CBRS Auction Opens With $357M in Bids

In 1,734 counties, companies didn’t make bids for all the licenses, demand exceeded supply in another 1,439. In 60 counties demand equaled supply. Bids hit $637 million after the first round in the last big wireless auction, of licenses in the 37, 39 and 47 GHz bands, and the auction closed at above $7.5 billion.

Key Bridge Wireless CEO Jesse Caulfield told us we will know more after the first few days of bidding. “I’m really interested to see what the top-line numbers are, because I think that will be an indicator for upfront interest,” he said. Many enterprise customers will wait before opting for licenses, he said. “They need to see the version 2 of the product, which is another year out,” he said: “This is a long game.”

“It may be true that we will know a lot in terms of the aggregate amount after a short period of time, but there are two big caveats,” said New Street’s Blair Levin. “There have been a number of auctions where it looked like the action was petering out but then just kept going, leading to a much larger aggregate amount than earlier rounds would have suggested,” he said: “The aggregate amount will not tell us who is bidding and from a market perspective, the who and the why is just as important as the how much, as there are nontraditional bidders who may use the spectrum in disruptive ways.”

“After fixing past policy errors, we’re now set to allow auction magic to efficiently allocate 70 megahertz per county for innovative wireless services, making 3.5 GHz the first new 5G mid-band spectrum in the U.S.,” said FCC Commissioner Mike O’Rielly. “5G is critical to America’s global economic and technological leadership, and the start of the 3.5 GHz auction today is a key milestone in our work advancing this national priority,” said Chairman Ajit Pai.

Conference

CBRS also came up at a conference.

Lots of questions remain about how many carriers and cable operators will bid in the auction, Juanyu Bu, vice president-mobility strategy at CTS, which offers in-building communications, said during a Connected Real Estate virtual conference Thursday. “That will play a big role in how we deploy our enterprise networks,” he said. “That’s a huge topic to consider right now.”

In discussions with customers, they want to make equipment mobile, but not rely on mobile phone connectivity, said Tom Landry, JMA vice president-product and market strategy. “You really don’t have to wait for 5G,” he said. “There’s a lot of capacity, a lot of capability from [CBRS] vendors today.” Landry said there’s a lot of confusion about what the PALs will mean for other users. “You will always have access to quite a bit of spectrum” even after the auction, he said. Companies can work with licensees once the auction is over, he said.

Don’t think of CBRS as a “trade-off” for Wi-Fi or licensed spectrum, Landry said. “In most cases what we’re really competing against is wires or fiber." CBRS is also helpful in extending fiber, he said. Most factories are still using wires for automated equipment, he said. CBRS “gives you very pervasive, very reliable independent channels of spectrum that you can use almost as though it’s an internet extension over the air,” Landry said.

Zenfi Networks sees CBRS as “another avenue for shared infrastructure and it solves a lot of problems for us,” said Walter Cannon, vice president-business development. There are places where it’s too expensive to build fiber, he said. “We can use CBRS as a transport mechanism for connectivity and that really helps out." CBRS could mean better connectivity in inner-city areas that are today unserved, he said: “Imagine if we could provide a CBRS network in public housing.”

Pandemic

Other speakers said the pandemic has meant a big change in how they do business.

There was a slowdown in the first four to six weeks of the pandemic, but since then, things have picked back up, said Shane Rubin, CTS vice president-operations. “Spending priorities have shifted but the need for the services hasn’t gone away,” he said: “Our customers were scared. Our own folks were scared, especially around places like hospitals and airports, which are typical targets for in-building solutions.” Sales were “virtually nonexistent” in the early days, he said. CTS is finding the desire for service “way outweighs the negative impact that we’re all going through,” he said.

With many office buildings and other venues mostly empty, CTS can do work in areas where installation was tough in the past, Rubin said. Despite high unemployment, CTS can’t find the skilled workers it needs to do the work, he said. Safety is a bigger concern than ever before, he said. You see workers in face masks and face shields working outside in temperatures above 95 degrees, he said. There are construction delays because of new cleaning requirements and access restrictions, he said. “You have to keep your team sizes very small because if there’s an outbreak, you would then have to quarantine.”

Equipment vendor Anixter is facing the same problems as CTS, said Amy Huizenga, vice president-supply chain. “The traditional model of delivering a project has to be completely redesigned,” she said: “Customers are trying to figure this out. … They’re trying to determine how do we protect our employees.” Some projects are being put on hold and resources are being shifted, she said.

David Kinnaird, chief operating officer at tech vendor Essensys, warned the pandemic is increasing cybersecurity vulnerabilities. “Businesses are having to rapidly think about working in a far more flexible way,” he said. “Plans may have floating around for years to adopt a cloud strategy and have been now brought forward,” he said: Remote users with different devices are now connecting to the network.