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Wireless Carriers looking for Elbow Room
pillageplunder writes "Businessweek is reporting on the upcoming Wireless Spectrum Auctions. Over the next two years (Starting in Jan 2005) the FCC will auction off enough spectrum that will more than double the amount currently available. Estimates range anywhere from 50 to 70 billion dollars will be raised by these auctions. Short term, it should improve the quality of Cell-phone, long term, it should open up opportunities for so-called 3G services to take off."
And what about the hammers? Will they be elbowed out?
Tell the truth and you won't have so much to remember.
This is a pet peeve of mine. Why should the FCC be able to sell spectrum for a region giving basically a monopoly to the bidder. I would much prefer that the FCC leases the spectrum to vendors and the income goes back to the people that rightfully own it (the land owners over the given region - you and me). It isn't the FCC's property to sell and it doesn't force vendors to address issues fast enough.
Here in Europe where we manage to have a single standard and phones work with each other we had 3G auctions a few years back nearly crippling the mobile operators, and still hardly anything on them, no one wants video conversations, you can watch music videos on it, but take up is pretty slack... the government made a killing tho...
auctioning spectrum is a bad idea. It's better to give it away for free to the companies that promises the best services to it's customers.
Many countries in europe auctioned off 3G-spectrum a few years ago, and the money involved was insane... many of the "winners" weren't able to build any networks from lack of funds after the crazy fees they payed for the spectrum.
Some countries instead held "beauty contests" where the companies that promised best area coverage where given spectrum for free (the promises must be kept with the threat of huge fines of course)
The gomment should be renting spectrum, not selling it outright. That way we would have an income stream , not just one payment to squander.
so could this mean that my Nextel phone will stop making my TV go crazy everytime i get a call? -jordan
Multiple choice:
a) the cost of a new wireless device that supports this technology
Ericb) the average damage to your car when you hit a tree while trying to watch a video on your phone
c) per-year productivity lost to phone-based instant messaging
d) your new monthly cellphone bill
JavaScript != Java
Will the cell phone companies soon be over-spectrumed, just like the landline people are now pipelined? Maybe that will cut the costs down to $15/mo for cell phones.
Then, MAYBE I'll get one.
HexaByte - he's a square and a half!
It would be far more useful to create more public airwaves rather than private and watch what happens. The 900,2.4G, and 5.2G have created a large number of innovations that have been resulted in a large number of products.
I prefer the "u" in honour as it seems to be missing these days.
The article isn't very well written. It says that more spectrum will help carriers increase coverage. That isn't true. It would allow some carriers to provide native coverage (as well as sell service) in some new markets, but more licenced spectrum won't increase coverage at all. Spectrum increases capacity. That means less system busies and the ability to let customers use more of the system's capacity for things like data.
It also suggests that Verizon and Cingular are in the same spectrum position which isn't accurate. In many markets (including mine) Cingular has nearly twice the spectrum of Verizon. This also leads me to think that Verizon will be a bidder in the auctions. Another thing that they don't mention is that the lesser carriers (T-Mobile and Sprint) often have equal or greater amounts of spectrum to Verizon in most markets.
These auctions allow carriers to increase their capacity in their current markets and to move into markets where they aren't able to offer service because they aren't licenced for it - like how Verizon isn't licenced to operate in Oklahoma City. It won't increase coverage as the article suggests.
Where exactly did all this bandwidth to just give away come from when the Military is having to override garage door openers to effectively use it's bandwidth?
I do security
Lets hope they do something like the UK where 3G bidders are obliged to cover 80% of the population by 2007.
That way citizens of the US get more out of the deal.. as a european living in the us i'm appalled at how frequently i loose reception.
http://www.cellular-news.com/3G/uk.shtml
out West? Well, those are rife with problems (environmental, esp watershed damage). I wonder what the ramifications of renting would be though. Probably, the gubmint isn't allowed to rent them through some sweetheart deal set up for the telcom companies. No, that never happens....
Comparing it to Windows will be a moot point, since El Dorado is going to have a 40% larger code base than XP.
Is the shout-out to manifest destiny intentional? "We need more wireless elbow room! These primitives don't realize you can own bandwidth! They'll give it up for pretty beads and mp3 ringtones invoking pop idols! We'd be fools not to auction it off!"
adam b.
...if they still charge too much for the content.
I'm talking $3 for a 125x125 background picture, only allow people to keep it for three months and that kind of crap.
I'm not paying $10 a month for slow internet service to same phone with 125 resolution either.
... so-called 3G services to take off
Isn't this what many people said about the last auction that occurred a couple of years back?
Instead of selling it to private companies, why don't they create more public spectrum? IMHO more has come out of WiFi in an unlicensed spectrum than in most private telco networks. Give more space to WiMAX (802.16) and let people figure out what to do with it. They'll be a lot more creative than the incumbents.
WiFi proved that the commons doesn't have to be a tragedy. Let's continue this experiment in public use. We don't have to necessarilly make all the available spectrum public; there's room for both private and public use / allocation. Commerical enterprise has been given its chance since the beginning of radio / the FCC. Time for different thinking.
More brain dead drones walking around with their camera phones saying "Can you see me now?"
Who cares about terrestrial signals any more, when I can soon get Howard Stern on my ipod.
http://engadget.com/entry/1234000547022729/
Ham radio operators are more likely to be 30-50 year olds with stable income and a family. Sheesh.
Sounds like a great way to burden the industry with debt so future investment is minimal.
What matters most here? revenue for the state or service for consumers?
--
Toby
The portion of the spectrum that they hang out on (the HF bands, ~140 mhz, ~440 mhz) don't have the bandwidth for this stuff...
The FCC is auction chunks of higher frequency spectrum...
Hams have little pieces of it here and there (ie 902 mhz, 927 mhz, some 1.2Ghz and 1.6Ghz IIRC)... but the chunks are so small that there's not really much to gain by yanking it.
Most of this spectrum is in the 800-900 mhz 1.8-2.0 Ghz bands...
There's a big push behind the scenes to move the public safety bands out of 800 mhz and into the 700's... that frees up a lot of 800 for cell carriers, and eliminates that nasty Nextel interference that a lot of trunked radio systems in metro areas experience.
Will they offer more unlicensed bands, or is this the other half of the deal?
Zhrodague.net - I do projects and stuff too.
Obviously the renewal terms should be long enough to make the rentals able to generate a reasonable return on investment even if that infrastructure has to be dismantled at the end of the term. I don't think that's so terrible. And the prospect of having to take down the infrastructure simply would get built into the bid amounts.
What I see instead is an agenda on the govt's part to turn public spectrum into the private fiefdom of some lobbying corporations. That must not be allowed.
The FCC needs to stop selling off what is not there.
The first amendment gives us the right of free speech.
Its ok to protect some radio spectrum, but to not give
the rest of us the freedom to set up our own wireless
networks and routers in the spectrum used my cellular
is simply against the law.
JavaScript != Java
How long did it take for you to realize this?
How much is my cell phone bill going to go up to cover it this time?
Coder's Stone: The programming language quick ref for iPad
My problem with the spectrum auction model is it encourages companies to buy up spectrum only for the purpose of keeping it from others companies. If you own the spectrum you should be forced to put it to use within N years by X% of the public in that area, otherwise it reverts back to the FCC.
The FCC has exactly those kinds of network build-out requirements in nearly every spectrum license it issues.
Short term, it should improve the quality of Cell-phone, long term, it should open up opportunities for so-called 3G services to take off. ... and ultimately it'll prevent people from setting up long distance, flexible, high bandwidth national and international wireless networks devoid of government oversight.
Hear that soft rumble? It's the bureaucracy expanding to fill in the gaps.
Direct away from face when opening.
Hey, let's sell off the National Parks too. Think of all the federal debt we can eliminate!
The FCC does in fact sell licences *only for a certain period of time*, typically 10 years. Therefore, a provider who would continue to provide services would probably have to repay for the rights to continue using the spectrum later on. So in a way, this is a lease.
The spectrum licences does not grant a monopoly to the highest bidder, far from it. In every spectrum band and every region, there are several licensees (at the very least 2, more commonly 5) and the FCC enforces restrictions on the total spectrum owned by a single entity.
This model is certainly better than what the FCC used to do before (choose licensees based on an ad-hoc examination process, or worse yet attribute them via lottery!!). It does try to enforce "opportunity costs". There are also "substantial service obligations" that are enforced to guard against people trying to organise the scarcity of spectrum by hogging it without using it.
One problem is, though, what is the value of spectrum now when the FCC might open up more spectrum in the future? In 1996, you didn't know that the FCC was going to auction twice the amount of spectrum again or that it was going to create more unlicensed spectrum bands...
Isn't this the spectrum that television broadcasts run over?
.001 Mhz worth fo spectrum to the public domain.
As we all know by now, the FCC will likely give most of this to the phone companies, some to the media moguls, and then slop off about
Thanks Mr. Powell...
Don't Crease the Weasel!
The FCC is indeed opening more unlicensed bands. It is getting to the point that operators can have pretty decent "elbow room" there. For a good idea of what's going to happen with WiMAX in such bands, check out this operator in Chicago, Boston, NYC, LA and some other places...
The FCC raises $50 to $70 billion. Once. BFD. They should move to a licensing scheme whereby these spectrums are allocated on a renewable basis. With the U.S. national debt at near back-breaking levels wouldn't it make more sense for the public - who ostensibly owns the "airwaves" - to reap benefits on a recurring basis from giant communications compamnies? As it stands now once the blocks of spectrum are auctioned off they're gone forever. The public no longer "owns" them. The FCC needs to stop giving this precious commodity away.
Why did oil drop by $10 a barrel in the last few weeks? Did the scarcity suddenly end? Why do gas prices in the US seem to reflect the oil futures market when the real price for the oil refined into gasoline lags the futures market by at least three or four months? The answer is that none of these prices has any real foundation in costs or expenses. The prices are determined by a futures market where traders are playing off each other. Someone buys a contract for March delivery and can then sell it for $0.001 a barrel more than they bought it for and they make a few thousand dollars. Magnify this by hundreds of traders on the 10 or 20 commodity exchanges and you get the idea of how this is really controlled.
Sure, OPEC can try to put a floor under this, and they have in the past. But they have no control over the upper limit - that is set by the traders. And, like all traders (or gamblers), they are ruled by their emotions rather than logic. This means that while Iraq is sitting unable to deliver any oil this must mean that people will pay more for it in a few months - so the March contract must be worth more. Right.
Expensive auction rounds are eventually paid for by the consumer as the telcos have to make their money back from the infrastructure investments and frequency auction...Obvious, I know, but I think the frequencies should be alloted by beauty contest (i.e. potential, cohesiveness of plan, financial accountability etc.)
The FCC should aim to charge only for their costs with adminstering the frequencies and the opertaors and not see this as an opportunity for a quick buck.... In Europe the telcos are getting ready to take the 3G consumers to the cleaners to make back the money from goverment auctions as well as enormous infrastructure investments
I foound the elbow room a couple months ago it's a bar 2 blocks away http://www.ypsirocks.com/
So, do all ham call signs start with VE3, or do you live around here somewhere?
Do daemons dream of electric sleep()?
Much of what they're offering is "surplus" UHF-TV and VHF-TV channels, to become available when the digital TV conversion goes through (don't hold your breathe waiting for it). These frequencies aren't compatible with existing phones, either domestic or foreign. These frequencies aren't contiguous with existing cellular bands, so new hardware is needed in the handsets. More parts, more power consumption, poor compatibility, less battery life: is that what customers are begging for? I don't see how a rational company would pay much, if anything, for spectrum that is incompatible with the well-established standards. In this post dot-com era, the "irrational exuberance" of previous spectrum land-grabs is unlikely to recur.