|CTIA CEO Steve Largent
In some ways, this seems a golden age for the wireless industry.
The smartphone revolution has made mobile computing a reality, a necessity, for many. The devices are now less a status symbol than a way of life. For a growing number of users, the smartphone is coming to rival the PC as their primary computing device, with the landline a fading memory.
But as wireless networks increasingly become the on-ramp to the Internet, the industry has come under growing scrutiny from regulators and lawmakers. Open Internet advocates have become sharp critics of restrictions on the applications users can access on wireless networks.
VoIP provider Skype has a petition pending with the Federal Communications Commission that would require wireless providers to open their networks to new applications.
[cob:Pull_Quote]Others, including many smaller wireless providers, have protested the practice of the big carriers locking up chic new devices like the iPhone in exclusive agreements with the handset makers.
Lawmakers have held hearings. The Justice Department has gotten involved. Under new leadership, FCC has signaled its intention to take a close look at the industry, most recently issuing notices of inquiry (NOI) soliciting comment on how it should act to spur competition, innovation and investment in the sector.
InternetNews.com recently sat down with Steve Largent, president and CEO of CTIA, the trade association representing the wireless industry, at his Washington office.
In the interview that follows, Largent, a former congressman and a NFL Hall of Fame wide receiver who shattered every major receiving record in his 13-year career with the Seattle Seahawks, discusses his views on the industry he represents.
After the first meeting of the newly reconstituted FCC, we saw those NOIs looking into competition, innovation and investment. As the commission gathers information and looks toward policy decisions, what steps would you most like to see it take that will benefit the industry you represent and the consumers it serves?
First of all, I would say about the NOIs, we look at is as an opportunity to tell our story to the full FCC as it’s been reconstituted with three new members. So we’re looking forward to taking advantage of that opportunity.
But the thing that we’re going to press the FCC on the most vigorously over the long term is this issue of finding additional spectrum for the wireless industry. We feel like in the long term that is the most important and salient issue of this industry, ensuring that we have a path forward to find additional spectrum as we offer more and more services at higher speeds to more customers. We’re going to need additional spectrum.
I think that the last spectrum that became available and was auctioned in the last three years took somewhere between eight and 11 years to come to fruition, to come to the point where we were able to purchase it at auction. We can’t afford to wait that long for the next available spectrum.
England, Germany and Japan all have somewhere between 300 and 360 additional megahertz of spectrum they’re going to make available to their wireless industries in their countries, and we need to see the same sort of effort in this country, because we’re just going to be constrained.
Nobody does as good a job as the wireless industry of utilizing this limited resource as well as we do. But even given that, with the demand for additional services, and the number of people carrying handsets, we’re going to need more spectrum.
When you look to the FCC and Congress where many members and officials have expressed some concerns about various issues in the wireless sector, what policy proposals — either on the table or in the offing — scare you the most?
That’s a good question. I would guess Net neutrality, and the conversation about proposing legislation to impose a Net neutrality rule on the wireless industry would be the most threatening to the core of our industry.
Because wireless is different from so many other industries, from cable, from even wireline, in that our industry relies on the ability to manage its network to allow the calls and services to go through. And if we’re not allowed to manage the network — and Net neutrality at its basic core is about, ‘You don’t manage it, you just supply it’ — it could bring down our network.
We don’t see that that’s in the best interest of anybody in this country, whether it’s our public safety or individuals with phones to allow a few users — the so-called ‘bandwidth hogs’ — to dominate this industry and take over a network. We don’t think that serves the public good.
Do you envision in the next big spectrum auction the same fight over open access that played out with the C Block in 700 MHz?
My hope is that the government learned its lesson from the C Block experiment. The fact is that they can auction the spectrum but they’re going to get a lot less money for it when they put all these different constraints on the spectrum.
[cob:Special_Report]If they’re just willing to open up the auction to have any bidders and all bidders bid on it to use the spectrum for CMRS that that’s the best and most fruitful way to conduct an auction.
So you oppose conditions?
Yeah, when they impose conditions, they’re going to get less money. And I don’t think that’s the goal of spectrum auction, it shouldn’t be. I don’t think that’s what the government wants, particularly this government, with the financial constraint that it’s under.
You’re not an advocate for the Treasury Department, you’re an advocate for the wireless companies. Think back to your convention in April of last year, when [then-FCC Chairman] Kevin Martin gave a speech that was met with applause when he announced his intention to oppose Skype’s petition.
The argument that you make about the auction raising more money for the Treasury is certainly one that people in the government might be receptive to, but why is it that the members of the industry you represent are so opposed to conditions like those that Skype is trying to impose?
It depends on what your goal in having an auction is for. If your goal is to raise the maximum amount of money, then you need to have the rules be the least invasive. And I think that is what the goal of having a spectrum auction should be — give the spectrum to people that want it and need it, and let them put it to work and make it available to customers.
I don’t think having the government prescribe what it should look like, what you should offer, what you can’t offer, what rules you have to be under — I just don’t think that’s a good way to develop a highly competitive industry.
Page 2: Skype, “the oligopoly” and the Super Bowl
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|CTIA CEO Steve Largent
At the time, Martin said that he felt that the industry on its own was moving in that direction, so he didn’t feel at the time that it was necessary for the FCC come in and take a strong stance on something like Skype’s petition. Democrat Copps disagreed.
Would you still agree with Martin’s assessment of a year and a half ago?
I actually think we’ve even gone further than what he liked about what our industry was doing at that point. We have 630 handsets, and over 100 handsets you can download Skype onto and use Skype. It is a very competitive industry. I think if you’re looking for a particular feature, you can probably find it on one of our handsets that’s offered by one of our companies.
On the handset exclusive issue, there is some division in your association. At the June Senate hearing we heard [Cellular South President and CEO] Hu Meena refer to the system as it exists as an “oligopoly,” complaining that nine of the top 10 handsets were locked into single-carrier exclusives, of which his company had none.
From an advocacy standpoint, how do you view your role in this debate?
I have to be very careful here because you’re putting me between members of our association here. I have to be very guarded about what I say. I’m proud to say that our industry is working on this issue, and we’ve seen some movement in the right direction, from Verizon specifically. And I would not be surprised to see other companies move in the same way toward our Tier 3 carriers in particular.
That’s all I really feel comfortable saying about that right now. I’m hopeful that they will make announcements in the coming months.
Can you characterize your role as the leader of the association that represents these conflicting interests?
All I’m saying is I’m encouraging the people that are at issue with one another to get into a room and negotiate and try to resolve it amongst ourselves, because it’s always better to resolve it within the industry than to rely upon somebody outside the industry to impose regulations that work and that won’t be harmful in the long run.
Tell me a little about what CTIA is doing with regard to health care.
We are not doing a lot specifically other than heralding the inclusion of the wireless industry in the health care revolution that’s going on. We’re talking about the role that wireless is playing, not only in health care, but in transportation, smart grids and education. Those are the sectors that we’re focusing on right now. And wireless is playing a huge role in each of those particular venues, and it’s something that we want to trumpet.
We are encouraging companies that are involved in those industries with wireless devices to showcase their equipment or services in our show. So you’ll see them at our show in October, as well as next April.
There’s all kinds of stuff out there, it’s just crazy. Think about using your iPhone to deliver blood pressure, heart rate, even I think there’s a device now you can attach to your iPhone that if you’re diabetic you can send test results that you’ve done yourself to your doctor via your mobile device, instantly. Stuff like that is just crazy. It’s very exciting to see where it’s all going to end up.
We’re a couple weeks a way from football season. Who do you like in the Super Bowl?
I’d love to see the Redskins go, and I was not a Redskin fan until [former Seattle teammate] Jim Zorn became the head coach, but I’d sure like to see him be successful.
I think he will be successful. I don’t know if he’ll get to the Super Bowl — I don’t know you can say any team is a lock for the Super Bowl this early in the season, but I’d sure like to see him go. So I’m pulling for the Redskins. I hope your service doesn’t go to Seattle, because I’ll get killed.