Limited Mobility (WLL) Services "Mistakenly" Offer Mobility

When governments auction off mobile cellular licenses for billion$, the buyers of the spectrum rights tend to demand a high level of value from the licenses. The buyers expect that the regulator will not subsequently sell other licenses to compete with the first set, but at much reduced rates. Thus, when regulators in the UK, China, and India auctioned off certain licenses, they required that the communication services used on those frequencies not roam. Thus was born the “limited mobility” wireless service, where CPE are mobile in the entire area covered by one antenna, but the system prevents a hand-off from one tower to another. The customer’s device is tagged to only work on the home tower. In China, Xiao Ling Dong is the name of the wildly successful limited mobility voice service based on fully mobile Japanese PHS technology. In the UK, UK Broadband is the BWA provider who has been told that their fully mobile UMTS TDD network technology is limited by licenses that do not permit roaming (which would compete with the 3G licensees, who overpaid for their rights). In India, it’s Reliance Telecom and Tata, who are using CDMA to offer wireless local loop (WLL) voice service, despite active protests from the GSM cellular companies which we covered in 2003. Well… Oops. Someone at Reliance and Tata forgot to put the “limited” in “limited mobility”, and “mistakenly” allowed the phones to roam. We wonder if the mistake was deliberate, since it obviously increases the value proposition of these cheaper WLL services. The regulator has threatened penalties to Tata and Reliance, and will reel them in, but the clash begs the question: “Is it in the public interest for the government to artificially limit the value of technology in order to support existing businesses?” The answer is, unfortunately, not as simple as the question. For my answer, read the comments below.

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