Edwards to the FCC: Free Our Spectrum
by Matt Stoller, Wed May 30, 2007 at 10:32:44 AM EDT
This is very exciting news. John Edwards is the first Presidential candidate to ask the FCC to unlock the incredible block of spectrum coming open in the next few years. It's a bit complicated, as telecom stuff always is, but basically you have a huge slice of the public airwaves coming free, and the FCC must decide how it's going to be auctioned off. Because the legislation freeing the spectrum was a budget bill, the auction must bring in a certain amount of money, so just making the spectrum open and free isn't an option.
The rules of the auction are key, because if a wireless incumbent like AT&T, Verizon, or a cable-owned wireless carrier like Sprint can muddle up the economics of a wireless broadband network, they will.. If the FCC decides to auction the spectrum off in regional chunks, then Verizon can, say, bid up the price of the Northeast section. Since these networks only because profitable if they are national in scope, a large regional chunk controlled by an incumbent would prevent other bidders from creating an open national network.
A good FCC could ban incumbents from bidding, but that's unlikely. Still, if the bids are not anonymous, then there's possible collusion among the various incumbents. Verizon, AT&T, and Sprint do not want to really use this spectrum, they just want to keep it off the market since that increases the value of their own existing-owned spectrum. So anonymous bidding is important.
And finally, wireless net neutrality would be really useful. This basically means if you bought an iPhone you could use it on any network. Locked in pricing, bans on innovation, and total telecom control of the network would be gone if this rule were in place.
Edwards is visiting Silicon Valley today, so his press release is stamped 'Mountain View'. He won't be the last to speak out on this critical auction.
Dear Chairman Martin:
The upcoming 700 megahertz spectrum auction presents a once-in-a-lifetime opportunity to shape the next generation of American technology.
In recent years, the Internet has grown to touch everything and transform much of what it touches. It's not the answer to everything, but it can powerfully accelerate the best of America. It improves our democracy by making quiet voices loud, improves our economy by making small markets big, and improves opportunity by making unlikely dreams possible.
As you know, the Federal Communications Commission is now preparing to auction the 700 megahertz slice of the spectrum. This "beachfront" band is particularly well suited to wireless broadband because it has wide coverage and can easily pass through walls.
By setting bid and service rules that unleash the potential of smaller new entrants, you can transform information opportunity for people across America -- rural and urban, wealthy and not. As much as half of the spectrum should be set aside for wholesalers who can lease access to smaller start-ups, which has the potential to improve service to rural and underserved areas. Additionally, anyone winning rights to this valuable public resource should be required not to discriminate among data and services and to allow any device to be attached to their service. Finally, bidding should be anonymous to avoid collusion and retaliatory bids.
I urge you to seize this chance to transform the Internet and the future.
To offer a bit of historical context, telecom/media issues had not been discussed by the public in any serious way since the 1930s. After the fight over radio, when big companies began monopolizing everything and captured our regulatory agencies, the public was cut out of the process. Both television in the 1950s and cable in the 1980s were huge moneypots delivered to business elites, without substantive input or discussion. The internet was basically an accident, developed off grid by the government.
The first time the public really engaged in a mass scale in structural media issues since the 1920s was in 2003, on media consolidation rules. Millions of people moved on this because they felt betrayed by the Iraq war and the trivialization of our politics and media. And then in 2005-2006, we had net neutrality, and now the Presidentials are beginning to weigh in on spectrum.
This is a big deal. We're at an inflection point.