Priorities

By Senator Mark R. Warner

As a former tech entrepreneur and a co-founder of Nextel, people often assume I know everything there is to know about spectrum. The fact is, I don’t. But what I do know is that esoteric debates about the government’s spectrum policy have a profound effect on innovation.

Let’s face it: spectrum is a dry topic. Few members of Congress spend much time thinking about it. These days, though, we all spend a lot of time talking about jobs. And every mobile technology and most major startup companies in the last 20 years could not have taken off without the use of spectrum in some form. Groupon uses e-mail to revolutionize bargain shopping. Square has pioneered the use of mobile devices to accept credit card payments. The fact is, the companies that are growing and creating jobs are those companies that successfully leverage technology to create a better consumer experience.

Like land or pockets of natural gas, spectrum is a valuable limited resource. Yet before we knew it was valuable, the government used to give it away for free without any thought to the future. The decision to auction spectrum in the 1980s was revolutionary. As someone who was fortunate to have a seat at the table in the early days of the wireless industry, I should know. But even I could not have imagined the many uses we now have for spectrum.

Smartphone users in major metropolitan areas eagerly purchase the latest mobile devices with their ever-growing capabilities, even as wireless network providers struggle to keep up with unanticipated demands for data. People care a lot when their mobile calls get dropped, and consumers now expect rich multimedia presentations — streaming video, audio, and cloud-based services — putting a severe strain on limited bandwidth.

Like land or pockets of natural gas, spectrum is a valuable limited resource. Yet before we knew it was valuable, the government used to give it away for free without any thought to the future.

These days, spectrum fights can be brutal. Fortune 500 companies spend billions of dollars acquiring spectrum rights. Smaller players and new market entrants worry about access to a resource that, in the face of skyrocketing consumer demand, may surpass water rights in its limitations.

In late March, the National Telecommunications and Information Administration — the federal agency responsible for managing government-held spectrum — issued a much-anticipated report on spectrum availability. The agency made a good-faith effort to study the vast array of federal agencies located in key bands.

The NTIA study noted that the globally harmonized 1755-1850 MHz band, home to more than a dozen federal agencies, is a highly desired swath of spectrum for commercial use.

However, it could cost the government upwards of $18 billion to clear this part of the band over the next 10 years. So not only will it be expensive to access this spectrum: commercial users should expect to share at least part of the band for a significant period of time.

I believe spectrum sharing is a necessary and viable option for users. But as a businessman, I recognize that constraints and overall uncertainty could choke off the investment dollars we need to build out networks that could use this band (or others, for that matter). That means we must strike a balance between critical federal agency needs and commercial demands.

Historically, spectrum fights have been heavyweight bouts. The U.S. military and intelligence services hold the majority of federal spectrum for critical functions, and they often are criticized for their inefficient use of it. Unfortunately, they’re not the only ones. There are simply not enough incentives for more efficient spectrum use.

Interestingly, Congress enacted legislation in February 2012 which allows federal agencies to use funds from the existing Spectrum Relocation Fund to help pay for future agency transition planning activities. This trust fund was created in 2004 by the Commercial Spectrum Enhancement Act. Winning spectrum auction bidders pay into this fund, and federal agencies can withdraw money to help pay for spectrum transition costs.

I am hopeful that allowing agencies to use “forward-planning” funding will encourage a smoother transition. However, it is clear that Congress still needs to work closely with agencies to accurately identify these relocation costs while we clear as much of the band as possible.

We all know the U.S., the birthplace of the internet, is falling behind the rest of the developed world in terms of broadband speeds and access. The Obama Administration and the Federal Communications Commission have been pushing for more commercial access to spectrum, yet it is increasingly clear that we do not have a long term plan to manage this limited resource.

Earlier this year, the internet exploded with consumer concerns about proposed legislation intended to curb online piracy. Without a real spectrum plan, we risk reaching a tipping point where the same forces that spontaneously ignited during the PIPA/SOPA debate are stifled — along with our nation’s economic ability to further innovate and grow.

Just a few short years ago spectrum was a tool no one had to care about. Today, it is something we cannot ignore.