by Jim Baker
This September rail Internet pioneer Nomad Digital announced that it has acquired spectrum in the United Kingdom to deliver broadband communication services to trains. This is the first time a private communications operator has bought spectrum for such a specific application, so Unwired decided to interview Nomad Executive Chairman and co-founder Nigel Wallbridge to find out more about the strategy behind the acquisition.
JB: Can you tell me what the key drivers were for Nomad to seek the spectrum in the first place? What were the challenges you had to overcome?
NW: There is broad agreement that an effective wireless broadband connection to rail vehicles significantly reduces costs for operators and improves service for passengers. In the past we have had to construct the best wireless networks out of whichever spectrum was available to us. In certain cases, such as the Dubai Metro, we have used licensed spectrum. In Germany T-Mobile was able to obtain spectrum at 450MHz to service D-Bahn’s ICE trains with passenger Wi-Fi.
We strongly believe that the public policy benefits of providing licensed spectrum for public transit are self evident and we also think that public transit operators should use a service provider to access this spectrum; we want to be such a provider. We want to be the ‘Verizon’ for the transit industry. This UK license is another, very early, step on our journey.
JB: How long has the process taken from initial research to the granting of the spectrum, and when was that spectrum granted?
NW: The spectrum was awarded in September 2010, but it has been a long haul. We have worked with Ofcom, the UK spectrum regulator, on a number of different spectrum parcels.
JB: Your recent press statement states the grant is 5.01 to 5.02GHz — how is this spectrum allocated and are there power restrictions that might hinder operations?
NW: The spectrum is not constrained to 10 MHz in a single channel, and the requested power reflected our ambition to create an effective, high-capacity link off the train for outgoing traffic. The maximum EIRP is 47dBm delivering a significant uplift from both mobile phone solutions for the uplink and license-exempt spectrum in both directions.
JB: Somewhat unusually the spectrum had been previously managed by the Civil Aviation Authority (CAA); what was the use of the spectrum before Nomad acquired its license?
NW: The spectrum was, and is, targeted by the CAA for the use of automatic landing systems for planes although, in this case, the spectrum isn’t in use for this application right now. The UK Government has promoted the efficient use of spectrum by asking users to share it where appropriate, so we worked with the CAA to show that we could safely share the band.
JB: What are the top three applications you envisage using this spectrum for?
NW: When we started we were certainly focused on customer Wi-Fi and that certainly continues to be a huge success for us. But we are now seeing even more growth in other applications, such as ‘live’ passenger information systems and data file download from trains. So I would say that upload and download of large files from trains would also be ideal candidates for the use of this spectrum. In the end the Nomad model is to provide IP connectivity for all the applications that can be used to improve train operations and services. And we think that there are tens, or even hundreds, of them.
JB: 5GHz is a fairly high frequency relative to cellular frequencies. What network topology do you envisage using in this band? Mainly train-to-shore? And if so, will this be primarily in fixed locations like railway stations or do you plan also using track-side infrastructure along the right-of-way?
NW: Yes, certainly for train-to-shore communications. In the short term we will see the spectrum used wherever we need high bandwidth and where there isn’t an easy alternative. So yes we will use it in depots and stations and perhaps where there are gaps in coverage — such as in tunnels. We are not yet ready for a ubiquitous trackside roll-out because we can roam onto public networks and take advantage of that infrastructure at low cost. Things may change though.
JB: The 5GHz band has a light-touch licensing regime in the UK. Did the move to seek your own spectrum reflect a concern that the rest of 5GHz could become too crowded?
NW: In the UK the light touch public 5GHz licenses are not yet too crowded — but these bands are very low power and we do predict that they will become busier as they have in the U.S. Our new licensed spectrum gives us a secure, higher power alternative over which we have more control.
JB: Will you be developing your own equipment to work at this frequency or are their existing wireless broadband equipment vendors who support the band?
NW: Our current intention is to use existing off-the-shelf equipment.
JB: Does communication-based train control (CBTC) play an important part in Nomad’s service offerings either today or in the future, and if so, could this spectrum be used for such an application?
NW: Yes the spectrum could be used for CBTC. So far Nomad has tended to stay in the non-safety critical market. But things are changing; some of our customers are coming to us and saying that they need to move their signaling to IP. Nomad is in the business of IP communications to trains and we are pleased to work with our customers to provide safety critical services, such as CBTC, if there is benefit in doing so.
In many parts of the world railroads have adopted the GSM-R standard and this has proved to be expensive and very slow to roll-out. The technology demands ubiquitous coverage before services can become operational. Very few counties have properly operational networks and some of the core network equipment is already heading towards obsolescence. I hope that the implementation of equivalent systems in the U.S. will allow for roaming between multiple technologies and will use IP. That way the railroads can have low-cost, flexible and easy network roll-out.
JB: There are other useful licensed spectrum holdings in the UK, 3.5GHz for example. Has Nomad considered sub-licensing spectrum from other licensed spectrum holders for rail applications?
NW: The spectrum market is unusual. In the past there has been a tendency to horde spectrum. I think that regulators clearly see broad economic benefits in increasing usage efficiency. More spectrum is therefore becoming available through initiatives like spectrum sharing and the digital dividend. So even though demand for spectrum is high we are entering a phase with high supply as well. Nomad is always looking for opportunities to find and develop spectrum for its customers in public transportation.
JB: The 2.5-2.6GHz spectrum is due to come up for auction in 2011. Do you envisage Nomad wanting to play a role in that auction, either solo or within a consortium? If not, do you have any views as to what might be the outcome of that auction?
NW: Nomad is working with spectrum regulators in many countries to try to ensure that the needs of public transportation are not ignored as spectrum is packaged, allocated and, in certain cases, auctioned. So yes, we are certainly considering 2.5-2.6GHz.
I think that this spectrum would be very useful for public transportation. The general mobile network operators are increasingly focused on sub-1GHz spectrum to reduce their network roll-out costs and in many countries the fixed wireless access model has never really taken off. So 2.5-2.6GHz may not draw very high prices at auction.
JB: Nomad had an increasing presence in North America, having won several major contracts and being best known for the Amtrak Acela deployment. What have been some of the challenges in building solutions using a combination of licensed and unlicensed bands for wireless infrastructure in the U.S., and do you think Nomad make seek licensed bands of its own in the U.S. one day?
NW: Acela was certainly a great contract for us. We really enjoy working with Amtrak and the U.S. railroad and mass transit scene is very promising. As I said earlier it’s important to allow for roaming between different technologies to provide flexibility and ease of roll-out.
The spectrum market in the U.S. is exciting and the government has tried to make spectrum available for municipal use. We would love to take advantage of the 4.9GHz band, which we think is underutilized and we see other opportunities as well, especially around 700MHz.
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Jim Baker is managing partner at Xenventure, a market strategy and private equity firm based in San Francisco and London. A C-level wireless industry veteran, Baker has been involved in many deployments of wireless technologies on passenger transportation worldwide and is a recognized industry expert on Wi-Fi, 3G and 4G convergence. He is chair of the Technology Committee at the Joint Council on Transit Wireless Communications which is developing a strategic plan for implementation of wireless technologies in mass transit. Contact Baker via LinkedIn or follow him on Twitter.