Will the US someday have an open wireless broadband network to compete with the existing telco giants? The FCC has at least left alive that possibility. The government is planning to auction a broad swath of spectrum currently occupied by UHF TV, and today, in a 4-1 decision, the commissioners adopted the limited open access provisions proposed three weeks ago by FCC Chairman Kevin Martin. The auction rules the commissioners settled on fall considerably short of those urged by consumer groups and the tech crowd—primarily Google and Frontline Wireless, an ambitious startup backed by Silicon Valley giants James Barksdale, John Doerr, and Ram Shriram. Nonetheless, the full impact of today’s decision probably won’t be known until months from now, when the auction finally begins.
The tech industry’s most controversial request was that the FCC require the winner of one large block of spectrum—the 22 MHz that are subject to open-access requirements—to make its network available to other companies at wholesale rates. By requiring the network to be open not only to all devices and services but to all players, the thinking went, the government could ensure that competition to the telcos emerged. In the end, the wholesale provision had the support of the two Democratic commissioners, Michael Copps and Jonathan Adelstein, but not of the three Republicans. So a compromise was needed—but by failing to specify that the winner make its network available to other companies, Adelstein said in a statement, “I am afraid we may have missed a golden opportunity to open that elusive third channel into the home.”
Reed Hundt, vice chairman of Frontline (and former chairman of the FCC), was sanguine nonetheless. “This shows by far the most significant impact of the tech industry on the FCC since the invention of the Internet,” Hundt told me this afternoon. “The idea that open access would be applied to a huge block of spectrum is a true accomplishment, and the credit goes to the tech industry, including Google"—which had recently announced it would bid at least $4.6 billion if open-access provisions were included.
“However,” Hundt added, “this is a highly contingent victory, and it depends entirely on tech meeting the challenge. The FCC is saying, if you want these rules, you have to pay the money. It means, in stark terms, put up or shut up.”
Even without the wholesale provision, the open-access rules Martin proposed drew plenty of heat. Steve Largent, president of the wireless industry trade group CTIA, accused Martin of “crafting special rules...to address problems that don’t exist in our competitive market.” AT&T actually backed Martin's plan, a sign that it wasn't terribly radical after all. But Verizon charged that Google was pressuring the FCC to adopt rules “that force all bidders to implement Google's business plan”—thereby reducing the incentive of other players (read: Verizon) to bid. And in a Wall Street Journal op-ed piece headlined “Broadband Baloney,” FCC commissioner Robert McDowell, who ended up the lone dissenter in today’s vote, called upon the nation to “put aside flawed studies and rankings, and reject the road of regulatory stagnation” by cutting out rules that would ensure competition. “Belief in entrepreneurs and a light regulatory touch is the right broadband policy for America.”
It’s been awhile since anyone, even an FCC commissioner, tried to paint the likes of Verizon as entrepreneurial. The nadir of the debate, however, may have come last week, during a Senate Commerce Committee hearing on the upcoming transition from analog broadcasting to digital. The move to digital is key to the spectrum auction, since that’s what is freeing up the spectrum that will be auctioned. With it, however, comes the horrifying (to elected officials) specter of major voting blocs suddenly bereft of TV. The proceeds from the spectrum auction are earmarked to pay for converter boxes that would enable America’s remaining analog TV sets to pick up a digital signal—which is why Alaska Senator Ted Stevens and others on the committee were so concerned that if the FCC set open access conditions, it might discourage some bidders and keep the government from getting top dollar.
Nonstop TV for analog laggards, or wireless broadband freed from the constraints of the telcos? In the end, it's just a question of priorities.
Photo: Megan @ Flickr
