The U.S. Federal Communications Commission (FCC) recently voted to establish rules for a spectrum sale scheduled for auction in 2021 October, which will include the sale of much-coveted mid-band spectrum that has the ability to deliver 5G wireless to millions of people.
There are three types of spectrum used to create 5G networks: high-band, also known as “millimeter wave,” which deliver the fastest speeds but with a narrower geographic coverage; low-band airwaves, which deliver wider geographic coverage but at speeds not much faster than 4G; and mid-band, which delivers a greater balance of speed and geographic coverage.
Carriers highly value mid-band airwaves for the ability to haul large amounts of data over long distances. The spectrum has the power to automate homes, businesses, and vehicles, but has largely been missing from networks. The upcoming auction is expected to change that situation.
“We take action that will move us closer to 5G service that is fast, secure, reliable, and most importantly available everywhere in the country,” FCC Acting Chairwoman Jessica Rosenworcel is reported to have said during a monthly meeting in Washington.
Ruling Expected to Expand Much-Needed Mid-Band Coverage In the U.S.
In the U.S., major telecommunications companies are racing to lay the foundation of next generation wireless networks. In filings, Verizon Communications Inc., AT&T Inc., and T-Mobile US Inc. informed the FCC that auctioning off vast tracts of spectrum would boost the acceleration of 5G coverage in the country —especially where they have struggled to expand service into rural areas. However, Google, along with a number of cable companies and smaller wireless providers stated that offerings on a per county basis would attract more diverse bidders to compete for the frequencies.
In a previous airwaves auction, the telecommunications giants spent big on mid-band spectrum. In an attempt to double its holdings on the spectrum, Verizon spent the most at US $52.9 billion. While T-Mobile spent far less at US $9.3 billion, it already owned a vast sum of the spectrum at the time thanks to its acquisition of Sprint in 2020. Additionally, the carrier has an established mid-band network. This put T-Mobile ahead of its competitors, who won’t be able to erect their spectrum holdings until the end of 2021. By that time, T-Mobile anticipates coverage for 200 million people in its high-speed 5G network.
“T-Mobile won,” Craig Moffett, founding partner and analyst at MoffettNathanson, told CNN Business. “Their mid-band spectrum position was far better than either Verizon or AT&T’s going in… and they didn’t have to spend anything like the same kind of money in order to keep that position.”
While AT&T and Verizon may be slower to build out their networks, they offer enhanced fiber infrastructure that will make them strong competitors.
5G rollouts will continue to take time, especially in the rural U.S. However, with carriers fiercely vying to expand prized mid-band networks, the transition to 5G is well underway.
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Reid, Jonathan and Shields, Todd. (17 March 2021). Next 5G Auction to Feature Large Tracts Sought by Carriers. Bloomberg.
Duffy, Clare. (14 March 2021). Wireless companies shelled out billions of dollars to fix this 5G problem. CNN Business.