Radio spectrum is a vast resource that allows people in all countries to improve their communications, grow their industries, and enrich their everyday lives. Most countries consider RF spectrum a public resource to be used for the benefit of the all citizens. Each country will divide the spectrum up into licensed and unlicensed bands in order to mitigate radio spectrum pollution and maximize the benefit of usable radio spectrum.
Licensed bands can be reserved for a specific use or sold or leased to a specific user. For example, the state may reserve spectrum for military or public safety use. In other cases a commercial user must apply for and pay for a license to use the spectrum. The license grants the licensee the exclusive use of that spectrum for a specific use thereby eliminating any interference issues.
Unlicensed spectrum, also called license-free spectrum or license exempt means users do not have to apply and pay for a license and it means anyone can use the spectrum. Unlicensed implies there is little regulation; however this is not entirely true. Regulations limit the amount of transmit power unlicensed transmitters can use. The transmitters also use innovative technologies such as OFDM to “peacefully coexist” with other transmitters in the same spectrum. Unlicensed is an ambiguous term since it means different things in different countries. Some countries require registration of each specific radio or link. Others require detailed audits on each radios power output and area covered. Using unlicensed spectrum is fast and easy but as anyone can use it along with you, interference can become an issue.
Lightly licensed frequency bands, such as the 3.65 GHz band in the US, are a hybrid of the other two types. A user or entity must register with the FCC and pay a nominal fee before using any equipment operating in the band. Although registration is required, it does not grant an exclusive right to use that frequency in any particular location. Users must still work with each other to mitigate any potential interference issues.
Just to add to the confusion, the same frequency bands can be licensed in one country and unlicensed in another and some countries do not assign any spectrum as unlicensed. Further some countries such as the US have very different rules regarding the use of unlicensed in each radio frequency.
Over the past decade, as the demand for wireless solutions has grown, the amount of commercial licensed spectrum has nearly doubled, and in the US the amount of unlicensed spectrum has nearly quadrupled.
Why would you use one over the other?
The biggest reason for electing to go with licensed spectrum for your broadband rollout is the lower probability of interference, especially in urban areas where unlicensed spectrum tends to be more crowded. That said, licenses may not be available, and if they are, time and money is required, sometimes substantial amounts.
The biggest reason for choosing unlicensed spectrum for your broadband rollout is speed and cost. You can be up and running with an unlicensed network much more quickly and equipment tends to be less expensive. Look for power efficiency in unlicensed radios to maximize range and throughput and mitigate interference.