8 Spectrum Opportunities for Critical Infrastructure
Wednesday, June 03, 2015 | Comments

Critical infrastructure industries (CII) companies face constrained spectrum and spectrum shortages as their communications networks are under greater demands to facilitate services and secure operations. The industry has been searching for spectrum for years, especially to meet regulations that require reliable communications for natural gas facilities, pipeline operations and other CII companies.

CII companies operate in four broad categories. Site-based operations in the VHF and UHF bands (including 800 and 900 MHz) bands under Part 90 of the FCC’s rules are the most common.

Unlicensed Part 15 spectrum in the 900 MHz and 2.4 and 5 GHz bands is also common, but those bands are congested. Unlicensed TV white spaces bands under Part 15 rules are in their infancy but could represent a good option for CII companies because of their propagation characteristics.

Another commonly used spectrum block is the 3.65 – 3.7 GHz band, which requires a nationwide license and registration of individual sites. The FCC recently revised the rules for this band, which will result in a transition period over the next several years.

Finally, area-wide licenses are increasing in popularity in several bands, many of which were allocated for purposes that never developed. These bands offer several benefits — primarily interference protection and the exclusive authority to operate channels in a defined geographic area. Law firm Keller and Heckman recently conducted a webinar outlining several area-wide license options for CII entities, along with the challenges each band presents.

Spectrum Options
1. Commercial mobile radio services (CMRS) paging spectrum. Governed under FCC Part 22 rules, this band consists of 20-kilohertz channels and supports much of the same equipment that is traditionally used by CII companies, making it potentially an easy transition.

“This is probably the first band we saw our critical infrastructure clients show interest in, mainly because it is paired very similarly to the Part 90 UHF spectrum,” said Greg Kunkle, a partner with Keller and Heckman. “It’s exclusive spectrum, so it’s a good option in areas where you can’t get UHF spectrum under Part 90 or where you need exclusive spectrum, for example, for a trunked station for a control channel.”

The major challenge in this spectrum is channelization, said Wes Wright, an associate with Keller and Heckman. While the channels appear to be 25-kilohertz channels, they include 2.5-kilohertz guard bands on each channel edge. Companies that need wider channels (for example, for TETRA) or two 12.5-kilohertz channels may find this band problematic, although some companies have combined contiguous channels to overcome that issue, said Wright.

Less of a challenge is that the band is allocated for commercial operation, so a waiver is necessary for private operation. Several companies have sought and been granted a waiver in this band, which is fairly routine at this point, said Wright.

2. Automated maritime telecommunications system (AMTS). The AMTS band offers paired channels in the 217/219 MHz bands. AMTS spectrum has garnered increasing interest from CII companies, said Kunkle. The band includes 1 megahertz of paired spectrum for 2 megahertz total and is licensed over large geographic areas.

“It’s not like VHF public coast bands where the maritime industry really relies on the spectrum,” said Kunkle. “There’s really very little, if any, use of AMTS bands by maritime, and so the FCC has made it easier for land-based terrestrial operations to use AMTS. We’ve seen a lot of interest there.”

One challenge with the AMTS band is that the licensed areas are large and only a few companies hold licenses. Incumbents, including over-the-air broadcasters, are entitled to interference protection, which could limit operations for new entrants, said Wright. Most new entrants must submit an engineering analysis to the FCC and mitigate any interference.

A waiver is not required to operate for private, internal purposes. However, a waiver to operate under specific Part 90 rules rather than Part 80 maritime rules may be needed, said Wright.

3. Interactive video and data service (IVDS). The former IVDS spectrum at 218 – 219 MHz offers 1 megahertz of total spectrum in two 500-kilohertz blocks. However, there is limited availability, and incumbents must be protected.

“Like the AMTS band and the paging band, this is a band that the intended use either never developed or fell off at some point,” said Kunkle. “The intended use was for smart TV set-top boxes, and most of this spectrum is currently unused in the United States.”

Fewer than 50 systems, mostly in major metropolitan areas, are licensed in this band. Much of the IVDS spectrum reverted to the FCC when licensees failed to meet buildout obligations and is not widely available. However, Keller and Heckman identified it as a potential spectrum opportunity in the future.

“We highlight this because the real opportunity, at least in our view, for CII companies with respect to this band is a future auction,” said Wright. “The commission has indicated that it will auction this spectrum at some point.”

4. 220 – 222 MHz. Most of the spectrum in this band has been auctioned and is available on the secondary market. Because it is authorized under Part 90 rules, waivers are not required to convert it to internal, private use, and it represents a simpler transition than some other spectrum options, said Kunkle. A small number of incumbents that remain in the band are entitled to interference protection.

Channelization complicates the band, however. At the time the FCC auctioned the spectrum, it expected 4-kilohertz trunked equipment to become available, and auctioned the spectrum in 5-kilohertz channels, said Wright. The band includes several interleaved channels.

Except for a limited number of blocks of aggregated channels, “if you are looking for anything broader than 5 kilohertz, you would probably have to negotiate with several different licensees and then ask for permission to combine those channels,” said Wright. “That can be a tall order.”

5. Narrowband PCS at 900 MHz. One megahertz of spectrum is available in each of the 901, 930 and 940 MHz bands and is paired in the same way as the Part 90 900 MHz band. Keller and Heckman officials said this band is a good option for high-capacity point-to-multipoint applications, as well as for adding spectrum to existing 900 MHz two-way voice systems. Some Part 90 equipment has been type accepted for this band.

“This has been a pretty attractive option for CII over the years,” said Wright. “One main reason is that a lot of CII companies hold 900 MHz licenses and have not been able to add additional channels through frequency coordination, so they’ve turned to narrowband PCS channels to supplement and add capacity to existing systems.”

6. Multiple Address System (MAS) band. The MAS spectrum at 928/959 and 932/941 MHz is licensed for site-based operations. The FCC auctioned a large portion of this band, and CII companies have shown some interest in acquiring the auctioned area-wide license in the MAS band.

7. 700 MHz A block. A recent option is the 700 MHz A block, and some CII companies have already acquired this spectrum in rural or remote areas. Of significant interest in this band are two nationwide allocations to Access Spectrum and Beach Point Capital. Access Spectrum is actively selling paired 1-megahertz by 1-megahertz licenses to CII firms.

“It’s an interesting opportunity because it’s available on a nationwide basis to be partitioned into smaller areas,” said Kunkle. “Between these two licensees, they hold almost all of the country, and it’s a band that could evolve for critical infrastructure over time.”

8. 2.5 GHz. Sprint uses spectrum in this band for 4G services, particularly in metropolitan markets, but there may be a potential for CII companies to use excess capacity in rural and remote areas.

“Sprint probably has a lot more spectrum at 2.5 GHz than it can use, and there’s a lot of spectrum here,” said Kunkle. “This is unlike the other bands that may have 500 kilohertz, a megahertz, or a couple megahertz. There’s a lot of spectrum at 2.5 GHz — tens of megahertz potentially available. And it might be a good option for companies in rural areas.”

Any purchase or lease of spectrum requires careful due diligence. Keller and Heckman outlined several considerations CII companies should be aware of as they look for spectrum opportunities.

• Understand the spectrum eligibility and use restrictions for each option. Many of the bands were allocated for different purposes and will require waivers to deviate from those purposes.
• Co-channel and adjacent channel interference protection must be considered. Area-wide licenses are typically more flexible and may be subject to signal strength limits. Operators are often free to negotiate agreements with neighboring licensees regarding site placement and border signal strength limits. Site locations typically are not listed on the license or registered with the FCC.
• Construction and substantial service showings may be required. Even though CII companies are not providing a consumer service, the FCC still generally requires contour maps that demonstrate substantial service based on the number of population units covered with a reliable signal strength. A company that buys a license covering a large area but only covers a small portion of that area may be required to return some of its spectrum.
• For areas along the Canadian and Mexican borders, companies should be aware that some spectrum may be primary to the United States and some may be primary to Canada and Mexico.
• Equipment certification may be required if used in bands repurposed from other services under different rules.
• Study the targeted spectrum to avoid unforeseen problems. Be aware of freezes that reserve certain spectrum for public-safety use and check the Universal Licensing System (ULS) to make sure there aren’t other applications for the spectrum. Make sure there are no outstanding FCC proceedings that could affect the spectrum, and make sure the seller is not being investigated.
• Allow plenty of time to acquire spectrum. Everything from the transaction to due diligence to FCC approval to the waiver process can take time. Build plenty of lead time into the project.
• Determine a fair value for the spectrum. Consider using a common benchmark, such as price per megahertz pop, as a starting point to determine a fair value.
• When leasing spectrum, understand the obligations of the lessor and lessee. Carefully consider the lease terms and end date, and try to build in a renewal with a fixed rate to avoid escalating lease rates or investments in equipment that will be obsolete if the lease cannot be renewed. Ensure the lessor has met its regulatory requirements and is in good standing.

“There’s no one-size-fits-all spectrum policy,” said Wright. “These options are not going to work in every instance. Companies should keep these in mind, remain flexible and view these as different tools in the tool box. Collectively, the site-based licenses, unlicensed operations and perhaps some of these area-wide licenses can combine to provide a solution for the company.”

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