The Spectrum Dilemma | Citizens Against Government Waste

The Spectrum Dilemma

The WasteWatcher

An April 1, 2015 Pew Research Center study found that 64 percent of Americans own a Smartphone, and 19 percent “rely to some degree” on their Smartphones to access online services and information.  The study also found that 7 percent of Americans owning a Smartphone do not have either traditional broadband access at home or other “easily available alternatives” for going online.  On October 29, 2015, Pew released its report, “Technology Device Ownership: 2015,” which found that 68 percent of U.S. adults now own a Smartphone. 

The increasing number of mobile broadband users means that additional spectrum will be required to provide them with the services they need in a consistent and timely manner.  But putting spectrum to use from the time it is purchased until it is deployed for consumers takes about 13 years.  The spectrum frequencies must be assigned, bundled, and repackaged to optimize their use by mobile carriers.

In January 2015, the Federal Communications Commission (FCC) completed the auction of 65 MHz of AWS-3 spectrum, garnering more than $40 billion in revenue for the federal government and expanding the capacity of wireless carriers to deliver better and faster service.  The FCC is currently reviewing proposed rules for the upcoming broadcast incentive auction and reverse spectrum auction that could provide more spectrum to mobile carriers.  Despite these efforts, more needs to be done to increase the amount of spectrum available for mobile use.  According to a June 23, 2015 report by the Brattle Group, the demand for spectrum will exceed supply in 2017, and the deficit in spectrum will continue to grow to 366 MHz by 2019. 

As part of the National Broadband Plan, the government is supposed to free up spectrum for mobile use.  To date, up to 500 megahertz (MHz) of this spectrum has been made available for non-governmental use.  According to the National Telecommunications and Information Agency (NTIA), the U.S. government currently has exclusive rights to more than 638 MHz of spectrum and shares another 1,030 MHz with commercial users, accounting for nearly 60 percent of the prime mobile spectrum.  However, not every agency may be willing to share spectrum with the private sector. 

On September 13, 2012, the House Energy and Commerce Subcommittee on Communications and Technology held a hearing on spectrum management.  During this hearing, the Government Accountability Office (GAO) testified that barriers to spectrum sharing exist in federal agencies.  These barriers include risk to an agency’s mission, cost to both federal and non-federal users, use of spectrum frequencies by more than one agency or program, limited budgets that make it cost-prohibitive to invest in new technology that would allow spectrum sharing, and a lengthy approval and enforcement process.  GAO also testified that, “While federal spectrum users often share spectrum among themselves, they may have little economic incentive to otherwise use spectrum efficiently, including sharing it with nonfederal users.”

On June 26, 2013, the Mercatus Center at George Mason University released a study that examined various proposals for reclaiming federal bandwidth, which would expand the amount of underused mobile bandwidth for private sector use.  According to the study, “reclaiming federal bandwidth has been painfully slow, and each year’s delay results in billions of dollars of social cost and forgone auction revenue.”

Just as with the incentive auction process proposed to encourage broadcasters to relinquish their unused or underused spectrum to be repurposed for wireless use, Congress must encourage improved spectrum management within federal agencies and provide incentives for more efficient use.  These incentives could include providing the agencies with a portion of any proceeds received through an auction of unused spectrum. 

An annual or biannual review of government-held spectrum that is “in the pipeline” should be required of all federal agencies holding spectrum allocations, in order to determine whether this spectrum is viable for disbursement to the private sector in future spectrum auctions.  In addition, a relaxation of the rules governing the secondary market for spectrum may be in order, so that companies with excess, unused spectrum would have the ability to trade out some of that spectrum in order to increase access to spectrum where it is needed most.

On October 28, 2015, the Subcommittee on Communications and Technology held a hearing on “Breaking Down Barriers to Broadband Infrastructure Deployment.”  Witnesses and subcommittee members discussed several pieces of legislation that have the potential to aid the spread of broadband across the country.  While the hearing focused mostly on the issues of pole attachments, “Dig Once” proposals for transportation projects, and other efforts to ease the costs and restrictions of building out broadband infrastructure; Subcommittee Chairman Greg Walden (R-Ore.) noted that the committee’s work on spectrum was “far from over.”

On November 2, 2015, President Obama signed the Bipartisan Budget Act of 2015, which raises the debt ceiling and provides a budget for the next two years.  Among the items used to pay for the $80 billion in extra spending, the agreement required NTIA to identify 30 MHz of federally held spectrum to be reallocated for non-federal use.  However, this miniscule amount of spectrum will not come close to addressing future needs.

On November 6, 2015, the Senate Commerce Committee released draft language of legislation that could potentially increase the amount of spectrum available for auction.  According to an article in the Washington Post, the proposal would require the government to free up an additional 20 MHz of spectrum beyond what was already signed into law as part of the Bipartisan Budget Act of 2015, by incentivizing agencies to relinquish their spectrum in exchange for up to 25 percent of the proceeds from auction.

Freeing up additional spectrum to add to the spectrum pipeline is key to continuing to enhance, improve, and prepare for the nation’s future communications needs.  NTIA should continue to work with federal agencies in determining how much of this prime spectrum is really needed by the agencies, rather than letting excess spectrum lie fallow and collect dust. 

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