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FCC's Wheeler Plans Incentive Auction, Reservation of Low-Band Spectrum

By Josh Long
April 21, 2014 - News

The Federal Communications Commission is moving forward with a plan to hold a highly anticipated "incentive auction" in 2015 that will open up low-band spectrum for wireless providers and give broadcasters an opportunity to relinquish airwaves for a portion of the proceeds.  

The groundbreaking auction will mark the first one since roughly $19.5 billion was raised in an auction of 700 MHz spectrum. That was in 2008 when the iPhone was a baby and before tablet computers flooded the American market.

Spectrum Crucial for Wireless Industry

The spectrum is important to wireless carriers because it can travel longer distances and better penetrate buildings and other obstacles than higher-band spectrum, resulting in lower costs to deploy it, according to Sprint, T-Mobile USA and others in an FCC filing.

"The broadcast TV incentive auction is one of the most significant proceedings in terms of the future of the mobile broadband industry and in terms of maintaining our global leadership in the mobile Internet," said Scott Bergman, vice president of regulatory affairs with CTIA-The Wireless Association, in a phone interview.

Although less than 5 percent of the world's population resides in the United States, the country is home to more than 325 million wireless subscribers and nearly half of subscribers on LTE, a high-speed mobile technology, Bergmann said. Informa Telecoms & Media previously forecast the number of LTE subscriptions in the United States would soar from 89.8 million at the end of 2013 to 242.1 million at the end of 2018.

FCC Chairman Circulates Proposal

Last week, FCC Chairman Tom Wheeler circulated a proposed order to his colleagues that would lay out the terms of the auction, which is expected to be held in the summer of 2015.

Wheeler's proposal includes plans to reserve a portion of low-band spectrum for mobile-phone providers that lack such capacity. That is good news for Sprint, T-Mobile USA and smaller wireless providers that compete with AT&T and Verizon Wireless.

As part of the auction, FCC also will make available nationwide spectrum for unlicensed use, such as Wi-Fi, Wheeler noted in an April 18 blog.

The FCC is expected to vote on an order governing the auction during its May 15 meeting.

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