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Ron Quirk: FCC Again Proposes to Enlarge Service Areas for Wireless Public Access Licenses

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The Federal Communications Commission (FCC) recently issued a Public Notice seeking comment on procedures for the auction of Public Access Licenses (PALs) in the 3550-3650 MHz (3.5 GHz) band. The auction is scheduled for June 25, 2020. Comments are due by October 28, 2019, and reply comments are due by November 12, 2019.

While the Public Notice indeed solicits comments on some bidding procedures, a major licensing issue is included therein. The FCC, at this late date, seeks to give bidders for PALs the “flexibility” to bid on large Cellular Market Area (CMAs), instead of bidding separately for the counties within the CMAs.

As those who have followed the history of the 3.5 GHz proceeding well know, in 2015 the FCC issued rules that set census tracts as PAL service areas. Census tracts, which generally align with the borders of political boundaries such as towns, cities, and small counties, would have offered WISPs and small wireless service providers the opportunity to bid on affordable licenses, many of which cover rural areas. That scenario was a win-win for the smaller players and rural America, which would have had access to affordable wireless broadband.

When Ajit Pai became Chairman in 2017, he called for a review of the 3.5 GHz rules. Chief among the new rules proposed was the enlarging of PAL service areas from census tracts to much larger Partial Economic Areas (“PEAs”). PEAs are approximately 178 times larger than census tracts. Based in part on comments it received, the FCC decided to compromise on the PAL service areas; settling on counties, instead of PEAs.

Now the FCC is attempting yet again to enlarge many of the PAL geographic areas, proposing that bidders can elect CMA-level bidding for the 172 CMAs that are classified as Metropolitan Statistical Areas (MSAs); those that incorporate more than one county. As shown in Attachment A to the Public Notice, these MSAs typically encompass many counties, and bidding on MSA-based PAL licenses requires large upfront payments and unaffordable minimum opening bids.

From a small carrier’s viewpoint, counties are certainly preferable to CMAs; the FCC’s proposal to increase many PAL service areas will make it that much more difficult to successfully bid for PALs. Cable companies and large mobile network operators (MNOs) will be able to outbid smaller providers for the more profitable CMA-sized PALs. This plan would effectively limit participation in the licensed portion of the 3.5 GHz band to the largest carriers who are focused on deploying 5G in profitable urban areas. The inevitable result is that rural areas will remain underserved.

Consequently, it is critical that all interested broadband stakeholders, particularly those that serve rural areas, make their voices heard in this proceeding. There is strength in numbers. Tell the FCC that all PAL service areas must remain at the county level. There is no excuse for moving the goalposts on smaller carriers at this late stage in the game.

About the author:

Ronald E. Quirk is head of The CommLaw Group’s Internet of Things & Connected Devices practice group. Spanning more than 25 years, Mr. Quirk’s legal career includes several years at the Federal Communications Commission and AMLAW 100 firms. He specializes in helping Internet of Things, WISPs, and other service providers build and expand their businesses by assisting them in navigating the complex labyrinths of federal, state, local, and international legal and regulatory processes, including spectrum management, licensing, radio frequency equipment authorization, small cell and tower siting. Learn more about The CommLaw Group’s upcoming presence at WISPAPALOOZA.

Originally published on LinkedIN and reposted with permission of the author.

BroadbandBreakfast.com accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@broadbandcensus.com. The views reflected in Expert Opinion pieces do not necessarily reflect the views of BroadbandBreakfast.com and Breakfast Media LLC.

Ronald E. Quirk is head of The CommLaw Group’s Internet of Things & Connected Devices practice group. Spanning more than 25 years, Mr. Quirk’s legal career includes several years at the Federal Communications Commission and AMLAW 100 firms. He specializes in helping Internet of Things, WISPs, and other service providers build and expand their businesses by assisting them in navigating the complex labyrinths of federal, state, local, and international legal and regulatory processes, including spectrum management, licensing, radio frequency equipment authorization, small cell and tower siting.

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Dmitry Sumin: What to Do About Flash Calls, the New SMS Replacement

Why are flash calls on the rise and how do operators handle them to maximize revenue?

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The author of this Expert Opinion is Dmitry Sumin, AB Handshake Corporation Head of Products

Chances are you’ve received several flash calls this week when registering for a new app or verifying a transaction. Flash calls are almost instantly dropped calls that deliver one-time passcodes to users, verifying their phone numbers and actions. Many prominent apps and companies, such as Viber, Telegram, WhatsApp, and TikTok, use flash calls as a cheaper, faster, and more user-friendly alternative to application-to-person SMS.

With the flash call volume expected to increase 25-fold from 2022 to 2026, from five to 130 billion, it’s no wonder they’re a hot topic in the telecom industry.

But what’s the problem, you may ask?

The problem is that there is currently no way for operators to bill zero-duration calls. This means operators don’t make any termination revenue from flash calls, which overload networks. What’s more, operators lose SMS termination revenues as businesses switch to flash calls. SMS business messaging accounts for up to five percent of total operator-billed revenue in 2021, so you can see the scale of potential revenue losses for operators. 

In this article, I’ll discuss why flash calls are on the rise, why it’s difficult to detect and monetize them, and what operators can do about this.

Why are flash calls overtaking SMS passcodes?

Previously, application-to-person SMS was a popular way to deliver one-time passwords. But enterprises and communication service providers are increasingly switching to flash calls because they have several disruptive advantages over SMS.

First and foremost, flash calls are considerably cheaper than SMS, sometimes costing up to eight times less. Cost of delivery is, of course, a prime concern for apps and enterprises.

Second, flash calls ensure smooth user interaction, which boosts user satisfaction and retention. On Androids, mobile apps automatically extract flash call passcodes. This makes the two-factor authentication process fast and frictionless. In comparison, SMS passcodes require users to read the SMS and sometimes insert the code manually.

Third, on average flash calls reach users within 15 seconds, while SMS sometimes take 20 seconds or longer. The delivery speed of flash calls also improves the user experience.

The problem: Flash calls erode operators’ SMS revenues

While offering notable advantages for apps, flash call service providers, and end users, flash calls create numerous challenges for operators and transit carriers.

As we discussed before, flash calls erode operators’ SMS revenues because much of the new flash call traffic will be shifted away from current SMS business messaging. The issue is only going to become more pressing as the volume of flash calls grows.

So from the operator’s standpoint, flash calls reduce revenue, disrupt relations with interconnect partners, and overload networks. However, there is still no industry consensus on how to handle flash calls: block them like spam and fraudulent traffic or find a monetization model for this verification channel, like for application-to-person SMS.

Accurate detection of flash calls is a challenge

The first crucial step that gives operators the upper hand is accurately detecting flash calls.

This is difficult because operators have no way of discerning legitimate verification flash calls from fraud schemes that rely on drop calls, such as wangiri. The wangiri fraud scheme uses instantly dropped calls to trick users into calling back premium rate numbers. In addition, flash calls need to be distinguished from genuine missed calls placed by customers.

The problem is that even advanced AI-powered fraud management systems struggle to accurately differentiate between various zero-duration calls. The task requires AI engines to be trained on large volumes of relevant traffic coupled with analysis of hundreds of specific call parameters.

Dedicated anti-fraud solutions are the answer

There are only a few solutions on the market that are capable of accurately distinguishing flash calls from other zero-duration calls. Dedicated fraud management vendors have made progress on this difficult task.

The highest accuracy of flash call detection now available on the market is 99.92 percent. Such tools allow operators to precisely determine the ranges from which flash calls are sent. As a result, operators can make an informed decision on how to treat flash calls to maximize revenue and can proactively negotiate with flash call providers.

Flash call detection creates new opportunities

Our team estimates that flash calls make up to four percent of Tier one operators’ international voice traffic. Without accurate detection and a billing strategy, this portion of traffic overloads operators’ networks and offers no revenue. However, with proper detection flash calls offer a new business opportunity.

Now is a crucial time for operators to start implementing flash call detection into their system and capitalize on the trend.

There are a few anti-fraud solutions on the market that give operators all the necessary information to negotiate a billing agreement with a flash call provider. Once an agreement has been reached, all flash calls coming from this provider will be monetized, much like SMS.

All flash calls not covered by agreements can be blocked automatically. This will help to restore SMS revenues. Once a flash call has been blocked, subscribers will most likely receive an SMS passcode sent as a fallback.

Moreover, modern solutions don’t affect any legitimate traffic because they only block selected ranges. This also helps to prevent revenue loss.

Essentially, the choice of how to handle flash calls comes down to each operator. However, without a powerful anti-fraud solution capable of accurately detecting flash calls in real time, it’s nearly impossible to monetize flash calls effectively and develop a billing strategy.

Dmitry Sumin is the Head of Products at the AB Handshake Corporation. He has more than 15 years of experience in international roaming, interconnect and fraud management. Since graduating from Moscow State University, he has worked for both vendors and network operators in the MVNO and telecommunications market. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views reflected in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

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Bjorn Capens: Strong Appetite for Rural Broadband Calls for Next Generation Fiber Technology

The first operator to bring fiber to a community creates a significant barrier to entry for competitors.

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The author of this Expert Opinion is Björn Capens, Nokia Fixed Networks European Vice President

In July, the Biden-Harris administration announced another $401 million in funding for high-speed Internet access in rural America. This was just the latest in a string of government initiatives aimed at helping close the US digital divide.

These initiatives have been essential for encouraging traditional broadband providers, communities and utility companies to deploy fiber to rural communities, with governments cognizant of the vital role broadband connectivity has in sustaining communities and improving socio-economic opportunities for citizens. 

Yet there is still work to do, even in countries with the most advanced connectivity options. For example, fixed broadband is missing from almost 30 percent of rural American homes, according to Pew Research. It’s similar in Europe where a recent European Commission’s Digital Divide report found that roughly 18 percent of rural citizens can only get broadband speeds of a maximum 30 Mb, a speed which struggles to cope with modern digital behaviors. 

Appetite for high-speed broadband in rural areas is strong

There’s no denying the appetite for high-speed broadband in rural areas. The permanent increase in working from home and the rise of modern agricultural and Industry 4.0 applications mean that there’s an increasingly attractive business case for rural fiber deployments – as the first operator to bring fiber to a community creates a significant barrier to entry for competitors. 

The first consideration, then, for a new rural fiber deployment is which passive optical network technology to use. Gigabit PON seems like an obvious first choice, being a mature and widely deployed technology. 

However, GPON services are a standard offering for nearly every fiber broadband operator. As PON is a shared medium with usually up to 30 users each taking a slice, it’s easy to see how a few Gigabit customers can quickly max out the network, and with the ever-increasing need for speed, it’s widely held that GPON will not be sufficient by about 2025. 

XGS-PON is an already mature technology

The alternative is to use XGS-PON, a more recent, but already mature, flavor of PON with a capacity of 10 Gigabits per second. With the greater capacity, broadband operators can generate higher revenues with more premium-tier residential services as well as lucrative business services. There’s even room for additional services to run alongside business and residential broadband. For example, the same network can carry traffic from four G and five G cells, known as mobile backhaul. That’s either a new revenue opportunity or a cost saving if the operator also runs a mobile network. 

This convergence of different services onto a single PON fiber network is starting to take off, with fiber-to-the-home networks evolving into fiber for everything, where homes, businesses, industries, smart cities, mobile cells and more are all running on the same infrastructure. This makes the business case even stronger. 

Whether choosing GPON or XGS-PON, the biggest cost contributor is the same for both: deploying fiber outside the plant. Therefore, the increased cost of XGS-PON over GPON is far outweighed by the capacity increase it brings, making XGS-PON the clear choice for a brand-new fiber deployment. XGS-PON protects this investment for longer as its higher capacity makes it harder for new entrants to offer a superior service. 

It also doesn’t need to be upgraded for many years, and when it comes to the business case for fiber, it pays to take a long-term view. Fiber optic cable has a shelf-life of 75 or more years, and even as one increases the speeds running on fiber, that cable can remain the same.  

Notwithstanding these arguments, fiber still comes at a cost, and operators need to carefully manage those costs in order to maximize returns. 

Recent advances in fiber technology allow operators to take a pragmatic approach to their rollouts. In the past, each port on a PON server blade could only deliver one technology. But Multi-PON has multiple modes: only GPON, only XGS-PON or both together. It even has a forward-looking 25G PON mode. 

This allows an operator to easily boost speeds as needed with minimal effort and additional investment. GPON could be the starting point for fiber-to-the-home services, XGS-PON could be added for business services, or even a move to 25G PON for a cluster of rural power users, like factories and modern warehouses – creating a seamless, future-proof upgrade path for operators. 

The decision not to invest in fiber presents a substantial business risk

Alternatively, there’s always the option for a broadband operator to stick with basic broadband in rural areas and not invest in fiber. But that actually presents a business risk, as any competitor that decides to deploy fiber will inevitably carve out a chunk of the customer base for themselves. 

Besides, most operators are not purely profit-driven; they too recognize that prolonging the current situation in underserved communities is not great. High-speed broadband makes areas more attractive for businesses, creating more jobs and stemming population flows from rural to urban centers. 

But rural broadband not only improves lives, but it also decreases the world’s carbon emissions both directly, compared to alternative broadband technologies, and indirectly by enabling online and remote activities that would otherwise involve transportation. These social and economic benefits of fiber are highly regarded by investors and stockholders who have corporate social responsibility high on their agendas. 

With the uber-connected urban world able to adopt every new wave of bandwidth-hungry application – think virtual reality headsets and the metaverse – rural communities are actually going backwards in comparison. The way forward is fiber and XGS-PON. 

Björn Capens is Nokia Fixed Networks European Vice President. Since 2017, Capens has been leading Nokia’s fixed networks business, headquartered in Antwerp, Belgium. He has more than 20 years of experience in the fixed broadband access industry and holds a Master’s degree in Electrical Engineering, Telecommunications, from KU Leuven. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views reflected in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

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Johnny Kampis: Federal Bureaucracy an Impediment to Broadband on Tribal Lands

18% of people living on Tribal lands lack broadband access, compared to 4% of residents in non-tribal areas.

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The author of this expert Opinion is Johnny Kampis, director of telecom policy for the Taxpayers Protection Alliance

A new study from the Phoenix Center finds that as the federal government pours tens of billions of dollars into shrinking the digital divide in tribal areas, much of that gap has already been eliminated.

The report, and a second from the U.S. Government Accountability Office, are more indications that regulations and economic factors that include income levels continue to hamper efforts to get broadband to all Americans.

The Infrastructure Investment and Jobs Act of 2021 allocated $45 billion toward tribal lands. This was done as part of a massive effort by the federal government to extend broadband infrastructure to unserved and underserved areas of the United States.

George Ford, chief economist at the Phoenix Center for Advanced Legal & Economic Public Policy Studies, wrote in the recent policy bulletin that while there is still plenty of work needed to be done in terms of connectivity, efforts in recent years have largely eliminated the broadband gap between tribal and non-tribal areas.

Ford examined broadband deployment around the U.S. between 2014 and 2020 using Form 477 data from the Federal Communications Commission, comparing tribal and non-tribal census tracts.

Ford points out in the bulletin that the FCC has observed several challenges for broadband deployment in tribal areas, including rugged terrain, complex permitting processes, jurisdictional issues, a higher ratio of residences to business customers, higher poverty rates, and cultural and language barriers.

Ford controlled for some of these differences in his study comparing tribal and non-tribal areas. He reports in the bulletin that the statistics suggest nearly equal treatment in high-speed internet development.

Encouraging results about availability of broadband in Tribal areas

“These results are encouraging, suggesting that broadband availability in Tribal areas is becoming closer or equal to non-Tribal areas over time, and that any broadband gap is largely the result of economic characteristics and not the disparate treatment of Tribal areas,” Ford wrote.

But he also notes that unconditioned differences show a 10-percentage point spread in availability in tribal areas, which indicates how much poverty, low population density, and red tape is harming the efforts to close the digital divide there.

“These results do not imply that broadband is ubiquitous in either Tribal or non-Tribal areas; instead, these results simply demonstrate that the difference in availability between Tribal and non-Tribal areas is shrinking and that this difference is mostly explained by a few demographic characteristics,” Ford wrote.

In a recent report, the GAO suggests that part of the problem lies with the federal bureaucracy – that “tribes have struggled to identify which federal program meets their needs and have had difficulty navigating complex application processes.”

GAO states that 18 percent of people living on tribal lands lack broadband access, compared to 4 percent of residents in non-tribal areas.

The GAO recommended that the Executive Office of the President specifically address tribal needs within a national broadband strategy and that the Department of Commerce create a framework within the American Broadband Initiative for addressing tribal issues.

“The Executive Office of the President did not agree or disagree with our recommendation but highlighted the importance of tribal engagement in developing a strategy,” the report notes.

That goes together with the GAO’s dig at the overall lack of a national broadband strategy by the Biden Administration in a June report. As the Taxpayers Protection Alliance reported, the federal auditor noted that 15 federal agencies administer more than 100 different broadband funding programs, and that despite a taxpayer investment of $44 billion from 2015 through 2020, “millions of Americans still lack broadband, and communities with limited resources may be most affected by fragmentation.”

President Biden has set a goal for universal broadband access in the U.S. by 2030. These recent reports show that the federal bureaucracy under his watch needs to do a better job of getting out of its own way.

Johnny Kampis is the director of telecom policy for the Taxpayers Protection Alliance. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views reflected in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

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