FCC Chairman Julius Genachowski has done a remarkable job in sounding a very consistent and clear alarm that our national romance with wireless communication is headed for a meltdown unless we make a lot more spectrum available for mobile. His agency has estimated that that demand for wireless data could begin outrunning the spectrum available in just a couple more years. Responding to a handful of deniers, Genachowski recently told a Stanford University conference: “No one can factually dispute that we have a spectrum crunch.”
Further, consumer excitement over the iPhone 5 clearly signals that even more pressure on our spectrum supply lies ahead. Even before Apple unveiled the latest upgrade, forecasters were predicting that mobile data demand would climb an average of 74 percent a year through 2016.
But Genachowski’s foresight in identifying the challenge isn’t enough. We need a convincing solution — especially in the short term. We need to find spectrum anywhere we can and get it to wireless service providers as fast as humanly possible. There is no single solution, so we better try “all of the above.”
The challenge is daunting, the FCC’s National Broadband Plan, released in 2009, said commercial wireless service required an additional 500 MHz of spectrum over the next decade, but was only able to identify 200 MHz that might be available for allocation that didn’t belong to some government agency. It urged new government-run auctions, an approach strenuously embraced by Genachowski and authorized by Congress this year. But as observers have stated, the approved auction probably won’t provide more than 60 MHz —‚ barely a tenth of what we need. And, even that won’t happen fast. In the past, it’s been 5-10 years between identifying spectrum for auction and getting it into service. The FCC aims to do better this time, but we shouldn’t put all our eggs in that basket.
Spectrum sharing was also pushed hard in a recent PCAST report by academic experts. Since federal agencies, which hold the lion’s share of spectrum, are reluctant to give it up, the report suggested they share it with commercial providers. It’s an idea worth exploring. But it would take years to figure out the mechanics and if you’ve ever tried to convince your children to share their toys, you know it may be easier said than done. During a speech at Stanford, Genachowski described sharing as “an additive,” not an answer.
In the near term at least, let’s let “the market” work. When somebody in our economy needs a valuable resource to serve customers they are more than happy to buy it from somebody who already has it, but doesn’t need it. It’s fast, too, because regulators don’t have to find it, persuade somebody to give it up, or write rules for an auction.
It’s also a way for Chairman Genachowski to turn his concerns over a spectrum shortage into a viable strategy because his agency must review and approve such deals. The FCC just approved transfer of spectrum from cable companies to Verizon — though it took approximately eight months to do so. Faster action and a clear signal that the FCC is inclined to approve additional transfers would help create a spectrum road map — market transactions now, auctions up ahead, and sharing as an option to explore.