FCC Chief Warns Broadcasters — Give Up Space for the Mobile Revolution

CES: Julius Genachowski calls for voluntary auctions and reallocation of “spectrum” space by broadcasters

A mobile revolution is coming, Federal Communications Chairman Julius Genachowski is sure of it.

He's also certain that unless broacasters open up needed spectrum space, it will be impossible to meet the future needs of mobile and broadband providers.

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"We're in the early stages of a mobile revolution that is sparking an explosion in wireless traffic. Without action, demand for spectrum will soon outstrip supply," Genachowski said in prepared remarks, in advance of his presentation at the Consumer Electronics Show on Friday.

Pointing to the fast growth in 4G devices, mobile broadband, tablets and e-readers, he said: "The consumer electronic industry is going wireless, and the future success of this wide-ranging industry and others depends on whether our government acts quickly to unleash more spectrum — the oxygen that sustains our mobile devices."

Indeed, having proposed new rules of the road as part of a controversial net neutrality order last month, Genachowski pledged that addressing the controversy over the nation's coming spectrum crunch will now move to the top of the FCC's agenda.

His proposal to CES — certain to rankle the television industry: a voluntary "spectrum auction," in which broadcasters will surrender some of their allocation to mobile and broadband providers

Under that proposal, current spectrum licensees would voluntarily allow the FCC to sell off a portion of their spectrum for wireless broadband use. In return, they would receive some portion of the proceeds.

He also reiterated the FCC's previous calls to reallocate 300 megahertz of spectrum "suitable for mobile-flexible use" within five years.

Other reasons he cited for the need for spectrum readjustments:

"Everywhere you look, mobile is becoming a staple of the workplace, increasing productivity and contributing to our economy.  From managing crops on a farm to managing inventory at Best Buy, mobile broadband is increasing productivity and contributing to our economy.

"Thanks to Skype, Facebook, Twitter and many others, mobile has become an incredible platform for connecting friends and families, kids on one end of the country to grandparents on the other.

"Mobile broadband can empower people not only in 21st century economies, but can promote 21st century democracy.  We've seen this around the world."

In addition to divvying up the current spectrum, the chairman said that the country must continue growing its wireless infrastructure by building more cellular towers. 

But it will have to move fast to meet the rising demand, he said.

According to a recent FCC study, from the first quarter of 2009 through the second quarter of 2010, the amount of data used by wireless consumers grew by more than 450 percent. Within five years, the FCC estimates that the amount of information flowing on the networks will increase from 25 to 50 times current levels.

Genachowski chose a safe setting to deliver his warning — CES is a veritable temple to emerging technologies. But even in Las Vegas, it's a divisive issue that is pitting old and new media against each other. 

On Thursday, Consumer Electronics Association president and CEO Gary Shapiro attracted fierce blowback after an opening speech in which he accused broadcasters of "squatting on our broadband future," by blocking the FCC's plans to reallocate spectrum.

National Association of Broadcasting President Gordon Smith pounced on Shapiro's remarks, saying that they ignored the growing popularity of broadcasting’s mobile DTV as an alternative to wireless broadband.

“Nobody has given back spectrum like we have, nearly a third in the digital transition. We already gave at the office," Smith said in response to Shapiro's remarks. 

Tellingly, Genachowski, who has drawn the ire of the NAB for his spectrum stance and  moves to alter the way retransmission negotiations are conducted, was effusive in his praise of the CEA and Shapiro. 

"I applaud CEA for its strong work to make incentive auctions a reality. And I'm pleased to be here at CES, with so many people who live and breathe the opportunities of technology, to talk about the importance of fighting for our mobile future," Genachowski said.

In embracing issues such as the mobile industry's spectrum needs and net neutrality, the FCC and by extension the Obama administration, has aligned itself with the needs of the internet and mobile sector.

In his remarks, Genachowski indicated that the satisfying the growing appetite for mobile data transmission was critical to the country's economic future. As evidence, he cited the rising popularity of internet based telecommunication platforms such as Skype and the expanding sales of tablets and phone apps. 

"Though we can't see it, spectrum is becoming increasingly essential to the daily lives of almost every American," Genachowski said. "This invisible infrastructure is the backbone of a growing percentage of our economy and our lives." 

"And whether or not most Americans know the physics of spectrum, they know what it feels like to have a slow connection or a call dropped. And they know we need to lead the world in mobile, and not fall behind," he added.