FCC Shouldn’t Over-Engineer Spectrum Auctions, McDowell Says
The FCC should “future proof” upcoming spectrum auctions by not imposing overly restrictive rules and giving carriers room to maneuver, FCC Commissioner Robert McDowell said in a speech at the GSMA Mobile World Congress in Barcelona. McDowell said he does not want to see a repeat of 2008’s 700 MHz auction, where “onerous encumbrances” imposed by the FCC led to a less successful auction. FCC Chairman Julius Genachowski also spoke to the GSMA.
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"The lesson learned from [the 700 MHz] auction and others is that when governments attempt to conduct social and economic engineering by foisting unnecessarily complicated mandates on the use of spectrum, their efforts frequently backfire,” McDowell said. “Private sector actors have a difficult enough time trying to predict market trends. Governments shouldn’t make matters worse for them.”
Before the 700 MHz auction, the FCC tried to attract a new national wireless player by offering the C-block in big chunks, increase the number of small carriers buying licenses, create a nationwide public safety network through the D-block and maximize revenues, McDowell said. “In reality, what those complex auction rules and conditions produced was: no new entrant in the C-block; fewer small business licensees overall; not even a serious bidder for the public/private partnership to build a public safety network; and reduced revenue for the U.S. Treasury,” he said. “In short, the U.S. government’s attempt at central planning failed.” McDowell said he will work closely with other commissioners on minimal auction rules for upcoming incentive auctions.
Genachowski’s speech was his first on spectrum since Congress gave the FCC the authority to conduct voluntary incentive auctions (CD Feb 21 p1). The law raises some concerns, Genachowski said. The spectrum title “contains provisions that could reduce the amount of spectrum we would otherwise recover for mobile broadband and that could limit the potential benefits of incentive auctions to the mobile industry and mobile consumers,” he said, without offering more specifics.
"Our job at the FCC is to implement the law, and we'll do so faithfully and expeditiously,” Genachowski said. “Our staff of course has already begun studying the new provisions, and you can expect to see the agency taking concrete steps toward implementation in the near future.” Genachowski also warned that the new law “puts some constraints” on the use of the TV white spaces for broadband. Genachowski urged more emphasis on sharing of radio waves between government users and the private sector. “In the U.S., as elsewhere, the traditional timetable for reassigning spectrum from government to commercial use is no longer tenable, and we need to accelerate this reallocation and think creatively about placing incentives on government users to deploy spectrum efficiently,” he said. “We also need to begin serious testing of sharing government spectrum with commercial users.”