Buildout Requirements Mean More Vibrant Secondary Market for Spectrum, AT&T’s Marsh Says
AT&T likes buildout requirements as part of spectrum licenses sold in FCC auctions, Vice President Joan Marsh said Thursday at a Silicon Flatirons conference on “Property Rights in Spectrum, Water, and Minerals.” Marsh also questioned whether proposals to make government agencies “pay for” the spectrum they use would mean more efficiency.
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AT&T won’t “sit on” the spectrum it buys and not put it in play, Marsh said. Use-it-or-lose-it mandates are a “very efficient mechanism to force secondary market transactions,” she said. “A significant part of our [spectrum] portfolio has come from secondary market transactions.” Marsh said AT&T is sometimes accused of “sitting on” spectrum. She cited as an example the 700 MHz licenses AT&T bought in the 2008 auction. “We didn’t build them immediately because they were the licenses we had reserved for next-generation technologies,” she said. “We were waiting for those technologies to mature. You have to do spectrum planning. You have to do short-term and long-term planning.”
AT&T has also put significant emphasis on efficiency, Marsh said. “We must be efficient with our spectrum to be able to put the type of capacity out there that’s needed today,” she said. “We're really working to try to squeeze every bit of efficiency out of our spectrum.” Efficiencies are achieved by using improved technologies like LTE and by building a “denser and denser” network, she said. “We are really driven by the customers that we serve and by the economics of our business to be very efficient with that spectrum,” she said. “Other users … not so much.”
The federal government is one of the largest users of spectrum, Marsh said. “They have enormous allocations and there is really no efficiency test at all,” she said. “There’s really no economic incentives and very little … consumer incentives. They have to serve their base, but there’s no requirement that they get the most efficiency out of their spectrum going forward.” AT&T understands that many government missions are critical, but it remains difficult to assess how efficiently federal agencies are using spectrum, she said.
Marsh questioned whether proposals to make agencies pay for the spectrum they use would work. “It’s going to become a budget item,” she said. “If you put fees on there, you put whatever financial requirements on the spectrum, I think it just becomes a budget item and it gets lost.” Some government use of the spectrum could be shifted to commercial networks, she said.
Rob Alderfer, principal strategic analyst at CableLabs, said the FCC should consider permanently dedicating key Wi-Fi bands like 2.4 GHz and 5 GHz to unlicensed use, given the huge importance of Wi-Fi to wireless Internet today. “There are new technologies coming online now that can actually pose a real threat to Wi-Fi,” he said. “I'm thinking about a nascent technology known as LTE unlicensed,” he said. “LTE is a scheduled technology, meaning it’s centrally coordinated, whereas Wi-Fi is very polite. Anytime you're using Wi-Fi your device is listening to see if there’s an available channel before it transmits.” Unlicensed LTE could “schedule itself continuously in unlicensed spectrum to the detriment of Wi-Fi,” he said. “That’s something that I think needs a little more exposure and discussion."
Alderfer also said spectrum sharing is too often “looked at as a panacea,” though sharing can mean different things. “People, I think, may tend to easily default to ‘let’s just share and it will be a lot easier to all achieve our goals,'” he said. “But really, the devil is in the details in terms of how that sharing is achieved and how the rights are parsed."
Pantelis Michalopoulos, partner at Steptoe & Johnson, quoted from William Howard Taft when he was chief justice of the U.S. Taft said, “Interpreting spectrum law is like trying to interpret the law of the occult,” according to Michalopoulos. “The fact of the matter is that there are no property rights for spectrum today under existing jurisprudence,” he said. But if spectrum licenses came with rights, some of the most difficult problems could be resolved, he said. “Harmful interference could be viewed … as a taking issue,” he said. “The inefficiency of the government would start to be thought about as being due to the lack of property rights that are being paid for by the users.”(hbuskirk@warren-news.com)