Transcript No Slide Title

National Spectrum Managers Association
Spectrum Management 2002
Diane Cornell
Vice President for Regulatory Policy
Cellular Telecommunications &
Internet Association (CTIA)
May 21, 2002
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Cellular Telecommunications &
Internet Association
• CTIA is the international organization of the wireless
communications industry for both wireless carriers and
manufacturers. Membership in the association covers all
Commercial Mobile Radio Service (“CMRS”) providers and
manufacturers, including cellular, broadband PCS, ESMR,
as well as providers and manufacturers of wireless data
services and products.
• CTIA is the voice of the wireless industry– representing its
members in a constant dialogue with policy makers in the
Executive Branch, the Federal Communications
Commission, and in Congress. CTIA’s industry committees
provide leadership in the area of taxation, roaming, safety,
regulations, fraud, and technology.
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Commercial Mobile Wireless Industry
Has Experienced Massive Growth In An
Incredibly Short Period Of Time
Since 1998, the wireless industry “comes of age”
– PCS subscribers top 10% of all subscribers
– $50 billion capital investment
– Wireless consumers – 2x growth
– Total minutes of use – 5x growth
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From Ancillary To Alternative
February 1, 2002
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Recent U.S. Subscriber Trends Suggest
Penetration Will Continue To Exceed Forecasts
90.0%
80.0%
73% ITU Estimate
Forecast Penetration
70.0%
60.0%
55.0% UMTS Estimate
50.0%
45.0% Current
Penetration
40.0%
30.0%
20.0%
10.0%
0.0%
1997
1998
1999
EMC
UBS Warburg
Goldman Sachs
CTIA Tracked Penetration
2000
2001
2002
Merrill Lynch
Bear Stearns
Yankee Group
2003
2004
2005
2006
2007
Raymond James
Morgan Stanley
ITU
2008
2009
2010
2011
2012
CSFB
Telecompetition
UMTS
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Current Voice Trends
• Total wireless minutes of use (MOUs) are growing at 75% year-toyear
• Wireless is increasingly substituting for wireline service:
– Wireless MOUs are increasing as a percentage of all telecom MOUs
– 18% of wireless consumers consider their wireless phone their primary
phone.
– 10-20 million wireline have been or are being replaced with wireless lines.
– Wireless MOUs amounted to 12 percent of all telecommunications industry
minutes in 2001
– Wireless MOUs are expected to amount to 40 percent of all telecom industry
minutes by 2005 according to The Yankee Group.
• 85% of wireless subscribers already use digital;
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Billions
Projected Wireless MOUs Average Over 1
Trillion in 2005, Over 2 Trillion in 2010
3,000
2,500
2,000
1,500
1,000
500
0
1999
2000
2001
Merrill Lynch Total Annual MOUs
2002
2003
CSFB Projected
2004
2005
Morgan Stanley
2006
2007
Goldman Sachs
2008
UBS Warburg
2009
2010
Average
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Wireless Data Service Projections
• In-Stat/MDR predicts two-thirds of American workers will use
wireless devices as part of their jobs by 2004.
• Jupiter Media Metrix estimates U.S. wireless web users will grow to
96 million by 2005.
• Gartner Group projects 90 percent of professionals / telecommuters
will use high-speed wireless data services by 2005, with 137 million
wireless data users in North America.
• AMI Partners projects half of entire U.S. workforce to be mobile by
2006, totaling 67 million workers, with over 26.4 million commercial
wireless data users.
• In-Stat/MDR projects 52 million wireless data subscribers in 2005;
39 million business wireless data users in 2006.
• Ovum projects overall U.S. wireless data penetration of 67 percent
by 2007.
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Wireless Data Service Projections
•
Personal use of laptops and PDAs for wireless e-mail and office
system access will increase, as well as machine-to-machine
communications, such as automated user updating by e-mail
systems, and specialized applications such as medical monitoring,
etc.
•
SMS: globally short message service / text messaging is growing
dramatically – from 1 billion a day at year-end 2001 it is expected
to reach 3 billion daily by year-end 2002.
•
Interoperability has been resolved in the U.S., laying ground for
SMS to take off in the next three years, with SMS message
volumes reaching 150 billion a year.
•
Multi-media Messaging Service (MMS) combines text, images,
audio and video, and is expected to build upon the SMS
experience - including applications focused on both consumers and
business users.
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MHz Of Spectrum Available By Nation
400
364.6
350
300.1
305
300
250
200
189
150
100
50
0
U.S.
Japan
Germany
U.K.
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What did we learn
on September 11?
• Networks built for “ancillary” usage—
don’t have enough spectrum when called
upon to support consumer demand during
emergencies
• Emergency interoperability a problem
• Desire for prioritization of national security
and emergency preparedness users
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Spectrum Management Challenges
• Additional Spectrum for Advanced Mobile Services
• NTIA Plan
• Trust Fund
• Timing of Auctions
• Delay of 700 MHz Auctions
• Flexibility
• Spectrum Allocation Reform
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NTIA Plan Benefits U.S. Economy
• International harmonization means scope/scale
economies
• 120 MHz supports mid-decade demand levels and
multiple providers
• Council of Economic Advisors — $500 billion
consumer benefit over next decade
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Global use of 1710-1850 MHz for
Mobile Services
Current / Planned / Support usage of 1710-1850 MHz
Not enough information regarding planned use
U.S. yet to make decision
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DoD Spectrum & NTIA Plan
15 MHz in
NTIA Plan
80 MHz of
Required
by BBA
1997 & in
NTIA Plan
Industry 2001
“ask” not in
NTIA Plan
Government
1710
1755
1770
1850
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Four Major DoD Systems in
1755-1770 MHz Band
Tactical Radio
Satellite
Fixed
Microwave
Guided
Munitions
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“Win-Win” Solution – Conclusions
• NTIA Plan eliminates most interference
• Remaining interference can be fixed or managed
• Comparable spectrum
• Equipment upgrades
• International commercial deployment complicates
DoD mission
• Administration FY2003 Budget endorses Spectrum
Relocation Trust Fund
• Administration FY2003 Budget endorses revised
auction timetable
• NTIA Plan provides vital commercial spectrum
• Guaranteeing DoD Capabilities #1 Priority
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700 MHz Auction Should be Delayed
• Current Plans – June 2002 Auction
• UHF Channels 60-69: 60 MHz
• 24 MHz – Public Safety
• 6 MHz – Guardbands
• 30 MHz – Commercial
• UHF Channels 52-59: 48 MHz – Commercial
• Bidders need predictability on when they can have
access to the bands to form business strategies.
• Budget-driven dates are not the best way to further
effective spectrum management or benefit
consumers.
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Movement Towards Flexibility
“Friend or Foe?”
• Flexibility in allocations has broad support within the
FCC and the Administration.
• Flexibility is fast becoming regulators’ preferred
solution to difficult, perplexing decisions.
• Flexibility has arisen in several different contexts, e.g.:
• FCC granted MMDS/ITFS incumbent licensees flexibility to
provide mobile services in the 2500 MHz band.
• FCC adopted a Notice of Proposed Rulemaking on two
proposals from MSS operators to provide terrestrial services.
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Flexibility: Two Perspectives
PROPERTY RIGHTS MODEL:
• Licensees who buy their spectrum at auction should be
given property-like rights to do whatever they like within
their assigned spectrum, provided they do not interfere with
other licensees.
COMMONS MODEL:
• License would be subject to efforts by the FCC to improve
the efficiency of utilization of the spectrum by allowing
additional “flexible” uses in assigned spectrum.
• Possibly results in additional services allowed to be
provided in the licensee’s spectrum.
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A Proposed Framework to Analyze Requests
for Flexibility in the Use of Spectrum
• First, determine whether reallocation of the relevant
spectrum band is preferable to granting the requested
flexibility.
• If reallocation is not appropriate, determine whether the
additional flexible rights can be auctioned, subject to
appropriate service rules.
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Spectrum Management
Reform
Need for process change is abundantly clear:
• FCC Chairman Powell -- “Put simply, our Nation’s
approach to spectrum allocation is seriously fractured… It
is important that the Commission move from its traditional
spectrum management paradigm of ‘command and control’
to a paradigm of market-oriented allocation policy to
provide more flexible allocations that allow multiple uses so
that spectrum can be put to its highest and best use….”
• NTIA Administrator Nancy Victory – “Our country’s
spectrum needs are too important to be undermined by
internecine squabbling between and among and within
branches of government.”
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Spectrum Management:
Procedural and Structural Reform
Some ideas for procedural and structural reforms to improve
efficiency of spectrum allocation process:
• Create an interagency senior advisory group (ISAG) to
facilitate decision-making on controversial spectrum
matters.
• Develop a “rolling” long-term spectrum planning process.
• Create an “independent review” mechanism similar to the
Base Realignment and Closure Commission (BRAC).
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Procedural and Structural Reform (cont.)
• Designate an entity to contribute an independent voice on
difficult sharing/interference and technical decisions.
• Improve U.S. participation in the international spectrum
process.
• Create a relocation “trust fund” from auction proceeds.
• Reform the satellite licensing process.
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Contacting CTIA
Cellular Telecommunications &
Internet Association
1250 Connecticut Avenue, NW
Washington, DC 20036
www.wow-com.com
202-736-2080
[email protected]
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