House Dems back FCC chief on airwave auction limits

House Democrats are throwing their weight behind Federal Communications Commission (FCC) Chairman Tom Wheeler’s plans to limit wireless industry giants AT&T and Verizon in next year’s airwave auction.

In a letter to Wheeler, 10 lawmakers applauded the agency’s proposal “to ensure every carrier has the opportunity to bid and win this beachfront spectrum and consumers, including those living in rural areas lacking sufficient mobile broadband coverage, enjoy the benefits of competition.”

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Signatories include House Energy and Commerce Committee ranking member Rep. Henry Waxman (D-Calif.), Rep. Anna Eshoo (D-Calif.), ranking member of the Commerce subcommittee on Communications, and Rep. Doris Matsui (D-Calif.), co-chairwoman of the Spectrum Caucus.

In Monday’s letter, the House Democrats commended Wheeler for his plans heading into next year’s auction, which will involve the FCC buying back airwaves from television broadcasters and reselling them to wireless companies looking to boost their cellphone networks.

The airwaves being sold in the auction are low frequency, which makes them particularly valuable becayse they can travel longer distances and better through walls.

Earlier this year, Wheeler announced that certain companies — especially AT&T and Verizon — would be kept from bidding on some of the airwaves in each market’s auction once the auction reaches a yet-to-be-determined revenue benchmark.

While some argue that companies should be able to bid without limits to ensure the auction meets its congressionally-set revenue goals — which will go toward funding a nationwide network for first responders and reducing the deficit — others say the deep-pocketed AT&T and Verizon should face bidding limits to promote competition for the smaller companies.

While Republicans have uniformly pushed Wheeler to abandon his plans to limit AT&T and Verizon, the disagreement over bidding limits has split House Democrats.

In Monday’s letter, Democrats praised Wheeler for “a transparent auction structure that accurately recognizes the unique value of low-band spectrum.”

The lawmakers said they believe the limits “will stimulate auction competition and revenues, ensuring opportunity to bid and win spectrum to enhance and extend rural build out and improve coverage in all areas, while guarding against excessive concentration of spectrum resources.”

But last month, a group of 78 House Democrats wrote to Wheeler asking him to allow unlimited bidding in the 2015 auction, citing concerns about the auction’s ability to generate revenue.

"Inviting as many bidders as possible to compete in an open and fair auction on equal terms will allow for the full market price of spectrum to be realized,” the lawmakers wrote.

Wheeler replied, defending his plan to limit those companies that already have large amounts of this low frequency spectrum.

"Today, most of this low-band spectrum is in the hands of just two providers," he wrote. 

"The Incentive Auction offers the opportunity, possibly the last for years to come, to make low-band spectrum available to any mobile wireless provider, in any market, that is willing and able to compete at auction."