OnQ Blog

Spectrum Legislation Now Is a Win-Win-Win-Win

Feb 15, 2012

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Should spectrum legislation be included in the payroll tax cut extension?  Or should it be used as an offset for an extension of unemployment insurance and the so-called “medicare doc fix?”  Or maybe it should be enacted as a stand alone bill.  Or how about yes to all the above?  Using spectrum legislation as an offset for one thing or another is something Congress is grappling with right now, and I hope will resolve soon.  The answer to the aforementioned questions are entirely above my pay grade, but one thing is clear: Congress should absolutely pass incentive auction authority legislation soon.  Here’s why:

Congress needs to take action before the looming spectrum crisis throws a cold blanket on one of the bright spots in the U.S. economy right now – mobile broadband.    Just consider a few of the truly amazing projections that were just released in Cisco’s “Global Mobile Data Traffic Forecast Update”:

  • ·         The number of mobile-connected devices will exceed the world’s population in 2012, and by 2016 there will be 1.4 mobile devices per capita.
  • ·         Two thirds of the world’s mobile data traffic will be video by 2016.  Mobile video will increase 25-fold between 2011 and 2016 accounting for over 70%t of total mobile data traffic by the end of 2016.

And turning to trends just in the U.S., consider this:

  • ·         More than 40% of all U.S. mobile subscribers now own smartphones (Nielsen)
  • ·         Mobile data usage in the U.S. continues to grow with 70.5% of U.S. mobile subscribers sending text messages, 41.6% using downloaded apps, and 28.5% playing mobile games during a 3-month period in 2011.

As my colleague, Dean Brenner, stated in testimony before the House Energy and Commerce Committee last year, voluntary incentive auction legislation is a “win-win-win-win.”  The four winners are the sellers of spectrum, who get to sell spectrum to a mobile broadband provider, something they cannot currently do; the buyers of spectrum, who get to use it for mobile broadband, something they cannot currently do; the U.S. Treasury (and by extension U.S. taxpayers), who would receive billions in dollars from the auctions; and U.S. consumers, who will benefit by having their ever-more sophisticated mobile phones continue to work wherever and whenever they need them.

A  corollary to that is that failure to pass spectrum legislation, whatever it’s being used to offset, is a “lose-lose-lose-lose.”   Let’s hope that Congress chooses a “win-win-win-win” and enacts voluntary incentive auction legislation soon.

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