roundtable: Selling off the Public Spectrum

roundtable: Selling off the Public Spectrum

Selling off the Public Spectrum

Vigdor Schreibman - FINS (fins@access.digex.net)
Fri, 6 Oct 1995 16:12:43 -0400 (EDT) 

Date: Fri, 6 Oct 1995 16:12:43 -0400 (EDT)
From: Vigdor Schreibman - FINS <fins@access.digex.net>
To: Vigdor Schreibman - FINS <fins@access.digex.net>
Subject: Selling off the Public Spectrum
Message-Id: <Pine.SUN.3.91.951006161105.21946D-100000@access1.digex.net>


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FINS: Communicating the Emerging Philosophy of The Information Age       
FEDERAL INFORMATION NEWS SYNDICATE                    
Vol III, Issue No. 19 (124 lines)                           October 9, 1995
    
     
                  READ THIS ISSUE OF FINS TO CONSIDER:      
                                                             
                *   Changing the basic structure of broadcasting
                                          
                *   The unsettled existing situation
    
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CLOSING THE "VALUES-GAP":
Selling off the Public Spectrum
By Vigdor Schreibman

  During great social transformations, such as that which follows a radical
change in the means of communications, the old morality falls under the
stress of new conditions setting the framework for rewriting the moral
charter of a people, for better or worse.  Take, or instance, the actions of
the US Congress regarding the great broadcast spectrum that is the foundation
for the preeminent electronic medium of communications in the United States. 

  The broadcast spectrum is owned by the American people, whose first
amendment rights are paramount in the field of broadcasting, according to the
Supreme Court.  This national resource has traditionally been safeguarded, at
least in legal theory, for the avowed purpose of maintaining the control of
the United States over all the channels of communications by wire and radio,
"for the maximum benefit of all the people of the United States."

  Recently, however, it occurred to someone at the late Office of Technology
Assessment (OTA), according to Sen. Ted Stevens (R-AK) in a statement on the
floor of the Senate recently, that the public spectrum might have very
substantial value in the marketplace.  OTA was right.  The first broadband
PCS (personal communications services) auctions conducted by the Federal
Communications Commission, as of Mar 13, 1995, brought in an astonishing $7.7
billion for 102 licenses, including 60 Mhz [Pepper, May 1995].

  The auction of a treasured national resource, it is reasoned by members of
the 104th Congress, could raise money for the government to help balance the
budget. Private corporate wealth could, thereby, also take over control of
the uses of the electronic medium as a powerful instrument to serve corporate
self-interests, instead of being used for the maximum benefit of "all the
people," as Congress originally intended. Sen. Larry Pressler (R-SD),
chairman of the Senate Committee on Commerce, Science, and Transportation has
even announced plans at a budget reconciliation mark-up Sept 28, to
"privatize public broadcasting" by selling off a $4 billion chunk of the
public spectrum to fund a new public broadcasting entity, which would
thereafter not require Congressional appropriations or oversight.  One can
only speculate how a "privatized public broadcasting" system designed by Sen.
Pressler, might be structured and how this would serve the public.  

  Moreover, with the expected transition from analog to digital spectrum
uses, many potentially lucrative new business uses of the public spectrum
have been identified that could provide, for example, multiple new channels
of digital television services as well as non-broadcast services for paging,
a vast array of data services, pay-per-view, and home shopping.  Robert
Pepper of the FCC Office of Plans and Policy, has confirmed private estimates
based on only current uses, which are primitive, that the market value of UHF
and VHF cellular, broadband and narrow band spectrum, might be worth as much
as a half-trillion dollars in the future.

  With these possibilities for new sources of government revenue to help make
good on the Republican "Contract with America," the fiscal year 1996 budget
resolution directed the Senate Commerce Committee to find ways to increase
revenue by some $15 billion for the period 1996-2002.  Consequently, Congress
is going to try selling off another 120 Mhz of the public spectrum and expand
the authority of the FCC to do so.  There are a few complications, however.

  It was revealed by Sen. Hollings that during the last two Congresses
members looked in vain for another 100 Mhz of public spectrum.  Hollings said
even the chairman of the FCC observed, "I don't know where to find it."  

  The FCC previously set in motion rules for broadcast transition from analog
to digital television to enable broadcasters to provide High Definition
Television (HDTV).  These rules calls for reservation of an extra chunk of
public spectrum for the exclusive use of existing television station owners,
valued at $20 to $70 billion, which was written into the telecom bills by the
broadcasters and approved by the House and Senate [S. 652; H.R. 1555].  That
extraordinary benefit very likely influenced the multibillion dollar premium
stock prices paid for recent broadcast network mergers of CBS/Westinghouse,
and ABC/Disney.  But now no one seems to want HDTV, with the extraordinary
lucrative uses found for digital broadcasting.  So the Commerce Committee has
now put a hold on any such free allocations, with a view toward auctioning
off the auxiliary spectrum, despite expected opposition from broadcasters. 


  A new "spread spectrum" technology now moving into prominence would make
obsolete the traditional practice of granting exclusive rights to any
specific part of the spectrum.  Such grants tie up use of the spectrum for
minimum needs of only one user, when many users could be using the same
spectrum spaces with a technology that searches out unused parts.

  Finally, the whole legislative scheme suffers from the problem that the
Senate Commerce Committee is not permitted by the rules of Congress to
initiate any such fund raising measures.  To get around this technicality
members intend on cloaking the undertaking in smoke and mirrors.  When Sen.
Stevens explained at the Committee mark-up Sept 28, how he planned to
accomplish this, his explanation was so difficult to understand that Sen.
Wendell Ford (D-KY), made a motion that, "All that understand that statement
vote aye."  Members just laughed, and Stevens gave up trying to explain.

  Seeking to refine the ultimate measure dealing wih these complex and
conroversial issues of importance, the Commitee proposal would direct the FCC
to re-evaluae its advanced television plan and report back to Congress wihin
180 days of enactment.  In the meanwhile the FCC would be prohibited from
awarding ATV spectrum to existing broadcast licensees.  Welcome signs.
  
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