by Kyle Mammarella
As consumers move deeper and deeper into the cloud, wireless bandwidth is running out at an exponential rate. The U.S. mobile phone industry is running out of the airwaves necessary to provide voice, text and Internet services to its customers.
Wireless spectrum — the invisible infrastructure over which all wireless transmissions travel — is a finite resource. Though the U.S. currently has a slight spectrum surplus, the Federal Communications Commission (FCC) has said we will reach a spectrum deficit as soon as 2013 if nothing is done. It will mean slower data speeds, more dropped calls, higher prices, and less mobile innovation.
“Network traffic is increasing,” says an official at the FCC’s wireless bureau. “[Carriers] can manage it for the next couple years, but demand is inevitably going to exceed the available spectrum.”
One of the greatest contributors to the “crunch” has been spiraling numbers of consumers that watch video, stream music and send pictures on their smart phones.
A recent study released by GigaOm Pro shows that the problem is only going to get worse. Currently, one-third of U.S. consumers already have smartphones, an increase of 45 percent since 2010. Moreover, by 2015, subscription services are projected to increase to over $750 million in revenues, an increase of over 425 percent from 2011. As smartphone proliferation continues and more alternative, anywhere access business models in the music industry are developed the closer the “crunch” becomes a reality.
Consumers are already starting to feel the effects. Last month, AT&T dropped unlimited data plans from its offerings and will no longer honor the ones its already sold. Other limited data plans significantly reduce the amount of music users can stream before accruing hefty excess usage fees. For example, a plan that comes with 5MB of bandwith each month would allow customers to listen to about an hour of streaming music per day, pending they do not use their phone for anything else.
Offline playback has offered a minor solution to the problem. Spotify, for example, allows users to cache up to 3,333 songs for offline use, meaning they do not have to tap into their data plan to stream music. Slacker has a similar offering for its radio stations.
Still, there does appear to be some hope on the horizon. On Wednesday, the Wi-Fi Alliance announced that they will begin to certify wireless devices for its Passpoint project in July 2012. It will allow users to connect to Wi-Fi hotspots and roam seamlessly from one Passpoint-enabled Wi-Fi network to another by using a user’s SIM card to authenticate access, much like cellular carriers around the world – if a device is authorized to use a particular hotspot network operator’s network it simply connects.
The Passpoint initiative is sure to be welcomed by mobile carriers looking to offload as much traffic as possible to Wi-Fi networks.
“The complementary relationship between Wi-Fi and mobile networks is finally becoming a reality. Next Generation Hotspots allow smartphones and tablets to automatically roam from the cellular network on to Wi-Fi hotspots thereby augmenting the coverage and capacity of both,” said Chris Bruce, Chair of the Wireless Broadband Alliance.
The FCC has also been working to free up more spectrum. Congress reached a tentative deal last week, approving voluntary auctions that would let TV broadcasters’ spectrum licenses be repurposed for wireless broadband use.
Kyle Mammarella is a New York based artist manager and music enthusiast.
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