The Race to Deploy Next Generation (5G) Telecom Networks: What Are the Governments of Australia and the United States Doing?
Ubiquitous access to broadband telecommunications services are well-established policy objectives for the governments of Australia and the United States, and both are now re-doubling their efforts to spur deployment of next generation networks. Tomorrow’s wireless broadband networks – aka fifth generation or “5G” – promise to advance key economic, educational, health and security goals. The governments of both countries are playing a critical role by allocating needed wireless spectrum and by reforming laws to speed the commercial build-out of 5G wireless and fiber networks. These government actions have raised investor confidence in the commercial promise of 5G which, in turn, provides the massive capital needed for providers to build next generation broadband networks.
Domestic Policy Interests Driving the Race
For the U.S. and Australia, compelling national interests are fueling support for 5G networks. In both countries, next generation broadband networks are seen as essential for the continued growth of the large domestic information/technology industry and for educational institutions to keep globally competitive. New 5G networks will also bolster growth of other key sectors of the domestic economy, such as remote monitoring and management for precision agriculture; real-time communications for intelligent manufacturing; and wireless sensing systems for smart cities, self-driving cars and many other enterprise applications. New broadband networks will also improve public safety and national defense. Indeed, many policymakers view the development of a strong domestic 5G economy as a critical national defense strategy.
5G Actions Taken and Planned in the U.S. and Australia
An essential input for new 5G networks is access to additional licensed and unlicensed radio frequency spectrum, which is controlled by government regulators.
The Australian government is only partway through its processes to rewrite the regulation governing the use of radio frequency spectrum, which it first announced in 2014. In light of this, the Australian Communications and Media Authority (ACMA), the Australian government regulator responsible for (among other matters) allocation of spectrum licenses, has developed its strategies to replan for, and allocate, spectrum licenses that are necessary to enable deployment of 5G networks under existing regulations.
The first significant Australian 5G spectrum auction, for 125 MHz of spectrum in the 3.6 GHz band, was completed in December 2018. Demand for that spectrum was strong, and the ACMA was pleasantly surprised to receive over four times the reserve price from the sale of that spectrum. Australia’s existing mobile network operators purchased the bulk of that 5G spectrum, but Dense Air Australia was also a purchaser. Dense Air, a new entrant in the Australian market, is proposing to establish a “small cell-as-a-service” business. The auctioned licenses commence in March 2020; however, the ACMA has put in place arrangements to allow earlier access (provided this does not interfere with existing uses).
The ACMA has also fast-tracked replanning of the 26 GHz band, which is suitable for 5G in higher density areas. In taking this step, the ACMA is one of the first regulators globally to consider arrangements across the entire 26 GHz band. The ACMA’s Five-Year Spectrum Outlook 2018-22 sets out the ACMA’s broader objectives to ensure spectrum for 5G is made available in a timely manner.
In the United States, the Federal Communications Commission (FCC) is allocating significant swaths of spectrum to support 5G networks. The FCC is currently auctioning off valuable high-band millimeter wave licenses. A schedule for the auction of mid-band Citizens Broadband Radio Service (CBRS) licenses should be announced in the first half of 2019 as well. The FCC also concluded a successful auction of low-band spectrum licenses in 2017. Additionally, the FCC is considering allocating new spectrum to meet the increasing demands of unlicensed Wi-Fi devices.
Infrastructure and Other Regulatory Policies
The costs and speed of constructing new 5G networks depend to a large extent on how quickly and affordably broadband providers can obtain the necessary government permissions to deploy small cells, construct cell towers, dig trenches along roads to lay fiber conduit, and use existing utility poles and public rights-of-way.
In the United States, proposals introduced in Congress would streamline deployment of small cell infrastructure by, among other things, implementing time limits for review of small cell construction applications and limiting government fees charged. In addition, other legislative action is pending that would increase funding for network build-out and reduce costs for wireless tower owners. On the regulatory front, the FCC has issued decisions to reduce government “red tape” and to expedite the construction of 5G networks. In March 2018, the FCC reduced the review standards under federal environmental laws for broadband providers constructing small cell networks. In August 2018, the FCC declared that all state and municipal moratoria on new broadband construction is preempted by federal law. The FCC also simplified the process for new wireless and fiber providers to attach new equipment onto utility poles with “one-touch make-ready” rules. Finally, in September 2018, the FCC adopted new rules similar to those proposed in Congress to expedite the local and state approvals of wireless small cell construction projects, including limits on the government fees charged and time limits for review of small cell construction applications.
The Australian government has long recognized the need to provide regulatory support for the rollout of telecommunications infrastructure to limit the possibility that planning and environmental red tape at a state, territory and municipal government level would significantly delay and increase the cost of deployment. Reflecting this, telecommunications carriers are granted specific federal level “powers and immunities” to facilitate the rollout of infrastructure quickly, and in a uniform way, across Australia. These federal level rules allow carriers to enter land to install and maintain some types of facilities and eliminate Australian state, territory and municipal government planning and environmental regulation that would otherwise apply. Given that 5G network infrastructure is significantly different than other network infrastructure, the government has consulted on modifications to the powers and immunities regime to allow the fast and efficient rollout of 5G networks. A number of the proposed changes to the powers and immunities regulation have already been implemented (for example, to expand the types of facilities to which the regime applies), and further reforms are expected as the government continues to negotiate with carriers and other stakeholders.
In recognition that there may be other regulatory impediments to the deployment and effective use of 5G in Australia, the Australian government has also set up a 5G working group with industry and government representatives to facilitate an ongoing dialogue to examine how Australia’s regulatory settings across different sectors may be optimized for 5G deployment.
Public Safety and National Security
Advanced communications systems allow first responders and military personnel to communicate with one another seamlessly, to share live-stream video of emergency scenes and to access public safety databases and military command centers. At the same time, cybersecurity risks and national security concerns complicate the deployment of broadband network equipment manufactured in some foreign countries.
The Australian government has acknowledged the importance of 5G networks in providing ultra-reliable communications. Notwithstanding this, the government has not made any definitive commitments for public safety uses of 5G. The government commissioned an Australian Productivity Commission report in 2015 to determine the best way to secure mobile broadband capability for the long-term needs of Australia’s police, fire, ambulance and other emergency services. That report concluded that government intervention in spectrum allocation was unnecessary to support development of the required capability and, therefore, it is not expected that public safety agencies will receive priority 5G spectrum allocations.
National security issues have challenged the Australian government’s thinking in relation to 5G network infrastructure. In August 2018, while not naming these companies directly, the government effectively banned both Huawei and ZTE from involvement in Australia’s 5G network deployment through the implementation of Telecommunications Sector Security Reform (TSSR) measures. Contentious decryption legislation, the Telecommunications and Other Legislation Amendment (Assistance and Access) Act 2018, was passed by the Australian government in late 2018 and is expected to potentially impact 5G infrastructure deployment and technology use by delaying rollout as operators ensure compliance with the new regime.
In the United States, Congress established FirstNet in 2012, a public-private partnership between AT&T and participating U.S. public safety agencies that is building an advanced wireless network across the U.S. specifically designed to address the needs of public safety first responders. To date, over 2,500 U.S. public safety agencies have joined FirstNet.
One open issue in the U.S. is how competing national security concerns may impact the supply chain of 5G network equipment and services from foreign countries. In response to cybersecurity concerns and violations of international treaties, the U.S. has also taken actions against China’s wireless manufacturers, Huawei and ZTE. Additionally, the FCC has initiated a proceeding to determine whether U.S. providers should be banned from using federal broadband subsidies to acquire network equipment or services from manufacturers that pose a national security risk.
There is no doubt the race is on to dominate 5G technology. Some criticisms have been made in both the U.S. and Australia that the government and regulators are not moving fast enough to help communications companies move forward in this area; however, in both jurisdictions, there is clear recognition of the importance of 5G technology, and many steps have been taken to facilitate the “5G future.” The future is impossible to predict, but it is undoubtedly the case that there will be significant enterprise and consumer benefits from 5G technology and the investments that companies make today in building and operating the next generation of broadband networks, facilitated by appropriate government support.