Spectrum overhaul long overdue

[Commentary] A critical telecommunications debate over spectrum will soon come to a head. In the run-up, however, all sides seem to have forgotten what the debate is, at its core, supposed to resolve.

Other than human ingenuity, spectrum is probably the single most important input into the broadband ecosystem, and certainly the most important asset controlled by the government. Over the last 70 years government has allocated all of it, but technologies and markets change. The question we should be debating is, what process should we use to reallocate spectrum to achieve our country’s purposes?

There are only four alternatives.
First, we can assume the original government allocations were perfect.
Second, we can let all spectrum license holders sell their licenses for any use.
Third, we can rely on the current law, which gives the Federal Communications Commission the power to reallocate by administrative fiat.
Fourth, we can use market forces to drive the reallocation by enabling existing holders to return voluntarily all or part of their spectrum to the market, and share in the proceeds of a government-run auction. This would result in an efficiently organized, market-driven relinquishment of frequencies, thus leading to a timely reallocation of economic assets reflecting new market realities.

Those are our choices — our only choices. While I favor the fourth alternative, my point today is that all of the discussion — whether there is a spectrum crisis today, tomorrow or in 2020, exactly how much spectrum we are going to need for iPads, the future role of femtocells, potential repacking plans and all other related issues — ignores the key question: how do we, not next year, but over the next decades, enable an ongoing reallocation of spectrum to improve our country’s well-being? That is the debate we need to have and the decision we need to reach.