Spectrum debate likely hot topic for CTIA

ORLANDO, Fla.--While many gadget fans will be looking for the latest smartphones and cool services coming out at this week's CTIA 2011 trade show here, policy wonks will be looking for news in the heated battle between the wireless industry and TV broadcasters over spectrum reallocation.

In recent weeks, the National Association of Broadcasters has called into question the Federal Communications Commission's plan to reallocate spectrum, much of which will come from unused broadcast licenses that have been voluntarily given up. The NAB has called many current spectrum holders, which have participated in previous spectrum auctions, hoarders. The group claims these companies are not efficiently using the spectrum they have already bought.

For example, satellite TV provider DirecTV, as well as cable operators Comcast, Time Warner Cable, and Brighthouse have all bought spectrum in recent FCC auctions and have not yet used that spectrum nor have they disclosed how they plan to use it. Even large carriers such as Verizon Wireless and AT&T have not used all the spectrum licenses they have purchased in recent auctions.

"Maybe you should develop that spectrum before you come to broadcasters asking for 40 percent more of their spectrum," Dennis Wharton, NAB's executive vice president for media relations, told the IDG News Service in a recent interview. "Why is it taking so long, if there really is a national spectrum crisis?"

The CTIA, which represents the wireless industry, and the Federal Communications Commission say spectrum reallocation is necessary because there's a looming spectrum crisis. Without additional spectrum allocated, wireless operators will not have enough airwaves available to meet the rapidly growing demand for wireless data services, these groups say.

While it's clear which side the CTIA is on in this debate, the topic will likely be a hot one at the group's biannual trade show this week where the industry is gathered not only to announce and view cool new products, but also to discuss important policies essential to the industry. (For more detail on what to expect in terms of products at CTIA, check out my colleague Kent German's preview piece from Friday.)

On Monday, I will be helping Chris Guttman-McCabe, vice president of regulatory affairs for the CTIA, host a panel discussion that will include several officials from the FCC, as well as representatives from AT&T and Verizon, who will be talking about wireless spectrum issues and policy.

The spectrum debate
The FCC's National Broadband Report, released last year, recommended that the FCC make 500MHz of new wireless spectrum available within 10 years for licensed and unlicensed use. The plan recommends that 300MHz of that spectrum should become available within the next five years.

One of the most controversial issues to come out of that plan is the reallocation of wireless spectrum. While the report recommends that the FCC reallocate about 20MHz of underutilized government spectrum, it also recommends that the agency get about 120MHz of spectrum from TV broadcasters.

The FCC is currently studying a plan for reallocating spectrum. The commission has said it doesn't plan to force broadcasters to give it up. Instead, it said it would create incentive auctions that would let broadcasters who aren't using some spectrum to voluntarily give it up in exchange for some kind of compensation.

While the NAB is open to a voluntarily approach, the lobby group has been questioning the FCC's premise for even asking for this spectrum, given that spectrum sold in recent auctions hasn't been used yet.

The NAB also says it may be difficult for broadcasters to give up spectrum, since the areas where spectrum is most needed is in cities, where many broadcasters are already using spectrum to provide free TV programming, as well as mobile digital TV.

Broadcasters also believe that as an industry, they've given up plenty of spectrum already. For example, the government forced the TV broadcast industry to move to broadcasting signals in digital rather than analog form, which freed up spectrum in the 700MHz band. That spectrum was auctioned in 2008. Verizon Wireless is using its 700MHz wireless licenses to build its "4G" LTE network.

But the wireless industry and the FCC believe that TV broadcasters, which were given their spectrum licenses for free during the dawn of TV, need to give more of it back for reallocation. In a column published Friday on CNET, CTIA CEO Steve Largent said that TV broadcasters have 294MHz of spectrum in each market, much of which is currently unused.

He claims that the CTIA estimates that revenue "from auctions of broadcast spectrum reclaimed through a voluntary mechanism would gross at least $36 billion for the federal government. This process would [retain] free over-the-air broadcast service while the industry would pay billions to the U.S. Treasury and billions more to the U.S. economy to deploy new technologies. Ultimately, consumers continue to get the world's best products and services. Everyone wins."

AT&T's senior executive vice president for external and legislative affairs said in a blog post Friday that the NAB itself is guilty of under using its spectrum resources and should not be pointing fingers at the wireless industry, which has paid millions for its spectrum licenses.

"NAB (insuates that) the problem isn't their own massive warehousing and underuse of precious spectrum resources," Cicconi wrote in a blog post Friday. "Instead, the problem is everyone else. It's not their 1950s transmission method that's inefficient; the fault is with modern devices that receive their signals. And somehow those companies making the largest capital investments in the U.S., and perhaps the largest private capital investments in American history, aren't investing fast enough to suit the broadcasters."

The CTIA and the Consumer Electronics Association say that the NAB is simply trying to deflect attention from the spectrum crisis. In a letter to Congressional leaders this week, the two groups said that the "NAB has once again endeavored to search for any hint of outlier instances where spectrum allegedly is not being put to productive use--a point that has been consistently refuted."

FCC Chairman Genachowski has also downplayed the NAB's claims. In a speech this week at the Mobile Future Forum, he said that the FCC's recently completed "baseline" spectrum inventory provides enough data to conclude that incentive auctions are needed.

"The spectrum crunch will not be solved by the build-out of already allocated spectrum," Genachowski said. "That spectrum was already built into the FCC's analysis of the spectrum shortage and does not detract from the desirability and necessity of adding the incentive auction tool to the FCC's arsenal."

He said there were "no hidden vacant lots of commercial airwaves." But he said that there are a few "areas well-suited to mobile broadband, such as the TV and [mobile satellite services] bands."

Meanwhile, the NAB says it wants the government to do a full inventory of spectrum to see how efficiently all spectrum holders are using their licenses. Such a broad inventory of spectrum that includes usage by wireless companies and other auction license holders has not been done.

It will be interesting to see how the debate plays out and what the wireless industry will say at this week's conference to flame the political fires. Stay tuned.