Who owns the airwaves? At the dawn of the broadcast age, the government assumed total control over radio frequencies in order to ensure that only one broadcaster could use a given frequency at a given place and time. This prevented interference, and was deemed by Congress to serve the public interest. The entire span of frequencies became known as ‘spectrum,’ and the government exercises exclusive authority to license blocks of spectrum to broadcasters.
For the past eight decades, regulators have allocated spectrum licenses by handing them out based on arbitrary and political criteria, or more recently by auctioning them off to the highest bidder. To make more spectrum available for next generation wireless technologies such as mobile broadband, Congress voted in 2005 that by February 18, 2009, TV broadcasters must give up their analog frequencies and transmit exclusively using higher quality, more efficient digital signals.
As part of the ‘digital TV transition,’ broadcasters will relinquish a coveted swath of spectrum capable of traveling long distances and penetrating walls. Even though the winning bidders in today’s auction will pay the government $10-15 billion for what the FCC describes as ‘beachfront’ property, they will have no ownership rights over the spectrum they’ve purchased. This is because the government maintains complete command-and-control authority over spectrum allocation and use. Due to a patchwork of bewildering bureaucratic policies strung haplessly together over the past 80 years, most spectrum remains unused, underutilized, or inaccessible.
Innovators require spectrum to deliver faster wireless broadband technologies to their customers, however, the government maintains the authority to saddle this spectrum with arbitrary rules and restrictions. For special interests and corporate lobbyists, the FCC’s rulemaking authority provides an ideal tool to manipulate the government and achieve unfair advantages in the marketplace.
In the upcoming PRI study, Wireless with Strings Attached: Net Neutrality and the Grounding of Wireless Innovation, we expose how special interests have conspired to exploit the auction process, bypass a competitive market, and turn wireless service providers into government-controlled public utilities. If they succeed, future wireless innovations will be dictated by bureaucrats and lobbyists, not driven by popular demand.
These policies beget consolidation and monopolization, and rarely serve the public interest. When companies are accountable to government, and not consumers, they lose a significant incentive to innovate. The dizzying rate of change and improvement in products and services observed in today’s wireless market will be replaced by the stagnant pace of government deliberation.
In Wireless with Strings Attached, we explain how reforming spectrum management could enhance competition, and provide consumers with more choices and lower prices. Only by relinquishing its control over spectrum can the government prevent harmful manipulation of the thriving and competitive wireless industry. Once freed from inflexible restrictions, providers will be able to sell unneeded frequencies in a viable secondary market, and experiment with spectrum to find the best technologies to meet the demands of their customers.
Going, Going, Gone! Spectrum Auction Starts Today
Daniel R. Ballon
Who owns the airwaves? At the dawn of the broadcast age, the government assumed total control over radio frequencies in order to ensure that only one broadcaster could use a given frequency at a given place and time. This prevented interference, and was deemed by Congress to serve the public interest. The entire span of frequencies became known as ‘spectrum,’ and the government exercises exclusive authority to license blocks of spectrum to broadcasters.
For the past eight decades, regulators have allocated spectrum licenses by handing them out based on arbitrary and political criteria, or more recently by auctioning them off to the highest bidder. To make more spectrum available for next generation wireless technologies such as mobile broadband, Congress voted in 2005 that by February 18, 2009, TV broadcasters must give up their analog frequencies and transmit exclusively using higher quality, more efficient digital signals.
As part of the ‘digital TV transition,’ broadcasters will relinquish a coveted swath of spectrum capable of traveling long distances and penetrating walls. Even though the winning bidders in today’s auction will pay the government $10-15 billion for what the FCC describes as ‘beachfront’ property, they will have no ownership rights over the spectrum they’ve purchased. This is because the government maintains complete command-and-control authority over spectrum allocation and use. Due to a patchwork of bewildering bureaucratic policies strung haplessly together over the past 80 years, most spectrum remains unused, underutilized, or inaccessible.
Innovators require spectrum to deliver faster wireless broadband technologies to their customers, however, the government maintains the authority to saddle this spectrum with arbitrary rules and restrictions. For special interests and corporate lobbyists, the FCC’s rulemaking authority provides an ideal tool to manipulate the government and achieve unfair advantages in the marketplace.
In the upcoming PRI study, Wireless with Strings Attached: Net Neutrality and the Grounding of Wireless Innovation, we expose how special interests have conspired to exploit the auction process, bypass a competitive market, and turn wireless service providers into government-controlled public utilities. If they succeed, future wireless innovations will be dictated by bureaucrats and lobbyists, not driven by popular demand.
These policies beget consolidation and monopolization, and rarely serve the public interest. When companies are accountable to government, and not consumers, they lose a significant incentive to innovate. The dizzying rate of change and improvement in products and services observed in today’s wireless market will be replaced by the stagnant pace of government deliberation.
In Wireless with Strings Attached, we explain how reforming spectrum management could enhance competition, and provide consumers with more choices and lower prices. Only by relinquishing its control over spectrum can the government prevent harmful manipulation of the thriving and competitive wireless industry. Once freed from inflexible restrictions, providers will be able to sell unneeded frequencies in a viable secondary market, and experiment with spectrum to find the best technologies to meet the demands of their customers.
Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.