Under pressure from Congress and telecom carriers, FCC Chairman Kevin Martin decides to drop a vote on a proposal to impose a free wireless broadband mandate on the FCC's next spectrum auction.
Federal Communications Commission Chairman Kevin
Martin finally gave in to pressure Dec. 12 from both Congress and the Bush
administration to cancel a scheduled Dec. 18 agency vote on a controversial proposal
to impose a free wireless broadband mandate on the FCC's next
spectrum auction.Martin's decision to cancel the vote came after
Sen. John D. Rockefeller, D-W.Va., the incoming chairman of the Senate Commerce
and Science Committee, and Rep. Henry Waxman, D-Calif., who will be heading the
House Energy and Commerce Committee, co-signed
a letter to Martin
stating it would be "counterproductive" to
vote on "complex and controversial items that the new Congress and new
administration will have an interest in reviewing."
A day after receiving the letter, Martin's office
quietly tabled the vote.
"We received the letter from Senator Rockefeller and
Congressman Waxman today and spoke with other offices," Robert Kenny, an
FCC spokesman, said in a Dec. 12 statement. "In light of the letter, it
does not appear that there is consensus to move forward and the agenda meeting
has been canceled. The items will remain on circulation and the
Commissioners can still vote on them."Under Martin's plan, the winning bidder of 25MHz in
the 2,155 to 2,180MHz advanced wireless services band would be required to
provide a free wireless broadband tier to 50 percent of the United States in
four years and 95 percent of the country within 10 years. The proposed free
broadband network would support itself by advertising and offering faster
speeds on pay tiers. The free tier of broadband services would be family
friendly, with the FCC requiring the winning bidder to filter out pornography.Martin
first proposed the idea in May but ran into stiff opposition from incumbent
wireless carriers worried about interference with their own networks. In
particular, T-Mobile, which paid $4 billion to win the airwaves adjacent to the
spectrum that will be up for auction, fiercely opposes Martin's plan.Republicans
in Congress also oppose the spectrum auction mandates, preferring the FCC
auction the airwaves to the highest bidder with no strings attached. Lame duck Secretary
of Commerce Carlos Gutierrez stepped into the controversy with a Dec. 10 letter
, urging the FCC chairman to reconsider the proposal in light of
the Bush administration's position that spectrum should be allocated by markets
rather than governments."The history of FCC spectrum auctions has shown that
the potential for problems increases in instances where licensing is overly
prescriptive or designed around unproven business models," Gutierrez
wrote. "In contrast, open and highly competitive auction processes have
supported both greatly expanded broadband services and the taxpayers' interests
in spectrum license allocation."Martin's
plan closely mirrors a 2005 proposal by Silicon Valley start-up M2Z Networks.
The catch, though, was M2Z didn't want to bid on the spectrum. Instead, M2Z
proposed that the FCC lease the spectrum to the company in return for 5 percent
of the gross receipts. M2Z now says it is now willing to bid on the spectrum.
The company is backed by Silicon Valley powerhouse venture capitalist Kleiner
Perkins Caufield & Byers.AT&T
and Verizon have also opposed the auction plan, as have the CTIA, the carriers'
principal trade association, and several Republican members of Congress. In
addition to interference concerns, the carriers have raised questions about
M2Z's ability to raise the capital needed to build a nationwide wireless
members of Congress, though, have shown an interest in the M2Z proposal with
Reps. Anna Eshoo (D-Calif.) and Chris Cannon (R-Utah) introducing legislation
that would require the FCC to auction fallow spectrum (like the 2155-2180MHz
band, for instance) to provide free, filtered broadband for 95 percent of the
country within 10 years.