Wednesday, April 27, 2011

NAB’s Spectrum Paper Misses the Mark

NAB released a study that claims there is no spectrum crisis. Too bad the study doesn’t contain any quantifiable analysis. The study relies on (1) procedural attacks on the FCC, (2) a discussion of networking technologies without sufficient technical or economic analysis, and (4) an argument that the FCC should find spectrum somewhere else.

NAB’s procedural argument attacks the FCC’s own analysis as well as its reliance on evidence produced by independent analysts. NAB complains that the FCC’s decision was based on the forecasts of independent analysts and that the FCC’s technical paper supporting the need for additional spectrum took too long. NAB does not, however, claim that the forecast of the independent analysts were wrong or explain why the FCC’s delay in issuing its technical analysis is relevant to its substance.

In any event, NAB’s sole focus on the findings of the FCC is too narrow. The international community recognizes there is a spectrum crisis as well based on a rigorous technical analysis. According to the calculations of the International Telecommunication Union (ITU), 1,280 MHz to 1,720 MHz (including spectrum already in use or planned to be used) will be needed to support new mobile wireless broadband technologies. (See ITU report here.) Compared to the ITU’s estimate, the FCC’s plan to make available 500 MHz of spectrum in the next ten years is conservative.

NAB’s recitation of potential new network technologies fails because it doesn’t quantify the overall potential capacity benefits of these technologies or their cost. There are limits to cellularization of networks based on physics, economics, backhaul availability, and environmental concerns. The NAB study doesn’t discuss any of these issues. It also doesn’t discuss the extent to which spectrum forecasts have already taken these potential capacity increases into account. Compiling a list of potential network technologies doesn’t qualify as quantifiable analysis.

NAB’s claim that mobile service providers are warehousing spectrum also rings hollow. NAB uses cable operators as its poster children for this argument. But the statements of one set of licensees that hold a mere 10 MHz of spectrum in certain markets do not mean there is no spectrum crisis. Here NAB commits the fallacy of “proof by example” – if one licensee is warehousing spectrum (no matter how little), all licensees are warehousing spectrum. That fallacy won’t fly.

Finally, NAB argues that, if the FCC just made all spectrum in its pipeline available, the crisis would be solved. But the FCC and ITU analyses have already taken this spectrum into account.

Everyone agrees there is a spectrum crisis except the broadcasters – the group from which the spectrum would come. But if NAB really believes there is no spectrum crisis, it wouldn’t worry about incentive auctions. Service providers won’t pay for spectrum they don’t need. Of course, NAB never paid for it either.

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