Subject: [NEXTEL-1] Doing What Needs to be Done

From: NEXTEL-1
Date: Wed, 23 Jun 2004 13:02:39 -0400

Doing What Needs to be Done

By Scott Hays
June 16, 2004

John Muleta is Chief of the Federal Communications Commission's Wireless
Telecommunications Bureau (WTB) Muleta previously served at the FCC from
1994-1998 where he held various positions in the Common Carrier Bureau
and the Office of Plans and Policy.  He also was president for PSINet
Ventures Inc., president of PSINet's Global Facilities Division and
president of its India, Middle East and Africa Division.

Connections: What is the key to widespread adoption of broadband
wireless access (BWA)?

Muleta: I think there are three critical factors: Vision and
entrepreneurial spirit, non-line-of-sight technology and plug-and-play
technology. If you have these three things in place, then you can
overcome all of the other hurdles that are slowing the adoption rate,
like spectrum management and poorer sighting. The key thing with
broadband wireless is once you're on, once you're connected and you have
high speed capability and portability, wonderful things happen.

You also have people out there that are willing to go for it by really
being innovative in terms of technological development. We have to use
all of these things to get to our goal of the 100 million user mark by
2010.

Connections: How far away is the industry from a technology standpoint?

Muleta: I think we're here. Many of the companies that that have been
around for a while have learned what works and their approaches have
become more practical. The deployment strategies have grown up. Their
spectrum can all be made to work, and I'm sure that many of the major
technology makers are all doing their part to facilitate this, both in
the licensed and unlicensed bands. The two approaches are really
complimentary, and the consumer market will benefit as a result.
Connections: What should the government's role be in encouraging the
adoption of BWA?

Muleta: The aspect we have to encourage is to provide current spectrum
users a flexibility to use the spectrum for its highest and best use.
That not only means technological and operational autonomy so you don't
have to go through a lot of paperwork to add something, but also the
ability to put different kinds of spectrum together to provide the
value-added services that consumers want. We need to do that in an
environment where we encourage lots of competition and lots of new
applications. People need to understand that there's an opportunity cost
of using spectrum, so whether its through secondary markets or the
auction process, we need for people to say "I've really got something
valuable here, so I need to take advantage of it." We need to make sure
people realize that spectrum is very, very valuable, and that there's
plenty of it. But you don't want to strain it so you have to be very
effective when using it and layering more and more services on top of
it.

What we can do as a government is to make sure that all these threads
are connected. I think then what you'll see is the same takeoff rate
that you did in the cellular PCS band, when you increase competition,
provide a lot of technical flexibility and have lots of competitors, you
really see innovation flourish. Now we have little phones that you can
buy for $50 and then throw away. I think we'll see similar traits in BWA
products.

Connections: How does the FCC go about making more spectrum available
for these technologies?
Muleta: Over the last 10 years we've released 120Mhz of spectrum for
point coordination function, and some has actually been returned to us
by various businesses. Plus, there's an additional 30Mhz out there in
the 2.1 and 1.7 areas that we're planning to bring to the market as soon
as possible. We're working to reband and permit a lot more flexibility
in the areas of matched band systems. We're trying to provide
flexibility and a competitive environment. At a minimum, you're talking
close to 400Mhz that we're working to release. We just have to get it to
the marketplace.

Connections: The U.S. adoption rate of BWA currently is one-tenth that
of the rest of the world. Is this something the government needs to be
concerned about?

Muleta: Yes, but the question is what are the mechanisms? Part of my job
as a public servant is to make sure that the spectrum goes to the
highest, best use to fulfill the public interest of the nation. Keep in
mind, we're a nation of 300 million people with a vast geography, so we
have different economic characteristics than countries like Singapore
and Hong Kong, where the adoption rates are higher. We have unique
federal-state jurisdictional issues regarding broadband deployment. So,
when someone says South Korea's ahead of us, well, they have different
mechanisms for achieving those goals, different statutory authority and
different levels of competing interest. Also, many of these countries
have higher population densities, so it's easier to reach more people in
one deployment than it is here.

Our adoption rate will increase as we bring more access to rural areas,
and granting this access has been one of our main concerns. We've
proposed greater spectrum flexibility for rural service providers and
we're hoping to have a ruling on that in July. We've initiated a
partnership with the Rural Utilities Service where they have $1.5
billion available for service grants. We've done joint presentations
telling people that there's money available . we've been out there
trying to get the message out. In the past, there were line of sight
issues, but I think that's been cured.

I'm a bullish BWA guy, and I think we're on the right track here.

Connections: How much progress has been made in providing rural access
over the last few years?

Muleta: I think we've made tremendous progress. There are roughly 8,000
WISPs in the country right now, and the majority of them are in rural
areas. It's a bit like the ISP business that I came from in the sense
that the issue in that area is how to achieve scale. Most of these guys
are going to get to profitability quickly, but they'd like to reach
higher levels of revenue. When you're serving communities of interest as
opposed to a general market, it's hard for any one individual to make
money to scale. So the real issue has not been that they're not out
there providing service, but for any one person to have significant
scale across many small communities takes a lot of effort and a lot of
underlying scalability. I think that when more urban and densely
populated areas start to roll out these kinds of services, the cheaper
it will be for rural areas to do the same because they'll be able to
ride the scale curve. There are folks out there that are providing tons
of wireless connectivity, but they can only do it in one small town as
opposed to many.

Connections: How do you see BWA being deployed in urban areas?

Muleta: I think it will take off as long as its plug-and-play employs
non-line-of-sight technology. I think one-third of our nation will be on
wireless. Now, when they go home, they may have landlines, but they'll
also be using wireless in some capacity. Many of the current service
providers eventually will bundle services that will entail BWA
technology. The company that provides you with the BWA element will be
the most important to you because it will enable mobility. The power of
BWA is that it's personal.

http://www.connectwithcanopy.com/index.cfm?canopy=stop.story&aid=226

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