Rivada Networks wants to revolutionise the way public and private operators share, pay for and access precious spectrum resources.

What value should we place on the use of the radio spectrum, and who should decide? At the beginning of the era of radio communications, spectrum was ‘free’ and any experimenter could use any frequency within the capabilities of their equipment. Then came regulation, and the spectrum was split into various bands for various uses. Licensing became required, and in more recent times, whole bands have been ‘auctioned’ off by regulators to the highest bidder.

And that’s the way it has been for some time — individual entities having exclusive use of sections of the spectrum, and able to charge their customers whatever price they choose. Spectrum, therefore, has become a very valuable commodity. And that’s one reason why public safety agencies in some jurisdictions are having trouble convincing their governments that a portion should not be valued commercially, but set aside for use as a ‘public good’. Spectrum is being gobbled up by telcos and other operators, leaving public safety agencies having to beg for their share.

But what if there were a different way to approach it? What if there were a way to value spectrum and use it commercially at a market-set price, while also providing no-cost capacity for public safety use?

That’s precisely what US company Rivada Networks is proposing to do. Rivada’s concept is so simple that it makes you wonder why no-one thought of it before. The idea is to set up a mobile broadband network for public safety use, but to ‘lease out’ spare capacity on the system whenever it’s available — and that is pretty much all of the time. And let the leasing fees pay for the network.

Not only that, but make it so that the spare capacity is priced according to a market mechanism, rather than something set by fiat by a controlling body. The market will find its own level, driving prices down and making it more accessible for all.

And also make it granular, so that the capacity can be purchased for as little as a minute or as much as a year, and in specified localised areas.

In other words, commercial users pay only for what they need, when they need it and where they need it. And the primary user, the public safety agency, has priority use of the resource.

What happens when there’s an emergency or disaster and the public safety user needs full access to the network? Simple — the other users get kicked off the system and back onto the commercial networks. Rivada calls it ‘ruthless pre-emption’. And that’s the risk those users take, but it’s a calculated risk — most public safety spectrum is ‘empty space’ for most of the time, so the likelihood of interruption is actually quite low.

The system would be automated, using patented technology. Potential users’ own automated networks can bid for spectrum slots, with the bidding system setting a market price.

Rivada calls the overall approach DSATPA — Dynamic Spectrum Arbitrage Tiered Priority Access.

To get some more information about the concept and the technology behind it, we spoke with the straight-talking chairman and CEO of Rivada Networks, Declan Ganley, on the sidelines of the Comms Connect conference in Melbourne.

CC: This idea of selling spectrum in a market sounds a lot like trading shares on the stock market.
DG: In fact, the trading platform — the software that we use — is built off an electricity market trading platform. That’s the foundational software that’s used in the marketplace. And in fact, electricity markets are more sophisticated than this. Their need for granularity down to the light switch is really important, and you know, stuff goes on fire if they get it even a little bit wrong. [What we’re proposing] is actually easier to do than electricity trading.

Anything that is scarce, you can commoditise. So the key then is effecting delivery. How can I deliver a specific volume of bandwidth in a specific geographical location in a specific window of time? As the barrel is to oil, [this] is to bandwidth. And we’ve done that. That’s what DSATPA does. It effects delivery, it makes it happen, it confirms it took place, and once you can do that you have a trading instrument that can trade it.

CC: So under your concept, you’ll fund and build the network for the public safety agencies?
DG: We’ll build it in collaboration with them. It’s got to be built to public safety standards. You’re not talking about just replicating another commercial network. The idea that you can do this on just any old commercial network is a load of bollocks.

CC: So if it’s such a good idea, why aren’t jurisdictions such as the UK going down this route?
DG: What happened is — and this is what you’ve got to watch out for in Australia — there are vested interests who will exercise regulatory capture, who have immense power, who will assuage their consciences that they’re doing something good for public safety, but will end up economically using it to subsidise less viable geographic rollouts, because their business model is so old-fashioned that they can’t make money in those places.

And that’s because they set an artificial barrier to entry by setting a price on bandwidth. We allow price discovery to take place, and that’s the fundamental difference. That’s why their model doesn’t work and ours does. [Telcos] have a monopoly over vast swaths of spectrum, and that’s not good for competition, it’s not good for pricing, it’s not good for consumers. And technology has far surpassed the need to have anything like that.

CC: In your Comms Connect presentation, you predicted that under your system the major telcos would sit it out and wait to see what happens.
DG: [And then six months later the telcos], they’ll come late to the game and be half eaten at that point. But there are a lot of other players as well. You might be surprised globally who’s looked at this and gone, oh s**t, this is going to destroy us. And then there are others who are now going, you know what, let’s do it.

CC: So what sort of response have you been getting?

DG: Well obviously the whole approach and model in the US [with FirstNet is] all on the record. We’re front and centre involved in that, we’ve really been impressed and cheered on this whole model and approach. That was great, they were the first in the world to make this move. And then Mexico quadrupled down and have gone even further. Mexico has huge public safety issues. [Its] legislation is the most innovative in the world. A lot of people are watching it. It’s the world’s first truly dedicated, wholesale, open market access model, and the reason that they did it was to invigorate the economy and to fire up the new economy. And the fact they wrote it into their constitution is just huge.

CC: So for Mexico it’s not just about public safety — they see it as an economic issue?
DG: They expect, and they are very sure, that this will add percentages to their GDP. The economic activity that this is going to generate, the employment that this is going to generate, will be measurable in their GDP. And it could do the same thing here [in Australia]. And by the way, somewhere on this side of the planet is going to be the home market for Asia-Pacific for commoditised bandwidth. So Australia needs to decide if it wants it to be here or whether it’d rather see it [located] somewhere else. You guys have been behemoths of commodities in this part of the world for a couple of centuries — here’s your chance to be a behemoth in this commodity now. And if you’re not, there’ll be plenty of upstarts waiting to take that place. The skyscrapers [holding those spectrum trading markets] will either be here, or they’ll be in Singapore, or Hong Kong or somewhere else.

CC: Are the regulatory frameworks in place to do this in the different markets?
DG: The FCC in the US has been very accommodating, very open-minded on all of this. There has not been any regulator, anywhere, that we’ve engaged with — US, Mexico, Europe — who has not been invigorated by this model. I can’t say which regulator, but there’s a very senior person in a very important regulator who said to me, “This ticks every box for us — increases competition, lowers prices, opens access, removes barriers to entry.” What’s not to like from a regulator’s standpoint?

Beyond that too, the regulation actually contemplates — in fact, I would argue requires — the public-private partnerships. In fact, you can’t not do this.

CC: You’re proposing this for public safety, but presumably it could apply equally to any other spectrum?
DG: [Yes,], and that will happen.

CC: Has it been done anywhere else so far?
DG: Yes. In the US, the DSA (Defense Spectrum Agency) has publicly announced that they’re looking at commoditising their radio spectrum and making it available in an open access model. DoD are a big owner of radio spectrum. This is a way for the military and defence functions to keep the spectrum, keep ruthless pre-emption and priority access to it, while allowing it to be used for the general good of the economy for all the times that they’re not using it, which in the defence case is even less than public safety — much less than public safety.

CC: In a way, you’d think there’s almost an obligation to do it?
DG: Well, it makes sense. If you want your economy to grow, that is. Having said that, when your defence department needs the spectrum, they really, really, really need it, and you need them to have it. And so we designed a technology that doesn’t just work in LTE for ruthless pre-emption, but does it for legacy systems and services as well, so that we can ruthlessly pre-empt radio resources even for legacy systems in a DoD environment.

CC: So how does the ruthless pre-emption work in practice?

DG: It’s based on the PLMN (public land mobile network). If you have a public safety PLMN you’re going to always stay on, but if you don’t and the public safety traffic starts rising, it starts automatically shutting [the other traffic] down.

The buyers of this bandwidth and the wholesalers, they know this could happen to them. Frankly, the number of times that’s going to happen to them is going to be far fewer than normal interruptions.

So what you do is, you fight to preserve the customer experience, and you give the customer alternative places to be handed off. But if there are no other options, they’re gone. And anything less than that is not going to be acceptable for public safety.

And by the way, I do not believe for a moment that a commercial carrier is going to kick off all of its retail consumers to give ruthless pre-emption to public safety. Are you telling me that a telco is going to kick off all of its commercial customers in a surge situation? Never.

CC: You’ve been awarded a number of patents for your technology. What do they cover?
DG: It’s pre-emption, tiered prioritisation and then obviously the marketplace functions as well. But they are patents that stand independently of each other. The other really crucial piece of technology that we have invented is a solution where without GPS we can position locate a device to under a cubic foot, including on the Z axis. Which means that we can get granular to the point of under a cubic foot to where bandwidth is delivered and consumed, which is wild.

CC: All of this is predicated on the public safety agencies being given dedicated mobile broadband spectrum. How do you see the Australian situation? Are agencies fighting hard enough?
DG: It’s like they don’t even know it is happening. You are very close to being rolled. Arguably you have been rolled, packaged up and had a [telco’s logo] stamped on your back. There are 30 MHz [that went unsold] in the 700 MHz band in the last auction. Ask for it. Ask for it. Because the market, as currently malformed, said that that spectrum is worth zero. And of course it’s not worth zero, it’s worth more than that. But at the moment the value has been zero in the last auction, and that’s because of the way the rules around it were formed. So give that to public safety as their dedicated spectrum, and then let an open access market do its thing with it, and then you’ll find the spectrum isn’t worth zero.