On the engineering value of spectrum in dense mobile network deployment scenarios

The continuing growth in the mobile data traffic magnifies the challenges for the design and deployment of scalable high-capacity mobile networks that can meet the future demand at reasonable cost levels. In order to meet the future traffic demand, an operator should invest on both infrastructure, i.e. densification of base stations, and more radio spectrum. Knowing the effectiveness of each element is thus of utmost importance for minimizing the investment cost. In this paper, we study the economic substitutability between spectrum and densification. For this, we measure the engineering value of spectrum, which refers to the potential saving in the total cost of ownership (TCO) as result of acquiring additional spectrum resources. Two countries are considered to represent different market situations: India with dense population and high spectrum price and Sweden with moderate population density and low spectrum fee. Numerical results indicate that additional amount of spectrum substantially relieves the need for densifying radio base stations, particularly for providing high user data rate in dense India. Nonetheless, the engineering value of spectrum is low in India (i.e. spectrum acquisition has less cost benefit) under the high spectrum price of today, whereas spectrum is instrumental in lowering the total cost of ownership in Sweden. Our finding highlights the importance of affordable and sufficient spectrum resources for future mobile broadband provisioning.