Aloha Partners received a waiver from the FCC, allowing the company to launch a pilot high-speed mobile data network in Tucson, Ariz., within the interference-ridden 700 MHz band. The move could set a precedent for public-safety wireless operators by allowing a large swath of 700 MHz spectrum to be utilized now, without having to wait for incumbent broadcasters to move out of the band.

Aloha was prohibited from operating in Tucson because an analog broadcast station uses the adjacent UHF channels. Despite heavy lobbying efforts from broadcasters, the FCC is allowing the 700 MHz licensee to prove its network won't interfere with television broadcasts. Aloha is using Flarion Technology's proprietary Flash-orthogonal frequency division multiplexing (OFDM) technology because of the low-power nature of the technology and shorter towers, but Charles Townsend, CEO and general partner with Aloha, said he's convinced Flash-OFDM isn't the only technology that can operate in the band sans interference.

A trial is likely to begin by the end of 2005, Townsend said. If Aloha proves no interference problems, the operator can launch a commercial service immediately, without having to ask the FCC for permission.

Townsend said about 25% of the country is already interference-free in channels 54 and 59, and another 25% could open up if licensees in channels 52 to 59 were allowed to operate on adjacent channels. The rest of the spectrum is directly encumbered by broadcasters.

Public-safety operators are clamoring to get their hands on the 24 MHz of spectrum that has been allocated for them in the 700 MHz band. Their efforts have been stymied by encumbrance issues posed by television broadcasters. Legislators are debating a hard date for broadcasters to return the spectrum. As it stands now, broadcasters don't have to leave the band until Jan. 1, 2007, or when 85% of the homes in the license areas can receive digital signals, whichever is earlier.

The FCC's action comes at an interesting time for Aloha, the largest holder of 700 MHz spectrum. Last month the company acquired Cavelier Group and DataCom Wireless, the second- and third-largest 700 MHz holders. The acquisition increased Aloha's spectrum holdings to 12 MHz of spectrum that covers 175 million pops, including 84% of the pops in the top 40 markets. Townsend said Aloha will continue to have discussions with another four to five 700 MHz licensees to create an even larger footprint.

Aloha has been working to convince public-safety agencies for the first time to place their trust in a commercial entity for access to badly needed high-speed data services. The company's vision has been to build a nationwide broadband wireless network and offer dedicated access to public-safety users on part of it and commercial broadband access to rural customers on the other half.

Michael Thelander, CEO of Signals Research, said Aloha has a low-cost advantage. It paid only $35 million for spectrum in the 700 MHz band, and the propagation characteristics of the band translate into lower capital expenditures at the outset.

“At 700 MHz, the radius of a transmitting base station could be two to four times larger than the radius of a 1900 MHz base station,” Thelander said. “The larger the radius, the lower the number of base stations required, the lower the initial capex.”

However, new opportunities also are emerging for Aloha. The growing interest in mobile broadcast television has created an equally compelling prospect for the company, Townsend said.

Major wireless companies are putting a stake in the ground for mobile broadcast television. Qualcomm announced plans to create a subsidiary called MediaFLO to deliver multimedia content to mobile devices using the 700 MHz band. Qualcomm plans to offer the network as a shared resource to U.S. CDMA2000 and wideband CDMA operators.

Nokia announced a trial in Pittsburgh with tower company Crown Castle to bring video services based on the European DVB-H standard to U.S. mobile users using Crown Castle's 5 MHz of spectrum in the L band (1670 MHz to 1675 MHz). Townsend said proponents of the DVB-H standard have been knocking on the company's door because the propagation characteristics of the 700 MHz band are ideal for delivering video services.

If Aloha goes head-to-head with Qualcomm, it will do so with two times the amount of spectrum. Qualcomm owns 6 MHz of spectrum in the 700 MHz band. In addition, the DVB-H standard already has been developed for the European market in the 700 MHz band, so the company wouldn't have to change the technology to accommodate the U.S. market.

“It's safe to say we are looking at several other technologies and will conduct a series of different trials for different uses of the spectrum,” Townsend said. “You'll see us lock into a plan in 2006.”

Aloha has never committed to deploying a Flash-OFDM network beyond the Tucson deployment. The company remains concerned about the proprietary nature of Flash-OFDM.

“We're a little company, and someone has to step up and start buying Flarion's hardware for it to become cost-effective for us,” Townsend said.

Flarion has been focusing heavily on gaining traction for Flash-OFDM outside of the U.S. now that Nextel has abandoned the technology because of its impending merger with Sprint. Major international operators are testing it, but no carrier has made a solid commitment to the technology. However, the technology is gaining some inroads into the public-safety sector. The District of Columbia in early 2004 launched a pilot high-speed wireless broadband network with Motorola and Flarion using Flash-OFDM technology. The district's Office of the Technology Officer has been making the case for a nationwide Flash-OFDM network in the 700 MHz band.