The Federal Communications Commission (FCC) released today a technical paper titled "Mobile Broadband: The Benefits of Additional Spectrum" that provides a technical analysis to validate the need for additional mobile broadband spectrum in the near-term and estimating the value created by making new spectrum available. The paper was released in conjunction with today's spectrum summit hosted by the FCC.
The FCC technical paper highlights that mobile broadband services are experiencing significant growth, driven by consumer demand for mobile data. According to the paper, industry analysts expect this growth to continue, calling into question the capacity of current mobile networks to keep up. As the paper cites, data usage over wireless networks is rapidly increasing, as well as the amount of data used by wireless consumers. In the six months preceding FCC reporting alone, subscriptions to mobile data services increased by 40%. The amount of data consumed per line increased by over 450% between the first quarter of 2009 and the second quarter of 2010. Even with substantial investment, the paper predicts that it is likely that mobile data demand will exhaust spectrum resources within the next five years.
The paper relies on industry-wide trends and forecasts to predict future spectrum needs. By adjusting the expected growth in data demand for offsetting growth in network density (which is the result of adding new cell sites) and spectral efficiency, the paper forecasts future spectrum needs relative to a baseline index of current spectrum use. Using this model, the paper estimates various factors affecting aggregate mobile network capacity and mobile data growth, and makes clear that mobile data demand will outstrip available wireless capacity in the near term. The paper demonstrates that a spectrum deficit approaching 300 megahertz (MHz) is likely by 2014. Keeping in mind that the addition of cell sites is the primary substitute to new spectrum for adding broadband capacity, the paper argues that making available 300 MHz of additional spectrum for mobile broadband is likely to entail economic value of at least $100 billion in the next five years.
The paper's conclusion is consistent with the recommendations of the National Broadband Plan, which calls for the Commission to make available 500 MHz of new spectrum for wireless broadband, including 300 MHz for mobile flexible use within five years. In addition, the president directed, in a June 28, 2010 Executive Memorandum, 500 MHz of new spectrum for mobile use. Since new spectrum has historically taken between six and 13 years to make available, and since mobile data growth trends are likely to continue beyond the near-term forecast in the paper, the FCC's technical paper provides analysis to validate the need for action to implement the National Broadband Plan's recommendation and the president's directive to make new spectrum available for mobile broadband.