A debate between the Federal Communications Commission and the outgoing Bush administration centers on the FCC's plan to make broadband available for free at government-mandated speeds.
In a letter to FCC Chairman Kevin Martin, Secretary of Commerce Carlos Gutierrez said providing free broadband services would be counterproductive, result in a congested and inefficient broadband, and be inconsistent with the Bush administration's stand that the service should be allocated by the markets, not the government.
Gutierrez asked the FCC to reconsider its business model that would include offering 25 MHz of the wireless spectrum in the 2155-2180 range to citizens without broadband access. The FCC is expected to vote on the move on Dec. 18.
Gutierrez said the administration believes the Advanced Wireless Services-3 Spectrum should be auctioned without price or product mandates and that the FCC should rely on the market to determine the best use of the spectrum.
Broadband for Everyone
If the FCC approves its AWS-3 rule, the auction winner would have to provide free wireless broadband to 50 percent of the population in four years and to 95 percent of the nation within 10 years.
Adopting broadband would increase the gross domestic product while keeping 61,000 jobs per year over the next 19 years and 1.2 million additional jobs in a single generation, according to a January report by the Congressional Research Service.
Seven percent broadband adoption would have $134 billion per year in direct economic impact, according to a study by Connected Nation.
Coming to the defense of the FCC is Menlo Park, Calif.-based M2Z Networks, which plans to bid on the AWS-3 spectrum and build the free nationwide broadband network.
"We made strong policy arguments about why 100 million people don't have broadband and about 45 percent of those people say they cannot afford it," said John Muleta, founder and chief executive of M2Z. "The carriers have monopolized and would rather serve those that can afford access than those that cannot."
M2Z, in response to Gutierrez's letter, is asking the FCC to move forward with its Dec. 18 vote. Delaying the vote would violate the Telecommunications Act, according to Muleta.
The vote has already been delayed twice by the FCC -- once in June and again in August -- because T-Mobile, AT&T and other wireless companies requested that the FCC do more analysis.
A provision in the Telecommunications Act states that the FCC, if it starts a rule-making process about a new service or technology, has to make a decision within 12 months. Muleta said the process began in November 2007.
"Delays only favor the people who have what they want," Muleta said. "The FCC unfortunately has to treat every argument equally, but this has been going on for two and a half years."
"Here you have essentially the Bush administration and carriers saying 'It is okay to break the law, FCC,'" Muleta added. "For the Bush administration to write a letter and say you can violate the law is astounding."
Muleta added that consumers have waited long enough and the Bush administration should support the plan, not fight it.