WhyDom

On April 17, 2007, the Wall Street Journal’s editorial team weighed in against proposals by Cyren Call, led by Nextel founder Morgan O’Brien, and by Frontline Wireless, led by Reed Hunt former FCC Commissioner, relating to the FCC’s up coming rulemaking decision about what to do with the upper 700MHz spectrum that will remain after analog television moves to digital.  On September 15, 2006, the FCC issued a Notice of Proposed Rulemaking in FCC Docket 06-150 regarding 700MHz spectrum  that had not been auctioned or that was being reclaimed from television stations moving to from analog to digital.  The auction may take place as early as August 2007, but in no event later than January 28, 2008.  The auction is projected to raise $10b-$15b.

The original 700MHz auction (Auction 31) was scheduled for 2002 but was delayed.   There are several issues involved in the 700MHz Rulemaking such as reclaiming unused televison 700Mhz spectrum.  In addition, there is the issue of not interfering with the current use of the 700MHz spectrum by public safety agencies.   The public safety concerns have been properly addressed and leveraged by Cyren Call and Frontline Wireless.   Cyren Call is proposing that it be given the public safety spectrum and use it to deliver service to public safety but also to sell the service commercial carriers.   Frontline Wireless proposes auctioning the spectrum with the requirement that the winning bidder provide service for public safety.   The WSJ’s position is that requiring the winning bidder to deliver public safety spectrum will dilute the auction and “make it less attractive to larger would-be bidders” and that the public safety portion of the spectrum should be sold not given away as Cyren Call suggests. 

The unused 700Mhz spectrum, where it is available, should be opened to unlicensed use just as 2.4GHz, the range for WiFi, is open and available with required interference constraints on 2.4GHz equipment.    There are three reasons the spectrum should be unlicensed:  1) unlicensed spectrum like 2.4GHz has clearly generated intense usage by individuals and enterprises in terms of actual use of the spectrum – the spectrum has not been wasted,  2) unlicensed spectrum, such as the 2.4GHz range, has generated using rough estimations more than $10b in sales taxes alone from the sale of WiFi chips in every laptop and WiFi routers, and 3) most licensed spectrum purchased by the “larger would-be bidders” (quoting the WSJ) sits on the sidelines and is not used.  As an example, look at 2.5GHz spectrum which was bid on and purchased primarily for MMDS (now BRS) for television but rarely used.   Large bidders can lock-up spectrum for years which discourages innovation, competition, and pricing.