FCC Micromanagement Could “Blow Up” Planned Spectrum Auction
Does the federal government have too little on its plate these days, or too much? The American public is unequivocal on that question, with a record 60% telling Gallup that bureaucrats are wielding too much power. Only 7% say “too little.”
Despite that ugly reality, the Federal Communications Commission (FCC) seeks to increase its level of micromanagement over our telecommunications market. The auction of spectrum from television stations to wireless carriers is obviously long overdue, and ideally would improve service quality and speed within that growing market. Unfortunately, the FCC intends to limit participation in bidding on highly valuable low-frequency airwaves by excluding the largest and most successful carriers in many markets. As Bret Swanson observes at TechPolicyDaily.com, that threatens to “blow up” the entire auction:
Because the auction depends on inducing the broadcasters to give up their spectrum in the first place, if two of the largest prospective bidders are limited, or sit out entirely, the whole thing could blow up. Without the two largest bidders, prices are likely to be much lower, and broadcasters might say, no thanks. No broadcaster participation, no new spectrum for new mobile innovations.”
The wireless industry has brought innovation scarcely imaginable even five years ago, but that vitality will be jeopardized if bureaucrats pursue this sort of overregulation and abandon the regulatory light touch approach. As Swanson ominously notes:
The FCC is about to take a huge risk with a hugely successful U.S. industry. It’s also openly favoring and disfavoring specific firms, something U.S. law used to try to avoid. The added irony, although it shouldn’t matter in a country that values the Rule of Law, is the favored firms are both foreign and the two disfavored are domestic.”
Instead if new FCC micromanagement, what we need is an open and fair incentive auction. Allowing the market to work, unencumbered by such bureaucratic arbitrariness, will unleash more of the profound potential that the wireless marketplace possesses to spark new social, economic and technological realities for America’s consumers.