ITFS, MDS, MMDS, and BTA History

The Channel Assignments

In 1963, the frequency band 2500-2686 MHz was reserved to educational institutions for over-the-air transmission of instructional TV programs. Transmission was point-to-point, for example, campus-to-campus or campus-to-hospital for continuing education needs. Hence the name: Instructional Television, Fixed Service (ITFS). The power authorized (up to 100 watts) allowed transmit/receive separations of up to 30-40 miles.

In 1972, commercial operators were permitted to use the coexisting commercial band 2150-2162 MHz for over-the-air pay-TV transmissions to rooftop antennas on apartment buildings and private homes and for business data transmissions. Transmitters were similar to those for ITFS service, and the range of these installations was also 30-40 miles. The transmitter site was centered in the coverage area, usually a city, on a preexisting tower or atop a tall building.

The antennas were usually omnidirectional to reach all subscribers in the circular coverage area. The signal was intended for distinct subscriber locations rather than for anyone who wanted to pick up the signals (as in the broadcast services). Therefore the new service was named Multipoint Distribution Service (MDS). This service was the beginning of what we now know as “Wireless Cable”. MDS was conceived as an alternate or supplement to conventional cable television (CATV). It was more successful in areas not covered by CATV. In areas where both services were available, it was severely challenged: it could offer only one or two TV channels versus the dozens of channels offered by CATV. Hence, after the novelty of MDS wore off, MDS revenues declined. Clearly, one remedy was to use more channels, and the commercial wireless operators eyed with interest the lightly used ITFS channels reserved for educational purposes.

MDS operators and potential MDS operators filed a Petition for Rulemaking to permit commercial use of some of the ITFS channels. As a result, in 1983 the FCC reallocated eight of the ITFS channels (identified as Groups E and F) for use by commercial over-the-air pay-TV operations. The idea was for each market to have two licensees, each of whom would have four channels. Since this allowed simultaneous broadcast of many more channels than existing MDS, the newly allocated channels became Multichannel Multipoint Distribution Service (MMDS). Many MDS operators have acquired MMDS channel licenses and, in some cases, newly licensed MMDS operators have acquired older MDS operations. Existing ITFS licensees using the E and F channels were not displaced at that time, although the rules permit the MMDS licensee to pay all costs and relocate such a licensee to an alternate channel if one is available.

Almost simultaneously, the FCC allocated three ITFS channels (in Group H) to the relatively new Operational Fixed Service (OFS). This was envisioned as a point-to-point transmit/receive service primarily for the transfer of business information. However, at once MDS and MMDS licensees in large numbers began to acquire licenses for the OFS channels in their markets and use them for one-way analog video programming. Since 1998, the FCC has considered these H channels (H1, H2 and H3) MDS channels.

For purposes of describing operations, we should consider the MDS, ITFS and MMDS services technically identical. For those interested in the FCC’s channel assignment plan, it is spelled out in Appendix A of LBA Technical Note 115.

The Cable Television-Type Operation

Historically, wireless cable has been a one-way analog video service. “One-way analog video service” means that it has operated much like commercial broadcast stations, sending one “video stream” such as NBC or CNN over each channel. Viewers used downconverters to step down the transmissions from 2500 MHz frequencies to 65 MHz, and then they could watch the programs on traditional television sets.

The MDS operator who had a license for one channel was limited to offering one channel of programming. The MMDS operator who had a license for four channels was only slightly better off, because four channels were available to cable customers. By aggregating all the MDS and MMDS channels in a market, the consortium of licensees could operate a wireless cable system with as many as 13 channels. Although this may have been viable in the early 1980s, by the 1990s the market demanded dozens of channels from a cable service. MMDS operators still desired use of the ITFS channels to meet this need.

ITFS operators tended to use their channels for long-distance education during regular working hours, and the channels lay fallow on nights and weekends when the wireless cable demand for programming was the greatest. The FCC had placed a provision in its rules that permitted an ITFS licensee to lease its “excess channel capacity”. This meant that as long as the ITFS licensee used its channels for educational purposes for a minimum of 20 hours per week per channel, it was free to lease the channel for commercial uses the rest of the time. The FCC rules contain restrictions on the Airtime Lease Agreements to prevent a naive educator-licensee from giving away too many of its rights, but the use of these agreements permitted an explosion in growth in ITFS operations.

The up-front cost to the educator to construct a four-channel transmission system and install receive equipment in the schools to be served could run into six figures. Most school systems did not have this kind of money available for an untried technology. So, under the leasing rules, it worked like this: the commercial wireless cable operator in the market paid all the up-front application costs for legal and engineering work to prepare an application to the FCC for a license to be held by the school. The wireless cable operator purchased the equipment, built the transmitter tower, installed the receive sites at the schools and built a studio. The operator worked with several educators in its market, so that most available channels were used, and all shared the transmission facility. Each educator was a licensee in its own right but had a contractual agreement to lease its excess channel capacity back to the wireless cable operator. The educator got the license without having to spend money, had the use of the studio and equipment built by the wireless cable operator and had use of the service for many hours each week. In addition, it received monthly lease payments from the wireless cable operator for use of the channels on nights and weekends. This arrangement is a classic example of business and educational entities cooperating to the good of both. This new, untried technology became a moneymaker for the school in addition to allowing long-distance education to become a reality. And, the wireless cable operator now had access to as many as 33 channels through the use of the ITFS, MMDS and MDS bands. Thirty-one of these channels are immediately adjacent to each other in the 2500 MHz band, and two are at 2100 MHz. The channels designated as the A group, the B group, the C group, the D group and the G group are the reserved educational channels. The channels designated as channel 1, channel 2, the E group, the F group and channels H1, H2 and H3 are available for commercial operators.

Commercial Use Of ITFS Channels

In 1991, the FCC decided to permit wireless cable operators to use ITFS channels for their commercial operations under certain rather strict conditions. A wireless cable operator is defined as one who holds a conditional license, a license or a lease on at least four MDS channels or has an unopposed application pending for at least four MDS channels. The wireless cable operator may request permission to operate on ITFS channels if there are no additional MDS channels available in the market and there are at least eight remaining unused ITFS channels available for future ITFS use in the community. Entities eligible for ITFS licenses may request from the FCC that they be given access to the commercially used ITFS channels for up to 40 hours per week per channel. These conditions are spelled out in 47 CFR §74.990 through §74.992.

BTA Auctions

In the early 1990s, the U.S. economy was down and Congress had discovered the dollar value of the spectrum licenses the FCC granted. It mandated that licenses in most services be granted to the highest bidder. This decision greatly changed the wireless cable market.

In 1995 the FCC rules were changed to specify that all remaining MDS licenses would be auctioned. The decision was made to divide the country into geographic areas, each of which could then be auctioned off. The Rand McNally Basic Trading Area (BTA) divisions were selected, with the addition of a few BTA-like areas to complete coverage of the United States and its territories. Each BTA or BTA-like area is a collection of counties. The physical size varies greatly although they tend to be smaller in the more densely populated east and on the west coast and they tend to be larger in the more sparsely populated areas of the western United States.

What the FCC was granting in its BTA license was the right to use any of the 13 commercial channels (see above for a list) anywhere in its BTA if it could do so without causing interference to any pre-existing licensee or to any adjacent BTA. These pre-existing licensees are called “grandfathered” licensees and their licenses remain in effect and are eligible for renewal at the end of their license term. The grandfathered licenses have a protected service area, which is a 35-mile circle, centered on the transmitter site in use in 1991 when the protected service area rules were finalized. This area may overlap more than one BTA and requires protection from all nearby BTA licensees. The interference protections required for these grandfathered stations is more generous than that provided to BTA licensees, as well. The BTA licensees are protected from interference at the boundary of the BTA, but the irregular shapes of the BTA boundaries are not reflective of real-world propagation conditions and make service to areas at the edge of the service area more difficult.

The MDS auction occurred from November 1995 to March 1996 and yielded $216.3 million. The auction funds were not allocated to the FCC; they went directly into the U.S. Treasury. A total of 493 licenses, one per BTA, were awarded to a total of 67 licensees.

Two-Way Digital Operations

Recently the wireless cable technical standards have been relaxed to permit a one- or two-way digital service. This broadens the potential use of the spectrum. A wireless cable operator may use digital compression to place additional “video streams” in the same number of channels, in effect increasing its channel capacity without using more bandwidth. It may use the response channels for pay-per-view ordering. Or, it may use the two-way service for high-speed wireless Internet or other data transfer applications.

This change in the rules was the result of efforts by a consortium of wireless cable operators, consultants, attorneys, ITFS licensees and equipment manufacturers. This group got together and created a plan to permit two-way use of the wireless cable frequencies. They determined minimum operating standards the equipment could tolerate, interference standards with which operators could live, an expedited processing method and frequency sharing rules the educators and wireless cable operators both found fair. Then the entire package was turned into a proposal at the Commission. The FCC granted substantial portions of the package without change. The initial filing window for two-way applications was in August 2000. Many of these applications have been granted and are being constructed.

In a two-way digital wireless cable system, each subscriber has not only a receiver but also a transmitter. These transmitters have low power and send a response back to the response station hub. The response transmission is called the upstream transmission, and the signal from the main transmitter is called the downstream transmission. Originally the system required a directional response transmit antenna oriented directly at the response station hub. However, that meant only trained service personnel could do installation. In an effort to reduce operational costs, some wireless cable operators petitioned the FCC to permit low-gain omnidirectional response antennas to be used so users could install the equipment themselves. This request was granted.

Booster stations

In addition, the FCC rules permitting booster stations have been relaxed, so an operator may more easily add supplemental transmitter locations to serve areas that were previously out of reach. Boosters might be used on the downstream component of the two-way system, or the transmitter frequency of the one-way system. This permits more “cellularization” of the market to improve coverage with multiple transmitters.

Line-of-sight operation

Traditionally, the antennas used for wireless cable have required a line-of-sight (LOS) path between transmit and receive antennas. This limits service providers to putting the hub antenna at a very high central location, often 500 feet above the surrounding area. They must also use a high transmit power to reach the 35-mile limit of the coverage area. In addition, the customer’s antennas must often be mounted at the highest point on the rooftop, which is unsightly from the consumer’s point of view and may also be in violation of restrictive covenants.

Even with these restrictions, the usable service area is limited to portions of the authorized service area. Any building behind, or “in the shadow of”, a larger structure cannot receive service. This larger structure can be a hill or a building or even a water tank. On a nationwide average, LOS service is available only between 30% and 80% of an authorized service area.

In addition, using a very tall high-powered transmitter creates interference problems in adjoining areas. Cooperation between operators in neighboring areas is necessary to resolve the interference issue. Often the same company will have operations in adjacent markets, so it is creating interference problems for itself. Use of a tall, high-powered hub antenna limits the operator’s ability to re-use the same frequencies in its market, as well.

Non-line-of-sight operation

To overcome these problems, several manufacturers are working on technology to permit non-line-of-sight operation. This is defined as reliable operation in the absence of a clear LOS path. Although the signal is not expected to penetrate large terrain obstructions, it can be expected to penetrate walls and foliage and bend around buildings. The signal should be robust enough to operate in an environment of multipath fading and in spite of some obstruction and interference. The goal is to achieve coverage of 90% of the authorized service area. Non-LOS (NLOS) paths are not as efficient as LOS paths, but they permit use of shorter, lower-powered transmitters. This allows more re-use of the frequencies.

The areas that have obstructed paths still receive a signal, but it is a weak signal. The NLOS areas receive signal that has traveled along paths that reflect (bounce off an obstruction) or refract (bend as they pass over an obstruction). There are any number of such paths that start at the hub site and end at the customer site. The signal received along any such path is weak, or attenuated. In addition, the paths have different lengths, which means the time delay along them varies. Intelligent customer premises equipment can use error-checking routines to combine the signals from the various paths and correct the flaws in the data sufficiently to have a usable signal. There are ways to predict the attenuation and the multi-path effects, and these calculations indicate the path loss to be expected from a NLOS path. The wireless cable operator can include this loss in its planning, and thereby permit NLOS operation.

Self-Installation of Customer Premises Equipment

One of the larger expenses in a wireless cable operation is providing and installing equipment on the customer premises. As long as the requirement exists to “fine-tune” each installation to optimize the LOS, trained installers must be dispatched for each new subscriber. As wireless cable systems are designed to permit higher loss budgets, customers can install equipment themselves. The goal is to have universally compatible equipment that is available at consumer electronics stores, which consumers can purchase and install themselves. The DirecTV model is the one desired by the wireless cable industry. Consumers buy the DirecTV equipment themselves and most install it themselves. Professional installation is available for a fee if the customer wishes. If this could be accomplished in the wireless cable service, an operator’s costs would be greatly reduced.


Airtime Lease Agreement. The agreement between the educator and the commercial wireless cable operator to permit the wireless cable operator to use the educator’s frequencies during certain times of the week. These agreements are discussed in 47 CFR §74.931.

Booster Station. An additional transmitter used by the wireless cable operator to repeat the signals of the MDS station or originate MDS signals. Booster stations are intended to augment service in areas that are poorly served by the main transmitter.

BTA. Basic Trading Area. A Rand-McNally designation for a geographical unit made up of one or more counties, which Rand McNally has determined have some characteristics in common.

BTA License. A license issued to a wireless cable commercial operator. The BTA licenses were auctioned in 1995 and 1996. A BTA license authorizes an operator to use all of the commercially available channels within a BTA as long as no interference is created to any authorized station existing at the time of the auction.

Cable Television (CATV). A subscription offering of multiple television channels available from a single entity, but CATV usually indicates traditional wired cable.

Customer Premises Equipment (CPE). The system of antenna, transmission line and downconverter or modem installed at the customer’s site to permit use of wireless cable broadband technology.

Excess Channel Capacity. Any time during the week that the ITFS licensee’s channels are not needed for educational activities. The spectrum used to lie fallow during these hours; now FCC rules permit leasing the use of the channels during this time to commercial operators, creating revenue for the schools and increasing spectrum efficiency. See Airtime Lease Agreement.

Federal Communications Commission (FCC). The federal agency mandated by congress to regulate use of the radio spectrum.

Instructional Television Fixed Service (ITFS). The frequencies set aside for use of educational entities in the course of their educational mission. The channels are six MHz wide each. The reserved channels range from 2500 MHz to 2686 MHz. The service is “fixed” in that the transmitter and receive sites are identified to the FCC and specified in the license. The purpose of this service is to permit long-distance learning. For example, a hospital may be a licensed receive site and use the service for continuing education. The FCC rules for ITFS stations may be found in 47 CFR §74, Subpart I (which begins at §74.900).

Line-of-Sight (LOS). A clear, unobstructed microwave path exists between transmit and receive antennas. Microwave LOS propagation requires not only that the direct path between the two antennas be unobstructed, but that an area around the path also be clear. This area is sausage-shaped and surrounds the direct path in all three dimensions. It is larger in diameter (extends farther from the direct path) in the center than at the endpoints, and varies in diameter with frequency and with the length of the total path. It is called Fresnel zone clearance after the French mathematician who developed the formula.

Multipoint Distribution Service (MDS). A domestic public radio service rendered from one or more fixed transmitting sites to multiple receiving locations. These channels are six MHz wide each. An MDS licensee may operate either as a common carrier or as a non-common carrier, but must specify such to the FCC. The frequencies originally assigned for this service are in the 2150-2162 MHz band. The frequency bands 2596-2644 MHz and 2650-2680 MHz were added when the need for more spectrum became apparent. The FCC rules for MDS stations may be found in 47 CFR §21, Subpart K (which begins at §21.900).

Multichannel Multipoint Distribution Service (MMDS). An MDS service utilizing multiple transmitting channels. The FCC rules for MMDS stations may be found in 47 CFR §21, Subpart K (which begins at §21.900).

Response Station. In a two-way digital wireless cable system, the customer site is the response station. It communicates back to the wireless cable system, communicating directly with the response station hub.

Response Station Hub. A fixed facility operated by the licensee or the wireless cable operator, for the reception of information transmitted by one or more response stations. The response station must use digital modulation with uniform power spectral density.

Wireless Cable. Use of microwave frequencies to aggregate multiple channels of video programming, which are then offered to subscribers. The use of microwave frequencies instead of wires makes it much easier to serve homes in less-dense areas. In addition, the cost of wiring is eliminated.