MIT Memo to Markey on Spectrum giveway [pardon if this is a repeat .. djf]

[David Farber <farber () central cis upenn edu>]

PLEASE FEEL FREE TO RE-DISTRIBUTE THIS WIDELY.




Memo to: The Hon. Rep. Edward J. Markey,
Chairman, Subcommittee on Telecommunications,
U.S. House of Representatives


From: David Carver, Tom Hargadon, Jr., Clark E. Johnson, Jr., Lee McKnight,
Russell Neuman, Suzanne Neil & Richard J. Solomon


Research Program on Communications Policy
Center for Technology, Policy & Industrial Development
Massachusetts Institute of Technology
Cambridge, Mass. 02139




The proposed Sec. 203 Broadcast Spectrum Flexibility amendment to HR 3636
fails to take into account recent radical changes in spectrum technologies.
Any changes in the use of the invaluable TV spectrum should not be made
with undue haste. New legislation on the re-allocation of spectrum use
requires careful technical and economic evaluation and broad public debate.
For example, these following points must be addressed to be sure the public
interest is fully satisfied:


- The spectrum is a public resource, and the public owns it. As a matter of
equity, a public trust is given to private enterprise to develop its uses.
The TV spectrum public trust was for broadcasting television, sponsored by
advertisers. If non-conventional television services are to be provided,
others besides the existing broadcasters should have the option to bid on
its use including telephone carriers, personal communications providers,
cable networks, minorities, and other entrepreneurs and non-profit
enterprises.


- Proposed Sec. 302 changes the HDTV agenda. It says HDTV is not really
about TV, but how the spectrum is to be allocated. New digital technologies
-- some developed by U.S. HDTV researchers -- make it possible to do a
number of different things with spectrum. Cellular digital TV promises to
be a very efficient way of using this scarce public resource. However,
there has not been sufficient time to analyze these new opportunities, nor
have any of these technology shifts been reviewed in Congressional
Hearings. The Congressional Office of Technology Assessment has just begun
a study on how new radiofrequency technologies can be used for local
infrastructure, and ARPA has several technical studies underway on
broadband spectrum utilization. Before Congress narrowly re-allocates the
spectrum, it may be best to wait until those studies are completed.


- The auction of roughly 40 Mhz of spectrum for personal communication
services (PCS) isexpected to bring in some $8 Billion in sorely-needed
revenue for the Federal Government. In contrast, some 400 Mhz of TV
spectrum might become available because these of new technologies. If
auctioned off, the 400 Mhz could be worth more than $100 Billion to the
taxpayer. Proposed Sec. 302 does not adequately address this issue, because
passage of the Amendment may devalue the PCS spectrum before auctioning.
Without a serious economic study, we do not know what we may be giving
away.


- This bill is intended to open up competition in telecommunications
industries that are converging due to digital technologies. TV spectrum is
an important part of that convergence, especially for local infrastructure,
since it can solve many of the "last mile" access problems for broadband
links. Competition should extend to use of the TV spectrum for
non-television purposes if Congress expects to maintain a "level playing
field" among competitors in the local arena. Legislation should be explicit
about how this competition will be maintained.


- Each UHF TV station today has one or more unused ("taboo") channels
associated with it, in some cases as many as 3 or 4 taboo channels per
station in each region that cannot be used due to interference. If HDTV is
desirable in the public interest, as the FCC has already stated in its
Report & Order, it is important that legislation explicitly specify that
the taboo channels cannot be used for anything else except HDTV. Any
attempt to use these taboo channels for anything else during the transition
may effectively kill terrestrial HDTV implementation. Therefore, several
major American corporations may have invested millions of dollars for
nothing. Also, any perceived American lead in world HDTV technology may
have been destroyed before it began.


- With new digital technology, it may be possible to use the taboo channels
for other services, including cellular local broadband two-way
communications, or additional TV stations, without interfering with
existing TV stations. The current wording of Sec. 302 is too vague, since
it could imply that channels not being used today because of interference
are part of the current broadcasters' dominion.


- Cellular TV techniques being proposed by the broadcasters might actually
free up as much as 20-30% of the UHF spectrum including the taboo channels,
depending on the mix between HDTV, regular TV, and other services. If these
new technologies are used, existing television and radio broadcasters would
have no need for any additional spectrum for broadcasting even if they
wanted to add conventional channels. The technologies are currently under
rapid development in the U.S. and in Europe, however, there are still too
many unknowns to make a clear legislative decision on changing the way
spectrum is allocated. Any additional space that is freed up should be made
available to anyone who bids for it, and legislation should make that
explicit, not fixing in advance who may use it.


- Any major modification of the use of TV spectrum to be compatible with
the needs of the national information infrastructure must take into account
universal access, including two-way interactive, symmetrical needs. There
are many firms investing in interactive spectrum-based services who need to
appreciate how much competition they will have before making large
investments. It is not clear in the proposed legislation whether one-way
broadcasting or two-way interactive services will be permitted. This should
be explicit.