Auction Plan Is Most Likely to Succeed, FCC Head Says
The U.S. Federal Communications Commission decided to push forward on its proposal for an incentive spectrum auction, despite likely criticism from some corners, because it thought the plan would be the quickest way to get wireless spectrum in use by mobile broadband providers, FCC Chairman Julius Genachowski said.
He spoke on Friday at the CES conference in Las Vegas.
Genachowski urged Congress to pass bills that will allow the auctions to happen. Legislation in front of both houses of Congress supports incentive auctions, which would allow current spectrum users such as mobile satellite operators and TV broadcasters to give back their spectrum and, in return, receive a portion of the proceeds from the auction.
Some TV broadcasters, who use spectrum that would be prime for mobile broadband services, have excess spectrum since the transition to digital TV. The change to digital broadcasting allowed them to more efficiently use spectrum. Some have opted to broadcast additional channels, but others are letting the excess spectrum go unused.
Critics of the plan, including Gary Shapiro, head of the Consumer Electronics Association, wonder why the broadcasters should be compensated for giving up spectrum that they didn't have to pay for in the first place.
"What we worked to do was to put together an actionable plan that could move quickly and get to the result that we need, which is freeing up a substantial amount of spectrum for mobile broadband," Genachowski said. Rather than propose an unpopular idea that would require years of debate, the agency decided to start with a plan that was likely to be approved quickly, he said.
He's hopeful that if Congress passes the legislation soon, an auction could happen in a year or two. "That's the pace at which we need to move for the country, given the incredible increase in demand," he said.
The FCC has already begun putting in place mechanisms to start implementing the plan quickly, he said. It would start by liberalizing rules to allow the spectrum to be used for mobile broadband. It would also move quickly to allow broadcasters to share spectrum with each other in order to more efficiently use what they have.
Genachowski pointed to growing demand for mobile broadband stemming from the proliferation of data-hungry devices such as tablets. While the amount of spectrum for mobile broadband in the FCC pipeline amounts to three times as much as was available a few years ago, some forecasts predict a 35-fold increase in mobile broadband traffic over the next five years, he said.
"I believe that projection is conservative, not fully accounting for the explosive growth of tablets and other devices," he said.
Genachowski outlined dire consequences if the government doesn't manage to free up more spectrum for mobile broadband. Consumers will have to choose between poor service and high prices, he said.
"But I think the even bigger risk is that if we don't have a world class infrastructure here for mobile and broadband, if we don't have a very large market for cutting-edge devices and services, we run the risk that the next generation of innovation, the next great companies that are developing new innovation, new products, new services, new apps, will start in another country and not here," he said.