House Communications Subcommittee Members Lean Toward Public Auction of C-Band in Hearing (Updated)

House Communications Subcommittee members appeared to be clearly favoring a Federal Communications Commission-led public auction of C-Band spectrum rather a private sale. That came in the subcommittee hearing "Repurposing the C-Band to Benefit All Americans" which looked at the Clearing Broad Airwaves for New Deployment (C-BAND) Act, sponsored by Subcommittee Chairman Mike Doyle (D-PA), Vice-Chair Doris Matsui (D-CA), and Reps Bill Johnson (R-OH) and Greg Gianforte (R-MN). That bill would mandate an FCC auction. The C-Band Alliance (CBA), comprising foreign satellite companies, has instead proposed a private-market sale rather than that FCC public auction, saying it will get the spectrum into the hands of carriers for 5G faster while still protecting the incumbent cable operators and broadcasters who get their network programming from distributors via C-Band satellite spectrum and providing some money to the treasury. The key issues for legislators on both sides are freeing up as much spectrum for 5G as quickly as possible, and preferably with lots of the proceeds going to the Treasury for broadband deployment and next-gen 911.

Chairman Doyle, who presided over the hearing, said that he found a lot about the CBA proposal "deeply disturbing," primarily that those companies would get the lion's share of a potential $60 billion a public or private auction could generate, money that could go to rural broadband buildouts, telehealth and next-gen 911. Chairman Doyle said the FCC and Congress needed to get the C-Band repurposing right because the spectrum was a "precious national resource." He said that if Congress gave away most of that $60 billion to foreign satellite companies, the American people would never forget it. Full Commerce Committee Chairman Frank Pallone (D-NJ) said he did not necessarily believe the CBA argument that a private sale would get the spectrum to 5G faster than an FCC auction, and said there would be novel enforcement issues of CBA's proposal to turn over some undetermined amount of the proceeds to the Treasury. He said an FCC auction would be more likely to be fair, transparent and competitive and pointed to the FCC's expertise in holding over 100 spectrum auctions. Rep Johnson said FCC licenses don't confer property rights and that while he was all behind speeding 5G, he said he was focused on those without basic broadband access, which he said was hollowing out communities in his district and nationwide. Rep Johnson said he is tired of the "closing rural divide talk" and wants some action, which a public auction could provide in the form of billions for the Treasury and Congress allocating funds for closing the digital divide.  

Additional coverage from Politico:

The satellite operators of the so-called C-Band Alliance are not only counting newfound backing from various right-leaning groups, but also joined with carriers including AT&T and Verizon to outline a set of principles that should guide any sale of the 5G-friendly spectrum the companies hold. These satellite firms and others insist a private sale, rather than a traditional FCC-run auction, would be the fastest way to get the 5G airwaves out to the commercial sector.

Nevertheless, no House lawmakers emerged to back their plan for a private sale during the hearing. And Sen John Neely Kennedy (R-LA) is gearing up to oppose the idea in conversation with President Donald Trump in a matter of days. He is also planning to meet with FCC staff on spectrum auctioning this week as he considers potential new appropriations hearings on the matter. Sen Kennedy, along with many House lawmakers, favors an FCC-run auction of the spectrum and framed the satellite firms' plan as a money grab. "I think it's a bunch of pigs trying to put all four feet and their snout in the trough," Sen Kennedy said. "And shame on the FCC. The FCC members ought to hide their heads in a bag if they do this." If the FCC allows a private sale, Kennedy added, "I am going to raise more hell than they can possibly imagine."