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Who Says Economists Never Agree? Big Coalition Backs Obama on Spectrum Who Says Economists Never Agree? Big Coalition Backs Obama on Spectrum

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TECHNOLOGY

Who Says Economists Never Agree? Big Coalition Backs Obama on Spectrum

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FCC Chairman Julius Genachowski(x)

More than 100 prominent economists, including a few Nobel Prize winners, endorsed the Obama administration’s efforts to shift television signals to broadband providers on Wednesday.

In a letter to President Obama, the economists urged Congress to grant the Federal Communications Commission authority to conduct so-called incentive auctions to facilitate the planned transfer of spectrum.

 

Under the approach, a TV station could voluntarily agree to have some or all of its frequencies auctioned to mobile carriers in exchange for a cut of the proceeds.

The letter was released on Wednesday at a White House event promoting the use of spectrum auctions to harness the potential of wireless broadband. Debate is intensifying in Washington over efforts by the Democratic-led FCC to shift capacity from TV stations to wireless carriers to alleviate a looming shortage of megahertz needed to meet growing demand for smart phones, tablets, and other devices.

“It’s essential that we move quickly,” FCC Chairman Julius Genachowski told a packed conference room in the Old Executive Office Building.

 

“Mobile broadband is being adopted faster than any platform in history,” he added. “If we wait until there’s a crisis, we will have waited too long.”

While broadcasters have reluctantly agreed to voluntary auctions, they’re concerned about the consequences, which could include “repacking” TV stations closer together on the dial and moving them to different frequencies.

Stations fear such changes would result in interference to their digital signals, and could jeopardize transmissions of high-definition programming and their rollout of a new technology, mobile DTV. Broadcasters also are concerned that if the auctions don’t recoup enough frequencies for wireless broadband, the administration might force stations to relinquish airwaves.

“Because of changing technologies, demand, and relative costs, old spectrum allocations based on out-of-date assumptions have become inefficient, wasting valuable spectrum resources,” the economists wrote. “Existing laws do not give the FCC the tools it needs to allow spectrum to be reallocated efficiently and quickly from old uses to newer, currently more valuable uses.”

 

Those signing the letter include former chief economists at the FCC under both Democratic and Republican administrations and academics from many of the nation’s top universities, including auction expert Lawrence Ausubel of the University of Maryland, Benjamin Edelman of Harvard Business School, and Timothy Bresnahan of Stanford University.

This article appears in the April 6, 2011 edition of National Journal Daily PM Update.

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