T-Mobile: Don't Ban AT&T, but Don't Be a Spectrum Hog
T-Mobile isn't interested in barring AT&T from purchasing 600MHz spectrum licenses during the 2014 spectrum auctions—a business-altering, if not industry-changing, event that the mobile carriers have been pushing hard for and looking forward to for years.
But that doesn't mean AT&T should be able to buy up all that its money and power would allow, Kathleen Ham, T-Mobile's vice president of federal regulatory affairs, said in a June 4 blog post.
The 600MHz band can carry signals deeper into buildings than spectrum above 1GHz and may represent the "most important block of spectrum to be sold in years," wrote Ham. She added that it has the potential to produce "skyrocketing consumer demand for data-intensive services" and enable better competition in rural and urban markets—"but only if competitive carriers have a viable opportunity to acquire some of this spectrum at auction."
The band's value, and its short supply, makes it "more crucial than ever for the [Federal Communications Commission (FCC)] to get the rules right before commencing the auction," Ham added.
In May, Julius Genachowski stepped down from his position as chairman of the FCC, and President Obama tapped telecom industry insider Tom Wheeler to take his place and Commissioner Mignon Clyburn to be acting chair while the Senate vetted Wheeler.
Clyburn's title went into effect Saturday, May 18, and on Monday, May 20, she has a letter on her desk from wireless carriers—T-Mobile and Sprint included—small businesses and entrepreneurs, asking her to perform a "thorough and comprehensive review and update" of the auction rules, ahead of the high-stakes auction.
The writing parties also feared the buying power of AT&T and Verizon Wireless.
"The nation's two largest wireless carriers already hold 78 percent of the low-frequency broadband-capable spectrum and account for more than 80 percent of wireless industry revenues," they wrote. "These two carriers have every incentive to employ their extensive market power to foreclose smaller competitors from participating in the 600MHz auction."
While T-Mobile's Ham said she doesn't back barring AT&T, neither can she get behind its "all-out campaign to quash any limits whatsoever on its self-perceived right to acquire any and all licenses."
At the same time, she added, "AT&T contends that the 600MHz spectrum is really nothing special, and regulators have no need to worry about excessive concentration of the low-frequency licenses in its hands."
A group of U.S. Congressmen, in a May letter to the FCC, said that the FCC rules don't require the FCC to "allow every carrier to bid or every megahertz of a spectrum band that is made available for auction." And the Department of Justice (DOJ), in an April filing, backed the importance of the lower-frequency band and the competitive advantage it can offer to carriers.
Ham, in her blog post, urged the FCC to give "due deference" to the DOJ's views.
"Notwithstanding AT&T's attempts to portray itself as a victim, the reasonable spectrum aggregation rules proposed by DOJ, T-Mobile and other competitive carriers, would promote broader bid participation—including by AT&T and Verizon—and likely would bring in more revenue for U.S. taxpayers," Ham wrote in conclusion.
When Congress gave the FCC auction authority in the 1990s, it expected it to encourage "a diverse bidder pool and fair opportunity," she added. "Congress still expects [truly competitive bidding] today."