GSMA Seminar Theatre 2015Mobile – Wi-Fi

Is there room for both licensed and unlicensed

networks?

The benefits of aligning industry and

governments on spectrum management Mike Wright, Group Managing Director

Networks, Telstra

Spectrum is the lifeblood of our networks. With it also comes the complexities of planning, building and optimising the investment in networks.

Carriers and Governments need to work together on jointly understanding and navigating the best outcomes for the community.

Page 4

TELSTRA HAS A CLEAR SPECTRUM STRATEGY AND ONE OF THE MOST ADVANCED NETWORKS

5

The development of a comprehensive spectrum strategy requires an in depth understanding of

future trends, development and promotion of industry standards, and close consultation with

regulators.

HSPA

(550Kbp-3Mbps)

HSPA+

(550Kbps- 8Mbps)

HSPA+DUAL CHANNEL

(1.1Mbps-20Mbps)

LTE

Cat 3/4

1800

(2Mbps-50Mbps)

LTE-A

Cat 6CARRIER AGGREGATION

1800/700

(2Mbps-100Mbps)

LTE-A

Cat 9CARRIER AGGREGATION

1800/700/

2600

150Mbps^

300Mbps^

450Mbps^WORLD

FIRST

WORLD

FIRST

WORLD

FIRST

WORLD

FIRST

3G

8502 X 10-15MHz

3G/4G

21002 x 10-

15MHz

4G

1800

2 x 15-20MHz

4G

700

2 x 20MHz

4G

2600

2 x 40MHz

2011 2015

2G/4G

900

2 x 8.3MHz

Presentation Title | Presenter Name | Date Page 6

UNDERSTANDING DEMAND: Allows optimisation of traffic balance and investment returns. 4G traffic now exceeds 3G

4G

3G

4G+3G

2G traffic has reduced

to very low levels and

will close end 2016

Flexible spectrum

rules allowed

LTE1800 to launch in

Sept 2011.

Careful balance of 3G

to not overinvest and

to extract value from

earlier investment

Presentation Title | Presenter Name | Date Page 7

OPTIMISING USE OF SPECTRUM AND TECHNOLOGY EVOLUTION ALLOWS LOWER COST TO HELP OFFSET GREATER DEMAND

$-

$100

$200

$300

$400

$500

$600

$700

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Wireless Data Product Unit Cost (PUC) - $/GB

42 Mbps

(DC-HSPA)

introduced 2012 2013 2014 2015 2016 2017

21 Mbps

(64QAM)

introduced

LTE1800

Introduced

NextG

commissioned

October 2006

LTE700

Introduced.

2 carrier CA,

300Mbps)4x2MIMO

Planned Q4FY15.

30% efficiency gain,

lower unit cost

3 carrier CA

planned Q4FY15,

450Mbps

FY16 plan Small

cells to increase

capacity and

economically

extend coverage.

VoWiFi as low

cost indoors

coverage

solution

In Australia, the Australian Communications

and Media Authority (ACMA) manages

spectrum.

Telstra has a strong and effective working

relationship with the ACMA on the development

of spectrum strategy.

In September 2014, the ACMA launched the

Five-year Spectrum Outlook providing greater

insight and transparency for spectrum users.

The document provides some clarity on how the

increase in demand for spectrum will be

managed across all industries.

Presentation Title | Presenter Name | Date Page 8

BY WORKING WITH CARRIERS GOVERNMENTS CAN GAIN SUFFICIENT FUTURE VISION TO ALLOW CUSTOMER DEMAND TO BE MET AS IT ARISES

In 2013 Telstra invested $1.3 billion on 2x20MHz of APT700 and 2x40 MHz of

2600MHz.

This spectrum will enable management of data demand well into the future.

Whilst formal access to APT700 was planned for 1 Jan 2015, many of the Analog TV

channels have been closed and bands re-stacked well before.

Telstra worked with the ACMA to secure early access licences in many areas under

a set of clear set of conditions including:

• community consultation, notification to all levels of Government, advertisements

in newspapers, a dedicated web page and extensive testing to ensure wireless

audio devices (which use the same or similar spectrum) were not impacted.

Though this process, we were able to launch a superior APT700 4G service in parts

of all major capital cities and 50 regional centres up to 6 months early.

Presentation Title | Presenter Name | Date Page 9

EFFECTIVE AND TRANSPARENT PROCESSES ENABLED EARLY DEPLOYMENT OF APT700

Page 10

Spectrum pricing and policies vary widely and are inconsistent worldwide

$ 0.00

$ 0.50

$ 1.00

$ 1.50

$ 2.00

$ 2.50

$ 3.00

400

500

600

700

800

900

100

0

110

0

120

0

130

0

140

0

150

0

160

0

170

0

180

0

190

0

200

0

210

0

220

0

230

0

240

0

250

0

260

0

270

0

$/M

Hz/P

op

($

US

)

Frequency Band (MHz)

AWS-3

(USA 2015)

APT700

(Australia

2013)

3.4

3.5

3.6

3.7

3.8

3.9 4

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9 5

5.1

5.2

5.3

5.4

5.5

5.6

5.7

5.8

5.9 6

6.1

6.2

Frequency Band (GHz)

FREE !

Spectrum Auction prices in Various Bands (2010-2015) + WiFi

EXPENSIVE

Presentation Title | Presenter Name | Date Page 11

GOVERNMENTS AROUND THE WORLD NEED TO BE CLEAR ON PLANS & INTENT FOR SPECTRUM PRICING

Extracting very high prices for licenced spectrum has a consequence:

• Operators have less capital to invest in network rollouts so consumers get a

poorer service and the economy fails to get the productivity benefit of a connected

and mobile broadband world.

• Costs get passed on to consumers.

Unlicensed spectrum has a benefit but it isn’t a cure all:

• Unlicensed spectrum provides a great benefit in wireless connectivity and

convenience in local areas and for innovative applications.

• Unlicensed spectrum is not a replacement for planned and managed networks.

• Free networks are not free, even on unlicensed as someone pays to build and

maintain or else they congest or deteriorate.

Too much focus on unlicensed/ free spectrum has a consequence.

• The allure of free can distort investment and markets so there needs to be a

balanced and clear communication of intent.

Thank you

spectrum4all@gsma.com