Establishing Effective Spectrum Policy

[Commentary] Proponents now seek to dramatically change the way the Federal Communications Commission’s spectrum screen is applied in ways that would create marketplace uncertainty and lead to arbitrary results that threaten to reduce competition, investment, and innovation. It is not radical change in the essential workings of the spectrum screen that is necessary. Instead, the FCC should take more modest steps to update the screen and ensure that it is applied in a way that best promotes competition, innovation, and investment.

• First, the FCC should update the screen to include all of the available spectrum that is “suitable” for mobile wireless services. Most prominently, the FCC should correct a current glaring omission by including in the screen the entire 194 MHz of BRS and EBS spectrum held almost entirely by Sprint/Clearwire, rather than the mere 55.5 MHz the FCC has included to date. That spectrum is in use today and there is no principled basis upon which it can continue to be excluded from the screen. The FCC should also conduct annual rulemakings to update the spectrum screen inventory as new allocations are brought online.
• Second, the FCC should reaffirm that the “safe harbor” provided by the screen is truly safe – i.e., that the FCC will not entertain spectrum aggregation-related challenges to any proposed spectrum acquisition that does not exceed the safe harbor level. This step is necessary to restore predictability to the workings of the screen, which the FCC has long recognized promotes innovation and investment.
• Third, the FCC should make clear that its case-by-case analysis of proposals to exceed the safe harbor level in any local market will remain tightly focused on whether the spectrum available to competitors and potential competitors remains sufficient to enable robust facilities-based competition to continue. This analyses should be informed by the reality that today’s screen, which is set at one third of suitable and available spectrum, is almost certainly too low and holdings in excess of the screen in some markets may promote the public interest by putting fallow or under-deployed spectrum to its best and most valuable uses.