WASHINGTON -- It’s been nearly four months since Congress let the Federal Communications Commission’s authority to auction spectrum lapse, potentially hindering the deployment of broadband or expanding 5G capabilities.
Spectrum auctions enable commercial providers to expand their broadcast television, mobile phone and broadband coverage. But in the current situation, the FCC can’t issue spectrum licenses won in previous auctions and the lapse jeopardizes funding to replace Chinese communications equipment.
“We’re in a situation where spectrum policy is effectively at a standstill because auction authority has lapsed,” said Nick Ludlum, senior vice president for communications at CTIA, a trade group representing the wireless communications industry. “There is no clear path at this point. There’s lots of discussions going on, but there’s no expectation that that’s going to be resolved imminently.”
T-Mobile won more than $300 million worth of spectrum licenses in an August 2022 auction. FCC Chairwoman Jessica Rosenworcel says the agency can’t distribute those licenses, as well as others.
“We are right now tying ourselves in knots trying to figure out how to get these licenses out, and the precedent we have here is complicated because issuing these licenses now could violate the Anti-Deficiency Act, which is a criminal statute,” she said at a June House Energy and Commerce Communications and Technology Subcommittee hearing with the FCC commissioners.
Her explanation wasn’t enough for some members of the subcommittee though.
“We all know that spectrum is the gold — 18 karat gold,” said Rep. Anna G. Eshoo, D-Calif., during the hearing. “Nothing moves without it. A carrier paid over $300 million for that last August. That’s going to come up to a year pretty soon. It’s stunning to me that someone pays for something, they don’t get it.”
Eshoo asked Rosenworcel if the FCC would consider issuing the licenses under a special temporary authority, but the chairwoman said that still could potentially violate the law because of the auction authority lapse.
In an April 2023 blog post, T-Mobile’s president of technology, Neville Ray, also advocated for the FCC to issue STAs, emphasizing that many of the licenses cover rural areas.
“T-Mobile has built out the towers and radios needed to make use of this spectrum in many areas of the country. If we were given STAs today, we could light up many of these markets in a matter of days. … The only thing separating nearly 50 million Americans from enhanced capacity, a huge speed boost and world-class 5G is the FCC issuing STAs,” he wrote, noting that home internet would be available to many families who never had a choice in broadband providers.
Public Knowledge, a public interest group focused on digital privacy, and four former FCC general counsels in separate letters to the agency wrote that they believe the FCC could issue the licenses despite the expiration of the auction authority.
Replacing Chinese equipment
The House Energy and Commerce Committee in May advanced, 50-0, legislation to renew the auction authority through Sept. 30, 2026, and direct billions in spectrum auction proceeds toward broadband expansion and Next Generation 911, which would enable the public to send photos, videos and text messages to first-responders.
The bill also would allocate proceeds to cover a nearly $3.1 billion shortfall in an FCC program to reimburse communications service providers for replacing communications equipment or services that pose national security risks, particularly from China.
If Congress doesn’t pass the legislation soon, or otherwise find a way to close the funding gap, the FCC won’t be able to fully reimburse such providers, Rosenworcel said in letters to congressional committee leaders.
Applicants under the program have until July 15 to submit at least one reimbursement claim to the agency. The providers then have to remove and replace the communications equipment and services within one year of receiving the initial reimbursement distribution.
“This is a serious problem, especially for rural America,” said Communications and Technology Subcommittee Chairman Bob Latta, R-Ohio, at the June hearing with the FCC commissioners. “Without these funds, small carriers could be forced to shut down their networks, leaving their customers without a connection.”
Rosenworcel wrote that the FCC could extend that deadline.
An Energy and Commerce Committee Republican aide said that they’re working with House leadership to bring the bill to the floor. But even if the House passes the legislation, it still has to get through the Senate.
Senate Commerce, Science and Transportation Chair Maria Cantwell, D-Wash., told Communications Daily in June that she backs the House bill, but ranking member Ted Cruz, R-Texas, said in a statement that it “misses the mark.” He particularly took aim at the auction proceeds designated for broadband expansion, which he characterized as “unneeded and duplicative.”
The House spectrum bill allocates money specifically for “middle mile” broadband, which connects local networks to national and regional ones. Some of the pressure on that need may be relieved by the Infrastructure Investment and Jobs Act, which allocates $1 billion for middle mile grants. And the Biden administration last week separately announced grants totaling $42 billion that would go to states to expand high-speed internet access.
But CTIA’s Ludlum said the lapse in the FCC’s auction authority stalls providers’ processes needed to open up spectrum for commercial use of wireless and 5G technology.
“The path that we travel in order to make spectrum available is a multiyear process. The providers and the FCC take years to study this until it’s brought to auction and then cleared and then made available for use,” he said. “This effectively has brought to a halt the industry’s ability to expand coverage, to anticipate and plan for increased demand, which is skyrocketing, to make sure that the wireless networks we count on today are as reliable and secure and robust and high-speed as we need them to be a year from now, two years from now, three years from now and so on.”
Another consideration is that FCC spectrum auctions have been a financial boon for the federal government. They’ve raised more than $258 billion for the Treasury Department since 1994, according to agency records.
Kathleen Burke, policy counsel for Public Knowledge, argued that the authority’s expiration shows how a focus on raising money has distracted from good policy.
“This is a great example of why and how spectrum auctions have led to this politicization of spectrum policy in the U.S. because of the high level of revenue that you get from spectrum auctions,” she said. “What we’ve seen more and more is that trying to collect as many dollars as possible for the federal government has become the end goal of some of these spectrum auction policies. And that has not always been the best kind of approach to making sure that spectrum is meeting the needs of the nation.”
