Spectrum trading set to increase

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Spectrum trading is set to become more common as operators seek to improve spectral efficiency, according to a new report from ABI Research.

A wide range of radio spectrum frequencies from sub-1GHz to 100GHz, including licensed, unlicensed and shared spectrum, must be utilised to unlock the potential of 5G, the report notes.

Total mobile data traffic is expected to grow from 306,000 petabytes today to roughly 1.5 million petabytes over the next four years. Further, private networks are also a growing trend – a third of industrial companies plan to apply for a private 5G licence, according to recent research from Capgemini.

Capacity trading

“Thus, there may come a time when dynamic capacity trading and wireless broadband can slowly become a tradeable, valuable commodity,” says ABI Research’s Making Spectrum Fit for 5G Services & Competition report.

“As spectrum becomes an increasingly more valuable asset, spectrum trading will become more relevant, which will result in a more efficient outcome where the cumulative spectrum supply is higher,” said Emanuel Kolta, Senior Analyst at ABI Research.

ABI Research notes that it won’t only be mobile operators who have a stake in the newly commodities resource – companies such as Rivada Networks are already starting to offer a dynamic spectrum trading platform.

Long-term benefits

“Regulators are expected to help vertical industries to access spectrum with respect to the mobile service providers and their investments. Those who can transparently provide access to relevant spectrum, at an affordable price will start from a better position,” the research house said.

Ofcom in the UK and the FCC in the US are leading on allocating spectrum for vertical industries and their experience can provide several insights for other regulators, ABI Research says.

Kolta commented, “To achieve the full scale of benefits and a leading position in the 5G race, governments and regulators have to support and stimulate mobile network operators with a huge amount of continuous 5G spectrum. Affordable 5G spectrum will help to support economic growth, establish geopolitical superiority, and even gain advantages in terms of military and intelligence powers.

"Political decision-makers need to consider these long-term benefits and focus less on the short-term financial benefits during 5G spectrum allocations.”