Selling Off Spectrum

Posted on August 2, 2011. Filed under: Uncategorized | Tags: , , , , |

By Scott Orr

For sale: Wireless spectrum, little used; contact the Federal Communications Commission.

The debate over the budget deficit and debt ceiling largely focused on parallel means of balancing the federal budget: spending cuts and tax increases. But there’s another option: selling stuff.

To that end, the FCC has proposed so-called “incentive wireless spectrum auctions,” to raise billions of dollars for the federal government by selling wireless spectrum that is currently collecting dust.

Here’s how it would work: TV broadcasters would give up licenses for TV channels that they are not using to be sold to wireless providers to grow wireless broadband networks. The proceeds would then be split between the federal government and the broadcasters who relinquished their licenses.

Not only does the plan raise badly needed cash for the government, the improved wireless broadband networks will help drive the emerging wireless internet and the adoption of new mobile devices. This, many believe, is the next generation of the Internet that will spur the economy and create jobs.

The Congressional Budget Office estimates that the incentive auctions could bring in nearly $25 billion over the next 10 years. Language sponsored by Sen. Harry Reid (D-Nev.) that would have raised $15 billion for deficit reduction through spectrum auctions was stripped from the debt ceiling bill.

The National Association of Broadcasters, meanwhile, was not all that excited about the plan, even though giving up licenses would be strictly voluntary. The broadcasters realize that unused spectrum is going to be sold, but they thought their interests would be better protected if the issue were addressed in a free standing bill away from the heat of the debt ceiling debate.

“We are pleased that the negotiated debt ceiling bill, to be considered by Congress, does not threaten free and local broadcasting,” said NAB president Gordon Smith in a statement.

“NAB will continue working with lawmakers on incentive auction legislation that is truly voluntary. Our goal is to ensure that TV stations choosing not to go out of business will be held harmless, and that tens of millions of Americans who enjoy local news, entertainment, sports and life-saving weather warnings from broadcasters will not be penalized,” he said.

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