with Steven Berry, president and CEO of the Competitive Carriers Association
A large stumbling block tripping up smaller mobile operators as they strive to enhance and expand wireless broadband services is access to backhaul. Steven Berry, president and CEO of the Competitive Carriers Association, alleges that since four large cable companies (Comcast, Time Warner, Bright House and Cox) sold their AWS spectrum to Verizon and began teaming with it on bundled services, they have become considerably less interested in crafting backhaul deals with small carriers. He's also concerned about the impact that the shift of the public switched telephone network from TDM to IP networking will have on connectivity for smaller players. Berry recently chatted with FierceBroadbandWireless Editor Tammy Parker about the connectivity issues faced by smaller operators. Following is an edited and condensed version of conversation.
FierceBroadbandWireless: Small carriers, particularly in rural areas, complain about a backhaul shortage? What is causing that?
Steven Berry: You've really got three issues.
How do small carriers that have very few wireline or fiber buildouts--they're servicing the most difficult, hard to reach and the most costly areas to service--get back to a wireline product or fiber? Many of our small carriers in rural areas are using microwave to get back to a wireline network.
And it is more difficult to have economically sustainable relationships with a wireline carrier, especially AT&T (NYSE:T), Verizon (NYSE:VZ), Comcast and Time Warner, because they already have their deals. They already have their billing relationships. That's one of the reasons I testified at the Senate Antitrust Subcommittee hearing against the SpectrumCo deal. I said that the deal should be conditioned to ensure connectivity.
Now we take one step further into the present day, and we're looking at the IP transition. Our position has been that this is a relationship with carriers. It's a wholesale relationship currently covered by Sections 251 and 252 of the 1996 Telecommunications Act, which says that an incumbent carrier, including those with ownership in backhaul, has to provide connectivity. We're saying the FCC should continue to require connectivity. We're not asking for rate regulation, but it's important that rates are economically sustainable.
FierceBroadbandWireless: What happens without an FCC mandate?
Berry: We're getting to a point where the largest carriers that own a large majority of the backhaul right now could make it extremely difficult for smaller carriers to connect to a network that would allow them to provide ubiquitous service nationwide... How do you sustain a competitive presence if your prices keep going up and you have to pay higher and higher prices to the very companies you're competing with on the retail side for consumers?... The larger carriers are eliminating their competition using all the levers, traits and advantages they have in the marketplace. So you need a framework for competition that ensures there will be the benefits of a competitive market without heavy-handed regulation.
FierceBroadbandWireless: Aside from lobbying for legislative and regulatory assistance, what else can you do to help your members with backhaul?
Berry: We're trying to create business solutions. We're giving our carriers an ecosystem for relationships. We've just launched a 4G LTE roaming hub, and all CCA members can join that roaming hub. The idea is that we can put together a 4G LTE roaming hub that is the equivalent of an open ecosystem for any carrier that wants to connect to a 4G network.
As we create that hub--hopefully everyone will be connected through a dual-core or multi-core connection--[our members] might be able to get better access rates because the hub will host traffic from 100-plus carriers. And hopefully CLECs would be interested in participating because they would get some guaranteed access to more traffic going over their own networks. And if the FCC continues to support the proper framework, even the large carriers like Verizon, AT&T, Comcast and others would have to provide access to these competitors. We haven't asked for price controls but what we have said is economically sustainable rates.
I'm hoping that hub matures into an ecosystem that has reliable partners where we can bring more cost advantages to the smaller carriers. It's not easy. And as we move to to an all-IP world it's going to get more and more difficult.
FierceBroadbandWireless: Are there related issues you are working on?
Berry: I would mention that everyone is going to small cells, heterogeneous networks…and Wi-Fi offloads… We've worked with Boingo so our carriers could access Wi-Fi offload capabilities out of market. Sprint and T-Mobile have joined our roaming hub, and we're hoping some of our carriers will sign onto some of the things the larger carriers are doing right now to reduce their costs and then share them through that roaming hub concept.
Everyone will tell you that in a suburban/urban area, it's all about how many new cells you can put up every 100 yards so you can reuse your spectrum at greater efficiency and lower your costs. We're looking at that also. It's more difficult to do in a rural area.
Then you get back to another issue, low-band spectrum. Low-band spectrum is so critical to rural carriers because of its propagation characteristics, its in-building penetration, all those things that allow you to build a network at one-fourth the cost but with better coverage and capabilities than at 1.9 GHz to 2.5 GHz, for example.
We are attempting to create an entire ecosystem one step at a time but keeping in mind that everything works together. We wouldn't mind for AT&T and Verizon to join the concept of having open ecosystems with devices, interoperability and true competition for the consumer rather than contrived competition.