended media briefings at the Keysight World conference held near San Francisco, California, yesterday. Keysight World San Francisco showed a more integrated Ixia as well as a further push towards 5G, automotive and energy, and data center and telecom. Much of the companies conversations during the event related to synergies between these technologies. Such as how to push the automotive industry forward using 5G and the need for edge computing in 5G. As Keysight is involved at the beginning of the launches of many new cellular technologies, it has good insights into the timeline and progress of the 5G market.
One of our key takeaways from the show is the increased pervasiveness of Ethernet in the telecom and automotive industry as well as the significant increase in constant data creation. All this data will need robust, and more intelligent networks to transport it. We were also impressed that Keysight World will actually take place in 10 cities around the world, with San Francisco being the first.
Another interesting observation was just how global Keysight was in looking at products, for example in one session that we attended, much of the automotive effort in the company was located in Germany.
Juniper Networks announced plans to acquire Mist Systems for approximately $405M in cash. We think this deal makes sense for Juniper, who can now sell a key technology - WLAN - into its customer base of large and medium enterprises. Valuation of the deal probably fell a bit short of the expectations of some, but the vendor landscape has already seen significant consolidation between Ethernet Switch and Enterprise-class WLAN vendors, with now just a few potential buyers and sellers.
The companies just had a call to discuss the announcement and share the following messages:
We attended Mobile World Congress Americas (MWCa) in Los Angeles, CA this week, as well as the AT&T Spark event in San Francisco. Since 5G is launching first the US, these two events became the public events where significant 5G-related announcements happened.
Additionally, discussions about spectrum in the US market were very active discussions. Some points we picked up on: