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Except that more spectrum isn't free and is a finite resource. It isn't fair to dismiss one carrier as not being viable (which is what I took from your origina

by Nrsolis 14y ago

Except that more spectrum isn't free and is a finite resource. It isn't fair to dismiss one carrier as not being viable (which is what I took from your original post) if they can compete along a different axis more efficiently when compared to another carrier. Don't forget that over time, technology advancement tends to favor later entrants to the market versus early ones. It's entirely possible that T-mobile can operate an LTE network with triple the base-station density of AT&T because they waited until the equipment was at a cost that would make the deployment cost-efficient.

rayiner 14y ago
My whole point is that the place in the design space a carrier with less spectrum is forced to compete from is less efficient than the place in the design space of a carrier with more spectrum. The carrier with less spectrum is forced to spend more capital on building cell sites, spend more money on operating costs for more numerous, smaller sites versus less numerous, larger sites, spend more money debugging inter-cell interference, etc, all just to match the other carrier in performance at a given capacity. The carrier with more spectrum has more capital tied up in spectrum holdings, but that's a totally non-depreciating capital asset that's by and large cheaper than network infrastructure to begin with. And I'm not writing off T-Mobile based on their current spectrum position. I'm writing them off based on the trajectory. If T-Mobile has to burn more capital deploying an LTE network with much higher density to achieve similar performance, then they are going to have lower margins than VZN and AT&T. Lower margins means less capital for building out the N+1 generation system. Of course this is all theoretically consistent with the status of wireless as a market that breeds natural monopolies. VZN has a spectrum edge right now that's moderate nationwide, but fairly substantial in many major cities. That edge in spectrum holdings means they can serve more customers at a given performance level for dollar of capital spent on infrastructure. That means when the next spectrum auction happens, they'll be able to acquire even more spectrum and enlarge their lead.

by Nrsolis 14y ago

rayiner 14y ago

My whole point is that the place in the design space a carrier with less spectrum is forced to compete from is less efficient than the place in the design space of a carrier with more spectrum. The carrier with less spectrum is forced to spend more capital on building cell sites, spend more money on operating costs for more numerous, smaller sites versus less numerous, larger sites, spend more money debugging inter-cell interference, etc, all just to match the other carrier in performance at a given capacity. The carrier with more spectrum has more capital tied up in spectrum holdings, but that's a totally non-depreciating capital asset that's by and large cheaper than network infrastructure to begin with. And I'm not writing off T-Mobile based on their current spectrum position. I'm writing them off based on the trajectory. If T-Mobile has to burn more capital deploying an LTE network with much higher density to achieve similar performance, then they are going to have lower margins than VZN and AT&T. Lower margins means less capital for building out the N+1 generation system. Of course this is all theoretically consistent with the status of wireless as a market that breeds natural monopolies. VZN has a spectrum edge right now that's moderate nationwide, but fairly substantial in many major cities. That edge in spectrum holdings means they can serve more customers at a given performance level for dollar of capital spent on infrastructure. That means when the next spectrum auction happens, they'll be able to acquire even more spectrum and enlarge their lead.