FCC: Spectrum for Sale

FCC Chairman Julius Genachowski pledged to make the release of additional spectrum a top priority for the agency in 2011, during his speech at the Consumer Electronics Show in Las Vegas.

In November, the Commerce Department announced a plan to allocate 115 MHz of spectrum to wireless broadband in the next five years. That came several months after President Obama ordered the National Telecommunications & Information Administration (NTIA) within Commerce to work with the FCC to free up 500 MHz over the next 10 years.

The FCC reported last October that the country’s spectrum deficit would reach 300 MHz by 2014. The agency is working to free up 300 MHz of spectrum over the next five years to address the looming spectrum crunch.

Citing the proliferation of LTE and WiMAX devices and networks, the rising use of machine-to-machine technology in consumer electronics and mobile social media applications, Genachowski said that the country’s mobile broadband market must be given more (paid) spectrum in order to thrive.

Genachowski concluded with a pitch for voluntary incentive auctions of spectrum licenses currently underutilized by television broadcasters. The voluntary auctions could generate billions of dollars for the U.S. Treasury and help alleviate the shortage of spectrum for mobile broadband services. In that system, smaller broadcasters could bunch up on a single frequency using multiplexing. Then that broadcaster could auction their frequency for a profit. Nevermind that broadcasters don’t pay a dime for their local television spectrum.

“It’s time to take the necessary steps to ensure that spectrum will be the great enabler of mobile innovation in the 21st century, not a chokepoint,” he said. “I believe incentive auctions are a test of whether the U.S. can make the right strategic choices in a complex and fast-moving digital economy.”

The FCC appears anxious to generate tens of billions for the treasury — spectrum crunch or not.

But telcos paid over $15 billion for spectrum they are not using. AT&T is the worst offender, sitting on more than $10 billion in spectrum. The FCC seems to encourage this kind of speculation, and is doing the Telco’s bidding by opening more spectrum for corporations to sit on.

According to the FCC:

  • Verizon Wireless spent $2.8 billion for (currently unused) AWS frequencies and $9.36B for 700 Mhz — but at least they are using their 700MHz frequencies.
  • AT&T (then Cingular) spent $1.3 billion for AWS frequencies in the 2006 auction and $6.64B for 700 MHz frequencies in 2008. AT&T also paid $2.5 billion in cash for 700 MHz licenses owned by Aloha Partners. AT&T now covers 100 percent of the top 200 markets. AT&T has spent over $10 billion for 700 MHz and AWS spectrum. They haven’t used any of it yet.
  • Cable operators spent $2.4 billion for (currently unused) AWS frequencies. Comcast and Time Warner then invested billions in Clear’s Mobile WiMAX frequencies at 2.6 GHz, which they are now using instead of their AWS spectrum. Cable operators are sitting on $2.4B in AWS spectrum. Unused.

Spectrum is the “oxygen” of commerce.

“Free”, unlicensed spectrum in the 900MHz, 2.4GHz, 5 GHz, and 60 GHz bands created a huge positive impact on the United States economy – and the rest of the world. White space radios (at 100 mWatts) won’t cut it.

Providing 50-100 Mhz of “lightly licensed” spectrum, in the 1.7, 2.1, 2.2 and 2.3 GHz bands might have a more positive impact on The Treasury then selling it off to the highest bidder. Newspapers and magazines could deliver their e-goods without paying “protection” fees to cellular operators, municipalities could deliver cost/effective services, and the entire consumer electronics industry would benefit, much like it did with the advent of Wi-Fi.

Maybe it could be managed by a Public Service Spectrum Trust.

Related DailyWireless stories include; Phoney Spectrum Scarcity, FCC Votes to Share TV Spectrum, NTIA Finds 115 MHz of Spectrum, The National Broadband Plan, Battle of the Bands, Cellcos: One Thing – Bandwidth, Verizon: Spectrum Scarcity is Good, CellCos to Martin: Sit Down and Shut Up, FCC: Free Broadband at 2155-2180 MHz, MXtv Makes Its Move, Free 2155-2175 MHz!, The Free Triple Play, How to Fix Muni Wi-Fi, D-Block: It’s Done, Congress Pays, and AWS: It’s Done.

Posted by Sam Churchill on .

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