Rural Wireless Coverage Overview: Part I
16/09/11 18:43 Filed in: Wireless Carriers | Roaming
Expanding LTE coverage to rural America keeps hitting the headlines as one of the justification for AT&T’s purchase of T-Mobile. AT&T’s point about rural coverage raises many questions about wireless service today including who actually provides it and what types of service exist? A review of the major national coverage maps from AT&T, T-Mobile, Verizon Wireless, and Sprint would lead one to believe that in one form or another national coverage has already been achieved. Behind these marketing machinations lies a different and more convoluted truth.
(AT&T, T-Mobile, Verizon Wireless, and Sprint Nextel respectively)
For years two primary types of operators dominated the wireless industry; large national operators and rural regional players. There are exceptions such United States Cellular, MetroPCS, and Cricket but generally speaking the split between national versus rural regional player was clear. The national players’s history came from either the PCS auctions and greenfield construction in the mid-late 90s (T-Mobile and Sprint) or from rollups of the legacy cellular carriers (Verizon Wireless and AT&T Wireless) that generated very different early on coverage footprints. The new PCS companies built their coverage primarily around population centers and interstates while relying on roaming partners to fill in the sparser rural areas. A large part of the reason for this approach resided in both the FCC buildout requirements of each license (population based and not geographic) as well as the introduction of licenses based on major trading areas (MTAs) versus the much smaller RSA/CSA licenses of the cellular world. Basic Trading Area (BTA) licenses also existed that were more similar to the cellular licenses and were largely purchased by RBOCs to overlay their existing markets.
The original cellular companies were generally classified as B carrier (The local Bell operating company) or A carrier (competitive Alternative). The smaller geographic license size, many years of buildout (licenses issued in early/mid 80s), the 800 MHz frequency propagation characteristics as well as the local telephone company seeking to overlay their copper network resulted in greater coverage of the total license geography in most areas. AT&T’s rollup of many of these legacy cellular carriers can clearly be seen in the local coverage areas in some regions that cover large geographic swathes and in others just the interstates and population centers are served.
(AT&T’s Midwest voice coverage - hash marked areas are partner roaming)
During the PCS buildout of the late 90s and early 00s, early days of cellular growth, and later during the consolidation period of 2000-2009 the wireless industry relied heavily on roaming partners (regional and rural carriers) and affiliated carriers to fill the coverage gaps. Some of these regional carriers (Dobson, RCC, Midwest Cellular, Alltel, and Centennial Communications) no longer exist and after being purchased by AT&T or Verizon Wireless. Many small affiliate operators of Sprint also ended up being purchased after a string of law suits against the company stemming from Sprint’s purchase of Nextel. A few Sprint affiliates including Swiftel (South Dakota) and Shenandoah Personal Communications Company (Virginia) still remain operating under the Sprint banner. Now Sprint uses Strategic Roaming/Rural Alliance partners in many areas (GCI - Alaska, N-Telos- West Virginia, NexTech Wireless- Kansas/Colorado, Pioneer Cellular-Oklahoma/Kansas, SI Wireless-Illinois area) that operate independently branded wireless offerings as well as offer seamless home service for Sprint customers. In a hybrid of Sprint’s affiliate and Rural alliance programs Verizon Wireless launched LTE In Rural America to expand the Verizon LTE network. Local operators build a LTE 700 MHz network using Verizon’s spectrum and core network infrastructure in exchange for access to Verizon’s national LTE network and preferential treatment. Currently Verizon’s program counts eleven members including: Bluegrass Cellular, Carolina West Wireless, Cellcom, Chariton Valley Communications, Convergence Technologies, Cross Wireless, Custer Telephone, Pioneer Cellular, S and R Communications, Strata Networks, and Thumb Cellular.
Verizon’s use of the Rural Alliance to extend LTE to smaller communities and a larger geographic area shows the cost and timing challenges of a national LTE deployment. To a lesser extent Sprint’s use of Rural Alliance reveals the same financial limitations of extending coverage however their indigenous network footprint is also considerably smaller than Verizon Wireless’ network. In fact all of the national carriers, including T-Mobile, rely on rural and regional operators to provide coverage in sparsely populated and rural markets. Through acquisitions and alliances the national players are reducing their dependency on rural operators however their focus remains heavily on covered POPs and not geographic coverage. While one would argue the latter the inescapable fact is that individual coverage requirements are determined by where people live, work, and play. In most cases the live and work are profitable because of the population density however play areas outside of major population centers or popular destinations generally do not represent a comparatively good investment for the national operators. This often results in large licensed coverage areas with no buildout from the national carriers.
In the second portion of this rural wireless coverage overview I’ll look at portions of Arizona, New Mexico, and Texas as illustrative examples of the need and value of independent rural operators.
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