Wireless Frequency Spectrum and Consumer Choices

According to the Federal Communications Commission (FCC), spectrum is the range of electromagnetic radio frequencies used to transmit sound, data and video across the country. This range includes all possible frequencies available from 0 hertz to infinity and these frequencies divided into contiguous service bands that are further divided into channels. The use of different frequencies for wireless communication is not new. The organizations that use these different frequencies include defense (e.g., drones, weapons), government (e.g., police, fire departments) and commercial (e.g., phone services by telecoms, TV stations). People also utilize these frequencies (e.g., Bluetooth, 802.11 wireless routers at home) for different purposes. Thus, due to the widespread usage of different frequencies, it becomes important that we understand the discussions at FCC regarding opening up different frequency spectrums.

Although the available frequencies are infinity but the 500MHz to 10GHz is the most optimum and thus it is called the golden zone. In the golden zone, the lower the frequency, the better the wireless signals spread and thus minimum infrastructure (e.g., radio towers, signal boosters) is required. In order to avoid signal congestion different organizations operate at different frequency spectrums. For example, Verizon operates at 800MHz and 1900MHz, Sprint at 1900MHz and TV broadcasters at 600MHz. From this we can see that TV operates at an optimum frequency within the golden zone.

Due to the explosion in the utilization of mobile devices, there is an increasing demand on better wireless signal transmissions. In light of this increased demand, the FCC is considering to request/force TV broadcasters to free up their 600MHz frequency spectrum that travels better through long distances and through buildings so that telecoms can use it. The disagreement in this FCC consideration is how should this frequency spectrum be opened up. One option is have an open auction where telecoms can freely bid and the other option is that large telecoms should have an upper limit of how much spectrum they can bid for. In the telecom industry, selection of either option matters. The reason it matters is that if there is an open auction then the telecom with the deepest pockets would take most if not all of the frequency spectrum released and thus would leave the smaller telecoms with limited options.

So, why should this “spectrum wars” matter to the consumers? The reason it matters is because if the large telecoms were able to get all the released TV frequencies then smaller telecoms would be forced to use higher frequencies. This means that smaller telecoms would have to spend more on infrastructure and maintenance of expensive equipment. This would result in the smaller telecoms passing these expenses to the consumers in the form of increased prices. Since most consumers are price conscious and want better quality and reliability from their phone service, they would select large telecoms as their best option. When the consumers start to make this decision, it will be only a matter of time when the business model for smaller telecoms would become unsustainable and they would have to close shop. After the smaller telecoms have disappeared we will see lack of competition, monopoly and future headaches for the consumers.

For the consumers, the future headaches would entail increased prices and elimination of services. Even without the actual allocation of frequencies, there is a trend by larger telecoms to take advantage of their size and they have started doing this by eliminating unlimited data plans. Imagine if this is happening now, how the larger telecoms would have the consumers in a chokehold when these organizations acquire the TV frequency spectrums. What else would these telecoms would be able to do then?

In conclusion, when the consumers close their eyes to what is going to happen, when they are most concerned with the immediate future but not the distant future, they would be exploited by large organizations. Not only would the attainment of TV frequencies benefit telecoms, but also the question becomes that if TV broadcasters are giving up their frequencies then what are these broadcasters going to do? Will the TV broadcasters move to cable and if yes then large telecom companies (e.g., Verizon) would still benefit since not only would they provide phone service but TV service and content creation. This to me seems another attempt to monopolize every media medium and would most likely result in corporations that would become too big to fail. Perhaps for the shareholders this would be a good thing but for the average consumer this would mean lack of choice and thus lack of freedom.

References:

  1. http://www.fcc.gov/spectrum
  2. http://www.fiercewireless.com/story/tv-broadcasters-remain-wary-600-mhz-incentive-auction/2014-03-26
  3. http://www.wilsoncellularbooster.com/page.html?chapter=1&id=9

 

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