With more mobile subscriptions than people in the U.S, there’s exploding demand for fast, reliable connections to our wireless networks. Rapidly growing mobile adoption and limited spectrum capacity is a losing combination. Already, American consumers are starting to see the negative effects of spectrum overload. In fact, U.S. wireless networks are the most congested in the world operating at 80% of capacity, compared to a global average of just 65%. The impact of this spectrum overload in the US will be measured by more than just the frequency of dropped calls and longer connection wait-times by American consumers: they will also be measured by missed economic opportunity, slower innovation, and sluggish job growth for American communities. Clearly, the time to act is now.
Fortunately, the Federal Communications Commission (FCC) recognizes the urgency of addressing the spectrum crunch and is working to swiftly and responsibly free up more spectrum for mobile broadband. Last year, the Commission secured Congressional support to conduct “first of its kind” spectrum incentive auctions to free underused broadcast TV spectrum to increase wireless capacity for mobile consumers. Now the challenge is creating an auction design that can appropriately navigate the minutiae of these complex transactions to ensure the end result our nation wants and needs – less time with that dreaded loading signal and more access to the next wave of wireless innovation.
While both broadcasters and wireless companies have participated in spectrum auctions before, the process, economics and strategy of this particular auction all are breaking new ground.
Unlike its predecessors, the upcoming incentive auction process envisions using a reverse auction to reclaim the airwaves from broadcasters coupled with a forward auction to distribute spectrum for commercial wireless use. Given this added complexity, this auction will not be the easiest process to design, or to implement — which is why it is a good thing the Commission is taking the appropriate time and effort to make sure they get the auction blueprint right. The Commission has pledged to begin the auctions next year — it is important both for our consumers and our economy that this schedule stays on track.
There are a few smart, common-sense and easy-to-implement approaches that, if embraced early by the Commission, can proactively address areas of potential uncertainty and confusion, and at the same time, do away with unnecessary delays, including
- Encouraging wide participation by broadcasters and wireless operators alike by ensuring all aspects of the auction process are as simple and transparent as possible – from bidding to the pricing structure – and continuing outreach so broadcasters can make informed choices about auction participation.
- Guaranteeing that all qualified entities can participate in these new auctions.
- Permitting wireless bidders to place package bids in the auction, and including guard bands in the band plan that are only as large as necessary to protect against interference, in order to maximize the amount of useful spectrum available.
- Allowing market forces and the well-established standards-setting process, rather than prescriptive regulatory mandates to operate to provide wireless companies greater flexibility in making possible the next wave of innovation.
- Reallocating broadcaster spectrum as quickly as possible following the auction, so wireless companies can move quickly to expand and upgrade their services
- By making more spectrum available and freeing innovators to put it to its most innovative uses, the FCC will be taking a big step toward ensuring the future of mobility, and securing America’s continued leadership in mobile technology. The United States leads the world in 4G LTE deployment, and consumers and our economy are only beginning to realize the full potential of these powerful, next generation networks.
As the nation migrates to 4G LTE advanced networks, the future of the communications marketplace is nearly boundless. The transition to 4G is bringing faster speeds and profound new cycles of mobile-fueled innovation for consumers.
Spectrum auctions are critical to ensuring our nation continues to have a broadband infrastructure that is the envy of the world. In innovation, government often does and should take a back seat to the innovators. Here lies the rare opportunity for Government to lead. Now all eyes are on the FCC to get it done fast–and get it done right.