Smartlinx3

Submission on Radio Frequency Auction: 2.3 GHz and 2.5 GHz Bands From Smartlinx 3 Limited

Introduction

Smartlinx 3 Ltd is a community owned open-access broadband network company. We are deploying an open-access network for Porirua and the Hutt valley. We were a successful applicant to the Broadband Challenge Fund. We were a successful applicant for 3.5 GHz spectrum.

To cover the geography of our area our network is, and for the foreseeable future will remain, a hybrid of fibre and wireless. The Minister of Communications has mentioned our type of network as a model for efficient use of spectrum and encouragement of competition:

“While I do not consider it appropriate to promote individual products or services, I would like to mention one local operator as an example of what can be done. SmartLinx3 is an open-access broadband network providing fast, symmetrical broadband for Porirua and the Hutt Valley and was a successful applicant to the Government's Broadband Challenge Fund… ...As an open- access network, SmartLinx3 makes efficient use of the wireless spectrum. This is because any service provider can offer their services over the company's network Individual lSPs do not have to occupy spectrum to serve just their customers. SmartLinx3 also enhances competition and reduces barriers to entry for service providers. lSPs do not have to make the capital investment needed for wide area wireless coverage, so they can focus their time and resources on excellence in service provision." ¹

Smartlinx 3 Ltd supports the Government's overall policy as noted in Clause 2.2 of the Discussion Document. In particular, we believe that our comments below support the policy objectives of:

• efficient use of spectrum,
• investment in infrastructure,
• competition between service providers, and
• technology neutrality.

General Observations

Customers that take connections on our broadband network are looking for connectivity with the following attributes:

• Fast connectivity. 2 Mbps is a minimum and 10 Mbps is common. There is increasing demand for faster speeds.
• Symmetrical connectivity, with upload speeds the same as download speeds.
• Uncontested connectivity - you get the speed you pay for, regardless of time of day or network load.
• Full duplex connections. For wireless this implies the use of FDD rather than TDD.
• Open-access - true choice of service provider as distinct from network operator.
• Access to KAREN compliant connectivity, vs: "the aggregation network itself should support the following service parameters to the end customer:

IPv6 capable

Multicast capalble

Minimum 1OMbps symmetrical bandwidth per customer CPE

Latency measured from customer CPE to the KAREN core should be < 25ms

Jitter measured at customer CPE to the KAREN core should be < 10ms

The aggregator will provide the Rendezvous Point for multicast and will therefore support MSDP and MBGP with PIM-SM.

Over subscription of any part of the aggregation network or the core connection to KAREN is not permitted

Security will need to be appropriate for both the connection and transit methods covering confidentiality, availability and integrity.

Aggregators will not levy a per MB charge for traffic to or from KAREN

Aggregators must not unreasonably restrict access to any services (including VLANs) or routes available on KAREN

Aggregation network availability should be 99.9% on a 12-month rolling basis

Aggregators should provide level 1 help desk services, which should be based around the hours of 0500 to 2100 from Monday to Friday as a minimum." ².

We regard the above requirements as fundamental to the ability of a network to provide adequate connectivity in the future - especially they should be minimum requirements for spectrum allocations to allow equipment capable of delivering to the above requirements.

Technology Obsolescence

As the document foresees spectrum management rights with a 20 year life it is considered that spectrum allocations should not be made with any particular technology in mind. In Section Three the Discussion Paper makes extensive reference to specific standards and technologies, such as WiMAX. 20 years from now it is likely that WiMAX, and similar standards, will be a distant memory. Indeed, we consider that the current 1EEE802. 16 standard is driving the development of sub-optimal solutions for fixed wireless broadband provision, and that non-WiMAX compliant solutions could well deliver better broadband solutions. For this reason we consider that permitting specific technologies, and by implication barring other technologies, is not a desirable outcome. Spectrum allocation should be technology agnostic.

Recommendation:

It is recommended that spectrum allocations should not be made with any particular technology in mind and that there should be no specific permitted (and by implication other, non-permitted) technologies.

Regional Networks

We regard regional networks as a means of encouraging competition and efficient use of spectrum. Regional networks do not require national spectrum, but they do require spectrum which guarantees freedom from interference to the same levels that national spectrum holders expect. Consigning regional networks to Managed Spectrum Parks relegates them to forever being able to provide only a second-class of connectivity. This flies in the face of the overall policy settings as outlined in Clause 2.2.

There is no technical, commercial or logical reason why regional networks should not be able to obtain rights to use licensed spectrum which would give them the same ability to provide high-level connectivity which the current discussion document reserves for national operators.

Recommendation:

It is recommended that some spectrum currently set aside for national operators is allocated to regional entities, such as councils, to allow them to develop regional networks able to deliver high quality connectivity.

The Order of the Process

There will be entities that are considering the merits of bidding for national spectrum as against hoping to manage within the proposed Managed Spectrum Parks. Their decisions on whether or not to bid for national spectrum will be influenced heavily by the rules for management of the Managed Spectrum Parks. It is therefore logical, and only fair, that the rules governing Managed Spectrum Parks are finalised before any auction of national spectrum commences.

Recommendation:

It is recommended that the rules governing Managed Spectrum Parks are finalised before any auction of national spectrum commences.

Use It or Lose It

It is considered that those allocated national spectrum should use it nationally and that any use it or lose it provisions should be applied locally, thus potentially allowing regional networks to deliver services where national operators have not bothered to go.

Recommendation

It is recommended that, if spectrum allocations contain a use it or lose it provision, this should be applied on the basis of Territorial Local Authority boundaries, and that local authorities should have first right of refusal for spectrum ignored by national operators in this way.

Responses to Specific Questions

Question 1 Considerations Relating to Lot Design

Not completely - see discussion above.

1. Spectrum allocations should be technology agnostic. Delete all reference to WiMAX and similar standards. In 20 years, probably less, they'll be history.
2. FDD is necessary to provide full duplex connectivity.
3. Agreed. Limit large national players from dominating the allocations of spectrum.
4. No comment
5. SAA is preferred.
6. No comment

Question 2: Proposed Lot Design

Option C(ii) is preferred. Option B provides too little spectrum for real broadband provision. Option A is too uniform and provides little opportunity for FDD applications. Ahead of all these options is allocating at least some spectrum on a regional basis as discussed above.

Question 3: Maori Interests

Smartlinx3 would welcome the opportunity to make regional VLANs available to Maori groups to allow them to deliver the services that they wish without having to invest valuable capital in building a broadband network.

Question 4: Eligibility to Bid

Allocation of some spectrum on a regional, rather than national, basis would overcome concerns in this area.

Question 5: Duration of Acquisition Limits

It is considered that spectrum rights should not be eligible to be traded, and that if not used they - should be surrendered.

Question 6: Use or Lose Provisions

December 2012 should be applied. The test for use should be TLA by TLA and that those TLAs where use has not been made should be forfeit. Option B, in terms of population coverage, shoulld be applied for each TLA.

Question 7: Settlement

We agree with 30 days.

Question 8: Managed Spectrum Parks: Proposed Allocation Procedures and Usage Rules

We have the utmost difficulty commenting on Question 8. The very presumption that regional networks should not be allowed to deliver services to the same quality as national networks we find offensive and discriminatory.

1. Referring to paragraphs 115 and 1I6 in the Discussion Document, Yes.
2. We find these conditions discriminatory when compared with the conditions imposed on owners of national spectrum. That said, if there must be a Managed Park, the requirements of paragraph 117 form the basis for sensible negotiation.
3. Option Three is preferred for the simple reason that it is technology agnostic. The other two options potentially tie operators to standards which will quickly become obsolescent. That said, Option Three's (or indeed any option's) alllocation process would need to be determined before national spectrum went to auction.
4. Allocating licensed spectrum regionally.
5. No comment
6. For regionally allocated spectrum, annual fees to cover MED costs only.

Question 9: Transition Plan for the 2.5 GHz Band

No.

Summary of Recommendations

Recommendation: It is recommended that spectrum allocations should not be made with any particular technology in mind and that there should be no specific permitted (and by implication other, non-permitted) technologies.

Recommendation: It is recommended that some spectrum currently set aside for national operators is allocated to regional entities, such as councils, to allow them to develop regional networks able to deliver high quality connectivity.

Recommendation: It is recommended that the rules governing Managed Spectrum Parks are finalised before any auction of national spectrum commences.

Recommendation: It is recommended that, if spectrum allocations contain a use it or lose it provision, this should be applied on the basis of Territorial Local Authority boundaries, and that local authorities should have first right of refusal for spectrum ignored by national operators in this way.

David Haynes
Managing Director
14th September 2007

Footnotes

¹ Wireless Forum Convergence Meeting

² REANNZ Aggregation Service Policy FINAL [136 kB PDF]