Commercial Spectrum: Plans and Actions to Meet Future Needs, Including Continued Use of Auctions

Since 1994, the Federal Communications Commission has used competitive bidding, or auctions, to assign licenses to commercial entities for their use of spectrum; however, its authority to use auctions expires on September 30, 2012.

Among other things, the Government Accountability Office examined 1) the extent to which FCC has made spectrum available for new commercial uses and the time taken to do so, 2) experts’ and stakeholders’ views on FCC’s plans and recent actions to meet future spectrum needs, and 3) experts’ and stakeholders’ views on the continued use of auctions to assign spectrum. GAO previously reported that auctions were effective in assigning licenses to entities that valued them the most; were quicker, less costly, and more transparent than mechanisms FCC previously used to assign licenses; and were an effective mechanism for the public to realize a portion of the value of a national resource used for commercial purposes. Experts and stakeholders responding to GAO’s survey strongly supported extending FCC’s auction authority—53 of 65 respondents supported extending FCC’s authority. However, experts and stakeholders held varied opinions on potential changes to auctions. For example, respondents generally supported actions that would provide a clear road map detailing future auctions, which could reduce uncertainty. In contrast, a proposal to require winners of auctions to pay royalties based on their revenues rather than the full amount of their winning bids up front garnered the least support. [GAO-12-118, November 23]