Save Our Spectrum Coalition Asks FCC To Create Wireless Broadband Competition
By Art Brodsky
April 5, 2007
The Federal Communications Commission (FCC) should use its auction of the valuable 700 MHz spectrum to create high-speed Internet service that will be a true competitor to broadband services offered by telephone and cable companies, a group of public-interest and consumer groups said today.
In a series of three filings with the FCC, the six-member Save Our Spectrum coalition said the Commission should structure the auction of the spectrum, and the service offered over it, so that the service will be operated in a non-discriminatory manner, under an open access structure following auction rules that will allow for greater participation than simply the incumbents.
The members of the coalition are: Public Knowledge, Media Access Project, Consumers Union, Consumer Federation of America, New America Foundation and Free Press.
While I applaud these group's goals, energy, enthusiasm, organization, and willingness to try to influence the upcoming 700 MHz auctions... with all due respect, they really just don't understand the real situation and why they're fighting the wrong war.
That there is to be an auction for remaining portions of spectrum around 700 MHz is a creation of the US Congress. Allocating portions of spectrum to various entities is entirely secondary to the purpose of creating revenue for the United States Goverment Treasury. Projected revenues from the 700 MHz auctions have already been allocated by Congress, factored into future budgets (and deficit reduction)... and spent! To change things regarding the 700 MHz auctions at this late date would, essentially, require an act of Congress... not merely unilateral action by the FCC.
Another issue that the coalition is unfortunately sadly ignorant of is that the allocation of any licensed spectrum will be "gamed"! Unfortunately, it's inevitable. An entire industry has grown up around "gaming" spectrum auctions, and all efforts to date to reduce the "gaming" have ultimately failed. The entities with the deepest pockets end up with spectrum allocations and can then do what they want with them. There are two minor exceptions: 1) Spectrum allocation in rural areas has sometimes not been of primary interest to larger entities (though this is changing as spectrum is now often acquired as "bargaining chips" to be traded or otherwise reallocated). 2) Previously, auctions for some portions of spectrum that seen as "problematic" were not widely participated in. Two examples are the initial 700 MHz auctions where that spectrum was encumbered by legacy television broadcasting and at the time no "sunset" date for cessation of television broadcasting was projected; and the 2.3 GHz Wireless Communications Service band that must deal with interference from adjacent high-power terrestrial "repeaters" for the Digital Audio Radio Service (DARS - aka Sirius and XM). Neither of these exceptions will likely happen in the future - all future spectrum allocations are seen as "good investments" whether or not an auction winner can make any real use of the spectrum.
Past efforts that attempted to "advantage" smaller organizations in spectrum auctions only resulted in the larger organizations "hiding behind" smaller entities. Eventually, the larger entities have always ended up obtaining auctioned spectrum, often with the simple expedience of buying out the smaller organization that actually won the auction. In essence, the entire system of spectrum allocation by auction is horribly, inequitably tilted against smaller entities actually winning or being able to hold on to the spectrum and deploy innovative, competitive services in competition with incumbent carriers.
One seeming example of what the coalition hopes to achieve might appear to be the "success" of Clearwire in deploying competitive Broadband Internet Access service against incumbent carriers. But looking more closely, Clearwire has spent hundreds of millions of dollars in stealthily (and savvily) acquiring ownership (when it can) and leases (when it can't own) of suitable spectrum. Clearwire provides services in only a relative handful of markets, is nowhere near being break-even (let alone profitable), and what Clearwire is now has only happened with Intel's willingness to speculatively invest billions of dollars to create a WiMAX industry.
So, what is the "right war" to fight?
What is within the FCC's purview to do that would effectively address the coalition's goals is authorize license-exempt use of "white space" in the remaining television broadcast spectrum (channels 2-51). The spectrum in question is television channels that are not being used for television broadcasting in particular geographical areas and thus can be used without the requirement of a license much. Such operation is very similar to the new 5.4 GHz band, where communications devices operating in that portion of the spectrum "defer" to "primary uses". In the 5.4 GHz band, "primary uses" are US DOD RADAR systems. In "television broadcast white spaces", "primary use" is television broadcasting.
License-exempt spectrum allocation means that there are no exclusive licenses - "anyone can play" - seemingly a major goal of the Save Our Spectrum coalition. License-exempt spectrum allocation has been overwhelmingly proven to enable a wide range of Broadband Internet Access Service Providers, from entrepreneurial Wireless Internet Service Providers in rural areas, to government-backed city-wide networks of outdoor Wi-Fi nodes that, in part, address digital inclusion issues.
However, in my opinion, the most profound effect of license-exempt spectrum allocation is that it enables individuals, small groups, even "unskilled" groups of neighbors to build their own Broadband Internet Access networks as is now being done with small Wi-Fi mesh devices from enlightened companies such as Meraki.
Technological evolution, especially Moore's Law, is on the side of license-exempt spectrum allocation in this fight. When the volumes are enormous (able to deploy with no license required - look at Wi-Fi sales), the technology improves rapidly, cost per unit falls exponentially, and a wide range of products and vendors emerge to satisfy every requirement.
I hope that the Save Our Spectrum Coalition can correct their course and... fight the right war.
By Steve Stroh
This article is Copyright © 2007 by Steve Stroh
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