Industry Trend Analysis - Fragmentation A Negative For European Spectrum - JULY 2017

BMI View: Ireland has moved ahead with its auction of the 3.6GHz band, as these frequencies start to garner more attention because of their potential for 5G. A series of new bands will become available for advanced wireless broadband services, but Europe will always be one step behind, as fragmentation will prevent the necessary scale for operators to launch nic h e services early in the market.

Ireland has raised EUR78mn (USD87.5mn) by selling 350MHz of TDD spectrum in the 3.6GHz band, with a frequency range of between 3,410-3,435MHz and 3,435-3,800MHz. The three major operators - Hutchison, Vodafone and eir - all acquired spectrum, as did Airspan and Imagine Communications ( see table). Frequencies around the 3.5GHz band are getting increasingly important, as they have been earmarked for 5G services, and we would expect them to receive greater attention as they begin to be auctioned in Europe.

The 3.5GHz band is already in use for broadband services, but mobile operators have tended to focus other bands for their services, such as 800, 900, 1,800, 2,100 or 2,600MHz in Europe. The 3.5GHz band is usually asymmetrical, under the TDD paradigm, and this means it has been used sparsely for legacy broadband technologies, such as TD-LTE or WiMAX. But this is changing with the advent of 5G, with multiple trials using the band as a fixed wireless alternative, or being used for small cells services. 5G will bring a series of new bands into play, starting with the 700MHz band, which brings strong coverage capabilities, as well as higher frequencies such as 28GHz, also known as millimetre wave, which will bring much higher speeds once all technical requirements are finalised. The battle between AT&T and Verizon for Straight Path highlights the growing importance of non-traditional telecoms frequencies (see ' High Frequencies Key To Future 5G Networks ' , April 11 2017 & ' Comcast, Charter And Straight Path All Point Towards 5G ' , May 9 2017).

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