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FCC To Loosen Wireless Ownership Rules
jgaynor writes: "The FCC on Thursday voted to remove the existing restriction on how many frequencies a single wireless provider can own in any one location. While this is a blow for consumers who want more cell bandwidth and services like data or video - they could end up getting hosed as this might knock some smaller players out of the market and decrease competition, raise prices, etc. Excite has coverage; CBS Marketwatch does too."
removing the entire cap, why didn't they choose a proof-to-purchase method. A little over a year ago when I purchased a few class C's for UU, I almost had to chew my leg off in showing that I needed the class C's that I wanted to buy. I understand this was/is due to limited supply and thereby it didn't bother me. I would much rather prove without a doubt that I need them, then have some other company (or individual) come along and buy them all and try to sell them back to me for three times the amount.
Anyway.. the same could have easily been done with the needed frequencies. "We'll give you more, but first show us that you need them and what you need them for and how you will use them in a fair way to not hurt the little guy" - HSJ
Never try to beat a professional at his own game!
this is pretty much what they did with radio, recently, and look what happened...now clearchannel owns an enormous amount of the radio stations, everywhere, which leads pretty quickly to /. getting pissed off that they might decide to censor a bunch of songs... how does the FCC think anything different will happen with cell networks?
This is a self-referential sig
normally I strenuously object to allowing government interference in business-related arenas, but this is no good at all for Joe Consumer.
A decent analogy might be an imaginary world where air is bought and sold on the market. There's a limited supply of the stuff to begin with, and without regulation large players can just buy up all the "air blocks".
Now, I know that technically the analogy is critically flawed because we all need air to survive, and we don't "need" cell phones. However, one could easily argue that (at least for most countries) telecommunications technologies (and by natual wireless technology) plays a critical role in economies both local and national in scope.
There's a limit to the spectrum available for wireless device use. Yes, competing companies can "use" frequencies owned by competing networks, but they have to pay more (and charge the consumer more) for this capability ("roaming" off your home network incurs charges).
This is probably more a bad thing than good. You can't really make the argument that consumers can still fight with their wallets, because doing so would require moving to a geographic region where the dominant players have lesser influence. I don't know about anybody else, but I'm not prepared to move because I dislike my mobile provider. It seems to me this gives the big guys a huge chance to shaft their customers. It's the ultimate "my way or the highway" scenario.
Plus, this may have more far-reaching implications than we realize. Wireless devices (meaning those other than just phones) are beginning to be common these days. How great is the chance that development on these devices could be somewhat stifled if they don't "play along" with the bigger companies that own certain frequency ranges? Sounds like a pretty far-reaching consequence to me.
Sigh, perhaps these are the death throes of PCS?
This will allow higher bandwidth and better services
Not true. Whenever a scarce resource becomes available there is a sort of land grab. Because of the nature and cost of this particular resource, the players grabbing the "land" are the people who are already the key players in the market.
Now, when a new company comes along with their pimp 10Mb protocol they don't have the ability to go through the usual FCC channels to buy bandwidth. One of three things will happen:
1. The squatting companies demands an insane amount of money for the band creating at best an additional cost to be passed on to consumers, or at worse a barrier to entry.
2. The squatting companies will tell the startup to get bent.
3. The squatting companies will allow the startup to use the band, but requires that they use a "standard" protocol such as CDMA (yay for 9600bps!!).
That's why it's not good.
1) George Bush won the election.
2) Michael Powell was appointed Chairman of the FCC.
Now, given that Mr. Powell is (a) very, very connected to the heaviest hitters in the Republican Party and in big business (b) has stated explicitly that he sees nothing wrong with 1 or 2 mega-corporations controlling all communications in the United States --- why would you expect any different outcome?
sPh
Once one entity controls a large percentage of a certain service/market, it starts cancelling "unprofitable" offerings and raising prices on the rest. Prime examples are the CLEC and independent ISP markets: now that the Baby Bells have driven the independents out of the market, DSL is disappearing and prices are going up.
sPh
Treating spectrum locale as "land" is a perfect demonstration of the value of a Georgist single tax aka "taxation only of unimproved land value". The spectrum locale "land" would have zero value without someone around to enforce the property right -- so the "economic rent" on that property right should be, simply, the costs of defense of that property right. This would fall out of "warrior's insurance".
Seastead this.
So how long before the only choice of provider is AOL-Time-Warner or Microsoft ? I really sometimes wonder if our elected officials have any clue whatsoever about technology. There is scant evidence that they do.
That's irrelevant. Broadcast receivers aren't regulated, and the FCC's current rules -- well, the law the NAB paid Congress to impose last year when the FCC tried to reform 1950s rules -- are incredibly conservative with regard to interference. Nonetheless, Chinese and other low-cost radio manufacturers manage to make receivers worse and worse, so that interference can be created in the receiver no matter how far or close they are apart.
Cellular is different -- the receiver is part of the type-approved handset, and quality standards are rather strict. The FCC isn't changing interference standards for cellular/CMRS/PCS at all. It's simply allowing network operators to buy each other up.
Forbes covered this two months ago. Basically, because too many providers are splitting up too little bandwidth, cell phone coverage sucks. It's high time the FCC got out of the way and let the stronger players acquire the weaker. Maybe service will improve to the point where I'd actually consider buying a cell phone.
On a related note, I have no sympathy for the companies that overpaid for spectrum licenses nor the greedy Feds who thought they had a chance in hell of collecting all those $billions. Golly, who pays for those license fees? Can you say massive tax on users?
What many people may not realize is that there are several wireless companies out there right now that are just sqautting on the spectrum they have. They built out just enough to keep their licenses, and are basically just waiting for the cap to be lifted, so that whichever company (AT&T, Cingular, Verizon or whoever) already owns a considerable amount of stock can buy them out, and make them all rich. So on the upside, once the Big Guy buys them out, people who live in those areas will finally get better service. It also helps Big Guy company cut costs for nationwide roaming and things like that, so its possible (albeit HIGHLY unlikely) that Joe Consumer might not get hosed.
The downside is that some smaller providers, who are genuinely interested in providing services, may get squeezed out of the market, since they have to partner with other providers to allow for nationwide roaming and other features that most consumers feel should come standard with any wireless plan.
Economic Darwinism is a powerful thing. Its fine and Dandy to watch all the posts about Powell and the FCC, but this is capitalism folks... If you don't want to see the big fish eat all the little fish, stay with your local provider. Unfortunately, most people are going to look at how much cheaper the big boys can do it and go with them, forcing the little guy out of the Market.
It takes a huge investment in infrastructure to construct this kind of network. Those survivors who are still around these days are the only companies with the viability to continue to expand. I don't fault them for being big, that is silly to criticize them for that. Size matters in this game. Note 1
The bigger point, which has been missed here, is that 'research shows' that people really don't care much about all these whizzy services that we keep hearing that we want. Mobile video and other streaming stuff is not the killer app. People want to get text messages and have the person they called answer the damned phone. Oh, they also want the call to stay up instead of getting dropped during rush hour. Beyond that, it has not been shown that there is a significant demand for much more than what we have now. That, and technology's financial crash has cooled the jets of the 3G mavens. I know for a fact that Verizon is installing 3G equipment, but don't know the details.
Note 1 - I think it is even sillier that there are people on /. who think that if everybody goes out and buys 802.11 junk that the world will be one big happy access point. Such an endeavor requires the kind of commitment that only a large entity can command. I'm not going to put up an access point so that you can use 'my minutes'. Sorry.
Note 2 - Well, I thought that I formatted this message properly, at least it looks OK elsewhere. Naturally, selecting 'HTML Formatted' in the /. preview mode doesn't really show you what the final post will look like. Russian roulette, anyone?
---slashdot: A failed experiment.
from the MarketWatch link:
Previously, carriers were limited to 45 megahertz of spectrum in big markets, or one-fourth of the available airwaves.
from the FCC link:
"the FCC's shift from an inflexible spectrum cap rule to reliance on case-by-case review of CMRS spectrum aggregation."
What's going on is that the FCC has decided that the "Anyone owning more than 1/4 of the spectrum is an illegal monopolist" rule is horse shit. Apparently, there are better measures of market competition than that.
Ceci n'est pas une signature.
AOL-Time-Warner-Microsoft, a.k.a. The Company.