FCC: Spectrum Auction Plans Big Part of Proposed $346 Million Budget

FCC Chairman Julius Genachowski, in requesting a 2013 budget of more than $346 million, detailed the work the FCC is doing, including preparing for spectrum incentive auctions.

Federal Communications Chairman Julius Genachowski, after putting up his dukes with CTIA President Steve Largent at the CTIA Wireless 2012 show in New Orleans May 8, embraced a different opportunity to detail all that the FCC has accomplished of late and what it has planned. On May 9, he presented the FCC's 2013 budget to the U.S. Senate Committee on Appropriations' Subcommittee on Financial Services and General Government. 

Basically adjusting the 2012 budget for inflation, Genachowski asked for a 2 percent increase to $346,782,000.

But first, he ran through some facts and figures, nearly all of them related to the 2009 National Broadband Plan, the nation's need for more spectrum or both.

In February, Congress approved legislation allowing the FCC to conduct "incentive auctions" to sell underutilized spectrum to meet the nation's growing mobile broadband needs. Genachowski called these an opportunity to "unleash vitally needed spectrum" as well as one to raise billions of dollars for deficit reduction. Over the last two decades, spectrum auctions, he said, have raised more than $50 billion for the Treasury€”though economists regard the value created by the auctions as being closer to $500 billion.

"Incentive auctions are unprecedented," Genachowski continued. "The U.S. will be the first country in the world to conduct them. It will be a complex task affecting major parts of our economy and involving many challenging questions of economics and engineering."

The need for spectrum was behind AT&T's controversial, and ultimately unsuccessful, bid last year to acquire T-Mobile. More recently, it's the motivator behind Verizon Wireless' also controversial partnership with SpectrumCo, a joint venture between several major cable companies. During a Senate Subcommittee inquiry into the Verizon deal, Joel Kelsey, a policy adviser with the pro-consumer group the Free Press, testified that the "trend toward a duopoly in the wireless market would be exacerbated by putting close to a third of the nation's broadband spectrum, measured by value, into the hands of Verizon." 

Just as Sprint fought the AT&T deal, Sprint and T-Mobile have been critical of the Verizon deal, if at times only for the vagueness of the details that Verizon and SpectrumCo have made public.

About the only thing that the nation's top-four carriers agree on is the need for more spectrum. And on this point Genachowski offered good news.

The FCC, he said, is "moving ahead in partnership with NTIA [the National Telecommunications & Information Administration] to test spectrum sharing between commercial and government uses in the 1755-1780 MHz band, a band of particular interest to commercial carriers."

In an address at CTIA May 8, Genachowski offered more details regarding spectrum sharing, explaining that the FCC's work with the NTIA could enable the FCC to auction paired spectrum in the next three years. He continued: 

"Given the huge amount of money and time it would take to move all of the federal systems€”estimated at $18 billion over at least a decade€”sharing is the most promising way forward before deadlines in the Spectrum Act will compel us to auction the 2155-2180 band unpaired. Paired with 2155-2180 MHz, it would extend the AWS band by an additional 50 megahertz. Just this past Friday, T-Mobile, working with CTIA, filed an experimental application to test the sharing concept."

In the interest of expediting spectrum sales, the FCC has also eliminated more than 200 outdated rules and other unnecessary requirements that could slow things down, he also pointed out.

Leading up to his budget request, Genachowski wrote that the FCC has additionally helped to reduce bill shock; launched a nationwide database to help curb smartphone theft; issued recommendations to address botnets, Internet route hijacking and domain name fraud€”three threats to cyber-security€”and more, and done so with the lowest number of full-time employees in the last 10 years.

"Few, if any, federal agencies," Genachowski noted with pride, "deliver a higher return on investment than the FCC."