The Federal Communications Commission should lift the spectrum cap placed on companies bidding in the 700 MHz auction and the C- and F-block re-auction of PCS spectrum.
It pains me to say that. From its infancy in the early 90s, I have rooted for the little guys to make it in the wireless world. I looked forward to writing about new carriers and the innovations they would bring to the industry. I wanted to see what small businesses could bring to wireless consumers that their large counterparts could not.
But it hasn’t played out that way.
Sure, there have been some new entrants, some bright spots here and there. But even with the spectrum cap and designated-entity status in place, it’s been the AT&T’s of the industry offering services like one-rate calling plans that have changed how we Americans dial.
Maybe I’m just tired. Or maybe it’s time to see what innovations the big guys could bring to the marketplace if they weren’t restrained by how much spectrum they could amass. (I am not for wholesale elimination of the spectrum cap because I think that ultimately could result in two carriers per market in a very short time frame, and the U.S. consumer is better served by having more choices per market.)
CTIA estimates 90 million people use wireless service today in the United States. About 74.5 million of those users-more than 80 percent-are getting service from eight very large carriers.
Five cellular carriers offer service in the top 20 U.S. markets, according to last week’s RCR Top 20 listing. Once SBC Communications Inc. consummates its merger with BellSouth Corp., and GTE is folded into Verizon, three carriers will control the 20 largest cellular markets.
The spectrum cap was designed to protect carriers from becoming too powerful. The reality is those eight carriers are powerful already.
DE status was designed to give small business a chance to enter the wireless marketplace. I wish them the best and hope some smaller carriers give the big telecom guys a run for their money.
But the hard facts are that a handful of carriers dominate the marketplace. Maybe they should have a chance to see what they can offer consumers if they had a little more spectrum to work with.
The C- and F-block re-auction, with its already jaded history, just may be the place to start.
