As is the annual tradition, the chairman of the FCC, the last three years being Julius Genachowski, spoke at the Consumer Electronics Show. As part of his remarks he took the opportunity to launch into an attack of the House Republican proposal on spectrum reform, even as he lauded the Senate plan.
The spectrum reform debate comes down to how radio frequencies allocated to various uses, including mobile phones and wireless Internet access, will be apportioned in a way to create “more” spectrum. Spectrum is a finite array of frequencies which the government claimed control over and now auctions off while holding some in reserve as buffers between “channels” and for government use.
So, why the seeming animosity about the House legislation from the FCC chairman? Simply put, he sees the House plan as an intrusion on the FCC’s current authority and practice of setting the terms for a spectrum auction by “pre-empting in an unprecedented manner” the FCC’s actions. Further he tried to make the case that specific House direction would be detrimental to the future, “designating any new spectrum for unlicensed use risks suppressing any innovation of the sort that gave us Wi-Fi."
He went on to plead that doing incentive auctions is easy and that the FCC needs to do them now, but in the context that Congress should not prevent the FCC from making rules about who can participate, and restrict what conditions the FCC could impose.
Instead of schooling Congress, the chairman instead should have committed to conducting auctions that are not laden with politically driven conditions. Those conditions, which have been increasingly used in the last couple years, drive down the value of the spectrum, in part because they cause bidders to flee, but even when they don’t the conditions alone drive down the value of the spectrum. Devalued spectrum results in less income hence requiring even more taxes to cover government spending, robbing US citizens.
Instead of guarding their own turf, the FCC should begin to guard American innovation by freeing up the raw materials without FCC dreamt-up conditions, and protect American citizens by wringing the most value out of each auction.
January 12, 2012