Cable operators scored a big win in the race for 5G by diving into the Federal Communications Commission’s (FCC) recent Citizens Broadband Radio Service (CBRS) spectrum auction. Three of the country’s largest cable companies – Cox, Comcast, and Charter – collectively bid more than $1 billion to gobble up mid-band spectrum perfectly suited for 5G. This promises to be a game-changer in mobile offerings.
These three large Multisystem Operators (MSOs) bought a collective 19-24MHz for $1.14 billion across their wireline footprints, combining for 4.6BMHz Point of Presence (POPs), or .25 cents per MHz/POP. This is a standard measurement for the value of spectrum based on how many people are covered versus how much spectrum is available.
The CBRS licenses are for 10-year periods and purchased on a per-county basis, with 40MHz available in any given county, and some of this may cover large, urban areas. Cable companies will now be able to deliver consumer mobile services, Fixed Wireless Access (FWA) services, and Managed Private Networks (MPNs) for enterprises. In the early phase, MPNs (4G/5G+WiFi6) will be very attractive to enterprises as they don’t need to buy or sublease the license for the whole county and can rely on the expertise from MSOs to run these networks.
Because the services work both outdoors and indoors, enterprises may wish to use it to connect their Internet of Things (IoT) devices. They may even use it to replace or supplement Wi-Fi in addition to IoT connectivity. Service providers, meanwhile, will most likely use CBRS to deliver FWA services and as a replacement for last-mile fiber access and consumer mobile service to offload their traffic from their Mobile Virtual Network Operator (MVNO) partner.
Part of the lure in the purchasing spectrum for these MSOs is to build their own inside-out wireless networks to eliminate high roaming costs they’re paying major mobile service providers through MVNO agreements. Analysts estimate they’re paying up to $700 million in MVNO costs every year.
How cable operators can win with CBRS
The mobile “greenfield” cable companies don’t have legacy 3G or 4G networks to build from, however, they’ll need to make some big decisions around the architecture. Should they start with 4G and then migrate to 5G or go directly to 5G? Should they look at the standard radio model or the new disruptive open Radio Access Network (oRAN) architecture? Going all cloud-native is a no brainer but how distributed the network should be is a decision they need to make. Deciding on what level of automation and security will enable them to run this network at an attractive cost should be a key driver.
In the 4G world, Cisco is a leading provider of packet core and we’re radio agnostic. In the past, service providers were locked into whoever owned the radio, but we can give operators a lot of flexibility. Not being locked into a vendor is a huge advantage from a cost perspective because they can purchase radio equipment from smaller, less expensive, and more agile vendors that will be more open to meeting their demands than larger companies. Another advantage is being able to mix and match from several different vendors and operate them across various regions of their market to identify which ones are the best performers.
As a leader in 5G, we’re a founding member of the Open RAN Policy Coalition. Our first oRAN deployment was a highly successful Non-Standalone (NSA) network with Rakuten in Japan. The best part of that deployment is that Rakuten is free to partner with any number of vendors. DISH Network has also publicly stated its intention to build a 5G Standalone (SA) network using oRAN technology, so it’s clearly gaining traction throughout the industry.
Cable operators need to consider new technology as they expand and modernize networks to capture new service opportunities. Not being locked down between radio and compute allows them to maximize their investment in compute. Also, now that they’ve jumped into the mobile business with both feet, cable executives will be under increasing pressure to make these new ventures profitable. For example, Comcast’s offering is reportedly on track to break even by the end of 2021 with approximately 3.5 million lines of service. Utilizing oRAN could really help make this a reality while saving Capital Expenditures (CapEx) and keeping those costs off the books.
How will this affect 5G development?
CBRS spectrum is expected to cover 80 percent of cable customers in the United States. That’s a very large swath of the country and could mean big money for the MSOs if they use it right. That’s why the FCC is referring to this as the “5G spectrum”. This will make the big cable companies very competitive in the race to roll out SA 5G networks.
Because they are new to this domain, their competitiveness will come from being able to offer more customized solutions for their customers. As Cable Operators modernize and add new capabilities to their network, they need to look to the future – go right for 5G. The 4G subscribers today will face a cycle of upgrades over the next 24-36 months when most will move into the 5G phone domain, and all smartphones will be 5G within the next few years.
Did you know that Cisco is a leading security provider, protecting 100 percent of the Fortune 100? Or that our automation tools provide a bridge between intent and action? No one is better equipped to secure the cable network. We’re moving into a domain where 5G networks are complex, with automation and security being core fundamentals of these solutions. Cisco is not just a mobile player, we’re an end-to-end network provider with SD-WAN and security portfolios, and dashboards for full network visibility and control.
The future of wireless is multi-access
Now that cable companies have purchased the spectrum license, they can offer 5G to enterprises as a managed service and couple it with Wi-Fi 6 to cover a large variety of use cases. By teaming up with service providers, we can bring them a best-of-breed ecosystem. In this way, cable operators can pinpoint areas of priority that would have a higher take rate for the service so they’re not stuck and can adjust as needed.
We’re building out this service so we can learn together, iterate on innovations, and identify high-priority areas. As a member of the CBRS Alliance, we look forward to working with these MSOs as they build out their new networks. At SCTE-ISBE Cable Tec Virtual Expo, we will be speaking on The state of Converging Access & 5G Mobile Networks. Start your virtual experience with us now. Visit Cisco’s Cable Tec Expo bonus microsite and catch up on how cable operators can get ahead of unpredictable demand with a next generation modern cable network.
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