Politics

The Fight for 700 MHz

Wireless politics in Washington, D.C. heats up as a new company with powerful backers seeks to change the rules and challenge the monopolists.

by Gerry Blackwell [July 26, 2007]

The future direction of the ISP industry may hinge on a controversial decision the Federal Communications Commission (FCC) is expected to make in late July about how it will auction 60 MHz of radio spectrum in the 700 MHz band.

It's spectrum currently used for analog TV broadcasting. It will become available for other applications—including broadband networking—in 2009 when television in America goes all digital. The FCC will likely auction the 700 MHz spectrum in January or February 2008.

At the center of the controversy is a brash start-up, Frontline Wireless, with some high-profile founders and backers, including vice chairman Reed Hundt, a former FCC chairman.

Proposal for change
Frontline has made a proposal to the FCC for a radical new approach to auctioning some of the available spectrum. If the federal regulator incorporates the company's ideas in its rule making for the auction, the winning bidder would be required to build a nationwide open-access broadband network to be shared by public safety users—police, fire and other first responders—and commercial service providers.

The winning bidder would be a wholesale-only carrier, selling capacity to public safety organizations at discounted rates and commercial service providers, including ISPs, at market rates.

This could be hugely important for independent ISPs. It means they could buy capacity and offer mobile subscribers nationwide wireless broadband service to supplement their wireline services. If no such open-access network emerges and independent ISPs cannot offer wireless services, subscribers may switch in droves to cellular providers who will be able to offer bundled wired and wireless broadband service.

Given the public benefit inherent in the Frontline proposal—the winning bidder would be building a public safety network that might otherwise cost tax payers billions of dollars—and given the company's team of influential industry veterans, it is more than likely that at least some of its ideas will be adopted by the federal regulator. Early unconfirmed reports of internal FCC deliberations suggest this is the case.

Besides Hundt, the Frontline team of heavy hitters includes chairman Janice Obuchowski, founder and president of Washington D.C.-based consultancy Freedom Technologies and a former senior technocrat in the George H.W. Bush administration, executive vice president and co-founder John Leibovitz, a media/telecom consultant with McKinsey & Company, and chief technologist Stagg Newman, who was chief technologist at the FCC for two years.

One of the company's main backers, meanwhile, is James Barksdale, president and CEO of philanthropic investment company Barksdale Management Corp. Barksdale held senior positions at AT&T Wireless, McCaw Cellular, and Federal Express, and has most recently been chairman of the Governor's Commission on the Recovery, Rebuilding and Renewal of Mississippi (after Hurricane Katrina).

Frontline also has the support of influential Silicon Valley players such as Google, Yahoo, and Skype.

The block of 700 MHz spectrum coming free in 2009 actually comprises 84 MHz in total. The FCC had already reserved 24 MHz for use by public safety organizations.

The Frontline proposal calls for the FCC to attach special rules to 10MHz of the 60 allotted for commercial use. The controversy arises because it also calls for the winner of that block of spectrum—now referred to as the D block—to have the use of half the 24MHz of spectrum reserved for public safety applications.

In return, the winner would have to build a nationwide broadband network reaching 99 percent of the population within ten years. Public safety organizations would have absolute priority on the 12 MHz of network capacity originally allotted for their use. And in major emergencies, if additional bandwidth were needed, they could use capacity from the 10 MHz of D block spectrum.

But in the meantime, the network operator could also sell its commercial customers unused capacity in the 12MHz of public safety spectrum.

Frontline proposes using the same kind of IP packet-level prioritization used routinely in many network applications today. The requirement to give public safety organizations priority means commercial service could "theoretically" degrade in the event of a major emergency, but it would happen rarely if at all and would likely only be local or regional in effect.

"If you work the numbers, it would be very rare that [public safety users] would ever need more than half the capacity available," says Frontline's Newman.

It does mean service providers could only use the public safety spectrum to offer "best effort" network services rather than offering service level agreements (SLAs) absolutely guaranteeing up time and bandwidth. But these are not major impediments, Newman says.

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