WASHINGTON-The cellular industry, putting the brakes for now on major legislation to avoid unnecessarily provoking the Pentagon, is floating a stop-gap plan on Capitol Hill that urges federal regulators to postpone next month’s ruling on third-generation mobile-phone spectrum and that calls on the departments of Defense and Commerce to conduct a 60-day review of national security implications of changes to military frequency use.
The industry wants the proposal included in a committee report accompanying a fiscal 2001 supplemental appropriations bill moving through Congress. The Cellular Telecommunications & Internet Association previously wrote to President Bush and Federal Communications Commission Chairman Michael Powell to request that the 3G spectrum decision-to be issued by July 31 under last October’s directive by former President Clinton-be delayed to give administration officials a chance to explore all options.
The Clinton plan, prompted by fears that the United States is falling behind Europe and Japan in the uncertain global market for next-generation mobile phones, envisions the FCC holding a 3G auction in June 2002 and issuing licenses by Sept. 30 next year.
“The expedited review should determine whether it is in the national security interest of the United States to make more internationally harmonized spectrum available to industry over the next three to five years,” according to industry-crafted draft report language. “The committee would urge the FCC to withhold from taking any administrative action that might limit the administration’s options in pursuing a possible win-win solution on this important issue.”
The legislative language is intended to give political cover to the FCC, which today does not appear to have any solid options for making 3G spectrum available to mobile-phone carriers. Late last week, Thomas Sugrue, chief of the FCC’s Wireless Telecommunications Bureau, said an announcement on the July deadline should be made in the next two weeks.
Adding a twist to the dynamic issue is an escalating skirmish between the mobile-phone industry and Craig McCaw’s New ICO over the mobile satellite firm’s request to use some of its frequencies for land-based cellular communications. At least one other mobile satellite company is seeking similar regulatory relief. The mobile-phone industry has responded by petitioning the FCC to take away spectrum from a mobile satellite industry that it says has failed in the marketplace.
In a letter to Powell last week, AT&T Wireless Inc., Cingular Wireless L.L.C., Sprint PCS and Verizon Wireless urged the FCC not to grant pending mobile satellite licenses until conflicting spectrum issues are sorted out.
While Commerce Secretary Donald Evans has signaled interest in helping the mobile-phone industry acquire 3G spectrum, it remains unclear where Defense Secretary Donald Rumsfeld-currently conducting a top-to-bottom Pentagon review-stands. Military top brass, fearing military capability will be compromised, are vehemently opposed to surrendering more spectrum to the private sector. They argue radio spectrum is particularly vital in a post-Cold War era that emphasizes mobility, intelligence and real-time information connectivity on the battlefield.
A delay in the 3G-spectrum ruling, which many observers expect to occur, would give cellular lobbyists more time to sell industry’s plan to Congress and the White House. Under the plan, which is mapped out in draft legislation crafted by the industry and due to be introduced later this summer by Reps. Chip Pickering (R-Miss.) and Fred Upton (R-Mich.), the mobile-phone industry would spend billions of dollars to relocate military communications systems from the 1700 MHz band to other, yet-to-be-determined frequencies. The money would be generated in the 3G auction and deposited into a trust fund the Pentagon could draw on to upgrade communications facilities.
“We’re going to have to find a deal to push people around a bit,” said Mike Chappell, deputy chief of staff to Pickering, at a 3G congressional briefing last Friday. Chappell said Pentagon officials he has met with were not open to relocation. “There’s not a willingness to cooperate,” said Chappell.
The 1700 MHz, 2500 MHz and 700 MHz bands were designated for 3G last year by the World Radiocommunication Conference. The mobile-phone industry prefers 1700 MHz because the band is expected to be used widely throughout the world, a factor that would make possible global roaming and lower production costs for phone manufacturers. In addition, industry argues the 1700 MHz band will become less useful to the U.S. military as more and more of the world’s mobile-phone firm’s adopt the band for 3G.
Industry calls its proposal a “win-win” for industry and the Pentagon because it would help DoD modernize communications systems and give operators new spectrum needed to drive high-speed, Internet-enabled wireless devices. But the Pentagon, owing to the fact the industry draft bill would elevate Evans over Rumsfeld in making a final decision on 3G spectrum, may find the proposal hard to swallow.
The Pentagon is clinging to a 1999 law that forbids defense spectrum from being reallocated unless alternative frequencies of technical comparability can be identified-and agreed to-by the secretaries of defense and commerce and chairman of the joint chiefs of staff. Such a finding then would have to be certified to Congress. The industry wants that hurdle removed
The battle between the mobile-phone industry and the Pentagon is playing out against a backdrop of other political dynamics that could influence the outcome of the 3G-spectrum tug-of-war or at least provide some clue to how the matter might be resolved.
For example, Rumsfeld’s plan to overhaul the military could cost more than $100 billion. The price tag was not factored in to the $1.35 trillion tax-cut signed by President Bush, suggesting the administration is likely to be looking for cost savings-such as industry-funded upgrades to military communications-to avoid the embarrassment later of finding out he cannot pay for the tax cut.
In addition, both Rumsfeld-by his push to instill civilian control at the Pentagon-and the president-by his decision last week to cease bombing exercises on the Puerto Rican island of Vieques-have signaled they are not afraid of making decisions that might offend military leaders and armed services supporters in Congress.
On the other hand, Rumsfeld-having come under fire in recent weeks from Capitol Hill and top brass-may feel inclined to oppose giving up spectrum to industry as a gesture to regain support internally and on Capitol Hill.
