Advocacy group the Wireless Innovation Alliance is calling on Congress and the FCC to consider unlicensed uses of spectrum in the debate around opening up more airwaves for mobile broadband services.
The value of Wi-Fi to the U.S. is in the "tens of billions of dollars," said Assaf Eilat, a senior economist at economic consulting firm Compass Lexecon and co-author of a paper focused on unlicensed spectrum.
In light of the incentive auctions of TV spectrum the FCC and Congress are mulling, Eilat said that setting aside some spectrum for unlicensed users can increase the returns in auctions because when new spectrum is scarce, demand increases.
"In this case, if unlicensed spectrum is made available, there's going to be competition between bidders for the ... available licensed spectrum, and that's going to drive the prices up," he said.
Stephen Coran, counsel to the Wireless Internet Service Providers Association (WISPA), said many rural areas depend on unlicensed spectrum for broadband services. He cited the fact that three quarters of the landmass in Texas and 38 percent of Illinois are served exclusively by WISPs offering broadband services via unlicensed spectrum.
"Spectrum is the subsidy that is the lifeblood of WISPs across the country," Coran said.
The idea of releasing unlicensed spectrum is under attack from some groups. This past summer, Republican members of the House Energy and Commerce Committee released a spectrum reform discussion draft bill designed to set up a process for auctioning unlicensed spectrum, but Wireless Innovation Alliance member Public Knowledge said the idea was unworkable
Moreover, Randolph May, president of the Free State Foundation, said he's wary of ideas to set aside significant amounts of unlicensed spectrum.
"Generally, licensees that buy spectrum at auctions have incentives to put the spectrum to the highest value use," May told IDG News Service. "Users of unlicensed spectrum generally don't have such incentives."
May also questioned Eilat's assertion that setting aside unlicensed spectrum could lead to higher auction returns.
"While the amount of spectrum auctioned at any one time may affect the bid price, this does not mean it is sound policy to give away spectrum for unlicensed use in order to render more scarce the amount of spectrum available for auction," May said. "Ultimately, the government will receive more auction revenues if spectrum that otherwise might be allocated for unlicensed use is auctioned."
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