PISC Reply Comments on Wireless Innovation

On behalf of the Public Interest Spectrum Coalition, we are pleased to submit these reply comments regarding the Commission's Notice of Inquiry on Fostering Innovation and Investment in the Wireless Communications Market.^[1]   As the Commission noted, the market for wireless broadband services has been evolving at an extraordinarily rapid pace and is delivering new and empowering technologies to American consumers.^[2]    Most recently, this is reflected in an exploding consumer demand for mobile data with the increasing use and availability of smartphones and aircard modems.  

The result of this data explosion has been a near unanimous call from wireless industry operators for more spectrum to meet demand.  Currently wireless companies hold licenses for just over 500 MHz of spectrum.  CTIA urged the Commission to commit to identifying and allocating a significant amount of exclusively-licensed spectrum - with a goal of at least an additional 800 MHz - for commercial wireless services.^[3]  This 800 MHz request is based entirely on a 2006 spectrum requirements study by the ITU.^[4]  Based on an elaborate modeling of emerging cellular technologies (such as LTE and WiMAX) and cell densities, ITU concluded that advanced market economies would require total allocations of roughly 1,300 MHz by 2015 and 1,720 by 2020.^[5]   

However, we believe that it is impractical, inefficient and ultimately anti-consumer to attempt to meet the growing demand for mobile data consumption primarily through traditional reallocations of exclusively-licensed spectrum by auction. While there is no question that the existing commercial wireless business model - based on exclusive licensing, tower-based hub/spoke channelization, centralized infrastructure and metered billing - will need more exclusive-use spectrum in the short-run to meet mobile data demand, it should be equally clear that this model is not sustainable longer term.   As high-capacity wireline connections and a consumer's ability to purchase hybrid mobile devices becomes more prevalent, it is neither cost-effective nor pro-consumer to encourage a model whereby most mobile data would be transported over expensive licensed airwaves, and through relatively distant carrier-provisioned infrastructure, when most communication can flow short distances over unlicensed airwaves and consumer-provisioned backhaul. 

Wise policy choices will be necessary to facilitate - and not impede - a market evolution toward these more spectrum-efficient and cost-effective "hybrid" or "heterogeneous" wireless broadband networks.  In addition to easy and robust access to shared spectrum with varying propagation characteristics, the Commission's pending extension of Carterfone rules to mobile Internet access services will be critical to ensuring that consumers have the choice to use devices capable of automatically switching among multiple wireless networks based on the consumer's (and not the carrier's) preferences.  We would expect that freed from carrier control, wireless device innovators will be motivated to offer consumers hybrid devices that can determine on the fly what connectivity is most economical for the consumer at a given time and place. 

The commercial wireless provider, relying on limited but exclusively-licensed spectrum, and shouldering the capital costs for centralized infrastructure, should increasingly confine its role to being the "quality of service provider" within a heterogeneous network controlled by consumers at the edge. Consumers will happily pay for remote coverage, for needed mobility (connectivity on the move), or for the transport of latency-sensitive applications.  But they should not pay an intermediary to send the bulk of their mobile data over the publicly-owned airwaves when there is a far more economic and spectrum-efficient alternative using local control over shared spectrum. 

Therefore, in addition to reallocating bands cleared completely for exclusive licensing, the public interest in promoting pervasive connectivity, innovation and consumer welfare suggests that the FCC should also lay the groundwork for complementary spectrum access models that facilitate innovative wireless networks.  To facilitate this wireless infrastructure, we believe it is essential for the Commission, the executive branch and Congress to explicitly support alternative models for spectrum access through:

• Opportunistic Access to Bands that Cannot be Cleared Quickly

In every community across the country, the vast majority of prime spectrum capacity lies fallow the majority of the time. At the same time, there are only a limited number of bands that can be cleared of incumbent use for reallocation via auction and exclusive licensing in any meaningful time frame.  In underutilized bands where it is not practical to relocate current users, or where that would likely take many years, spectrum capacity can be made available more rapidly by opening the bands to "opportunistic access" on a secondary basis that requires the user to avoid causing harmful interference with the incumbent use.  Underutilized federal bands should be an early focus for opportunistic access made possible by (a) adding frequencies to the TV Bands database; and (b) expanding the purpose of the CSEA Spectrum Relocation Trust to finance the modernization of federal systems to improve performance and facilitate spectrum sharing.   Opportunistic access presumes, as does the TV white space Order, that cognitive radio devices  are multi-band and capable of frequency hopping.  Unlike licensed bands, where it is expensive and time-consuming to upgrade or clear off existing users, no legacy devices need to be tied to a particular frequency.  Bands can be opened or closed for sharing - nationally, regionally, or locally - and even on short notice, without "stranding" any users or equipment. 

• Wholesale Access

An allocation conditioned on leasing bandwidth or transmission to any ISP or application/service (e.g., for embedded connectivity) will promote market entry, roaming, competition and innovation. Spectrum made available in traditional one-off auctions are also often too expensive for small, local providers and start-ups; and even for more established carriers, the auction blocs may not correspond well to the target market.  Auctioned spectrum is even less appealing to device and service providers - including an increasing number serving the need for embedded connectivity in "smart" energy, environmental, telemedicine and distance learning applications.  Wholesale access allows for more intensive, flexible and efficient use of spectrum resources that also promotes robust competition among wireless operators and allows for innovative uses and products.  Treasury could receive payments in perpetuity on such allocations - as a royalty on revenue, much as the Interior Department leases natural resources - rather than solely receiving revenues through a one-off auction.  This approach would not preclude an auction, but would lower the barrier to entry, leaving more capital for infrastructure.

• New Unlicensed Bands

The public interest and emerging economic realities strongly dictate that a substantial share of newly-cleared spectrum be reallocated for unlicensed use on a national basis.  These new unlicensed bands should include at least one very substantial and contiguous unlicensed band with superior propagation characteristics, below 1 GHz if feasible, as a means of diversifying the unlicensed spectrum ecosystem. The increasing need for shared spectrum as both an alternative and a complement to 4G carrier networks relying on licensed spectrum suggests that unlicensed networks need a similar combination of more total capacity, high-capacity (wide) channels and excellent propagation. Rural areas would benefit most from access to lower frequency unlicensed or licensed "lite" spectrum (such as the 3.65 GHz band) to promote greater wireless broadband from smaller operators. The history of innovation in the 2.4 GHz unlicensed band demonstrates that expanding unlicensed access will lead to new innovation by entrepreneurs followed by larger companies. New unlicensed bands could also provide a platform for the development of cooperative wireless devices and mesh networks.

• Test-Beds to Spur Innovation

One way to augment the FCC/NTIA "Test-Bed" is to make spectrum in bands corresponding to FCC-held licenses more readily available for commercial and/or technological trials.  An example is the 2155-2180 MHz band, which is not likely to be assigned and built-out for a new use for many years.  Opening additional FCC-held (and NTIA-held) bands could be implemented in tandem with the sort of expanded opportunistic access to a multiplicity of bands that could be managed through the TV Bands Database.

A critical step toward making substantially more spectrum capacity available for wireless broadband services and innovation is to make transparent how, where and when this publicly-owned resource is currently being used - or not used - by current public agency and private sector licensees.  The White House direct a joint NTIA/FCC effort to undertake a comprehensive Inventory of the Airwaves so that policymakers, innovators and the public have a more complete, comprehensive inventory of what frequencies are actually in use, for what purpose, with what technology, at what locations, frequencies and times.  Both government and private sector assignments and uses should be included in the map. Actual spectrum use measurements in a large and regionally diverse sampling of markets should be part of the Commission's broadband mapping exercise.

To read the full comments, download the PDF below.

^{[1]  See In the Matter of Fostering Innovation and Investment in the Wireless Communications Market; A National Broadband Plan for Our Future, Notice of Inquiry, GN Docket Nos. 09-157, 0951, FCC 09-66 (rel. Aug. 27, 2009) (the "Notice").}

^{[2] Id.}

^{[3] See Written Ex Parte Communication, CTIA-The Wireless Association, GN Docket 09-51, (filed Sept. 29, 2009), http://fjallfoss.fcc.gov/prod/ecfs/retrieve.cgi?native_or_pdf=pdf&id_document=7020039747,}

^{[4]  Estimated Spectrum Bandwidth Requirements for the Future Development of IMY-2000 and IMT-Advanced, Report ITU-R M2078 (2006).}

^{[5] Id.}