House Communications Subcommittee members are continuing to wrestle with whether and how to package legislation to reauthorize the FCC’s spectrum auction authority with other related policy matters. Witnesses at a Wednesday hearing on those issues urged Congress to quickly renew the FCC’s sales authority and cited a range of other matters lawmakers should simultaneously consider, including directing proceeds to pay for other telecom projects and addressing interagency disputes on frequency allocations (see 2203150069).
Wireless Spectrum Auctions
The FCC manages and licenses the electromagnetic spectrum used by wireless, broadcast, satellite and other telecommunications services for government and commercial users. This activity includes organizing specific telecommunications modes to only use specific frequencies and maintaining the licensing systems for each frequency such that communications services and devices using different bands receive as little interference as possible.
What are spectrum auctions?
The FCC will periodically hold auctions of unused or newly available spectrum frequencies, in which potential licensees can bid to acquire the rights to use a specific frequency for a specific purpose. As an example, over the last few years the U.S. government has conducted periodic auctions of different GHz bands to support the growth of 5G services.
Latest spectrum auction news
Witnesses scheduled for a Wednesday House Communications Subcommittee hearing on 5G and spectrum management issues (see 2203090074) urged lawmakers in written testimony to prioritize reauthorizing the FCC’s spectrum auction authority. Witnesses also cite interest in legislation to direct proceeds to pay for other telecom projects and address interagency disputes on frequency allocations. Congress last extended the FCC’s auction authority via the 2012 spectrum law. That authorization will expire Sept. 30. The partly virtual hearing is to begin at 10:30 a.m. in 213 Rayburn.
AT&T is in the market for more spectrum, Chief Financial Officer Pascal Desroches told a Deutsche Bank conference Monday, not elaborating on what bands the company may pursue. “Whenever something comes to the market, we’re going to evaluate it because we think this is a core asset that we will need in order to deliver the quality of services that we aspire to deliver,” he said. AT&T led bidding in the 3.45 GHz auction and was second after Verizon in the C-band auction (see 2201260055). Desroches noted AT&T’s recent uptick in post-paid phone adds, outpacing T-Mobile and Verizon. “For several years, we had been under-investing” in wireless and “hadn’t been investing in keeping our customers,” he said: “That changed in 2020, and we really stepped up our investment to a point where we are matching our competitors and the results have been very clear. We have, during that time, led the industry in share. We are growing both top line and bottom line for our largest business, and we expect that to continue.” Desroches said AT&T, Verizon and T-Mobile each has “a really good 5G network and they’re going to continue to get better” as more spectrum comes online. AT&T expects to lose some customers following its ongoing 3G sunset (see 2202240002) but not to take a major hit. “We expect to see some 3G subscribers churning off, and so that’s going to impact us some,” he said. On its fiber build, AT&T isn’t “immune” to supply-chain problems, Desroches said. “We have first priority on supplies,” he said: “We are in great position on access to labor relative to others, and what we’re seeing is while there were issues in the summer of last year, those issues have been largely resolved and we exited 2021 with good momentum, and that continues in 2022.” Desroches also said its fixed-wireless offering is well suited to less-densely populated areas, but in other markets it doesn’t make sense because the operating costs are higher. “Why not just simply go and do it right the first time … build fiber and bet on the long term that the trends are in your favor,” he said.
The FCC appears likely to adopt an ascending-clock auction in the 2.5 GHz band, or some version of a multi-round auction, rather than the sealed-bid approach favored by wireless ISPs, AT&T, Dish Network and others concerned about T-Mobile’s potential to dominate a more traditional auction, industry experts said. The auction is expected to start in July.
The House Communications Subcommittee plans a March 16 hearing on 5G and spectrum management issues, as expected (see 2203040073), the Commerce Committee said Wednesday. The panel will examine “facilitating the advancement of next-generation wireless technologies, including 5G, to ensure the United States uses wireless technology to serve consumers and remains a global leader in this important economic sector,” the committee said. The hearing is expected in part to focus on reauthorizing the FCC’s spectrum auction authority, which is to expire at the end of FY 2022 Sept. 30.
Telecom-focused lawmakers are trying to beat the legislative clock as they seek a way to renew the FCC’s spectrum auction authority, currently set to expire when FY 2022 ends Sept. 30. The House Communications Subcommittee is eyeing a March 16 hearing on auction authority reauthorization and potential ways to spend revenue from additional auctions, Hill aides and lobbyists told us. FCC Chairwoman Jessica Rosenworcel recently asked Congress to authorize the agency to use proceeds to pay for next-generation 911 tech upgrades (see 2202220057). Congress last extended the FCC’s auction authority via the 2012 spectrum law.
The FCC plans a 2.5 GHz auction starting in July, FCC Chairwoman Jessica Rosenworcel told the Mobile World Congress Tuesday. The FCC has been under pressure to announce a start date, with its auction authority expiring Sept. 30 (see 2202110056). Rosenworcel also told the conference the FCC will issue a notice of inquiry on receiver performance and standards (see 2202180054) in April. Speakers at the Barcelona event said 6 GHz is emerging as a key band for 5G and Wi-Fi globally.
The FCC got some support for use of an ascending-clock auction for the 2.5 GHz band, the only imminent auction of spectrum for 5G, in comments filed at the FCC, mostly posted Thursday. AT&T and groups concerned about bidding by the smallest players, prefer a single-round, sealed-bid auction. The agency is trying to start and end the sale before its auction authority expires Sept. 30.
Dish Network's mobile 5G network is up and running in Las Vegas, albeit with mixed results, and the company will easily meet its June goal of reaching 20% of the U.S. population, executives said Thursday, announcing its 2021 year-end results. "When it works, it works pretty well," Chairman Charlie Ergen said. He said network optimization and working with handset manufacturers to ensure Dish frequencies are in their hardware are still to be done before broad commercial launch, plus fixing of some regulatory issues like Enhanced 911 access.
Public interest and consumer groups proposed that the FCC allocate revenue from future auctions to endow a Digital Equity Foundation to help close the digital divide. The groups announced the initiative on a webcast Wednesday, the day after FCC Chairwoman Jessica Rosenworcel urged that some auction proceeds be used to pay for improved 911 (see 2202220057).