Genachowski calls for action to OK incentive auctions

LAS VEGAS — FCC Chairman Julius Genachowski warned Friday that a shortage of spectrum for mobile broadband threatens the economic competitiveness of the United States and called for swift action to make more spectrum available.

Speaking to a standing-room-only crowd at the Consumer Electronics Show, Genachowski specifically cited broadcasters as a source of that new spectrum, and hailed the FCC’s current plan for incentive auctions as a way to bring market forces to bear on the issue — if Congress authorizes those auctions.

“Spectrum is becoming increasingly essential to daily lives of almost every American,” he said, adding “The coming spectrum crunch is not just an issue for the future of gadgets. It’s a vital strategic issue for the future of our economy and job creation, our global competitiveness. Failure to act can have disastrous consequences.”

Genachowski noted the amount of spectrum for mobile broadband has grown threefold in just three years, but predicrted that mobile broadband traffic will increase by a factor of 35 — and probably more — in the next five years.

“The challenge we face here in the US,” he said, “is that our spectrum policy is outdated, reflecting the communications needs of the 20th century.”

Of broadcasters, Genachowski said “The percent of viewers who use (TV) spectrum has declined from 100% to under 10%. Some (broadcasters) are moving to make effective use of DTV spectrum, some are not.”

“Given the need for mobile broadband,” he said, “how can we justify shielding broadcasters from market forces?”

He called for speedy Congresional action, saying “I believe incentive auctions are a test of whether the U.S. can make the right strategic choices in a fast-moving global economy.”

Genachowski spoke for some 30 minutes before entering a one-on-one conversation with Consumer Electronics Assn. president/CEO Gary Shapiro.

Shapiro has been a critic of the incentive auction plan, and wondered aloud from the stage why broadcasters should be compensated for spectrum at all.

Under U.S. law, the airwaves are, by law, public property, and are only leased by broadcasters, not purchased.

National Assn. of Broadcasters prexy/CEO Gordon Smith, a former Republican senator who is often at odds with Shapiro and the CEA, was in the room for the session and afterwards Variety asked him about the idea of skipping compensation for broadcasters.

“When spectrum was licensed to broadcasters many years ago, it was with an understanding that they would spend a lot of capital on detrimental reliance on those licenses to produce a great broadcast industry.”

Smith also said that a swath of TV spectrum in the UHF band was given up during the DTV transition, on the promise broadcasters could develop the rest. “The ink isn’t even two years old on that promise, and already it seems that there may be a reneging on the promise.”

Genachowski said later in a press conference the proposal for incentive auctions was designed to avoid a partisan fight.

“The proposal we put together is onethat’s designed to have fast movement in an area where we need fast movement for our economy and for our global competitiveness. It was based very carefully on what the approach would be that would maximize the benefit to the American people, to the economy, and to be fair to all concerned. And to get something done.”

Genachowski also expressed concern about Intellectual Property issues, but told the public gathering “We see a lot more problems overseas than in the U.S.” Later, he told a press conference the FCC is not currently considering any changes to common carrier rules to protect Internet providers if they try to stop piracy.

Common carrier rules protect phone networks and similar communications services from liability for any criminal activity done over the network, but only apply as long as all traffic goes unmonitored and unpoliced.

One reason given for Internet providers’ hesitancy to police piracy is that it would open the door for lawsuits over other nefarious activities, including child pornography, securities fraud, human trafficking and terrorism.

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