In March, 37 senators urged President Barack Obama to appoint Jessica Rosenworcel to chair the Federal Communications Commission. The president instead named the well-qualified venture capitalist and industry veteran Tom Wheeler. Rosenworcel is sure to continue contributing mightily to the FCC as a commissioner, but perhaps the president should consider her for another job—attorney general.
This is not another criticism of the controversies embroiling the Department of Justice. Rather, Rosenworcel’s real contribution would be to offer a breath of fresh air in economic policy in the department, especially with regard to the dynamic tech marketplace.
The Justice Department doesn’t get it. Rosenworcel does. And the department’s anachronistic worldview threatens to delay our mobile broadband future.
Our nation faces a serious “spectrum crunch.” Too few radio frequencies are devoted to consumer broadband applications to meet the exponentially growing demand of wireless consumers. Too much existing spectrum is allocated for government or non-broadband uses, limiting consumers’ options. And America lacks a reliable, interoperable public safety broadband network and the $7 billion-plus needed to build it.
To address many of these challenges, Congress recently authorized “incentive auctions,” where broadcasters can voluntarily sell under-used radio frequencies to the highest commercial bidders. Proceeds will be used, in part, to build the public safety network and pay down debt while enabling wireless companies to help fix the spectrum crunch. Win, win, win.
Only some now suggest the auctions should exclude certain bidders. One might expect this from wireless competitors looking to narrow the competition. But on April 11, the DOJ’s Antitrust Division seemingly joined their cause, urging policymakers to impose auction “rules that ensure the smaller nationwide networks, which currently lack substantial low-frequency spectrum, have an opportunity to acquire such spectrum.”
Congress expressly mandated that no bidders be excluded from the auctions. Yet DOJ would do precisely that. Such interventions are frequently unfair and usually unwise, given the difficulty of predicting the future, especially as it relates to technology.
Rosenworcel appears to understand this. In a recent speech, she urged policy makers to first and foremost maximize auction revenue for the public safety network, FirstNet. She further recommended an open and transparent auction process that promotes speed, efficiency and fairness—not picking winners and losers.
She and fellow commissioner Ajit Pai make clear that the real solution to the spectrum crunch is not limiting carriers’ access to new radio frequencies—they will all need more bandwidth to give consumers what they want. Rather government should make significantly more spectrum available to the entire wireless industry on a fair and open basis. Instead of restricting who can bid, let’s find ways to transfer far more spectrum to the commercial market.
The mobile sector is constantly changing. With multiple mergers and spectrum-sharing arrangements in the works, DOJ’s recommendation could steer new frequencies to those with the greatest access to bandwidth. Just last month Morgan Stanley observed that a combined Clearwire, Sprint and DISH network would hold more than twice the spectrum of either Verizon or AT&T, the two companies DOJ aims to restrict.
DOJ’s supporters point out that it could block mergers and deals to protect competition, but how far should government go in controlling our wireless sector? Lawyers propose deciding which spectrum is most valuable, declaring who can buy it and how much they can acquire, then overseeing which companies can merge. Such a managed marketplace is not a formula for global leadership or rapid innovation.
So if we cannot make her FCC chair, let’s send Jessica Rosenworcel to Justice. Or at least hope that the DOJ heeds her counsel for humility, restraint and common sense in the upcoming incentive auctions.
Originally published at The Mercury News