FCC Chairman Kevin Martin is proposing free unlicensed access to the AWS-3 band if the company that buys a license at auction doesn’t meet FCC demands to build a nationwide Internet network, according to the Wall Street Journal today.
Mr. Martin said Wednesday that he has circulated two versions of the auction item — one with the unlicensed provision and one without — for the other commissioners on the five-member body to review before the meeting. The FCC will vote on only one version, depending on which version the other commissioners prefer, Mr. Martin said.
Mr. Martin wants to sell a nationwide license to the airwaves rather than give the channels to entrepreneurs because he wants to promote free Internet access. By adding a clause that would give away airwaves where there isn’t an Internet network after five years, Mr. Martin hopes that the owner of the channels would have an added incentive to build a network.
Mr. Martin said Wednesday that both versions of the auction item include a “use it or lose it” provision in which the owner of the channels would lose spectrum where there is no Internet access. The owner of the channels would “continue to serve whatever area they’ve built out,” he said.
The FCC is scheduled to vote on rules for the sale on Dec. 18. Mr. Martin wants the company that buys the airwaves to devote at least 25% of the spectrum to free Internet access for 95% of the country. The no-cost Internet service also would be smut-free for users under 18. Adult users could opt out of the filter blocking pornographic content.
The plan includes a provision requiring the winning bidder to meet benchmarks by five years, or have the spectrum reclaimed by the agency. Any spectrum reclaimed will be opened up for unlicensed use, according to a provision that will be voted on Dec 18th.
While “free”, nation-wide internet access seems like a good idea for consumers, building out a nation-wide system might cost $5 billion. If an operator had to buy the 20 Mhz of spectrum at auction, how much more would that cost…$1 Billion? $3 Billion? More? Total cost of an auctioned “free” network could reach $10 billion. It seems a dubious business model — especially now.
When Commissioner Adelstein was here in October, I handed him my own thoughts on how the AWS-3 band might be utilized. Here’s that letter:
October 21, 2008 Marlene H. Dortch, Secretary Federal Communications Commission Office of the Secretary 445 12th Street, SW Washington, DC 20554 Re: Portland, Oregon DTV Outreach: 2150 Mhz Spectrum Rules WT Docket Nos. 07-195 and 04-356 Dear Commissioner Adelstein: As a citizen of Portland, Oregon, I found MetroFi's "free" municipal Wi-Fi service to be essential. My sole source on income has been from my weblog (on wireless issues). MetroFi was my sole source of broadband connections for a period of about 6 months. With a $12K/yr income, I couldn't afford DSL. Now municipal Wi-Fi clouds are dark. I think the solution is 2150 MHz, but auctioning off the 2155-2180 MHZ band will increase their cost. The band should be free (like Wi-Fi) and lightly regulated (like 3650). If the 2150 Mhz range (using WiMAX), averages 3.5 miles, then each antenna tower might cover 10 sq miles. Perhaps a 100 sq mile city would need only need 10 towers. If each tower requires $50K in gear, that's $500K total. That's 1/20th the cost of Wi-Fi. Municipal Wi-Fi networks typically cost $100K+ per sq mile. Portland's 100 sq mile service was expected to cost about $10M. Currently cities are requiring 30-40 nodes per sq mile, plus lots of backhaul gear. Ten million dollars vrs $500K. Clearly, 2150 has advantages for municipalities. But 2150 won't be "free" if the FCC "taxes" it. This new 25 MHz-wide band should be lightly regulated - like 3650 MHz - and dedicated to municipal wireless coverage - defined as covering, perhaps, 80% of a city. That band should be free - like Wi-Fi. Like Radio. Like Television. Thank you for your leadership in "white spaces", 3650 MHZ and other policies. The balance between public and private interests is always subject to judgment calls. But cities need "free" broadband now. Companies like M2Z should be encouraged to compete with local entrepreneurs. I hope you will consider the successful 3650 model for a dedicated municipal wireless band. Thank you. Sam Churchill Founder, Dailywireless.org 815 NW Naito Parkway, # 506 Portland, OR, 97209 503.228.6459
Adelstein looked at the letter and thanked me, saying he’d give it to his staff for serious consideration.
With the current financial situation, the concept of “unlicensed AWS” may have some traction. Perhaps it’s an idea whose time has come. With Internet advertising revenue predicted to top broadcast television, newspapers and magazines by 2010, it might even fly.