This morning, the House Subcommittee on Communications & Technology held a hearing on “The Future of Video.” Among the witnesses participating in today’s hearing was David Barrett of Hearst Television, who appeared on behalf of the National Association of Broadcasters.
Barrett predictably opened his testimony by addressing the ongoing implementation of the repacking and incentive auction efforts set in motion by February’s spectrum legislation. NAB says “go slowly.” OK, I get it. But the Commission can get it right without dragging its heels.
As NAB’s Gordon Smith wrote yesterday in a letter to Chairman Genachowski, “the Commission need not choose between quality wireless broadband and a robust local broadcast system. We can, and should, have both.” I agree, and will duly note Smith’s new conciliatory approach. But, to ensure we have the quality wireless broadband that he is referencing, the incentive auction process must move forward expeditiously. That said, incentive auctions aren’t the focus for today since Congress already gave the FCC authority to proceed back in February. Instead, since we weren’t invited to participate on today’s panel, I want to address several other points Barrett made in his testimony.
The first point I want to take on is the increasingly tired NAB canard that the wireless industry is “warehousing vast quantities of unused spectrum.” That may sound ominous in testimony, but it just isn’t true. As Michael Katz noted in his excellent paper, which he presented at the “Spectrum Policy: Emerging Issues at an Inflection Moment” conference that was hosted by the Georgetown Center for Business and Public Policy, the claim of warehousing is belied by the fact that wireless carriers “have generally been investing large amounts of money to expand the capacity of their networks and increase their output levels.” Since the U.S. wireless providers invested more than $25.3 in 2011 and continue to expand their network capabilities, these facts clearly contradict the suggestion of warehousing.
Second, at a time when wireless carriers are allegedly warehousing spectrum, Barrett also says they’re using their allocations inefficiently. To support this contention, he trots out a recent New York Times piece in which Marty Cooper claimed that available technologies – which he just happens to sell – “could greatly increase spectrum efficiency” but are not being implemented by the wireless industry. It’s important to remember that Marty Cooper is a salesman. He’s pitching a product. But let’s ignore that he’s a salesman pitching his product for just a moment. If there was a product that was able to do what Cooper claims that would allow wireless carriers to spend only millions of dollars to use the spectrum they already hold more efficiently, rather than spending billions of dollars to acquire additional spectrum, don’t you think they’d use it? It’s telling that no carrier – here or abroad – has adopted Cooper’s “solution.”
There are some other statements that Barrett made today that he needs to explain a bit more too. For instance, in attacking the decision by wireless companies to experiment with data caps and tiered service offerings, Barrett suggests that the solution to delivering video without fees is “coupling high-powered one-to-many broadcast transmission with…cellular networks...” Now first, TV isn’t free; burying its cost in the products we buy from advertisers does not make it “free.” Next, I find the use of the word “coupling” interesting. Is Barrett calling for mobile TV technology to be embedded in wireless devices? If there’s consumer demand for that, I’m confident that the vibrantly competitive wireless industry will deliver solutions. But if there’s not, the government certainly shouldn’t require it. Technology mandates make for bad public policy. That would be true with respect to an FM chip and just as true with respect to a DTV chip. And remember, at a hearing last July before the House Subcommittee on Communications & Technology, NAB’s Gordon Smith agreed (see 1:29), telling Rep. Marsha Blackburn that the broadcasters are “not seeking a mandate” for mobile phones to carry a DTV chip.
On the plus side, Barrett testified that “just as the wireless companies are upgrading their technology, from 3G to LTE and beyond, broadcasters will also be upgrading, and the results could have an extraordinary impact on spectral efficiency.” I’m from the “I’ll believe it when I see it” school, but I hope that’s the case. As the folks at Ericsson have demonstrated, moving the broadcast industry from its current “high tower, high power” model to a “low tower, lower power” model that is more akin to wireless would allow broadcasters to move from a one-way to two-way service and reuse frequencies the same way that wireless companies have for decades. By employing this more efficient alternative distribution architecture, the broadcast services that today occupy nearly 300 MHz could be delivered using as little as 84 MHz of spectrum. This would create a sizeable spectrum dividend that could be made available for auction and help address the exploding demand for wireless broadband services.
Today’s hearing was an interesting look at where video is headed in the broadband age. The Subcommittee is right to wrestle with these questions. As they do, I’m confident that they they’ll conclude, as we have, that the right way to proceed is to make more spectrum available for commercial use and to rely as much as possible on a light – very light – regulatory regime. That’s the best way to ensure that the “Future of Video” is bright.