@thorstenbenner @maccadoo8 @smh The key part of the answer is, change the destructive way governments allocate radio spectrum, which is both the most costly & essential building block of any wireless network. When they’re getting that so wrong, it warps everything else. Do that & the game changes dramatically.
@thorstenbenner @maccadoo8 @smh Assuming they stop the thing that’s done such immense damage to the West’s ability to lead/dominate in wireless networking & dump the one off spectrum auctions, they should also allow for merging of some existing carriers. There’s a lot of debt out there that needs cleaning up.
@thorstenbenner @maccadoo8 @smh I had the discussion about ending the one off spectrum auctions with a senior ministry of finance person (from a large European Union member state) a few weeks ago. He said to me “but we need that money, we already have plans for it.”
@thorstenbenner @maccadoo8 @smh I told him he could still get a big cheque quickly to pay for his plans but there’s a smarter way to do it than these destructive auctions. This is it:
1. Issue a tender that’ll award large tracts of 5G spectrum to the bidder that commits to A.) the largest geographic coverage.
1. Issue a tender that’ll award large tracts of 5G spectrum to the bidder that commits to A.) the largest geographic coverage.
@thorstenbenner @maccadoo8 @smh B.) the most dense network capacity (need to get lots of gigabytes out there).
C.) the fastest rollout (performance bonds as insurance of performance).
D.) the highest security (more points for not including high risk vendors).
C.) the fastest rollout (performance bonds as insurance of performance).
D.) the highest security (more points for not including high risk vendors).
@thorstenbenner @maccadoo8 @smh E.) the networks must be ‘carrier neutral’, wholesale only. No consumer customers. They have to clear all their capacity 24/7 at whatever the wholesale market will clear it at, anything fractionally above zero. Just like electricity wholesale.
@thorstenbenner @maccadoo8 @smh And the key bit, for the finance ministry guy was this. Require a royalty, a percentage of annual revenue, could be in the range of half a percent to one & a half percent of revenue (not profit) per annum. You fix the number ahead of the bid so the percentage is not a variable.
@thorstenbenner @maccadoo8 @smh This then give the finance ministry/treasury a secure annuity line, an income stream that is ‘off balance sheet’ & doesn’t affect debt to GDP requirements etc. The finance ministry can issue a bond against that revenue line & they get that funded at sovereign rates (dirt cheap).
@thorstenbenner @maccadoo8 @smh The big banks will fall over themselves to place those bonds. Finance ministry gets its big cash windfall fast and they’ll end up raising more money than in the one off auctions which end up having a limited number of bidders. The wireless industry isn’t crippled up front.
@thorstenbenner @maccadoo8 @smh The wholesale, carrier neutral (meaning it doesn’t favour any mobile carrier over another or any new entrant or MVNO over another) network operator then deploys wide geography at maximum speed (that’s the winning criteria) & buys & deploys a lot of kit fast.
@thorstenbenner @maccadoo8 @smh The finance ministry guy said that would work. They get their big cheque, but in a different smarter way and the secure networks get deployed fast. The consumer & economy get vastly less expensive average per gigabyte costs & the economy gets a serious boost.
@thorstenbenner @maccadoo8 @smh Of course none of this needs a subsidy from Beijing via their 5G equipment ‘national champions’. It flips the table in them, changes the game. They have bet the farm that the West is too dumb, too ‘locked in’ to correct its big flaw. We can fix that if we do it right now.
