A bill to auction off pieces of the public airwaves currently used for broadcast television so that they can be freed up for wireless Internet is making its way to President Obama's desk. Members of Congress are promoting it, in part, as a jobs bill.
"With 13 million Americans still seeking employment, job creation is a driving force behind efforts to expand wireless broadband," wrote U.S. House Energy and Commerce Committee Chairman Fred Upton , R-Mich., and Communications and Technology Subcommittee Chairman Greg Walden, R-Ore.
Obama is expected to sign the legislation, which could ultimately mean faster connections for wireless devices.
Will Carriers Win the Bid?
The need is great. The decision comes just says after Cisco's Visual Networking Index forecast an 18-fold growth in global mobile Internet data traffic from 2011 to 2016. The forecast predicts an annual run rate of 130 exabytes of mobile data traffic, which is equivalent to 33 billion DVDs, 4.3 quadrillion MP3s, and 813 quadrillion short text messages.
Will AT&T and Verizon snap up the bandwidth? Should they be allowed to? Rob Enderle, principal analyst at Enderle Group, said the highest bidder is probably going to win -- and the wireless carriers will likely be among the highest bidders.
"When you are a government that's clearly well in the red, being too choosy about who can buy what probably isn't going to get you the money you want," Enderle said. "There certainly is going to be concern about too much bandwidth being concentrated in too few companies, but overall I think users will see at least initially a benefit from this bandwidth because carriers will have to do less throttling."
The Cost Benefits
The bill's authors expect the spectrum auctions to bring in more than $15 billion in federal revenue. It also helps the Federal Communications Commission save billions of dollars in taxpayer money to free up other spectrum that's ideal for licensed use.
"Spectrum auctions are not only good public policy for the communications and technology sector, they will produce meaningful job creation when we need it most," Upton and Walden said. "Estimates project that the new wireless build-out will result in billions of dollars in new investment. The hundreds of thousands of jobs that are created as a result will be an economic game-changer."
One study projects that build-out of next-generation wireless networks could generate 371,000 to 771,000 jobs, $25 billion to $53 billion in investment, and $73 billion to $151 billion in GDP growth.
But that requires making more spectrum available. This legislation does that by allowing the FCC to share proceeds with licensees, like broadcasters, who voluntarily return spectrum to be re-auctioned to meet the exploding demand for wireless Internet service.