Charter and Amazon are hoping the 3.5 GHz CBRS band bolsters their mobile plays (AMZN, CHTR)
Category : entrepreneur
US cable company Charter and ecommerce giant Amazon are leaning on the 3.5 GHz Consumer Broadband Radio Service (CBRS) band to expand their presence in the mobile market with new products and services. The 3.5 GHz CBRS band represents a low-cost option for companies developing connectivity solutions.
The band is prime mid-band spectrum that has been broken into two main portions, a licensed portion — set to be auctioned in June 2020, pending a vote — and an unlicensed portion. Because the unlicensed spectrum is free to use, entities that can’t afford or don’t want to compete at spectrum auctions can take advantage of connectivity services and develop their own solutions.
Here’s what Charter and Amazon are doing in the 3.5 GHz CBRS band:
- Charter is gearing up to build its own 4G LTE connectivity infrastructure that can reduce its reliance on Verizon and provide fixed wireless service. The cable company reportedly plans to use the 3.5 GHz CBRS band to build its own infrastructure for its mobile virtual network operator (MVNO) service Spectrum Mobile, which relies on Verizon’s network and the company’s own network of Wi-Fi hotspots. This will allow Charter to connect more customers via its own network and spend less on leased spectrum — Spectrum Mobile pays Verizon an estimated $3.09 per gigabyte. Charter also plans to harness the spectrum to expand its broadband footprint by using fixed wireless technology. This would help Charter widen the addressable market for its internet offerings, while curbing costs by not having to build out a wired network.
- Amazon is reportedly looking to conduct tests in the 3.5 GHz CBRS band. Though details are sparse, Amazon’s proposed 3.5 GHz tests would be in Sunnyvale, California — near its product development subsidiary Lab126 — as well as its headquarters in Washington and Virginia. The location of the tests signal that Amazon’s interest in the spectrum could be for testing connected devices: Lab126 has developed Amazon hardware such as its Kindle e-readers, Fire tablets, and Alexa-powered Echo smart speakers, for instance. The tests could also be related to the company’s announcement in November 2018 that it would offer a cloud-based private network solution based on the 3.5 GHz CBRS band.
The CBRS band represents an opportunity for companies that lack significant spectrum holdings — or the capital to acquire them — to disrupt the wireless market.
Besides being free to use, because the unlicensed band isn’t closed, there is a robust supply of open-source hardware that companies can use to access it, which allows those using the unlicensed band to benefit from cheaper equipment that is easier to scale. This could enable challengers in the mobile space to create disruptive services and devices.
In conversation with Business Insider Intelligence Analyst Peter Newman, Zack Brock, CEO of California-based communications startup Common Networks, echoed the benefits of working in unlicensed spectrum, specifically in regards to the startup’s work in the 5 GHz and 30 GHz bands:
“We’ve built on open spectrum, a lot of open hardware designs and open software, and we think long-term being in that open space, open standards tend to win, tend to be lower cost, tend to be more resilient to change and easier to scale compared to closed solutions. We’ve seen that over and over again in the networking and computing world.”
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