Ever since the Titanic sank, the U.S. government has regulated the airwaves within its borders. After the Titanic’s distress signal was drowned out by amateur radio operators, Congress passed the Radio Act of 1912, putting an end to the era of a “cacophony of competing voices, none of which could be clearly and predictably heard,” as the Supreme Court described it. Now that the Federal Communications Commission’s spectrum auction authority is set to expire, Congress must once again cut through the noise to find a path forward for America’s wireless future.
Given the inherent scarcity of airwaves, or “spectrum,” federal intervention made sense to prevent a tragedy of the commons — or tragic shipwrecks. Since 1934, the FCC has governed commercial and other non-federal uses of spectrum, while the Department of Commerce has governed federal use. But it wasn’t until 1993 that Congress gave the FCC the authority to auction spectrum licenses: the right to transmit wireless signals at particular frequencies. This introduced market forces into the process and helped turn the page on the arbitrary bureaucratic decision-making that predated auctions. Since 1994, the FCC has conducted over 100 spectrum auctions, raising more than $200 billion in revenue.
Periodically, Congress must renew the FCC’s authority to auction spectrum. Given the agency’s history as an instrumental player in America’s leadership in wireless innovation, one might think this should be a formality for Congress. But very little is simple in Washington these days, and the FCC’s expiring authority has created an opportunity for various stakeholders to jockey for position.
Stakeholder Spats
In recent years, federal agencies and private stakeholders unhappy with the FCC’s decisions have resorted to hyperbolic rhetoric and circumvention of the proper interagency processes to air their grievances. These stakeholders have peddled unfounded fears that FCC decisions would cripple our electric grid, increase car crashes, cause plane crashes, blind meteorologists to impending natural disasters, cripple GPS and more. A failure to reauthorize the FCC’s spectrum authority would undermine the commission and embolden entities who seek to wrest control of the commercial airwaves from the regulator.
The FCC is the sole regulator of commercial use of spectrum, and auctions are an important tool for the agency as it seeks to maximize the use of the airwaves and the benefits to the American people. Thus, Congress will almost certainly reauthorize the FCC’s spectrum auction authority in the coming months, but two questions remain. First, for how long should this authority be reauthorized? Second, should reauthorization be coupled with any directives to reallocate and/or auction certain spectrum bands?
On the first question, 10-year extensions have been the norm for reauthorization. But Congress is in the midst of critical debates about how to balance the interests of commercial and federal users. Americans are ever hungrier for faster Internet speeds, fueling demand for 5G and next-gen WiFi. Their appetite will only grow as data-intensive applications such as artificial intelligence, virtual reality and quantum computing continue to mature. With little to no unused spectrum left, Congress and the FCC must find ways to make room for new use cases without disrupting critical government functions or causing interference to existing users.
A shorter reauthorization, such as two years, would give Congress, the FCC, federal spectrum users, and commercial interests time to hash out how best to create a pipeline of spectrum to meet the needs of various wireless technologies — from next-gen WiFi to 5G to low-Earth orbit satellites. However, this raises the second question: what auctions, if any, should happen during those 18 months?
This question is the sticking point of the current debate over spectrum reauthorization. The wireless industry has identified the lower 3-GHz band (3.1-3.45 GHz) as ideal for 5G. The problem is that this band is currently used by the Department of Defense for radar systems. While the industry would prefer exclusive access to all 350 MHz in the band, it is a tough sell in Congress when national security is involved. The recent National Telecommunications and Information Administration’s Spectrum Policy Symposium only reinforced that notion, as a Department of Defense official warned that vacating the entire band would cost the agency billions of dollars and take decades to complete.
Legislative Solution
If forcing the Pentagon to fully vacate the band is a nonstarter, then how should Congress proceed? The Spectrum Innovation Act, as it was originally introduced, could serve as a guide.
The initial version, introduced by Reps. Mike Doyle (D-Pa.) and Doris Matsui (D-Calif.), would make at least 200 MHz of the lower 3-GHz band available for non-federal use and provide incentive payments for the DoD to either share or vacate portions of the band. This approach not only provides flexibility to find the right mix of federal and commercial use that will satisfy both the DoD and the telecommunications industry, but it also gives stakeholders time to consider other arrangements for the remaining 150 MHz in the band.
In order for this structure to work, however, Congress would need to remove the provision of the Spectrum Innovation Act preventing the FCC from auctioning spectrum outside the designated 200-MHz band. With that provision removed, Congress could package the bill with a reauthorization of the FCC’s authority. This would not only send a clear message that the FCC’s purview over commercial spectrum is here to stay, but it would also put valuable spectrum in the pipeline for 5G.
Efficient and effective use of spectrum is critical for the U.S. to maintain its global leadership in wireless technology. At a time when countries are competing to dominate the next wave of innovation and federal agencies are increasingly looking to undermine the FCC’s domain over commercial spectrum, Congress can ill afford to leave the agency without the auction authority it needs to continue doing its job. ▪️
