August 22

Understanding Wireless Technologies: Licensed vs. Unlicensed Spectrum

The science behind how wireless technologies move data through the air is based on radio waves. The airwaves are made possible by the electromagnetic spectrum, which occurs in nature, but is regulated by governments around the world to prevent operators from interfering with each other. Here's a look at the differences between licensed and unlicensed parts of the radio spectrum.

Understanding the Radio Spectrum

It's difficult for many people to understand what the electromagnetic spectrum is since it's usually not taught as part of people's regular education. Yet everyone knows what it's used for, such as radio, TV, and wireless internet.

This spectrum of energy contains all the frequencies that facilitate wireless technologies. Frequencies of energy waves can be broken down into vibrations or cycles per second, measured in Hertz (Hz). The further you move up the spectrum, the higher the number of vibrations per second, moving from kilohertz (KHz) to megahertz (MHz) to gigahertz (GHz). Different regions of the spectrum are called "bands."

In the kilohertz band are commercial AM radio signals, while FM radio and TV signals occupy the megahertz band. Wireless internet is higher up the spectrum in the gigahertz band. The radio spectrum is divided into licensed and unlicensed channels. Licensed channels are assigned by government to exclusive operators. Meanwhile, unlicensed channels are open for public use, but subject to regulations.

Licensed Spectrum

In the United States, the Federal Communications Commission (FCC) oversees licensing of spectrum frequencies. The FCC sets the rules as to which parts of the spectrum can be licensed to commercial entities. Major cellphone carriers such as AT&T and Comcast own most of the licensed spectrum allocated for wide-area coverage in the gigahertz range. These owners can make special licensing available for clients to operate per-link or per-area, although it can be expensive.

A key advantage to using the licensed spectrum for wireless communication is the lack of congestion and minimal interference. A spectrum licensee can take legal action against parties that interfere with their transmission. Licensed frequencies allow for better technical performance compared with unlicensed frequencies. Mobile network operators (MNOs) are able to deploy cellular networks with more flexibility to manage interference between the base station transmitter and radio receivers.

The main disadvantage to using licensed frequencies is equipment costs are much more expensive than for unlicensed use of the spectrum. Usually, only large organizations are able to afford this option. The more licensed links the company purchases, the higher the costs. Due to how licensing is issued, it's necessary to hire an attorney to assist with licensing, which can add to expenses.

All AM and FM radio stations must obtain broadcast licenses to meet FCC requirements. The reason most people you know don't own radio stations is due to the regulatory red tape and costs involved. The FCC also requires licensing for low-power FM (LPFM) stations that serve small communities. Even amateur ham radio operators in the ultra-high frequency (UHF) range of 420-450 MHz must hold FCC licenses.

Unlicensed Spectrum

Beyond the frequencies allotted for commercial and public use, much of the entire spectrum is unlicensed. Wi-Fi operates in the unlicensed spectrum. Wireless ISP startups known as WISPs typically begin service with unlicensed frequencies and may grow to purchase licensed spectrum space when higher performance becomes an issue. A big difference with unlicensed frequencies is lower cost.

The use of unlicensed frequencies allows MNOs to spread out base stations for network cost-cutting, as there are no fees involved with using the unlicensed spectrum. The equipment doesn't have to be as expensive as for licensed broadcast stations.

But due to the performance limitations of unlicensed frequencies, users can be plagued with interference problems. While paying for a license greatly reduces interference issues, unlicensed users have to live with noise and dropouts caused by radio interference from other close-range unlicensed operators. It's important to note that prior to the federal government issuing radio licenses, early AM radio stations suffered from signal interference from other operators occupying nearby frequency bands.

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Heavily-populated areas present major problems for unlicensed spectrum users, but it's possible to co-exist in a crowded region of mobile operators. There are still regulations to meet, so it's not the complete wild west. Certain regions, for example, have restrictions on the amount of effective isotropic radiated power (EIRP) that can be used.

Unlicensed users can make equipment adjustments to reduce transmitting power, which can reduce interfering with others on the same frequencies. Other strategies for avoiding interference include occupying higher frequency bands and using a strategy called frequency hopping, which involves selecting a specific block of frequencies.

Differences in Frequency Bands

The three primary frequency bands the FCC has assigned for unlicensed use are: 900 MHz, 2.4 GHz, and 5.8 GHz. Use of these bands does not require filing with the FCC. All three bands support mesh networks and high-speed Ethernet interfaces.

The 900 MHz frequency provides the best coverage area compared with the GHz band. But it only offers a limited number of channels, which reduces the number of wireless networks that can operate in an area. Conversely, the 5.7 GHz frequency allows for the greatest number of available channels, but it requires antennas to be aligned in direct line of sight to achieve long distances.

Frequency allocation is important in the IoT age because most IoT devices currently operate on unlicensed spectrum bands. Companies seeking more reliable IoT transmission performance should consider purchasing use of licensed frequencies. If you own a license for specific frequency, no one without your permission is allowed to bleed over into your band, which can result in FCC fines.


While most of the radio spectrum is licensed to broadcast stations, the FCC allows a limited number of unlicensed frequencies for users of wireless technologies. But to avoid interference from other unlicensed spectrum users, it's beneficial and more reliable to use licensed frequencies.


FCC, licensed spectrum, radio spectrum, unlicensed spectrum, wireless frequency bands, wireless technologies

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