The FCC has walked a fine line between heavy-handedness and helpfulness in its dealings with the wireless industry over the past year. The agency has pledged to open 500 MHz of spectrum for mobile broadband services by 2020; made key moves to encourage the deployment of public safety networks; is trying to expand 3G access into rural areas; and set deadlines for cell tower applications under its shot clock mandate.
The FCC is also looking at net neutrality regulations; may force operators to notify customers when they’re about to exceed their plan’s monthly limit; and has stepped up its scrutiny of the industry’s competitiveness.
Chris Guttman-McCabe, vice president of regulatory affairs at CTIA, says the tower siting deadlines and the move to release more spectrum for the wireless industry top the industry association’s list of the most positive developments to come down the pipe from the FCC over the past year. “The tower siting issue was really important for us,” Guttman-McCabe says, adding that the progress on opening more spectrum “has been pretty positive.”
The FCC’s shot clock for tower siting permits went into effect in November 2009 and gave state and local governments 90 days to approve or deny tower collocation permits and 150 days to rule on all other tower siting applications. The ruling was a victory for the wireless industry, which viewed the rules as an essential tool to stop local governments from dragging out the permitting process for months or even years.
The agency has started to make good on its spectrum promises as well. It is letting LightSquared use its satellite spectrum for land-based LTE services as part of a move to open 90 MHz of satellite spectrum for mobile broadband services. The FCC also moved to remove regulatory barriers for the use of microwave spectrum for wireless backhaul; ended a two-year wait to open white space spectrum for “super Wi-Fi” services; is working on incentive auctions of underused television spectrum; and plans to auction off 16 licenses in the 700 MHz band in July.
Despite these developments, consultant and industry veteran Andrew Seybold would like to see the agency move faster to open spectrum for mobile broadband services.
“I don’t think they’ve been nearly aggressive as they should be, though having said that, they did just auction off AWS and 700 MHz spectrum,” he says. “You can’t put too much spectrum out there or you drive down value.”
Seybold also criticizes the agency’s plan to auction off a portion of the 700 MHz band once slated for public safety. The FCC plans to re-auction D-Block spectrum that failed to sell in 2008. Unlike its previous auction, when the spectrum was slated for public safety use only, the FCC now wants to open the spectrum for commercial use, though users of the spectrum would have to allow roaming for public safety agencies. The revised plan allocates just 10 MHz of 700 MHz spectrum solely for public safety agencies, with a contiguous 10 MHz that will be shared with commercial carriers. Seybold and others in the public safety arena argue it’s an insufficient amount of dedicated bandwidth for an LTE network.
Beyond spectrum and public safety, Seybold also says the agency’s net neutrality efforts and its move to push LAN mobile operators to narrow band by 2013. “I don’t give them good track record in wireless at all,” he says.
Seybold is a harsh critic of the FCC, but concedes that the agency has done some good for the wireless industry over the past year, with items like funding for rural 3G services, which would shift up to $300 million in universal service funds relinquished by Verizon Wireless and Sprint to expand 3G services in rural areas as part of its universal service reform efforts. CTIA says the fund is “insufficient to support mobile broadband in all high cost areas,” but the move is generally regarded as beneficial to the industry.
Seybold says the agency could undermine its own efforts to promote the growth of the wireless industry if it moves forward with its net neutrality regulations tomorrow, a vote which is likely to overshadow many of its other initiatives over the past year.
“If they insist on net neutrality for wireless, they’re going to undo all the good they’ve done,” he says. “It means that wireless operators will have a lot less tools available to manage their networks. Their course of action should be to support the wireless industry to find more spectrum and allow the network operators to manage their data.”
So far, many of the agency’s moves affecting the wireless industry have been more bark than bite. The FCC’s investigations into early termination fees, handset exclusivity deals and Apple’s rejection of Google Voice have yet to produce any results, since the agency hasn’t issued a proposed rulemaking on the items, much less an order. The agency’s bill shock proposal also seems to be stagnating – the agency issued a report on unexpectedly high bills, then a notice of proposed rulemaking, but has yet to issue any actual orders on the topic.
George Ford, a chief economist with the Washington, D.C.-based think tank the Phoenix Center, says the wireless industry should be wary of the FCC, even if some of its moves over the past year have been little more than hot air.
Ford says the FCC’s critical reports of the U.S. telecommunications market are reflective of the attitudes of the agency’s top decision makers. “The mentality is that this industry is not giving the country what it should be, and we’re going to fix it. They’re constantly on the industry about the way it provides services to consumers,” he says. “The regulatory threat is real.”
Frost & Sullivan analyst Mike Jude says the FCC has struggled to define its purpose in the wake of the Comcast decision last spring, which effectively blocked it from regulating broadband Internet services. “The regulatory framework is just creaking with age and regulatory opportunities within traditional telecommunications are limited and disappearing,” Jude says. “A regulatory agency with nothing to do is a loose cannon on deck…They’re trying to define a need that they can address.”
Filed Under: Industry regulations