Obama Administration Calls for Spectrum Reform

A key federal agency has signaled its support for an overhaul of the government’s approach to wireless spectrum, calling for a reallocation in favor of wireless broadband networks that could pave the way for a bitter political fight.

In a letter to the Federal Communications Commission, the head of the National Telecommunications Information Administration (NTIA) said that the broadband market, still dominated by cable and wireline providers, continues to suffer from a lack of competition, arguing that robust wireless networks will be a critical part of President Obama’s goal of achieving universal adoption of high-speed Internet service.

“Given the projections of explosive growth in wireless bandwidth requirements, a primary tool for promoting broadband competition should be to make more spectrum available for broadband wireless services,” NTIA Administrator Lawrence Strickling said in the letter. “The administration supports exploring both commercial and government spectrum available for reallocation, and favors a spectrum inventory to determine how radio frequencies are currently being used and by whom.”

NTIA, a division of the Commerce Department, shares responsibility with the FCC for spectrum allocation.

But efforts to free up coveted slices of the airwaves for broadband service invites staunch opposition from incumbents, namely the Defense Department and TV broadcasters, who have both resisted previous efforts to reclaim spectrum.

The National Association of Broadcasters (NAB), for instance, staged a high-profile lobbying campaign in 2008 to oppose an order the FCC ultimately approved to open the unlicensed spectrum in between TV channels for wireless networks.

The NAB recently filed comments with the FCC calling the choice between broadcast TV and broadband a “false dichotomy.” The group asked the FCC to explore alternative methods to boosting wireless broadband that wouldn’t involve spectrum reallocation, suggesting that it “critically evaluate the wireless industry’s bloated and unsupported claims that it needs additional spectrum.”

In the meantime, Sen. Olympia Snowe (R-Maine), who is co-sponsoring a bill that would require a thorough inventory of the current spectrum allocations in the public and private sectors, this morning delivered a letter to the FCC calling on the commission to conclude several lingering spectrum proceedings while also noting that it will have to take a close look at broadcasters’ allotments.

The flurry of comments comes as the FCC is developing a national broadband plan that will include a spate of policy recommendations and a detailed market analysis, slated to be delivered to Congress next month. The directive for the broadband plan came in the economic stimulus package enacted last February, the same bill that earmarked $7.2 billion for broadband projects, of which NTIA is administering the lion’s share.

NTIA’s comments on wireless spectrum were largely based on an analysis antitrust authorities at the Justice Department submitted to the FCC on Monday. In that filing, antitrust chief Christine Varney urged the FCC to promote spectrum reform as a path to new entrants in the broadband market, and suggested rules to prevent large incumbent carriers to outbid smaller upstarts if the airwaves are sold at auction.

In the last major auction the FCC held, Verizon Wireless and AT&T, the nation’s two largest carriers, bought about three-quarters of the nearly $20 billion of spectrum that was sold.

Both sets of comments from NTIA and DoJ also reflect the increasingly apparent technical reality that the volume of data traversing wireless networks threatens to overwhelm providers’ capacity. That flood of data has led carriers to look to alternative management techniques, such as offloading subscribers to Wi-Fi networks when they are available. AT&T’s struggles to support the iPhone have been well documented. CTIA, the principal trade association representing the wireless industry, has described the situation as a “looming spectrum crisis,” and plans to press policymakers vigorously this year to move toward a new auction.

“A key question looking forward is whether emerging ‘fourth generation’ (4G) wireless services will have price and performance characteristics that might make them a viable alternative to wireline services for a significant number of customers,” Strickling wrote in the letter to the FCC.

“The next several years will test the limits of wireless broadband, including the adequacy of in-building coverage and the ability of wireless networks to accommodate large numbers of data-intensive users.”

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