Commissioner: FCC picking ‘winners and losers’ for spectrum

The Federal Communications Commission (FCC) is meddling in the market by restricting the ability of some companies to participate in an upcoming spectrum auction, according to one of the panel's five commissioners.

Ajit Pai, a Republican, criticized FCC Chairman Tom Wheeler on Thursday for moving forward with a plan that could limit the amount of airwaves that major carriers like AT&T and Verizon can buy.

ADVERTISEMENT
"We should not pick winners and losers," he said at a forum sponsored by the wireless advocacy coalition Mobile Future. "The inevitable effect of a policy that limits participation will be less spectrum for mobile broadband, less funding for national priorities, a higher budget deficit, and an increased chance of a failed auction."

The Mobile Future coalition includes major wireless companies like Verizon and AT&T, as well as a range of smaller companies and business groups.

The FCC's proposal to cap the industry giants' participation in next year's spectrum auction has attracted heated pushback from critics and prompted AT&T to threaten to sit out the sale.

Smaller carriers say that limiting the larger companies from buying up all the in-demand low-frequency airwaves will improve competition in the marketplace. But the FCC's decision put its thumb on the scale does just the opposite, Pai said.

"It restricts competition," he said. "Instead of good, old-fashioned competition, the chosen few would have spectrum set aside especially for them."

In the highly anticipated 2015 auction, the FCC will buy airwaves from broadcast companies and resell it to wireless carriers looking to keep up with the growing demand for mobile access.

By law, the FCC is required to rake in billions of dollars to fund first responder networks, public safety efforts and to pay down the deficit. An overly complex auction that limits some companies from getting involved could threaten that obligation, Pai warned.

A straightforward auction is like a Rubik's Cube, he said: complicated, but still manageable. But an auction with limits is more like a Rubik's Cube with 17 blocks on each side "that has 1,539 parts."

"We at the FCC need to avoid creating an unnecessarily complex puzzle like this, in large part because I doubt that either we or auction participants could solve it," Pai said.