FCC chairman: GOP tax bill threatens 'US global leadership'

Federal Communications Commission (FCC) Chairman Julius Genachowski said on Tuesday evening that language in the House GOP payroll tax bill that restricts his agency's ability to regulate the airwaves could "threaten U.S. global leadership in spectrum-related innovation." 

"Several provisions of the House bill would tie the agency’s hands in ways that could be counterproductive, reducing economic value and hindering innovation and investment," he said in a statement after the House approved the bill 234-193.

President Obama has threatened to veto the Republican version of the legislation, which would extend a payroll tax cut and unemployment benefits but includes a variety of controversial provisions.

 The package includes Rep. Greg Walden's (R-Ore.) spectrum legislation, which could raise as much as $15 billion to pay for other provisions in the bill.

The spectrum legislation incentivizes television broadcasters to give up their airwaves for the government to auction to wireless companies, which have struggled to meet the data demands of smartphones and tablet computers. The bill also creates a nationwide broadband network for first responders.

Genachowski called House passage of a bill authorizing spectrum auctions "a major achievement" and applauded Republicans for including the public safety network.

"Unless we free up new spectrum for mobile broadband, the looming spectrum crunch risks throttling our mobile economy and frustrating mobile consumers," he said. 

But he warned that provisions limiting the FCC's ability to designate some spectrum bands for unlicensed use could stifle economic growth.

"Unlicensed spectrum stimulates innovation, investment, and job creation in many ways, including by providing start-ups with quick access to a testbed for spectrum that is used by millions, bringing new technologies to consumers in a rapid fashion," he said. "Wi-Fi, Bluetooth, cordless phones, garage door openers, wireless car keys, and baby monitors—industries generating billions of dollars of revenue — would not exist without unlicensed spectrum."

The Republican spectrum bill does not do away with unlicensed spectrum, but it does restrict the FCC's ability to set aside additional spectrum for unlicensed use.

When lawmakers debated the legislation earlier this month, Rep. Walden, chairman of the Energy and Commerce subpanel on Communications and Technology, argued that designating additional unlicensed spectrum would be a give away to big companies at the taxpayer expense. He noted that the government will have to pay broadcasters to incentivize them to give up their spectrum and said the government should not pay for frequencies that it will then hand over to private companies for free.

Democrats also oppose a provision in the bill that restricts the FCC's ability to impose net-neutrality conditions on wireless companies that purchase spectrum leases at auction. 

The FCC's net-neutrality rules prohibit Internet service providers from slowing down or blocking access to websites that compete with their interests.

Although Genachowski did not specifically mention the Republican anti-net-neutrality provision, he argued the legislation imposes too many restrictions on the FCC.

"Ensuring that the Commission retains the flexibility to determine the optimal band plan for new spectrum that becomes available, including the creation of guard bands and other interference safeguards, will enhance the value of the new commercial mobile licenses, as will ensuring that the Commission can conduct auctions in ways that will best further innovation, investment, and competition in the wireless space," Genachowski said.

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