FCC chief: Airwave auction should boost competition

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Genachowski touted his 2011 decision to block AT&T's $39 billion bid to buy T-Mobile, saying it was "absolutely the right call."

"Two and a half years ago, the U.S. mobile marketplace was on the doorstep of duopoly," Genachowski said. "Look at the market now."

He said that thanks to the FCC's efforts, T-Mobile and Sprint are "moving up, they're getting stronger and we're seeing a healthy competitive market." He noted that T-Mobile is trying a new business model by offering contract-free plans. 

"Meanwhile, AT&T and Verizon are doing exceptionally well," he added.

But Genachowski also said that even the largest cellphone carriers need access to more airwaves to meet their customers' booming demand for mobile data.

"I'm convinced the auction will be designed so that everyone can get more spectrum," Genachowski said.

In a letter to Genachowski earlier this month, the Justice Department's Antitrust Division urged the FCC to use "rules, weights, or caps" to prevent Verizon and AT&T from buying up all of the airwave licenses at auction.

The Justice Department argued that ensuring smaller carriers have access to spectrum — the airwaves that carry all wireless signals — is critical for promoting competition and keeping prices down.

But in its own filing with the FCC, AT&T blasted the Justice Department's advice and said the agency was trying to rig the auction in favor of the smaller carriers.

"Picking winners and losers in this fashion would be patently unlawful," AT&T wrote.

Also on Tuesday, a trio of economists released a study, which found that restrictions on the auction could reduce revenues by as much as 40 percent.

Genachowski announced last month that he would step down some time in the coming weeks. President Obama is expected to name Tom Wheeler as his successor on Wednesday.

—Updated at 5:55 p.m.