FCC Action May Delay Deployment of 5G and Industrial IoT Applications and Services Under Innovative New Spectrum Sharing Regime in 3.5 GHz Band

The FCC’s plan to release an additional 150 MHz of spectrum in the 3.5 GHz band under the new Citizens Broadband Radio Service (CBRS) shared spectrum access regime will likely be delayed as the agency continues to work out final details of shared access rights. In action earlier today the Commission adopted a notice of proposed rulemaking seeking comment on several proposed changes to several aspects of CBRS regime, including potential changes to the size and term of priority access licenses, and changes to certain technical rules.

As we have previously reported, in 2015 the FCC adopted an innovative new spectrum allocation regime to assign spectrum use on a shared basis. The sharing regime (often referred to as CBRS, or the “innovation” band) reflected the agency’s decision to reject existing binary choices of spectrum allocation –either offering the spectrum as licensed or unlicensed. Instead, the FCC forged a third way by adopting rules intended to facilitate opportunistic use of the 3.5 GHz band on both a licensed and unlicensed basis, while also protecting existing incumbent users of the spectrum band. 

To achieve this goal spectrum users in the newly developed CBRS 3.5 GHz band will be classified in one of three tiers that will define their access rights:

1) Incumbent users – which include the federal government (the Navy), certain existing fixed satellite services and certain wireless ISPs with existing 3650-3700 MHz licenses.

2) Priority access licensed users – entities that obtain priority access licenses (via an auction originally planned for 2018) will occupy the second tier of access rights and receive protection from general authorized access users, but must not interfere with incumbent users.

3) General authorized access users – entities that choose to utilize available spectrum on an opportunistic basis, when such spectrum is not already used by incumbents or priority access licensees.

The task of operationalizing this sharing regime in the real world will fall to advanced frequency coordinators, known as the Spectrum Access Systems (SAS) administrators, who will mediate and control access rights between the three tiers of users. Under this system one, or several, SAS administrators will utilize advanced algorithms and databases to operationalize a dynamic spectrum assignment and mediation process to facilitate shared access amongst all users of the spectrum across all three access tiers.

Today’s NPRM is focused primarily on changes to the priority access license (PAL) structure. Under existing rules, the PAL licenses would be issued for a term of three years, and cover a census tract. However, today’s NPRM asks whether the Commission should extend the license term to ten years, and change the geographic size of the license area. Some interested parties, including mobile service providers, have argued that PALs should be issued for a longer term and larger geographic area, and that the current rules should be amended such that PALs are enlarged to cover an entire Partial Economic Area (PEA), rather than much smaller census tracts. Other providers and interested parties have argued that the Commission should maintain the existing size of the license areas, and the shorter license terms. All interested parties will now have an opportunity comment on these proposed changes. 

There is significant interest in this spectrum band from a wide variety of organizations. More than two hundred experimental licenses have already been issued to mobile service providers, cable operators, wireless ISPs, DAS system providers, and industrial users (such as GE). As currently conceived these entities have publicized their intentions to utilize this spectrum to expand small cell capacity and enable 5G services, extend rural broadband services over fixed wireless connections, provide neutral host networks, and catalyze industrial IoT applications and services. Millions of dollars have already been invested in these efforts to commercialize services and networks under the new 3.5 GHz band. However, the Commission’s decisions concerning PAL license terms and sizes could affect how, or whether, many of these potential applications can be viably operationalized on a commercial basis.

While the Commission is likely to adopt final rules for certain general authorized users in 2018, this latest rulemaking effort could delay the planned auction of priority access licenses to the end of 2018, or beyond. Stay tuned for additional developments in this space, and how this spectrum sharing regime may be applied to other bands in the future.