Subject: [NEXTEL-1] Airwave battles mount before FCC overhaul

From: [email-masked]
Date: Fri, 16 May 2003 04:49:39 -0400

Airwave battles mount before FCC overhaul

03/13/2002 - Updated 10:36 PM ET

By Paul Davidson, USA TODAY

In an age when many U.S. consumers can pick
from six or more mobile phone services, about
13,000 residents of rural southeast and central
Alaska still have none.

Alaska Power & Telephone can't justify shelling out
$800,000 at federal auctions for airwaves needed
to carry wireless signals for such a tiny audience.

Recently, though, AP&T told the Federal
Communications Commission it could offer
service using free, unlicensed spectrum if it got a
waiver to do voice transmissions on frequencies
set aside for data.

But Dobson Communications, a cell phone
provider in nearby Fairbanks and Juneau, is crying
foul: It paid big bucks for airwave licenses for its
service. "A grant of the waiver would undermine the integrity of the competitive bidding
process," Dobson says in an FCC filing.

Battles like this one likely will be more frequent in coming months. The FCC is poised
to transform how it doles out airwaves to wireless carriers, broadcasters and satellite
firms. The agency wants to encourage wider unlicensed sharing of spectrum and
relax rules on how companies may use licensed spectrum they buy from the
government.

"The government has always had this role of providing spectrum," says FCC
Chairman Michael Powell. "But there's a view that the public owns the spectrum. And
what's really started to happen is there are many more creative ways" to use it.

Such ideas for reforms swirled for years but have taken on urgency thanks to soaring
demand for wireless services. Like a pasture grazed by too many cows, the airwaves
are packed. In the past two years, the number of mobile-phone and satellite TV
subscribers each has risen about 40%, to 132 million and 18 million, respectively.

The overcrowding has sparked a litany of interference complaints from existing
services, such as mobile phones, about new entrants, such as satellite radio.

For decades, the agency has licensed — most recently by auction — specific
frequency blocks to certain industries. Congress created the system in 1934 to police
interference on the radio dial.

But some experts say the system is an anachronism now that smart antennas can
recognize and grab a relevant signal, even when different services use the same
frequencies. Devices equipped with such antennas and operating at very low power
could share designated frequency bands without needing an FCC license, just as
portable phones and garage-door openers do.

A more flexible approach would let airwaves be used more efficiently and innovatively,
experts say. That could ease a shortage that has led to spotty cell phone coverage
and slowed the rollout of wireless Internet services. It also could bring offerings to
rural communities now too costly to serve.

With an unlicensed service, residents of 18 towns in Alaska's forests and tundra
could "have connectivity anywhere in town," says Michael Garrett, president of AP&T
unit Alaska Telephone. They could not, though, use the low-power service outside
their towns.

But incumbent users of the airwaves, such as Dobson, are wary, saying new,
less-regulated services would interfere with their networks and devalue their
investment in licenses.

Balancing act

The FCC is trying to balance both interests by cautiously moving to a more pliant
system while still policing interference. Last month, it appointed a spectrum policy
adviser and approved a breakthrough unlicensed service, ultra-wideband. Other
proposals are likely to be passed within months.

How the FCC, and possibly Congress, plan to encourage more efficient spectrum
use:

Promoting more unlicensed services. New software-based antennas can
share frequencies. Many use a technology called "spread spectrum," which
disperses a signal across a broad swath of frequencies at low power,
minimizing interference. Receivers are coded to pluck out the signal sent by a
certain transmitter, filtering out others. The CDMA (code division multiple
access) standard used by many mobile-phone firms is based on spread
spectrum.

Another technology dodges static by finding open channels and hopping from one to
the other. By contrast, current mobile-phone services monopolize entire blocks of
channels even when they are not in use. The distinction, experts say, is akin to that
between the wired phone network, with customers speaking over specific lines, and
the free-form Internet — or railroad tracks vs. highways.

Although some of the technologies are not new, falling equipment prices have made
unlicensed frequency sharing more feasible, says New York University law professor
Yochai Benkler.

For years, Benkler's academic views got scant notice at the FCC. That changed with
the wildfire growth of a technology based on spread spectrum called Wi-Fi (wireless
fidelity). Wi-Fi lets providers such as Wayport and Ricochet create unlicensed
wireless Internet networks in homes, airports, even cities.

Open to all?

Some experts say the FCC should open virtually all the airwaves to unlicensed
services and raise maximum power levels enough to permit mobile-phone networks.
"It's definitely possible to operate without interfering with existing networks," because
of the low-power emissions, says Dave Beyer, head of wireless routing for Nokia, the
biggest maker of mobile handsets. It's rolling out a wireless Internet service to homes
using 2.4 gigahertz unlicensed spectrum.

Others disagree. "There are often strong differences among engineers about what
levels of interference will occur," says Julius Knapp, deputy chief of the FCC's office of

engineering and technology. "These sorts of issues are going to be looked at closely."

Mobile-phone giants with costly spectrum licenses say no interference should be
tolerated. "Whoever paid billions for that spectrum should not have that right taken,"
says Steve Berry of the Cellular Telecommunications and Internet Association (CTIA).

Stanford University law professor Lawrence Lessig says the real point is that obsolete
technologies should make way for new ones. "Cars interfered with horses and
buggies, but you wouldn't shut down GM. Horses and buggies have to move away. It's
the same with spectrum hogs."

Another point in favor of an unlicensed system is that it could foster innovation.
Equipment makers typically gear products "to a select handful of license holders" who
shy from risks, Beyer says. By contrast, a Nokia unit concocted a wireless Web
network in which rooftop antennas communicate with each other instead of a base
station because it knew it could sell to a diverse base of unlicensed Internet service
providers.

Realistically, there is no chance the FCC will open all the airwaves to unlicensed
providers. But the agency may permit unlicensed uses on select licensed bands,
raise allowable power levels in existing unlicensed bands and possibly carve out new
unlicensed bands.

The FCC took a big step with the ultra-wideband approval last month. The new
unlicensed wireless service likely will spawn home wireless video networks and
other services. Eventually, experts say, it will be so refined that it can power
unlicensed mobile-phone networks on existing licensed spectrum without interfering.

"I think it's simply a matter of time before it can compete with wireless providers," says

analyst Rudy Baca of the Precursor Group.

But only if the FCC allows further development of ultra-wideband. And that idea is
likely to raise the hackles of mobile-phone giants who fear the devaluing of their
multibillion-dollar investment in spectrum. "There's an expectation that the asset you
purchased will not be eroded by the government," Berry says. He suggests that
companies should pay for the right to use airwaves for unlicensed services.

Politics and money

There are also political hurdles, Baca says. Auctions "are a big moneymaker for
politicians."

Benkler blasts the FCC for plans to proceed this year with three more auctions of the
little remaining prime spectrum, because that will make future frequency-sharing even
thornier. "We need to stop the auctions so we can make these policy decisions," he
says.

Sen. Ron Wyden, D-Ore., says he's trying to rally lawmakers to support more flexible
use of the spectrum.

"The goal of reform," he says, "has to be to maximize efficient use of spectrum, not
short-term revenue for the government."

Spectrum sharing is no panacea — too many unlicensed services might bump into
each other, even if cordoned off in their own band, says former FCC official Dale
Hatfield. But, he adds, "It's very much worth the experiment."

Relaxing rules on spectrum allocation. The FCC has long parceled
airwaves in a fairly rigid way.

Specific blocks go to specific industries: mobile phones, fixed wireless, broadcast,
satellite and so on. The aim was to grant a fair allotment for each industry and prevent
interference.

Also, while licenses can be sold under certain conditions, owners rarely sell, because
they might need the spectrum someday. And leasing is all but impossible: The FCC
fears losing control over lessees who might cause interference or break rules.

The system's inflexibility was underscored by the recent failures, such as that of
mobile satellite provider Iridium. Under the current system, it could not use the
licenses for a different service, nor peddle them to others.

Such frustrations, along with more static-resistant new equipment, are prompting
change. Future auctions will be open to any industry, officials say. And the FCC is
expected to make leasing much easier in a few months.

"The idea is to set basic standards, so you can control interference but not tie their
hands," Knapp says. That, he says, "would let the market work, rather than trying to
hold back spectrum when there's so much demand."

Help for rural areas

Rural phone companies welcome the proposals, saying auctions are too expensive
because they must bid for geographic regions far bigger than their planned service
areas.

Central Texas Telephone Cooperative wants to lease airwaves from big carriers to
beam phone service to new homes in outlying areas instead of installing new wires.

"It would lower our costs from $10,000 per subscriber to less than $1,000," says CEO
Delbert Wilson.

CTIA's Berry, though, is worried. "Why should I be allowed to change my use (such as
from wireless to broadcast) if I interfere with somebody else already there?"

Fairly resolving interference disputes. The FCC is refereeing a spate of
battles between proposed or new wireless services and incumbents claiming
interference. They include: satellite radio services vs. mobile-phone carriers,
mobile-phone carriers vs. police and fire radios, and a wireless TV service vs.
direct broadcast satellite (DBS) services.

Typically, new services use modern transmitters that minimize disruption and
incumbents have older, more sensitive equipment.

Who pays for progress?

The FCC seems inclined to permit the new services while guarding against
interference.

But it must answer some vexing questions:

Who pays for incumbents to buy new equipment or move to other channels?
Entrants, incumbents or both?
And how much interference is tolerable?

Powell's senior legal adviser, Peter Tenhula, offers this analogy: "Do you mitigate
airplane noise based on the guy who goes to his back yard to read? Or do you
assume people will be in houses?"

http://www.usatoday.com/money/covers/2002-03-14-airwaves.htm

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