WASHINGTON-The Clinton administration last week officially began the process of trying to secure spectrum from military, commercial, educational and religious users for third-generation mobile-phone systems, a high-priority objective the administration admits will be difficult to achieve in light of incumbent rights and conflicting policy goals.
Gregory Rohde, the president’s telecom policy adviser, bluntly told a packed room at the Commerce Department last Thursday that the challenge of obtaining 3G spectrum will be as tough as the stakes are high for the United States.
“We realize this is not going to be an easy process,” said Rohde, director of the Commerce Department’s National Telecommunications and Information Administration. Rohde said he plans to hold a series of public meetings and meet with parties individually. “There’s a lot at stake here.”
Clinton, concerned about the prospect of losing to Europe and Asia a wireless market some consider akin to next-generation Internet, signed an executive memorandum on Oct. 13 directing federal agencies to identify spectrum earmarked for 3G (698-960 MHz, 1710-1885 MHz and 2500-2690 MHz) at the World Radiocommunication Conference this past summer in Istanbul.
At a minimum, the U.S. government stands to profit nicely from auctioning 3G licenses that promise to provide high-speed voice, data and video services on Internet-friendly wireless devices. But to do so will require more bandwidth (and likely a relaxation of the spectrum cap) than available to carriers today.
3G auctions in the United Kingdom and Germany fetched $80 billion. Some, though, have questioned whether mobile-phone firms can recoup the billions of dollars that will be spent-on top of the billions already sunk into first- and second-generation wireless systems-on a 3G business that may not live up to expectations.
Garnering two of the three global bands for 3G will be a challenge. Moreover, other spectrum (at 700 MHz) eyed for the 3G-but held by TV broadcasters-will be difficult to nail down.
In fact, what began as a civilized process for obtaining 3G spectrum may well deteriorate into the kind of political brawl that Rohde fears could doom the entire process.
Worried about just such a scenario, the Cellular Telecommunications and Internet Association unsuccessfully lobbied for 3G spectrum legislation in a must-pass appropriations bill. The White House opposed legislation sought by CTIA, which nonetheless plans to return to Capitol Hill next year to seek 3G help.
The administration and various industry sectors are working under tight deadlines. With the Commerce Department’s Oct. 20 release of the 3G spectrum plan, mobile-phone companies, incumbent government and non-government licensees and other parties have begun talks with government officials. Posturing is into full swing.
On Nov. 15, NTIA and the Federal Communications Commission will release interim reports on 3G spectrum availability in the 1700 MHz and 2500 MHz bands. The spectrum for 3G is considered as a supplement to 800 MHz cellular telephone and 1900 MHz personal communications service frequencies.
NTIA is overseeing the study of the 1710-1885 MHz band, which is heavily occupied by the Pentagon and relied on by other federal agencies as well.
The FCC has responsibility for assessing 3G spectrum use of the 2500-2690 MHz band, home to thousands of fixed high-speed Internet, educational and religious users.
By year’s end, the FCC will propose 3G spectrum allocation rules.
Final 3G spectrum reports will be issued by the FCC and NTIA by March 1. Meetings between government and industry officials will continue from there, as the FCC and NTIA work toward a decision on 3G spectrum rules.
By June 30, the FCC will issue final 3G spectrum rules as well as propose auction guidelines. The FCC will release final 3G service and auction rules by Dec. 15 2001. The 3G auction will be conducted by the FCC by June 15, 2002, and licenses will be issues by Sept. 30 that year.
While Rohde seeks cooperation and compromise among the various parties, there are few signs 3G spectrum negotiations will follow that direction.
“We are not at all concerned that we will have to move from our spectrum,” said James Fisher, a spokesman for Sprint Corp.
Sprint has invested heavily in both fixed wireless Internet and mobile-phone licenses.
Fisher said Sprint cannot find comparable broadband spectrum to which it could be relocated. “We would be surprised if the FCC comes up with something else,” said Fisher. The cost of relocation, if it is possible, would be borne by 3G mobile-phone firms.
While the mobile-phone industry wants access to all three 3G bands, Sprint PCS believes it can live without some of them.
“2.5 GHz isn’t key for going to 3G for us,” said Jeff Chaltas, a spokesman for Sprint PCS. “We’re not in desperate need for additional spectrum.”
Obtaining spectrum from either the 2500 MHz band or the 1700 MHz band will be a major undertaking that appears to have put the Clinton 3G directive on a collision course with presidential politics and the 1996 telecom act.
With both major-party White House candidates having stressed education and religious tolerance, it could be difficult for either Republican George W. Bush or Democrat Al Gore to force educational and religious users to move from the 2500 MHz band.
“The [2500 MHz] spectrum is invaluable for the provision of fixed-wireless broadband access to unserved and underserved Americans, and for state-of-the-art interactive educational programming,” said Andrew Kreig, president of the Wireless Communications Association International.
A similar problem exists for the Pentagon’s 1700 MHz spectrum, whose value is arguably greater for the military in a post-Cold War era that emphasizes connectedness and information dominance.
Frank Holerness, director of the Pentagon’s Office of Spectrum Analysis and Management, said the Department of Defense is a major stakeholder in 3G spectrum debate. “We just want to make sure we’re doing the right thing for everybody.”
That Sprint and WorldCom Inc. (each has spent $1 billion on fixed wireless licensees at 2500 MHz) plan to offer high-speed broadband Internet service to residents throughout the country raises an interesting policy dilemma.
While the administration wants the United States to be a 3G wireless leader, the U.S. also wants to promotes the competitive goals of the 1996 telecommunications act. So far, little local residential competition has materialized.
Sprint, WorldCom and others planning to offer high-speed Internet service at 2500 MHz can argue they are furthering a national policy that has not been realized to date.
Brian Fontes, senior vice president for policy and administration for the Cellular Telecommunications and Internet Association and a former U.S. ambassador to the WRC, called the president’s 3G initiative a “momentous task.”
Fontes, like Rohde, said cooperation was crucial. He recommended that tasks be divided up on a manageable basis and that government officials have easy access to industry experts on standards and relocation.
