The Citizens Broadband Radio Service (CBRS) band promised to bring innovative ways of using spectrum to the U.S. market, and one of those is close at hand, opening up a new secondary market for spectrum.
Federated Wireless, one of the pioneers in CBRS, today announced availability of its Spectrum Exchange, which allows CBRS license holders to lease their spectrum, when not in use, to third parties. The exchange is an automated portal that will provide nearly instant access to spectrum without interacting directly with the Federal Communications Commission (FCC). The system still awaits final FCC approval, but the company says it’s close to obtaining that.
Federated Wireless talked about its “Airbnb” for wireless spectrum more than a year ago. Since then, the FCC concluded the auction of Priority Access Licenses (PALs) for CBRS spectrum, where tried-and-true auction participants like Verizon picked up additional mid-band spectrum for 5G and cable operators acquired PALs as well. Yet it was the first auction that saw bona fide participation from non-traditional bidders, like large enterprises that can use the spectrum for their own private wireless networks.
Even with those non-traditional participants, there’s a significant amount of spectrum that license winners don’t plan to use on their own, and that’s spectrum that they can lease to others through the Federated exchange system.
Federated Wireless has been busy ramping up customers and devices, enabling both the unlicensed General Authorized Access (GAA) and the PAL portions of CBRS, according to Federated Wireless CEO Iyad Tarazi. Federated was named a Spectrum Access System (SAS) administrator by the FCC in January 2020.
“The whole idea behind this is to make sure that we continue to increase spectrum utilization in this band,” he said. In this case, it’s about creating a third alternative to GAA and PAL, so that a PAL or a portion of it doesn’t sit idle. “Across our users, there’s more buyer interest than seller interest right now,” Tarazi said.
Here's one way how it could work. The PAL auction sold licenses based on counties, which differ in size. Cable companies, for example, may not be operating in 100% of a county, but they bought the entire county, so they can sell a portion of it to somebody else who can use it.
Another situation is an entity might have bought licenses that they’re unable to use right away. That licensee can lease the spectrum to a wireless carrier, for example, for a few years. The sellers can even set parameters, so that they exclude certain competitors from using it and set the prices they want for it.
Private networks tap unused spectrum
While CBRS spectrum is getting deployed, another trend that’s coming on strong is the private wireless space. “I have spent a good portion of my time making sure we develop that,” working with the Department of Defense (DoD), cloud companies such as Amazon Web Services (AWS) and Intel, Tarazi noted.
Federated has done some work as well on the applications side, such as how to incorporate CBRS into cameras, smart warehouses and zero trust security systems. “We have a very healthy pipeline of wireless partners,” he said.
Federated is particularly interested in the intersection of these two areas – entities with PALs, like cable companies or utilities, that aren’t using them to the full extent – and those from the enterprise space looking to use a PAL in certain deployments.
“We’ve been getting steady and strong requests for an electronic way,” for people to exchange, situationally, PALs they bought with people that need it, Tarazi said. “We have a pretty big pipeline,” of customers who would like to either make their PALs available or get access to other PALs.
Federated isn’t revealing pricing right now, but it’s at a point where it’s ramping up its first customer, Frontier Communications. It’s also working in the background with the FCC to get all the processes up and certified.
At some point in the future, it will launch commercial services on a wider scale. Today, “we’re talking about operator-to-operator and the beginning of that journey,” Tarazi said. It’s also focused on CBRS now, but the model can be applied to other spectrum as opportunities arise.
It’s another milestone in the process where people are able to buy and sell spectrum in a very minute quantity involving targeted locations that could be as small as a warehouse. They’ll be able to do it through APIs and in less than a second, he said. “These are big things in spectrum that we haven’t had before, but it is an extension of the innovation that CBRS brought to the market.”
Today, when carriers lease spectrum from others, it generally takes a long time and large geographies are involved. In this model, they can literally allow an operator to lease a property the size of a warehouse to an enterprise, which is very different than how it’s been done – and no lawyers need to get involved.
“This looks a lot closer to what renting a property on Airbnb with the click of a button looks like,” than how spectrum leasing historically has been conducted, he said. “It’s another way to bring cloud innovation” to the market for spectrum.