AT&T Blasts FCC Chairman's Remarks Opposing House GOP Spectrum Legislation

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By Paul Barbagallo  

AT&T Inc. sharply criticized remarks made Jan. 11 at the 2012 International Consumer Electronics Show in Las Vegas by Federal Communications Commission Chairman Julius Genachowski, who reaffirmed several of his “sticking points” regarding GOP spectrum legislation that passed the House last month as part of a tax extenders package.

In a blog post Jan. 13, Jim Cicconi, AT&T's senior executive vice president of external and legislative affairs, said Congress, not the FCC, should set rules for “voluntary incentive auctions,” in which the agency would reclaim airwaves from television broadcasters and auction them off to mobile network operators, sharing some of the proceeds with TV stations that volunteer to cease broadcasting and, ultimately, give back their spectrum to the government.

Genachowski wants as much flexibility as statutorily possible to design incentive auctions, including the power to say which companies can participate and which cannot.

“In our experience, anytime a regulatory agency seeks unfettered discretion that is the best reason Congress should not give it to them.”

Jim Cicconi, AT&T  

“In our experience, anytime a regulatory agency seeks unfettered discretion that is the best reason Congress should not give it to them,” Cicconi wrote.

Rep. Greg Walden (R-Ore.), the chairman of the House Energy and Commerce Communications and Technology Subcommittee and sponsor of the bill, included the provisions at issue to prevent the FCC from imposing so-called spectrum “caps" and further net neutrality mandates on auction bidders.

Walden fears that if the FCC is given carte blanche by Congress to design incentive auctions, the agency may decide to place limits on how much spectrum Verizon Wireless and AT&T, the two largest wireless carriers in the country, could buy in any given market. Under such a scenario, the FCC could even disqualify the companies from participating in bidding altogether. According to Walden, if the FCC bars two companies with deep pockets like Verizon and AT&T, the Treasury might even see lesser proceeds from incentive auctions.

After T-Mobile Shift, AT&T Hungry to Bid.

After failing to obtain regulatory approval to acquire T-Mobile USA, AT&T clearly has the most to lose by being barred from an incentive auction.

“The entire principle behind spectrum auctions is to allow free and competitive markets to work, thus ensuring that valuable spectrum goes to the most economically viable uses,” Cicconi added. “This also provides maximum return to the U.S. Treasury. For the FCC to assert, in the name of ‘fostering competition,' that it should have final say on which companies can bid on spectrum is for them to engage in picking winners and losers. That is not the job of the FCC.”

In his speech at the CES show, Genachowski voiced opposition to legislation that “prejudges or micromanages” FCC auction design and band plans. Doing so, Genachowski said, could “significantly diminish” the value of incentive auctions.

He also came out strongly against a provision in Walden's bill that would prohibit the FCC from designating reclaimed TV spectrum for “unlicensed”use. Unlicensed spectrum, which could be used by any company for free, has led to the growth of wireless technologies such as Wi-Fi. He noted that all the “in-home connectivity” he saw on the CES show floor used unlicensed Wi-Fi connectivity.

For AT&T's blog post, visit http://attpublicpolicy.com/fcc/att-statement-on-incentive-spectrum-auction-legislation/. For the text of Genachowski's remarks, visit http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0112/DOC-311974A1.pdf.