Wave of Recent Studies Highlights Growing Need for More Wireless Spectrum

Earlier this month, the Taxpayers Protection Alliance (TPA) highlighted a report from CTIA (The Wireless Association) that analyzed the direct and indirect value of wireless spectrum on the economy. The findings of the report made clear that wireless spectrum is becoming more valuable to the growing mobile economy.  The need for government to release more of it into the private market is undeniable.

Some of the highlights of the report included:

• Employing 1 person in the wireless industry results in an additional 6.5 people gaining employment
• Mobile entertainment revenues were valued at an estimated $9 billion in 2014
• One analyst estimated that the “app economy” generated an estimated 752,000 jobs in 2013
• An analyst at IHS, a market research firm, stated that the U.S. telehealth market is expected to grow from $240 million in 2013 to $1.9 billion by 2018

On the heels of that report, more information has been published this week that builds upon the overall concern on the need for government to free up more spectrum. Two reports were released this week making the case to free up more spectrum.

First, a white paper from CTIA titled “Mobile Data Demand: Growth Forecasts Met”, shows that the FCC’s projections on mobile data growth were quite accurate over the period of 2010-2014.  But, despite the growth being on target, the government has been lagging in the area of allowing more spectrum to hit the market:

Despite the FCC’s nearly perfect projections, the government has made 135 MHz spectrum available for mobile broadband since 2010, which is less than half of what the FCC suggested would be required by 2015. Moving forward, projections for 2019 from Ericsson and Cisco indicate there will be nearly six-times current traffic levels due to even more users, more mobile connections and more data-intensive services and applications. Yet there are no plans to make sufficient spectrum available to support this traffic, even with the AWS-3 auction and the upcoming incentive auction.

This is important because with the growth in mobile data usage, there is clearly a need for more spectrum. The more spectrum made available to private industry through incentive auctions, the better chance wireless carriers have to ensure they can provide the best service to customers. This also means more money made from the sale of licensed spectrum that goes to deficit reduction, which benefits taxpayers across the country.

The second report released this week on spectrum, “Substantial Licensed Spectrum Deficit (2015-2019): Updating the FCC’s Mobile Data Demand Projections”, details exactly how the mobile data projections over the four years make clear the government must do more to get additional wireless spectrum into the marketplace and do so sooner rather than later:

To meet the projected six-fold increase in mobile data, wireless carriers require 50 percent more spectrum by 2019 than is currently licensed for commercial mobile services

Additional licensed spectrum key to America remaining global mobile leader, generating more than $400 billion in annual economic activity and supporting more than 1.3 million jobs

The report notes that the need is pressing, despite scheduled auctions already slated to take place and that they will not be enough to meet demand in the marketplace:

The upcoming incentive auction will meet some of the demand for more licensed spectrum, but even that reallocation will leave significant demand (best case still than two-thirds of the projected deficit) for more licensed spectrum.

TPA continues to advocate for increased spectrum to be sold into the marketplace as a means for benefitting consumers and taxpayers.  These new reports are further evidence that the spectrum being held by the government should only be enough to fulfill any security requirements. It is long past due for the Federal Communications Commission to ensure as much wireless spectrum is made available to the market as possible.  That is a win for consumers and taxpayers.