Spectrum Policy in the Age of Broadband:
Issues for Congress
Linda K. Moore
Specialist in Telecommunications Policy
June 21, 2012
Congressional Research Service
7-5700
www.crs.gov
R40674
CRS Report for Congress
Pr
epared for Members and Committees of Congress

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Summary
The convergence of wireless telecommunications technology with the Internet Protocol (IP) is
fostering new generations of mobile technologies. This transformation has created new demands
for advanced communications infrastructure and radio frequency spectrum capacity that can
support high-speed, content-rich uses. Furthermore, a number of services, in addition to consumer
and business communications, rely at least in part on wireless links to broadband (high-
speed/high-capacity) infrastructure such as the Internet and IP-enabled networks. Policies to
provide additional spectrum for mobile broadband services are generally viewed as drivers that
would stimulate technological innovation and economic growth.
The Middle Class Tax Relief and Job Creation Act of 2012 (P.L. 112-96, signed February 22,
2012) included provisions to expedite the availability of spectrum for commercial use. These
include expediting auctions of licenses for spectrum designated for mobile broadband;
authorizing incentive auctions, which would permit television broadcasters to receive
compensation for steps they might take to release some of their airwaves for mobile broadband;
requiring that specified federal holdings be auctioned or reassigned for commercial use; and
providing for the availability of spectrum for unlicensed use. The act also includes provisions to
apply future spectrum license auction revenues toward deficit reduction; to establish a planning
and governance structure to deploy public safety broadband networks, using some auction
proceeds for that purpose; and to assign additional spectrum resources for public safety
communications.
Increasing the amount of spectrum available to support new mobile technologies is one step
toward meeting future demand for mobile services. This report discusses some of the commercial
and federal spectrum policy changes required by the act. It also summarizes new policy directions
for spectrum management under consideration in the 112th Congress, such as the encouragement
of new technologies that use spectrum more efficiently.
Congressional Research Service

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Contents
Spectrum Policy............................................................................................................................... 1
Spectrum Policy Provisions in the Middle Class Tax Relief and Job Creation Act of 2012 ........... 2
Deficit Reduction....................................................................................................................... 2
Directed Auctions ...................................................................................................................... 3
Incentive Auctions ..................................................................................................................... 4
Federal Spectrum Use and Reallocation.................................................................................... 5
Unlicensed Spectrum................................................................................................................. 6
Emerging Spectrum Policy Issues ................................................................................................... 7
Spectrum Sharing ...................................................................................................................... 7
Conclusion ....................................................................................................................................... 8

Appendixes
Appendix A. Competition and Technology Policy ........................................................................ 10
Appendix B. Spectrum-Hungry Technologies ............................................................................... 16

Contacts
Author Contact Information........................................................................................................... 18

Congressional Research Service

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Spectrum Policy
The purpose of spectrum policy, law, and regulation is to manage a natural resource1 for the
maximum possible benefit of the public. Electromagnetic spectrum, commonly referred to as
radio frequency spectrum or wireless spectrum, refers to the properties in air that transmit electric
signals and, with applied technology, can deliver voice, text, and video communications. Access
to radio frequency spectrum is controlled by assigning rights to specific license holders or to
certain classes of users. The assignment of spectrum rights does not convey ownership. Radio
frequency spectrum is managed by the Federal Communications Commission (FCC) for
commercial and other non-federal uses and by the National Telecommunications and Information
Administration (NTIA) for federal government use.
Wireless broadband,2 with its rich array of services and content, requires new spectrum capacity
to accommodate growth. Spectrum capacity is necessary to deliver mobile broadband to
consumers and businesses and also to support the communications needs of industries that use
fixed wireless broadband to transmit large quantities of information quickly and reliably.
Although radio frequency spectrum (air) is abundant, usable spectrum is currently limited by the
constraints of applied technology. Spectrum policy therefore requires making decisions about
how radio frequencies will be allocated and who will have access to them. Current spectrum
policy is based on managing channels of radio frequencies to avoid interference.3 The FCC, over
many years, has developed and refined a system of exclusive licenses for users of specific
frequencies. Auctions are a market-driven solution to assigning licenses to use specific
frequencies and are a recent innovation in spectrum management and policy. Previously, the FCC
granted licenses using a process known as “comparative hearings” (also known as “beauty
contests”), and has used lotteries to distribute spectrum licenses.
As wireless technology moves from channel management to network management, spectrum
policy going forward may entail encouraging innovation in network-centric technologies and
their applications.4 An increasing number of policy makers and wireless industry leaders are
urging that laws and regulations be revised to reflect significant changes in wireless technology
that are creating a new mobile network communications environment.

1 The Code of Federal Regulations defines natural resources as “land, fish, wildlife, biota, air, water, ground water,
drinking water supplies and other such resources belonging to, managed by, held in trust by, appertaining to, or
otherwise controlled by the United States.... ” (15 CFR 990, Section 990.30).
2 Broadband refers here to the capacity of the radio frequency channel. A broadband channel can quickly transmit live
video, complex graphics, and other data-rich information as well as voice and text messages, whereas a narrowband
channel might be limited to handling voice, text, and some graphics.
3 With technologies that rely on channel management, two signals can interfere with each other even if they are not at
the same exact frequency, but are close in frequency. To avoid harmful interference, the frequencies must have
frequencies that are sufficiently different, known as a “minimum separation.”
4 Summarized in Appendix B.
Congressional Research Service
1

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Spectrum Policy Provisions in the Middle Class Tax
Relief and Job Creation Act of 2012
Some provisions in the Middle Class Tax Relief and Job Creation Act of 2012 (P.L. 112-96),
signed into law on February 22, 2012, have required reallocation of spectrum, new assignments
of spectrum rights, and changes in procedures for repurposing spectrum used by the federal
government. Many of these provisions focus on spectrum assignment within the existing
regulatory framework, in which licenses for designated radio frequencies are awarded through
competitive bidding systems (auctions).
Major provisions in the act that are summarized in this report cover:
• Deficit reduction;
• Directed auctions;
• Incentive auctions for television broadcasters;
• Reallocation of spectrum from federal to commercial use;
• Unlicensed spectrum.
Other provisions in the act, not covered in this report, include simplifying the approval of zoning
requests for modification of cell towers at the state and local level; and putting in place measures
to facilitate antenna placement on federal property. The act also has provided for the
establishment of a new authority to plan and develop a nationwide public safety broadband
network and has included other measures in support of improved emergency communications.5
Deficit Reduction
The Middle Class Tax Relief and Job Creation Act of 2012 has addressed the interlaced issues of
spectrum access and deficit reduction. The issues are connected because, when radio frequency
spectrum licenses are auctioned for commercial purposes by the FCC, the net proceeds are
deposited in the U.S. Treasury.6 The act has extended the FCC’s auction authority until the end of
fiscal year 2022. Because the FCC’s authority would have expired at the end of fiscal year 2012,
revenue from auctions held after fiscal year 2012 is considered new revenue. Most of the
proceeds from auctions of licenses in designated spectrum as specified in the act are to be
deposited directly into a Public Safety Trust Fund, created by the act, with these proceeds
appropriated for purposes defined in the act.7 Some of the proceeds are directed to deficit
reduction.8

5 Measures in the act that apply to public safety are covered in CRS Report R42543, The First Responder Network and
Next-Generation Communications for Public Safety: Issues for Congress, by Linda K. Moore.
6 47 USC § 308 (j) (8). Net proceeds are the auction revenues minus the FCC’s expenses. Congress has twice in the
past amended the provision in order to use auction proceeds for other purposes by creating special funds to hold and
disburse auction proceeds. The Commercial Spectrum Enhancement Act, Title II of P.L. 108-494 created the Spectrum
Relocation Fund; the Deficit Reduction Act of 2005 created the Public Safety and Digital Television Transition Fund.
7 H.R. 112 96, Sec. 6413.
8 $20.4 billion of auction proceeds, Sec. 6413(b) (5) and balances remaining after 2022, Sec. 6413 (a) (2).
Congressional Research Service
2

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Proceeds from the sale of licenses of repurposed federal spectrum identified in the act will be
directed first to the Spectrum Relocation Fund, to cover costs of moving federal users, with the
balance going to the Public Safety Trust Fund.9 Proceeds from the sale of advanced wireless
service licenses in the other spectrum bands identified by the act will go directly to the Public
Safety Trust Fund.10 Proceeds from the auction of new licenses created by the release of
television broadcasting spectrum will go to cover costs specified in the act, with the balance to
the Public Safety Trust Fund.11 Balances remaining in any fund created by the act will revert to
the Treasury in 2022.
The legislation that first authorized the FCC to establish “competitive bidding systems”12 for a
limited period was included in the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66).
The Balanced Budget Act of 1997 gave the FCC auction authority until September 30, 2007. This
authority was extended to September 30, 2011, by the Deficit Reduction Act of 2005 and to 2012
by the DTV Delay Act (P.L. 111-4). The Deficit Reduction Act of 2005 also specified that $7.363
billion of proceeds from auctions required by the act be applied to deficit reduction.
Directed Auctions
The Middle Class Tax Relief and Job Creation Act of 2012 has required the FCC and the NTIA to
identify specific bands for auction from spectrum designated for commercial advanced wireless
services and for federal use, and in most cases to commence the auction process within three
years. The act has mandated spectrum license auctions for frequencies at 1915-1920 MHz;13
1995-2000 MHz; 2155-2180 MHz; an additional 15MHz to be identified by the FCC; 14 and
15MHz of spectrum between 1675-1710 MHz, subject to conditions in the act.15 The Secretary of
Commerce must by February 22, 2013, submit a report to the President identifying 15 MHz of
spectrum between 1675-1710 MHz for reallocation from federal to non-federal use.16 The NTIA
has produced a Ten-Year Plan and Timetable that identifies bands of spectrum that might be
available for commercial wireless broadband service. As part of its planning efforts, NTIA
prepared a “Fast Track Evaluation”17 of spectrum resources that might be repurposed in the near
future. One recommendation was to make available 15 MHz of spectrum from frequencies
between 1695-1710 MHz.

9 P.L. 112-96, Sec. 6401 (c) (3) (C).
10 P.L. 112-96, Sec. 6401 (c) (3) (C).
11 P.L. 112-96, Sec. 6401 (c) (4).
12 47 USC §308 (j) (3).
13 Spectrum is segmented into bands of radio frequencies and typically measured in cycles per second, or hertz.
Standard abbreviations for measuring frequencies include kHz—kilohertz or thousands of hertz; MHz—megahertz, or
millions of hertz; and GHz—gigahertz, or billions of hertz.
14 P.L. 112-96, Sec. 6401 (b).
15 P.L. 112-96, Sec. 6401 (a).
16 P.L. 112-96, Sec. 6401 (a).
17 NTIA, An Assessment of Near-Term Viability of Accommodating Wireless Broadband Systems in the 1675-1710
MHZ, 1755-1780 MHz, 3500-3650 MHz, and 4200-4220 MHz, 4380-4400 MHZ Bands (President’s Spectrum Plan
Report), November 15, 2010, at http://www.ntia.doc.gov/report/2010/assessment-near-term-viability-accommodating-
wireless-broadband-systems-1675-1710-mhz-17.
Congressional Research Service
3

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Incentive Auctions
The Middle Class Tax Relief and Job Creation Act of 2012 has permitted the FCC to conduct
incentive auctions, that is, to establish a mechanism whereby spectrum capacity may be
relinquished for auction by some license-holders, who would then share in the proceeds.18 Many
commercial wireless licenses can be resold directly by their license-holders for comparable uses;
the purpose of incentive auctions is to reward license-holders, such as television broadcasters,
who repurpose their spectrum for a different use. Although incentive auctions might be used for
other types of license-holders, the act specifically addresses spectrum assignments for over-the-
air television broadcasters, somewhat limiting the applicability of the law for other license-
holders who might wish to relinquish spectrum through an incentive auction.
The act has established procedures for the FCC to follow in reallocating television broadcasting
spectrum licenses for commercial auction. Through a reverse auction process, the broadcasters
would establish the amount of compensation they are willing to accept for the spectrum they
voluntarily release for auction.19 Additionally, broadcasters that do not voluntarily relinquish
spectrum rights but are required to relocate or make other required changes may be compensated
for costs incurred.20 In lieu of cash payment, as compensation for relocation broadcasters may
choose to accept regulatory relief that would allow new uses for their spectrum.21
Spectrum voluntarily released by TV broadcasters would be repurposed for commercial
broadband communications, with licenses sold through what the law refers to as a “forward
auction.”22 At least one successful reverse auction is required to set minimum prices for a forward
auction. For the results of a forward auction to be valid, auction proceeds must at a minimum
cover: (1) payments to broadcasters that relinquished spectrum for auction, (2) the costs to the
FCC of conducting the auctions, and (3) the estimated costs for relocation of other broadcasters;23
the latter is not to exceed $175 million, deposited in a TV Broadcaster Relocation Fund.24 If
auction revenues do not cover costs as specified in the act, the FCC may not assign new licenses
and planned reassignments and reallocations may not occur.25 If the reverse auction and forward
auction conditions are met, the FCC may “make such reassignments of televisions channels” as
appropriate in its consideration, subject to certain conditions.26 Examples of conditions include a
general prohibition against reassigning licenses to frequencies below an existing assignment,27
and obligations to determine that a reassigned channel is not adversely affected by cross-border
channel assignment agreements with Canada and Mexico.28 The auction and channel
reassignment process may only occur once.29

18 P.L. 112-96, Sec. 6402 “(G) “(i).
19 P.L. 112-96, Sec. 6402 “(G) “(ii) and Sec. 6403 (a).
20 P.L. 112-96, Sec. 6403 (b) (4) (A).
21 P.L. 112-96, Sec. 6403 (b) (4) (B).
22 P.L. 112-96, Sec. 6403 (c) (1).
23 P.L. 112-96, Sec. 6403 (c) (2) (B).
24 P.L. 112-96, Sec. 6402 “(G) “(iii) “(I).
25 P.L. 112-96, Sec. 6403 (c) (2) (A).
26 P.L. 112-96, Sec. 6403 (b) (1) (B) (i).
27 P.L. 112-96, Sec. 6403 (b) (3).
28 P.L. 112-96, Sec. 6403 (b) (1) (B).
29 P.L. 112-96, Sec. 6403 (e).
Congressional Research Service
4

---

Spectrum Policy in the Age of Broadband: Issues for Congress

The Balanced Budget Act of 1997, which mandated the eventual transition to digital television,
represented the legislative culmination of over a decade of policy debates and negotiations
between the FCC and the television broadcast industry on how to move the industry from analog
to digital broadcasting technologies. To facilitate the transition, the FCC provided each qualified
broadcaster with 6 MHz of spectrum for digital broadcasting to replace licenses of 6 MHz that
were used for analog broadcasting. The analog licenses would be yielded back when the
transition to digital television was concluded. The completed transition freed up the 700 MHz
band for commercial and public safety communications in 2009.
In its 2010 National Broadband Plan (NBP),30 the FCC revisited the assumptions reflected in the
1997 act and made new proposals based on, among other factors, changes in technology and
consumer habits. In particular, because over-the-air digital broadcasting does not necessarily
require 6 MHz of spectrum, the NBP proposed that some stations could share a single 6 MHz
band without significantly reducing service to over-the-air TV viewers. Among the proposals for
how broadcasters might make better use of their TV licenses, the NBP raised the possibility of
auctioning unneeded spectrum and sharing the proceeds between the TV license-holder and the
U.S. Treasury. The FCC and the NTIA urged Congress to provide new legislation that would
allow this type of incentive auction.
Federal Spectrum Use and Reallocation
The Middle Class Tax Relief and Job Creation Act of 2012 has addressed how spectrum resources
might be repurposed from federal to commercial use through auction or sharing, and how the cost
of such reassignment would be defined and compensated, among other provisions. The
Commercial Spectrum Enhancement Act of 2004 (P.L. 108-494, Title II) was amended to
facilitate the transfer of spectrum rights to commercial purchasers from the agencies relinquishing
spectrum. Expenditures incurred by federal agencies for planning may now be included among
those costs eligible for reimbursement as part of the transfer of spectrum to the commercial
sector. Other reimbursable costs cover a wide range of technical options, including spectrum
sharing.31
The act has required the establishment of a Technical Panel within the NTIA to review transition
plans that each federal agency must prepare in accordance with provisions in the act.32 The
Technical Panel is required to have three members qualified as a radio engineer or technical
expert. The Director of the Office of Management and Budget, the Assistant Secretary of
Commerce for Communications and Information, and the Chairman of the FCC have been
required to appoint one member each.33 Spectrum sharing to facilitate the transition from federal
to commercial use is supported in the act’s provisions. However, the NTIA has been required to
give priority to reallocation options that assign spectrum for exclusive, non-federal uses through
competitive bidding.34

30 Connecting America: The National Broadband Plan, 2010 at http://www.broadband.gov.
31 P.L. 112-96, Sec. 6701 (a) (1) (D) “(3).
32 P.L. 112-96, Sec. 6701 (a) (3) “(h).
33 P.L. 112-96, Sec. 6701 (a) (3) “(h) “(3) “(B).
34 P.L. 112-96, Sec. 6701 (a) (3) “(j).
Congressional Research Service
5

---

Spectrum Policy in the Age of Broadband: Issues for Congress

The Commercial Spectrum Enhancement Act of 2004 put in place statutory rules for covering the
costs to federal agencies of relocating wireless communications facilities to new spectrum
assignments. The act created the Spectrum Relocation Fund to provide a means for federal
agencies to recover relocation costs directly from auction proceeds when they are required to
vacate spectrum slated for auction. In effect, successful commercial bidders cover the costs of
relocation. Among key provisions of the act were requirements that the auctions must recoup at
least 110% of the costs projected by the NTIA, and that unused funds would revert to the
Treasury after eight years. These provisions remain in effect. Specific frequencies were
designated for immediate auction35 by the Commercial Spectrum Enhancement Act but the law
was written to apply to any federally used frequencies scheduled for reallocation and possible
auction.36
Unlicensed Spectrum
Unlicensed spectrum is not sold to the highest bidder and used for the services provided by the
license-holder but is instead accessible to anyone using wireless equipment certified by the FCC
for those frequencies. Both commercial and non-commercial entities use unlicensed spectrum to
meet a wide variety of monitoring and communications needs. Suppliers of wireless devices must
meet requirements for certification to operate on frequency bands designated for unlicensed use.
Examples of unlicensed use include garage door openers and WiFi communications. WiFi
provides wireless Internet access for personal computers and handheld devices and is also used by
businesses to link computer-based communications within a local area. Links are connected to a
high-speed landline either at a business location or through hotspots. Hotspots are typically
located in homes or convenient public locations.
New technologies, sometimes referred to as Super WiFi, are being developed to expand the
usefulness of unlicensed spectrum without causing interference. For example, to use unassigned
spectrum, known as white spaces, between broadcasting signals of digital television, geolocation
database technology is being put in place to identify unencumbered airwaves. Super WiFi devices
are expected to reach the market by 2013.37
Similar technologies are being considered to expand the availability of spectrum for unlicensed
use at 5 GHz by sharing with existing federal users in those frequencies.38 Commercial providers,
such as for wireless Internet, currently share parts of the spectrum at 5 GHz with federal users.
With the objective of improving future WiFi capacity, the Middle Class Tax Relief and Job
Creation Act of 2012 has required new studies and evaluations of frequencies at 5 GHz.39 These
would lay the groundwork to expand commercial use of unlicensed spectrum within the federally

35 Following the procedures required by the act, the FCC scheduled an auction for Advanced Wireless Services (AWS),
designated Auction 66, which was completed on September 18, 2006. The AWS auction attracted nearly $13.9 billion
in completed bids. The cost to move federal agencies to new spectrum locations was set at almost $936 million.
36 The creation of the Spectrum Relocation Fund is discussed in CRS Report RS21508, Spectrum Management and
Special Funds, by Linda K. Moore.
37 “Spectrum Bridge Gains Final FCC Approval, White Spaces Broadband Era to Begin,” by Joan Engebretson,
telecompetitor.com, December 22, 2011.
38 These and other frequencies for unlicensed use are discussed in The Economic Value Generated by Existing and
Future Allocations of Unlicensed Spectrum, Perspective, Ingenious Consulting Network, September 28, 2009;
sponsored by Microsoft, Inc.
39 P.L. 112-96, Sec. 6406.
Congressional Research Service
6

---

Spectrum Policy in the Age of Broadband: Issues for Congress

managed 5 GHz band. The FCC has been required to commence a proceeding that might open
access for some unlicensed devices in the 5350-5470 MHz band. The NTIA would be required to
prepare an evaluation of spectrum-sharing technologies for the 5350-5470 MHz and 5850-5925
MHz bands.
Emerging Spectrum Policy Issues
The United States currently enjoys a position of world leadership in mobile broadband
technology development and deployment.40 U.S. companies have been at the forefront of mobile
wireless and Internet convergence. The introduction of the first iPhone in 2007 is a prominent
signpost marking the convergence of these technologies.41 Innovation in applying the Internet
Protocol (IP) to mobile networks has spurred jobs and economic growth. The success of
smartphones like the iPhone, in the United States and globally, followed on that of WiFi, which
had stoked consumer demand for wireless access to the Internet.42 New economic and social
cultures are being built on the ubiquity and ease of access to the Internet from mobile devices.
This expanding industry requires additional spectrum capacity, a key resource. The Middle Class
Tax Relief and Job Creation Act of 2012 employs three key policy tools for increasing the
availability of radio frequency spectrum for wireless broadband: allocating additional spectrum;
reassigning spectrum to new users; and opening up spectrum for unlicensed use. Other policy
options that may be employed to increase spectrum capacity include requiring that wireless
network infrastructure be shared; changing the cost structure of spectrum access; moving to more
spectrum-efficient technologies; and sharing spectrum. Facilitating the adoption of new wireless
technologies that enable spectrum sharing is emerging as a major policy consideration for
spectrum management.
Spectrum Sharing
The FCC and the NTIA have identified spectrum sharing as a way to increase spectrum capacity
and efficiency. The agencies are jointly implementing tests of spectrum sharing between
commercial and federal users.43 Other spectrum sharing projects are also under consideration or
recommended.
The NTIA has produced a Ten-Year Plan and Timetable for freeing up federal spectrum for
commercial use that would encourage sharing among federal agencies, between federal agencies
and private users, and among private users. 44 In a detailed analysis of federal spectrum use in the

40 See for example spoken and written testimony of witnesses before the House Committee on Science, Space, and
Technology, Subcommittee on Technology and Innovation, “Avoiding the Spectrum Crunch: Growing the Wireless
Economy Through Innovation,” April 18, 2012.
41 “Spectrum and the Wireless Revolution,” Randall Stephenson, Wall Street Journal, June 10, 2012.
42 See “A Brief History of Wi-Fi,” The Economist Technology Quarterly, June 10, 2004.
43 Prepared Remarks of FCC Chairman Julius Genachowski, International CTIA Wireless 2012, May 8, 2012.
44 NTIA, An Assessment of Near-Term Viability of Accommodating Wireless Broadband Systems in the 1675-1710
MHZ, 1755-1780 MHz, 3500-3650 MHz, and 4200-4220 MHz, 4380-4400 MHZ Bands (President’s Spectrum Plan
Report), November 15, 2010, at http://www.ntia.doc.gov/report/2010/assessment-near-term-viability-accommodating-
wireless-broadband-systems-1675-1710-mhz-17.
Congressional Research Service
7

---

Spectrum Policy in the Age of Broadband: Issues for Congress

1755-1850 MHz band,45 the NTIA found that spectrum sharing might be a more viable solution
for those frequencies than reallocation to the commercial sector, citing an estimated cost of $18
billion to move federal users to other frequencies, and advances in spectrum sharing technology.
The FCC in its National Broadband Plan recommended that a “new, contiguous nationwide band
for unlicensed use” be identified by 2020;46 and that spectrum be provided and other steps taken
to “further development and deployment” of new technologies that facilitate sharing.47
The President’s Advisory Council on Science and Technology has endorsed increasing spectrum
capacity through new technology that increases efficiency and allows for shared use of spectrum
resources. In a report, Realizing the Full Potential of Government Held Spectrum to Spur
Economic Growth, the council has that up to 1000 MHz of additional spectrum capacity could be
provided through shared access between the federal government and commercial providers.48
Spectrum-sharing technologies include geolocation databases, smart antenna and cognitive
radio—all of which are deployed—and network-centric technologies, such as Dynamic Spectrum
Access, that are being tested by research and development facilities such as the Defense
Advanced Research Projects Agency.49 Enabling technologies such as these allow
communications to switch instantly among network frequencies that are not in use and therefore
available to any radio device equipped with cognitive technology. Future technological
breakthroughs in fields such as quantum communications hold the promise of even greater
transmission speeds and spectrum efficiencies.50
From a policy perspective, actions to speed the arrival of new, spectrally efficient technologies
might have significant impact on achieving broadband policy goals over the long term. In
particular, support for technologies that enable sharing could pave the way for dramatically
different ways of managing the nation’s spectrum resources.
Conclusion
Major advances in wireless technology have given the United States a competitive edge in
communications innovation, fueling industry growth and job creation. Policy makers may wish to
consider not only how to maintain this leadership but also how to adapt to changing economic
and social expectations. The mobile network communications environment presents new
challenges and opportunities in policy areas such as identity theft, privacy protection, street crime

45 U.S. Department of Commerce, An Assessment of the Viability of Accommodating Wireless Broadband in the 1755–
1850 MHz Band, March 2012, at http://www.ntia.doc.gov/files/ntia/publications/
ntia_1755_1850_mhz_report_march2012.pdf.
46 Connecting America, Recommendation 5.11.
47 Connecting America, Recommendation 5.13.
48 Recommendations of the President’s Council of Advisers on Science and Technology, pre-publication remarks on
Realizing the Full Potential of Government-Held Spectrum to Spur Economic Growth, Council meeting, May 25, 2012.
49 Some of the research in network-centric technologies is discussed in Appendix B.
50 Some of the principles of quantum communications and possibility of a quantum Internet are discussed in
“Breakthrough in Quantum Communication,” Science Daily, April 11, 2012.
Congressional Research Service
8

---

Spectrum Policy in the Age of Broadband: Issues for Congress

(for example, smartphone theft), health services, education, urban management, and electronic
payments.51
The amount of spectrum needed for fully realized wireless access to broadband is such that
meeting the needs of broadband policy goals could be difficult to achieve through the market-
driven auction process. To meet current demands of the wireless industry, large amounts of new
radio frequencies would need to be identified and released.52 Without abandoning competitive
auctions, spectrum policy could benefit from including additional ways to assign or manage
spectrum that might better serve the deployment of wireless broadband and the implementation of
a national broadband policy.
Current spectrum policy relies heavily on auctions to assign spectrum rights through licensing.
However, the adoption of spectrum-efficient technologies is likely to require a rethinking of
spectrum management policies and tools. The assignment and supervision of licenses might give
way to policies and procedures for managing pooled resources. Auctioning licenses might be
replaced by auctioning access; the static event of selling a license replaced by the dynamic
auctioning of spectrum access on a moment-by-moment basis.
Auction winners are deemed to be the companies that can maximize the value of the spectrum to
society by maximizing its value as a corporate asset. However, auction-centric spectrum policies
appear to have generally focused on assigning licenses to commercial competitors in traditional
markets that serve consumers and businesses. Auctioning spectrum licenses may direct assets to
end-use customers instead of providing wireless services where the consumer may be the
beneficiary but not the customer. Wireless networks are an important component of smart grid
communications. Spectrum resources are also needed for railroad safety,53 for water
conservation,54 for the safe maintenance of critical infrastructure industries,55 and for many other
applications that may not have an immediate commercial value but can provide long-lasting value
to society as a whole.

51 Some of these policy issues are discussed in Socioeconomic Impacts of Wireless Technology, prepared by BSR for
CTIA – The Wireless Association, May 2012. CRS products include: “Smartphone Theft and Crime Prevention,”
Congressional Distribution Memorandum, March 30, 3012, by Linda K. Moore, available on request; CRS Report
R41733, Privacy: An Overview of the Electronic Communications Privacy Act, by Charles Doyle; CRS Report R41756,
Privacy Protections for Personal Information Online , by Gina Stevens; CRS Report R42511, United States v. Jones:
GPS Monitoring, Property, and Privacy, by Richard M. Thompson II; CRS Report R40908, Advertising Industry in the
Digital Age, by Suzanne M. Kirchhoff; CRS Report R40599, Identity Theft: Trends and Issues, by Kristin M. Finklea;
and, CRS Report RL34632, Text and Multimedia Messaging: Issues for Congress, by Patricia Moloney Figliola and
Gina Stevens.
52 International Telecommunications Union projects an estimated need for additional spectrum capacity that could
reach nearly 1,000 MHz in the United States, as reported in “Summary of Results of ITU-R Report M. 2079,” p. 13,
presented by Cengiz Evci, Chief Frequency Officer, Wireless Business Group, Alcatel-Lucent, August 28, 2007.
Available at http://standards.nortel.com/spectrum4IMT/Geneva/R03-WRCAFR07-C-0024.pdf. See also CTIA-The
Wireless Association, Written Ex Parte Communication, FCC, GN Docket No. 09-51, September 29, 2009, which
suggests a goal of at least 800 MHz, based on extrapolations from the ITU research.
53 The railroad industry uses wireless communications as part of their information networks to monitor activity.
54 For example, sensors buried at the level of plant roots recognize when watering is needed and communicate this
information over wireless networks.
55 In general, critical infrastructure industries facilitate the production of critical goods and services such as safe
drinking water, fuel, telecommunications, financial services, and emergency response. A discussion of key issues
appears in CRS Report RL30153, Critical Infrastructures: Background, Policy, and Implementation, by John D.
Moteff.
Congressional Research Service
9

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Appendix A. Competition and Technology Policy
Telephone service was once considered a natural monopoly, and regulated accordingly. The
presumption was that redundant telephone infrastructure was inefficient and not in the public
interest. State and federal regulators favored granting operating rights to a single company, within
a specific facilities territory, to benefit from economies of scale, facilitate interoperability, and
maximize other benefits. In return for the monopoly position, the selected provider was expected
to fulfill a number of requirements intended to benefit society. Thus, for decades, the regulated
monopoly was seen by most policy-makers as (1) ensuring that costly infrastructure was put in
place and (2) meeting society’s needs, as interpreted by regulations and the law.56 Past policies to
regulate a monopolistic market may have influenced current policies for promoting competition.
The FCC’s emphasis on efficiency for delivering services to a pre-determined market could be
leading wireless competition toward monopoly; new regulatory regimes might be a consequence
of this trend, if it continues.
With the introduction of auctions for spectrum licenses in 1994, the United States began to shift
away from assigning spectrum licenses based on regulatory decisions and toward competitive
market mechanisms. One objective of the Telecommunications Act of 1996 was to open up the
communications industry to greater competition among different sectors. One outcome of the
growth of competition was the establishment of different regulatory regimes for information
networks and for telecommunications.57 As a consequence of these and other legislative and
regulatory changes, the wireless industry has areas of competition (e.g., for spectrum licenses)
within a regulatory shell, such as the rules governing the Public Switched Telephone Network
(PSTN).58 As the bulk of wireless communications traffic moves from voice to data, companies
will likely modify their business plans in order to remain competitive in the new environment. A
shift in infrastructure technology and regulatory environment59 might open wireless competition
to companies with business plans that are not modeled on pre-existing telecommunications
industry formulae. Future providers of wireless broadband might include any company with a
robust network for carrying data and a business case for serving broadband consumers. Potential
new entrants, however, may lack access to radio frequency spectrum, the essential resource for
wireless broadband.
In formulating spectrum policy, mainstream viewpoints generally diverge on whether to give
priority to market economics or social goals. Regarding access to spectrum, economic policy
looks to harness market forces to allocate spectrum efficiently, with spectrum license auctions as
the driver. Social policy favors ensuring wireless access to support a variety of social objectives
where economic return is not easily quantified, such as improving education, health services, and
public safety. Both approaches can stimulate economic growth and job creation.

56 The original Communications Act of 1934 codified many regulations for monopolies as practiced at the time.
57 For a discussion of policy issues, see CRS Report R40234, The FCC’s Authority to Regulate Net Neutrality After
Comcast v. FCC , by Kathleen Ann Ruane, and CRS Report R40616, Access to Broadband Networks: The Net
Neutrality Debate, by Angele A. Gilroy.
58 PSTN is a global system; rights of access and usage in the United States are regulated by the FCC.
59 On December 1, 2009, the FCC published a public notice seeking comments on the “appropriate policy framework to
facilitate and respond to the market-led transition in technology and services, from the circuit-switched PSTN system to
an IP-based communications world.” “Comment Sought on Transition from Circuit-Switched Network to All-IP
Network,” NBP Public Notice #25, DA 09-2517 at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-09-
2517A1.pdf.
Congressional Research Service
10

---

Spectrum Policy in the Age of Broadband: Issues for Congress

In evaluating competition within an industry, economists and policy makers examine barriers to
entry, among other factors.60 Barriers might come from high costs for market entry such as
investment in infrastructure or there might be legal and regulatory barriers to entry. As part of its
evaluation of competition for mobile services, the FCC has identified three factors that could
constitute barriers to entry to the commercial mobile communications industry. These barriers
affect not only competitiveness but also access to networks and investment in new technology.
The factors are “first-mover advantages, large sunk costs, and access to spectrum.”61 All three of
these factors are subject to regulations that have been influenced by past or existing policies
regarding spectrum allocation and assignment.
First-mover advantages62 have accrued primarily to the early entrants in the wireless industry.
Early in the development of the cell phone industry, the FCC created cellular markets and
assigned two spectrum licenses to each market; one license went automatically to the incumbent
provider in that market. The second license was made available to a competing service provider
(not the market incumbent); the difficulties in choosing the competitors that would receive
licenses contributed to the subsequent move to auctions as a means for assigning spectrum
rights.63 These early entrants, and the successor companies that acquired them and their licenses,
have maintained their core customer base and benefit from early investments in infrastructure.
Many first movers into the wireless market, therefore, acquired their market-leader status through
regulatory decisions that provided them with spectrum licenses, not through market competition.
Large sunk costs refer to the high levels of investment needed to enter the wireless market. Not
including the price of purchasing spectrum, billions of dollars are required to build new
infrastructure. The sunk costs of incumbent wireless service providers set a high bar for new
entrants to match if they are to compete effectively in major markets. In the mobile telephone
industry, the FCC has observed that most capital expenditures are spent on existing networks: to
expand and improve geographic coverage; to increase capacity of existing networks; and to
improve network capabilities. Performance requirements for spectrum license-holders, such as the
size of a market that must be served or deadlines for completing infrastructure build-outs, are
some of the policy decisions that can add to the cost of entry.
Spectrum Auctions and Competition
The FCC was authorized to organize auctions to award spectrum licenses for certain wireless
communications services in the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66). The
act amended the Communications Act of 1934 with a number of important provisions affecting
the availability of spectrum. The Licensing Improvement section64 of the act laid out the general

60 For example, U.S. Department of Justice and the Federal Trade Commission, “Horizontal Merger Guidelines,”
Jointly issued April 2, 1992, revised April 8, 1997.
61 FCC, “Wireless Telecommunications Bureau Seeks Comment on Commercial Mobile Radio Services Market
Competition,” Public Notice, February 25, 2008, DA 08-453, WT Docket No. 08-27 at http://hraunfoss.fcc.gov/
edocs_public/attachmatch/DA-08-453A1.pdf. Earlier annual reports have also cited these barriers.
62 The initial occupant of a market segment may benefit from a number of advantages such as preemption of resources,
advantageous relationships with customers and suppliers, and early profits for reinvestment in infrastructure.
63 The distribution of licenses for cell phone networks from the early days of the technology until the introduction of
auctions is described in Wireless Nation: The Frenzied Launch of the Cellular Revolution in America, by James B.
Murray, Jr., Perseus Press, 2001, 2002.
64 P.L. 103-66 Title III, Subtitle C, Chapter 1.
Congressional Research Service
11

---

Spectrum Policy in the Age of Broadband: Issues for Congress

requirements for the FCC to establish a competitive bidding methodology and consider, in the
process, objectives such as the development and rapid deployment of new technologies.65 The law
prohibited the FCC from making spectrum allocation decisions based “solely or predominately on
the expectation of Federal revenues....”66 The Emerging Telecommunications Technologies
section67 directed the NTIA to identify not less than 200 MHz of radio frequencies used by the
federal government that could be transferred to the commercial sector through auctions.68 The
FCC was directed to allocate and assign these released frequencies over a period of at least 10
years, and to reserve a significant portion of the frequencies for allocation after the 10-year time
span.69 Similar to the requirements for competitive bidding, the FCC was instructed to ensure the
availability of frequencies for new technologies and services, and also the availability of
frequencies to stimulate the development of wireless technologies.70 The FCC was further
required to address “the feasibility of reallocating portions of the spectrum from current
commercial and other non-federal uses to provide for more efficient use of spectrum” and for
“innovation and marketplace developments that may affect the relative efficiencies of different
spectrum allocations.”71 Over time, auction rules have been modified in accordance with the
changing policy goals of the FCC and Congress but subsequent amendments to the
Communications Act of 1934 have not substantively changed the above-noted provisions
regarding spectrum allocation.72
The rules set by the FCC for using spectrum licenses (service rules) may have been oriented
toward the concepts of building and managing networks that were formed in the days of the
telephone, favoring traditional telecommunications business plans over those of companies with
different business models. Some companies that might be well suited to meet social goals, such as
access in rural areas, might have been precluded from bidding at all because of constraints not
considered relevant to market-driven allocations. For example, public utilities, municipal co-
operatives, commuter railroads, and other public or quasi-public entities face a variety of legal,
regulatory, and structural constraints that limit or prohibit their ability to participate in an auction
or buy spectrum licenses. Many of these constraints exist at the state level but federal spectrum
policy plays a role in perpetuating the status quo.
There are many ways to view competition. Although competitiveness may be evaluated by factors
such as barriers to entry or number of market participants, a key measure of whether market
competition is working is an assessment of the dynamic of a specific market: its prices, variety,
level of service, and other indicators that are considered hallmarks of competitive behavior. The
Federal Trade Commission, for example, promotes competition as “the best way to reduce costs,
encourage innovation, and expand choices for consumers.”73 Viewpoints about the level of
competitiveness in providing wireless services to the U.S. market differ.74 However,

65 47 U.S.C. §309 (j), especially (1), (3), and (4).
66 47 U.S.C. §309 (j) (7) (A).
67 P.L. 103-66 Title III, Subtitle C, Chapter 2.
68 47 U.S.C. §923 (b) (1).
69 47 U.S.C. §925 (b) (1).
70 47 U.S.C. §925 (b) (2).
71 47 U.S.C. §925 (b) (3).
72 See United States Code Annotated, Title 47, sections as footnoted, WEST Group, 2001 and the 2007 Cumulative
Annual Pocket Part.
73 “Competition in the Technology Marketplace” at http://www.ftc.gov/bc/tech/index.htm.
74 Different assessments of competition in the wireless market have been filed as comments in FCC Docket No. 09-66,
(continued...)
Congressional Research Service
12

---

Spectrum Policy in the Age of Broadband: Issues for Congress

telecommunications business analysts generally describe the U.S. market for wireless services as
competitive because consumers benefit in many ways from competition on price, service,
coverage, and the availability of new devices.
Both the wireless industry and its regulator have focused on “wireless consumer welfare”75 in
evaluating competition and the effectiveness of spectrum policies for assigning spectrum licenses.
Auctions are judged to be an efficient way of assigning spectrum for commercial uses that adhere
to traditional business plans.76
Spectrum Caps
As part of its preparations for the first spectrum license auctions, the FCC decided to set caps on
the amount of spectrum any one company could control in any geographically designated
market.77 The theory behind spectrum capping is that each license has an economic value and a
foreclosure value. The economic value is derived from the return on investment in spectrum
licenses and network infrastructure. The foreclosure value is the value to a wireless company that
already has substantial market share and wants to keep its dominant position by precluding
competition. Spectrum caps were chosen as the method to prevent foreclosure bidding. The intent
was to ensure multiple competitors in each market and to restrict bidding to only the licenses that
could be used in the near term.
Beginning in 2001, spectrum policy placed increased emphasis on promoting spectrum and
market efficiency through consolidation. The FCC ruled to end spectrum caps, citing greater
spectral efficiency from larger networks as one benefit of the ruling. Spectrum caps were seen as
barriers to mergers within the wireless industry, to the growth of existing wireless companies, and
to the benefits of scale economies. The spectrum caps were eliminated on January 1, 2003.78
Auction rules requiring the timely build-out of networks became a key policy tool to deter
hoarding. The FCC instituted a policy for evaluating spectrum holdings on a market-by-market,
case-by-case basis—a practice referred to as spectrum screening—as a measure of
competitiveness.

(...continued)
part of the process for the preparation of the FCC’s Fourteenth Report; Annual Report and Analysis of Competitive
Market Conditions with Respect to Commercial Mobile Services.
75 This phrase is used in the written statement of AT&T Inc. submitted for a hearing before the House of
Representatives, Committee on Energy and Commerce, Subcommittee on Communications, Technology, and the
Internet, “An Examination of Competition in the Wireless Industry,” May 7, 2009. In written testimony submitted by
Verizon Wireless for the same hearing, comments stated that wireless providers need suitable and sufficient spectrum
because of “consumers’ reliance on broadband services.”
76 The GAO has reported this viewpoint in several reports, including Telecommunications: Strong Support for
Extending FCC’s Auction Authority Exists, but Little Agreement on Other Options to Improve Efficient Use of
Spectrum,” December 20, 2005, GAO-06-236 and Telecommunications: Options for and Barriers to Spectrum Reform,
March 14, 2006, GAO-06-526T.
77 Licenses are designated for a specific geographic area, such as rural areas, metropolitan areas, regions, or the entire
nation.
78 FCC News, “FCC Announces Wireless Spectrum Cap to Sunset Effective January 1, 2003,” November 8, 2001.
Report and Order FCC-01-328. See Docket No. 01-14, Notice of Proposed Rulemaking, released January 23, 2001, at
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-01-28A1.pdf.
Congressional Research Service
13

---

Spectrum Policy in the Age of Broadband: Issues for Congress

In 2008, the Rural Telecommunications Group, Inc. (RTG) petitioned the FCC to impose a
spectrum cap of 110 MHz for holdings below 2.3 GHz. In October 2008, the FCC sought
comments on the RTG petition for rulemaking.79 RTG argued that competition in the industry was
declining as it became more concentrated. It claimed that the larger carriers were warehousing
their spectrum holdings in rural areas while rural carriers were struggling to acquire spectrum
capacity for mobile broadband and expansion. Rural carriers, RTG reported, were being shut out
of opportunities to acquire new spectrum holdings and were being outbid in spectrum auctions.80
Opponents to the spectrum cap cited data to support their claims that the wireless
communications market is competitive. They argued that additional amounts of spectrum are
needed to support the growth in mobile broadband and that a spectrum cap could cut off growth
and innovation.81 Implementing spectrum caps as a tool for regulating competition would
represent a significant shift in policy for the FCC, were it to take that course.
In comments filed regarding the National Broadband Plan, the Department of Justice considered
the possibility that “the foreclosure value for incumbents in a given locale could be very high.”82
Although it recognized some form of spectrum caps as an option for assuring new market
entrants, it observed that “there are substantial advantages to deploying newly available spectrum
in order to enable additional providers to mount stronger challenges to broadband incumbents.”83
Competition in Rural Markets
Over the years, various legislative and policy initiatives have created a number of requirements to
help small and rural carriers acquire spectrum licenses.84 Some of the FCC’s efforts to encourage
spectrum license ownership for small, rural, or entrepreneurial businesses are in response to
congressional mandates.85 These and other statutory and regulatory programs may have allowed
many small carriers to remain in business even though many others have been absorbed by larger
carriers.86 As wireless traffic, revenue, and profits migrate to broadband, business models that
were effective for voice traffic may no longer be viable, especially for companies that have relied
on the regulatory environment to protect their markets. This change in operating environment

79 FCC RM No. 11498, October 10, 2008. Comments supporting and opposing the petition are published in this
proceeding.
80 Those supporting the RTG petition included the Organization for the Promotion and Advancement of Small
Telecommunications Companies (OPASTCO), the National Telecommunications Cooperative Association, the Public
Interest Spectrum Coalition, and a number of smaller (non-dominant) wireless carriers.
81 Opponents to spectrum caps that filed comments were AT&T Inc., Verizon Wireless, CTIA—The Wireless
Association, the Telecommunications Industry Association, and the Wireless Communications Association
International.
82 Ex Parte Submission of the United States Department of Justice, In the matter of Economic Issues in Broadband
Competition: A National Broadband Plan for Our Future, GN Docket 09-51, January 4, 2010, p. 23 at
http://fjallfoss.fcc.gov/ecfs/document/view?id=7020355122.
83 Ibid., p. 24.
84 For example, most auctions have provided bidding credits for small businesses.
85 In 47 USC §309 (j) (3) (B), the FCC is instructed to promote “economic opportunity and competition and ensuring
that new and innovative technologies are readily available to the American people by avoiding excessive concentration
of licenses and by disseminating licenses among a wide variety of applicants....”
86 The Congressional Budget Office (CBO) reported in a 2005 study that a significant number of small companies that
acquired spectrum licenses through preferential programs later transferred the licenses to larger companies: Small
Businesses in License Auctions for Wireless Personal Communications Services, A CBO Paper, October 2005, at
http://www.cbo.gov/ftpdocs/68xx/doc6808/10-24-FCC.pdf.
Congressional Research Service
14

---

Spectrum Policy in the Age of Broadband: Issues for Congress

may have disproportionately affected the ability of rural wireless carriers, in particular, to
compete effectively.87 A study of how new technologies might be affecting the competitiveness of
small and rural carriers might be useful in reviewing the effectiveness of policies intended to aid
them.88
The FCC, acting on the statutory authority given to it by Congress, has broad regulatory powers
for spectrum management. The FCC was created as part of the Communications Act of 193489 as
the successor to the Federal Radio Commission, which was formed under the Radio Act of
1927.90 The first statute covering the regulation of airwaves in the United States was the Radio
Act of 1912, which gave the authority to assign usage rights (licenses) to the Secretary of the
Department of Commerce and Labor.91 Licensing was necessary in part because, as radio
communications grew, it became crucial that frequencies be reserved for specific uses or users, to
minimize interference among wireless transmissions.92 A key component of spectrum policy is the
allocation of bands of frequencies for specific uses and the assignment of licenses within those
bands. Allocation refers to the decisions, sometimes reached at the international level, that set
aside bands of frequencies for categories of uses or users; assignment refers to the transfer of
spectrum rights to specific license-holders.
The rules set by the FCC for using spectrum licenses (service rules) may have been oriented
toward the concepts of building and managing networks that were formed in the days of the
telephone, favoring traditional telecommunications business plans over those of companies with
different business models.

87 A number of rural wireless carriers and their associations have filed comments on the increasing difficulties they face
in competing for wireless customers. Comments are in a number of FCC dockets, such as RM11498, regarding
spectrum caps, and WT Docket No. 09-66, on the state of wireless competition.
88 The CBO study cited above was prepared at the request of the Senate Budget Committee to examine the impact of
small-bidder preferences on federal revenue and was completed before data traffic became a significant factor in
providing wireless services.
89 47 U.S.C. § 151.
90 P.L. 632, Sec. 3.
91 P.L. 264, “License.”
92 An “Act to regulate radio communications,” usually referred to as the Radio Act of 1912, was passed partly in
response to radio problems—including interference—associated with the sinking of the Titanic. Hearings Before a
Subcommittee of the Committee on Commerce, 62nd Congress, 2nd Session, pursuant to S. Res. 283, “Directing the
Committee on Commerce to Investigate the Cause Leading to the Wreck of the White Star Liner ‘Titanic,’” testimony
of Guglielmo Marconi, et al.
Congressional Research Service
15

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Appendix B. Spectrum-Hungry Technologies
Enabling technologies that are fueling both the demand for mobile broadband services and the
need for radio frequency spectrum include Long Term Evolution (LTE); WiMAX; fixed wireless;
WiFi; high performance mobile devices such as smartphones and tablets; and cloud computing.
Fixed wireless and WiFi are not new technologies but mobile broadband has given them new
roles in meeting consumer demand. Future technologies include network-centric technologies,
which include opportunistic solutions such as Dynamic Spectrum Access (DSA).
Long Term Evolution (LTE)
LTE is the projected development of existing 3G networks built on Universal Mobile Telephone
System (UMTS) standards.93 Like all fourth-generation wireless technologies, LTE’s core
network uses Internet protocols. The network architecture is intended to facilitate mobile
broadband deployment with capabilities that can deliver large amounts of data, quickly and
efficiently, to large numbers of simultaneous users. LTE will likely be implemented in stages
through modifications to networks using frequencies in bands already allocated for commercial
wireless networks.94 LTE might operate on spectrum bands at 700 MHz, 1.7 GHz, 2.3 GHz, 2.5
GHz, and 3.4 GHz.95
WiMAX
WiMAX provides mobile broadband but its earliest applications were for fixed wireless services.
WiMAX (Worldwide Interoperability for Microwave Access) refers to both a technology and an
industry standard, the work of an industry coalition of network and equipment suppliers.96
WiMAX uses multiple frequencies around the world in ranges from 700 MHz to 66 GHz. In the
United States, available frequencies include 700 MHz, 1.9 GHz, 2.3 GHz, 2.5 GHz, and 2.7 GHz.
The introduction of WiMAX in the United States is being jointly led by Sprint Nextel
Corporation and Clearwire Corporation.
Fixed Wireless Services
Fixed wireless services have taken on new importance as a “backhaul” link for 4G. Backhaul is
the telecommunications industry term that refers to connections between a core system and a
subsidiary node. An example of backhaul is the link between a network—which could be the
Internet or an internetwork that can connect to the Internet—and the cell tower base stations that
route traffic from wireless to wired systems. Two backhaul technologies well-suited for mobile

93 See, for example, “Mobile Broadband Evolution: the roadmap from HSPA to LTE,” UMTS Forum, February 2009,
Universal Mobile Telephone System Forum at http://www.umts-forum.org/.
94 Implementation summarized in Connecting America, Exhibit 5-B, p. 77.
95 Spectrum is segmented into bands of radio frequencies and typically measured in cycles per second, or hertz.
Standard abbreviations for measuring frequencies include kHz—kilohertz or thousands of hertz; MHz—megahertz, or
millions of hertz; and GHz—gigahertz, or billions of hertz.
96 Founding members of the WiMAX Forum include Airspan, Alvarion, Analog Devices, Aperto Networks, Ensemble
Communications, Fujitsu, Intel, Nokia, Proxim, and Wi-LAN. For additional information, see
http://www.wimaxforum.org/.
Congressional Research Service
16

---

Spectrum Policy in the Age of Broadband: Issues for Congress

Internet access are fiber optic cable and point-to-point microwave radio relay transmissions.97
Network expansion plans for WiMAX and LTE include microwave links as a cost-effective
substitute for fiber optic wire under certain conditions. Radio frequencies available in the United
States for microwave technologies of different types start in the 930 MHz band and range as high
as the 90 GHz band.
WiFi
The popularity of WiFi is often cited as a successful innovation that was implemented using
unlicensed frequencies.98 WiFi provides wireless Internet access for personal computers and
handheld devices and is also used by businesses to link computer-based communications within a
local area. Links are connected to a high-speed landline either at a business location or through
hotspots. Hotspots are typically located in homes or convenient public locations, including
airports and café environments such as Starbucks. WiFi uses radio frequencies in the free 2.4 GHz
and 5.4/5.7GHz spectrum bands. Many 3G and 4G wireless devices that operate on licensed
frequencies can also use the unlicensed frequencies set aside for WiFi.99
Cloud Computing
Cloud computing is a catch-all term that is popularly used to describe a range of information
technology resources that are separately stored for access through a network, including the
Internet. An Internet search on Google, for example, is using cloud computing to access a rich
resource of data and information processing. Network connectivity to services is another resource
provided by cloud computing. Google Inc., for example, offers word processing, e-mail, and
other services through Google Docs. Although off-site data processing and information storage
are not new concepts, cloud computing benefits from the significant advances in network
technology and capacity that are hallmarks of the broadband era. Cloud computing can provide
economies of scale to businesses of all sizes. Small businesses in particular can benefit from
forgoing the costs of installing and managing hardware and software by buying what they need
from the cloud. Consumers also can benefit because they no longer need to buy personal
computers in order to run complex programs or store large amounts of data. The convergence of
4G wireless technology—with its smartphones and netbooks—and the growing accessibility of
cloud computing to businesses and consumers alike will contribute to the predicted explosive
growth in demand for wireless bandwidth.
Network-Centric Technologies
The concept of channel management dates to the development of the radio telegraph by
Guglielmo Marconi and his contemporaries. In the age of the Internet, however, channel
management is an inefficient way to provide spectrum capacity for mobile broadband. Innovation

97 A discussion of backhaul technology is part of the testimony of Ravi Potharlanka, Chief Operating Officer, Fiber
Tower Corp., at House of Representatives, Committee on Energy and Commerce, Subcommittee on Communications,
Technology, and the Internet, “An Examination of Competition in the Wireless Industry,” May 7, 2009.
98 Unlicensed frequencies are bands set aside for devices approved by the FCC. The frequencies are effectively
managed by the FCC instead of by a license-holder.
99 “Wi-Fi Popular Now in Smartphones, Set to Boom,” by Matt Hamblen, Computerworld, April 1, 2009.
Congressional Research Service
17

---

Spectrum Policy in the Age of Broadband: Issues for Congress

points to network-centric spectrum management as an effective way to provide spectrum capacity
to meet the bandwidth needs of fourth-generation wireless devices.100 Network-centric
technologies organize the transmission of radio signals along the same principle as the Internet. A
transmission moves from origination to destination not along a fixed path but by passing from
one available node to the next. When radios are networked using network-centric technologies,
individual communications nodes continue to operate and can compensate for failed links. The
effects of interference are manageable rather than catastrophic. The network is used to overcome
radio limitations. With channel management techniques currently in use, if a channel’s link fails,
the radio is cut off.
Pooling resources, one of the concepts that powers the Internet now, is likely to become the
dominant principle for spectrum management in the future. Dynamic Spectrum Access (DSA),
Content-Based Networking, and Delay and Disruption Technology Networking, along with
cognitive radio, and decision-making software, are examples of technologies that can enable
Internet-like management of spectrum resources.
DSA is part of the neXt Generation program, or XG, a technology development project sponsored
by the Strategic Technology Office of the Defense Advanced Research Projects Agency
(DARPA). The main goals of the program include developing both the enabling technologies and
system concepts that dynamically redistribute allocated spectrum.
The Department of Defense (DOD) is working to implement network-centric operations (NCO)
through a number of initiatives.101 Leadership and support to achieve DOD goals in the crucial
area of spectrum management is provided by the Defense Spectrum Organization (DSO) created
in 2006 within the Defense Information Systems Agency (DISA). The DSO is leading DOD
efforts to transform spectrum management in support of future net-centric operations and warfare,
and to meet military needs for dynamic, agile, and adaptive access to spectrum. The DSO is
guiding DOD spectrum management along a path that envisions moving away from stove-piped
systems to network-centric spectrum management.

Author Contact Information
Linda K. Moore

Specialist in Telecommunications Policy

lmoore@crs.loc.gov, 7-5853


100 A leading advocate for replacing channel management of radio frequency with network-centric management is
Preston Marshall, the source for much of the information about network-centric technologies in this report. Mr.
Marshall is Director, Information Sciences Institute, University of Southern California, Viterbi School of Engineering,
Arlington, VA.
101 A discussion of the goals of NCO is included in CRS Report RL32411, Network Centric Operations: Background
and Oversight Issues for Congress, by Clay Wilson.
Congressional Research Service
18

---