Business models for mobile network operators in Licensed Shared Access (LSA)

Abstract

This paper presents business models for mobile network operators (MNOs) in the new Licensed Shared Access (LSA) concept. The LSA concept allows spectrum sharing between an incumbent spectrum user and an LSA licensee under the supervision of the regulator with rules and conditions that guarantee predictable quality of service (QoS) levels to all involved spectrum users. This paper summarizes the LSA concept and its application to the mobile broadband where an MNO shares spectrum from another type of incumbent spectrum user such as military or programme making and special events (PMSE) services which corresponds to the industry driven Authorised Shared Access (ASA) concept. The paper highlights the importance of developing viable business models for the new spectrum sharing concepts as they need to provide clear benefits to the key stakeholders to be adopted in real life. The paper depicts the evolution path of business model theories and focuses on a recent action-oriented business modeling approach. This approach is applied to the mobile broadband using the LSA concept to derive business models for MNOs for accessing new LSA bands. Separate business models are derived for dominating and challenger MNOs whose market shares and amounts of exclusive spectrum license differ significantly and will face different business opportunities arising from LSA. To assess the transformation coming with the LSA concept, business models are first developed for the current situation with exclusively licensed spectrum bands. New business models are then developed for the introduction of the new shared LSA bands. The developed business models indicate that the dominating MNOs could benefit significantly from the new LSA bands which would enable dynamic traffic management to offer different service levels to different customer segments. For challenger MNOs, the LSA concept could offer the opportunity to challenge the dominating MNOs and win their customers by offering tailored services to a wider customer base using the new LSA spectrum resources. Moreover, it could significantly re-shape the business ecosystem around the mobile broadband by opening the door to non-MNO entrants.