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Spectrum Hot Real Estate

The fact that businesses around the world are knocking on the doors of their governments asking for spectrum is a clear indication that this telco real estate market is hotting up. The reason for this is not too hard to guess—the enormous growth in the demand for mobile broadband. There is a large amount of pent-up demand as the mobile operators didn’t want to open up this market while they were in the middle of adding new customers to their mobile voice services.

With that market saturated their attention has now moved to mobile broadband.

However, it was the iPhone that broke open this market. The mobile operators didn’t want to sell mobile broadband access on its own; they preferred to bundle it with the content offerings in their mobile portals. Apple broke that nexus and this led to the current mobile broadband explosion.

At the same time this clearly brings mobile into the data market. The emphasis is now on applications and many of them are based on video. This has also affected the mobile radio market—these are the thousands of mini mobile radio networks that operate around the world, mainly for the public safety agencies such as police, ambulance, fire, security, etc. Because of proprietary technologies these networks are still stuck in the old world of voice only. All of these networks are in desperate need of upgrading but very few can afford these upgrades on their own.

This is where the trans-sector concept kicks in. By sharing common infrastructure each agency can run its own service over that shared infrastructure. However, most agencies are wary of using a commercial network for this purpose. Nevertheless in the USA that is exactly what the FCC is proposing.

In Australia ACMA has also clearly indicated that these agencies will have to learn to share; and they will need to work on harmonising their networks.

It will be interesting to see whether this will happen on a voluntary basis and if commercial networks are willing to make their infrastructure available to these agencies on a utilities basis.

Alternatively, could this also lead to regulatory intervention that could possibly, in turn, lead to a separation of the basic infrastructure from the services?

By Paul Budde, Managing Director of Paul Budde Communication

Paul is also a contributor of the Paul Budde Communication blog located here.

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