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FCC reaches deal with satellite industry to free up more 5G spectrum

The C-band spectrum is seen as critical to the deployment of 5G.

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The FCC will pay satellite operators billions to transition to other frequencies in order to auction the C-band spectrum to wireless carriers deploying 5G.

Mark Peterson/Getty Images

The Federal Communications Commission has struck a deal worth billions of dollars with a group of satellite companies to free up spectrum that can be used for 5G service. On Thursday, FCC Chairman Ajit Pai released details of the plan, which entails satellite companies giving up valuable spectrum. 

The plan calls for the FCC to pay satellite companies $3 billion to $5 billion in compensation for abandoning the so-called C-band spectrum and moving to another frequency so the airwaves can be auctioned. The FCC also said it would pay another $9.7 billion in accelerated incentive payments to operators in the C-band.  

The money to pay for this move would come from the auction, which will divvy up the spectrum licenses for 5G use. 

Satellite companies including Intelsat and SES use the C-band spectrum to serve TV broadcasters and cable network operators with video feeds. The FCC is asking these companies to modify their use of this spectrum in order to prevent interference from cellphone use.

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But the negotiations over how much spectrum these companies would have to give up and how they'd transition their use of the spectrum has been going on for months. Meanwhile the wireless industry has been pushing for this spectrum to be reallocated so they can use it to build their 5G networks. 

The C-Band spectrum, which is in the 3.7-4.2GHz range of frequencies, is considered midband spectrum, which many say is crucial to the deployment of 5G. Wireless carriers need a mix of wireless spectrum that consists of very high-frequency spectrum, low-band spectrum and midband spectrum to deliver the coverage and speeds necessary to make 5G a reality. 

The C-Band spectrum is also very important because it's a swath of spectrum that's commonly available around the globe and is already earmarked for 5G service in several countries. The Global Mobile Suppliers Association said in a report last month that 23 countries have already auctioned or allocated C-Band spectrum for 5G mobile usage. The countries which have already held C-band auctions include Australia, Italy, Germany, Finland, South Korea and the UK.  France is on the verge of allocating spectrum licenses.

Congress has also been pushing the FCC to reallocate the C-band spectrum for 5G. A bipartisan bill was introduced last week in the Senate to provide money to help move satellite providers.

Verizon CEO Hans Vestberg called Pai's C-band proposal "monumental." 

"Chairman Pai's historic announcement sets forth a bold vision for bringing much needed mid-band spectrum to auction this year," he said in a statement. "Most importantly, his plan ensures that this critical spectrum is not only auctioned quickly, but cleared on an accelerated basis. This speedy transition will undoubtedly ensure that the US will preserve its global leadership in 5G and will produce hundreds of billions of dollars in economic benefits for the country."