The world of wireless will be interesting in 2014. Spectrum crunch, huge build-outs and a price war will highlight the year.
The spectrum crunch is what CTIA talks about. If that was the case, why haven't these cellcos deployed all their available spectrum then? T-Mobile just paid $2.4B in cash and swapped AWS and PCS licenses for VZW's 700 MHz A block. That means that all of these cellcos HAVE spectrum that they have NOT deployed yet. And with a new auction coming up (likely in 2015). See this one slide about the spectrum swap.
When Softbank bought 80% of Sprint (and Clearwire), Softbank wanted the best network built. That will take a lot of cash (especially since Sprint's current 4G network is awful). The capital expenditures in building out 4G (and 5G) networks for the big 4 - T-Mobile, Sprint, VZW and Ma Bell - will require a lot of money. A LOT! Add in the DISH Network spectrum and LightSquared's spectrum going into a possible 5th national grid and we are talking even more billions.
If DISH was smart, it would work the Rural Wireless Association or the Competitive Carriers Association to build out. But that's just me thinking aloud.
DISH got a nice letter from the FCC about use of the spectrum it owns. DISH can use it for broadband. And DISH will bid over $1 Billion for the H block spectrum. It is also in a fight for LightSquared spectrum, which is in bankruptcy court.
Finally, we have a price war starting. While M2M and the Internet of Things will add devices to the network, ARPU can't go up fast enough to pay for the network builds, the spectrum, the maintenance, tower rental and the backhaul.
BTW, if you want to join the insiders' club for wireless, join PCIA. Look who the members are - ATT, DISH, everyone!.
PS, the NCTA and the RWA put on an event with CES in Vegas (now): The Wireless Symposium. The name: Build Wireless Now makes me laugh. Get on that.
The other event to watch is the fight over CAF funds. The ILECs - ATT, Frontier, C-Link - are in a battle with fixed wireless and satellite providers over the broadband map and over-building with government funds. That should be an interesting battle.
Post a Comment