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The differences between European and North American smart grid meter communications markets help us understand the role that policy plays. Wireless smart electricity meter communications systems are vastly more prevalent in the U.S. than in Europe (97 percent of new meters shipped in the first quarter of 2011 in the U.S. were wireless; only 15 percent were in Europe). 

More importantly, the technological approaches are fundamentally different. In Europe, 100 percent of the wireless meters sold in the first quarter of 2011 were for exclusive licensed cellular service. In the U.S., 80 percent of wireless meters were mesh networks using unlicensed airwaves; only 2 percent were cellular (the rest was noncellular licensed).  

A major factor in the difference is the regulatory environment. Most smart grid communications systems in North America use 900 megahertz unlicensed spectrum. They can do that because, in 1985, the FCC took a chance on industrial, scientific, and medical “junk bands,” and deregulated a contiguous band (from 902 to 928 megahertz). That allowed anyone to deploy equipment and networks if they could build systems robust enough to live with the fact that anyone else could also deploy there.

European regulators have been more suspicious of open wireless environments, and imposed a much heavier hand. They have about one-tenth of the amount of spectrum open for unlicensed use below one gigahertz, and even that is at substantially more restricted power levels. The resulting difference in innovation paths, as we see in smart grid meter markets, is stark. The FCC, under both Democratic and Republican leadership, has opened up not only the original 900 megahertz and 2.4 gigahertz bands, but also the five gigahertz band. 

And there’s the rub. We know that the future is untethered ubiquitous computing. Our primary policy solution to dealing with that future is still licensed: we talk about “spectrum crunch” and try to auction as much spectrum as possible for licensed use. When the “spectrum crunch” meets the “debt crunch,” the urge to auction every sliver of spectrum in sight reaches feverish levels. Unfortunately, this gets the future of wireless exactly wrong; Wi-Fi is a primitive precursor to what a range of innovations in cognitive radios, dynamic frequency and power selection, mesh networks, and systems-level innovations are likely to make possible. Wi-Fi is today’s Gopher to what will become the HTML5 of wireless.

Open wireless systems are born messy, from dramatic improvements in computation and network architectures, and rapidly overtake the seemingly more reliable circuit-switched architecture of the past, with its predictable, incremental upgrade path. There will continue to be room for exclusive-use licensed spectrum approaches; but the basic wireless infrastructure of the future will be the inverse of what we believed necessary, natural, and inevitable in the first hundred years of radio. 

Policy needs to catch up. Short-sighted search for auction, limited understanding of the next switch, and lobbying are pushing legislators to auction more spectrum to exclusive licensed use, and makes them resistant to expanding the deregulation of wireless communications systems on the Wi-Fi and 900 megahertz model. Future open wireless is one area where the U.S. has an early mover advantage because of regulatory innovations from the 1980s and 1990s. We should not retreat from that position now that we can already see the next switch.

Yochai Benkler is the Berkman Professor of Entrepreneurial Legal Studies at Harvard University. The work underlying this article can be read in this white paper: Open Wireless V Licensed Spectrum Market Adoption.

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Credit: Technology Review

Tagged: Computing, Communications

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