A competitive wireless market Is good for business and consumers

Spectrum is the lifeblood of the mobile broadband services that are transforming the way we work, learn and play.  It is this finite resource that we are consistently pushing to its limits.  America’s voracious appetite for data requires wireless carriers to acquire and deploy spectrum in order to maintain this critical driver of our nation’s economy.

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The success of the auction will require competitive bidding rules that encourage the broadest participation by both large and small bidders to generate the largest auction revenues possible.  Generating sufficient revenues from the auction and ensuring a healthy, competitive marketplace must be the primary objectives of sound auctions policy.  And indeed, the long success of spectrum auctions has shown that the government can raise tens of billions of dollars in revenue for the Treasury – while at the same time enabling innovation and investment in wireless communications that generates hundreds of billions more in consumer surplus across the economy and hundreds of thousands of jobs.  So, it’s not only important to get it right for the auction, but also for the post-auction wireless marketplace.

Furthermore, this sound spectrum policy has been the enabler of our broader bi-partisan deregulatory communications policies.

Remember, the primary objective of the 1996 Communications Act was the transformation of the telecommunications market from heavily regulated, highly concentrated stovepipe industries (e.g. local v. long distance) to deregulated competitive markets.  Largely because of the robust competition in the wireless space, deregulation has become possible.  Just think, for years a primary goal of telecommunications regulation was to set limits on rates for long-distance phone calls.  Then along comes the wireless industry – spurred on by competition – and the introduction of one-rate nationwide calling plans.  Suddenly long-distance charges are a thing of the past, and competition and market forces succeed where regulation had failed.

And beyond cheaper long distance, this competition has brought consumers innovations that the regulators could never have imagined.  Indeed, entire industries have emerged - from mobile applications to tablet computing - that are completely transforming the world economy, and the United States is leading the way.

Now, maintaining a competitive market for wireless services is more important than ever as the wireless industry evolves into the default broadband provider for millions of Americans.  That is why a rapid and successful auction is so important.  Without adequate spectrum for all who want to compete, the innovative wireless market will erode.  Already we hear calls for increased regulation of the wireless market, whether it is wireless net neutrality or data rate regulation, and the result is the same.  Less competition fosters greater regulation, and greater regulation stifles investment and innovation.  If we don’t get this auction right, we run the risk of returning to the days when regulated monopolies dominated the communications marketplace and the height of innovation was a new color for your rotary phone.

To those of us closely watching the incentive auction, there is no doubt this is one of the most challenging and worthy endeavors ever tackled by the FCC.  And no doubt the stakes are high.  But the bottom line is that only a competitive wireless marketplace is good for business, good for consumers and critical to future economic growth.
 
Kneuer is the former assistant secretary for Communications and Information and administrator of the National Telecommunications and Information Administration under President George W. Bush.