Now, Washington is back in the business of putting vast chunks of wireless spectrum on the market. It has learned an important lesson: since 1993, the F.C.C. has leased spectrum to the highest bidder using Dutch auctions. From 2001 to 2010, it reaped a hefty $33 billion on behalf of taxpayers.But there is another lesson that the political system has not learned as well: how to foster competition. Cheap, competitive wireless broadband will be absolutely crucial for advancing the frontier of the digital economy. Yet as the government prepares to sell perhaps the last big chunk of valuable low-frequency spectrum that will be made available for wireless communications and mobile computing, pressure from Congress to raise as much money as possible threatens to get in the way of this objective....A critical concern is that AT&T and Verizon Wireless have deep enough pockets and a clear interest in keeping competitors out at any price. The two companies control roughly two-thirds of the cellular communications market and hold the licenses to 80 percent of the far-reaching, low-frequency spectrum most valued by mobile providers.
Now with the 5G developments and the ability to go as high as 100 bps/Hz in bandwidth utilization the incumbents have tons of capacity yet their game is and always was, and always will be to keep any potential competitor out. That is the conflict an FCC has. The conflict is that the price any new entrant would pay is always less than what the incumbent is willing to offer.
New incumbents will innovate whereas the old guys will just do more of the same, not that it is that bad but it is quite expensive. The incumbents are at best a duopoly and at worst a de facto monopoly, same genes, just different bodies.
The FCC is faced with a problem, actually many problems. First they are generally dumb, technically speaking. The FCC management just does not understand the potential of wireless, and in fact as I have examined in the recent books by Administration hangers on, neither does anyone in DC. Bandwidth is NOT the issue, capacity is, and capacity has exploded. Prices are kept high by limiting the players. Thus to the incumbents the cost of keeping out a competitor or even fronting a shill is the cost of doing business.
The 1996 Telecom Act had some potential but it was destroyed by the then Administration and most importantly by the FCC, the FCC under that Administration and the one following.
This ultimately leads to the question; what good is the FCC? Technology runs circles around it and the folks running through it all too often just use it as a stepping stone to feed at a higher level of the trough.
Posts
