FCC Chairman Tom Wheeler has been on the job for barely two weeks, but Sprint (NYSE:S), T-Mobile US (NYSE:TMUS), Dish Network (NASDAQ: DISH) and other smaller carriers are already lobbying him to ensure rules that let them get access to 600 MHz broadcast TV spectrum in the forthcoming incentive auctions.
In a letter to Wheeler on Thursday, the companies' top executives--along with executives from U.S. Cellular (NYSE:USM), C Spire Wireless, Bluegrass Cellular, Cellular One, the Competitive Carriers Association and the Computer & Communications Industry Association--urged Wheeler to adopt rules for the auctions that would ensure "that the two dominant wireless incumbents not be allowed to lock competitive carriers out of acquiring low-band spectrum in the upcoming 600 MHz auction."
AT&T (NYSE:T) and Verizon Wireless (NYSE:VZ) have repeatedly said limits on how much spectrum they can acquire in the auction will limit how much revenue the auction generates and will amount to picking winners and losers.
"AT&T and Verizon already hold licenses for nearly 80 percent of the low-band spectrum available for commercial broadband use," the executives wrote. "They have economic incentives to acquire the remaining low-band spectrum in the 600 MHz band to stop our companies--their competitors--from offering truly sustainable, competitive wireless broadband service across America. Low-band spectrum, with its excellent propagation and building penetration properties, is an essential element of the spectrum mix wireless carriers must have to offer wireless customers spectrally-efficient competitive pricing, terms, features, and technology."
"To be clear, none of us has ever suggested excluding the largest two carriers from the 600 MHz auction. Reasonable spectrum-aggregation limits, however, will help ensure that carriers of all sizes have a meaningful opportunity to acquire the low-band spectrum they need to sustain effective and efficient competition," they wrote. "More competition, in turn, means more jobs, more investment , faster innovation, and more economic growth in America. Competition will also enable the Commission to maintain its 'light-touch' regulatory approach to the wireless industry, rather than the aggressive regulation that duopoly tends to engender."
Since taking office, Wheeler has been conspicuously silent on the hot-button issue of limits or bidding restrictions for the incentive auctions. The FCC is still receiving input and developing rules for the auctions, and the debate has been raging for well over a year between the larger and smaller carriers.
Wheeler has said in multiple interviews that one of his chief goals is figuring out how to promote economic growth and innovation through competition, and another is enabling networks to deliver new services.
However, the whole debate over spectrum aggregation limits will largely be a moot point if the FCC can't persuade enough broadcasters to give up their spectrum for auction in the first place. The best-case scenario the FCC is hoping for is for broadcasters to give up 120 MHz of spectrum, but that will largely be determined by how much money broadcasters think they will get for the airwaves in the auction.
"It would be a mess if you gave a party and nobody came," Wheeler recently told FierceWireless in an interview, acknowledging that broadcasters' participation is crucial.
- see this letter (PDF)
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