A System Dynamics Approach to Quantitatively Analyze the Effects of Mobile Broadband Ecosystem's Variables on Demands and Allocation of Wireless Spectrum for the Cellular Industry Open Access
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Usage of cellular networks for data services is growing rapidly worldwide as more consumers browse the Internet, check emails, and watch videos on smartphones and tablets. To ensure that sufficient capacity is available on cellular and wireless networks, current utilization of the radio spectrum, an encumbered and finite resource, needs to be evaluated. Spectrum is usually made available by governmental regulatory bodies through auctions. From a policy and regulatory perspective, auctions of spectrum try to ensure the efficient use of spectrum by allocating it to the entities that value it the most. Auctions also generate revenues for governments. Cellular operators worldwide have been asking for allocation of more spectrum for cellular networks to support the growing demand of mobile data services. Perception of radio spectrum scarcity has been linked, sometimes linearly, to the higher demand of mobile data services and the greater market penetration of mobile broadband devices. To validate the "spectrum scarcity" notion, various elements of the wireless ecosystem, including network infrastructure, spectral efficiency of mobile technologies, and data offloading via unlicensed spectrum need to be appraised; and their effects on "spectrum utilization" need to be understood. Research presented here takes a system dynamics approach to study dynamic behavior among these elements and their effects on usage of spectrum through computer-based simulation. System dynamics provides a powerful means to model a complex system comprised of dependent and independent variables. With the help of the Causal Loop Diagram, we explain the research framework and formulate the hypotheses. A stock-and-flow model-based simulation is employed for hypotheses testing to justify the need for more spectrum. Dynamic behavior among different variables of the wireless ecosystem is also analyzed through this simulation. The study conducted here also explains why system dynamics appears to be a comprehensive approach to address the wireless industry's spectrum scarcity and utilization problem. Simulation results show that mobile data demand can exceed the current capacity of cellular networks causing a spectrum deficit if apt planning of spectrum policies and appropriate infrastructure investment are delayed.