The world’s two largest satellite operators, Intelsat and SES, have enjoyed considerable share-price rises largely because of the “windfall” gains expected to flow from the re-versioning of their C-band frequencies over the US.
One market commentator, having conducted a detail examination of the objections to the scheme, is extremely pessimistic, saying the C-Band Alliance’s (CBA) proposals are not well supported. In a nutshell it has been suggested that the members of the Alliance will sell 200 MHz of their C-band spectrum to help drive 5G take-up in the US.
The CBA is made up of Intelsat, SES, Eutelsat and Telesat, and their proposals are now sitting before the Federal Communications Commission (FCC) awaiting a decision.
Paul Litchfield, a now retired head of international investments for a Top 50 bank, writing on the Seeking Alpha web-site, says he has examined 1051 pages of filings to the FCC – positive and negative – including comments from 61 different organisations and parties who submitted their observations on the last day open to them (October 29th) by the FCC requirements under its ‘Notice of Proposed Rule Making’ (NPRM) requirements.
Litchfield says there’s plenty of support for the proposals from C-band broadcasters, users, equipment vendors and manufacturers, but not a lot otherwise.
But he then lists those objecting, and there are some powerful names present: T-Mobile, Comcast/NBC, Qualcomm, Google, Nokia, Ericsson, US Cellular. Balanced against these objectors there are also powerful supporters, including Verizon, Cisco, Motorola, National Public Radio and PSSI Global. One must also assume Intel to be a supporter – or at least neutral – because its name was attached to the original concept.
AT&T is another ‘neutral’ commentator, saying: “the CBA’s proposal ‘warrants serious consideration’. But in the next sentence say, ‘it remains unclear whether CBA’s spectrum reallocation proffer is the efficient amount of spectrum to be reallocated’.”
Litchfield says that T-Mobile “completely cans the CBA proposal. Wireless companies today measure broadband spectrum in gigahertz, not megahertz, and wireless spectrum auctions have contributed more than $100 billion in auction revenue to the United States Treasury. The satellite operators’ proposal, by contrast, caps spectrum for broadband at 180 megahertz and directs all spectrum revenue to satellite investors and none to taxpayers.”
Litchfield argues that there is near-universal disapproval of the amount of spectrum on offer by the CBA, with T-Mobile – for one – stating that it wants a minimum of 300 MHz, and ideally 500 MHz, to be made available. It is the same with Ericsson. Nokia is “underwhelmed” by the amount of bandwidth on offer. Microsoft – itself fairly neutral – says that 400 MHz should be cleared. The CBA has insisted that it is only 200 MHz on offer.
Litchfield concludes that the CBA’s proposal is flawed. “Their proposal cripples America’s chances of winning the race to 5G by confining our world class competitors to the equivalent of a one lane horse track. This is a completely unacceptable result which will never be endorsed by the FCC.”