Spectrum

Spectrum issues, community wireless, muni broadband

White Spaces Lurches Forward Again. OET Issues Good But Weird Proposal.

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Over a year ago, the FCC took a major leap forward on deployment of broadband and rethinking our national spectrum policy by voting to open the unused broadcast channels for unlicensed use (aka the “broadcast white spaces”). The Order left a bunch of questions unanswered, such as who would run the proposed database of available frequencies for white space use. Petitions for Recon got filed, lots of requests for revision and modification of the rules got made, and then nothing happened.

In fairness to OET, it’s been a busy year. First there was a change in administration, then it was “all DTV all the time” until the magic June 12 deadline. Then it was bringing on a new FCC Chair and two additional new Commissioners. Then it was “National Broadband Plan all the time.” But still, it was with a tremendous sense of relief that the process had not utterly vanish off the FCC’s radar screen that I saw the FCC’s Office of Engineering and Technology release a Public Notice on the database. At last! We can get moving on this again, and hopefully move forward on the most promising ‘disruptive’ technology currently in the hopper.

And move we are, in a very peculiar fashion. Rather than resolve the outstanding questions about how the database provider will collect money, operate the database, or whether the database will be exclusive or non-exclusive, the Public Notice asks would-be database managers to submit proposals that would cover these issues. Further, parties have until January 4, 2010 to submit proposals. The FCC will take comment from members of the public on the proposals a month later.

I label this approach “good, but weird.” On the one hand, this seems to my non-engineering and well ordered mind to be totally backwards. How the heck can anyone tell if they want to manage the database when they don’t even know what the requirements are. On the other hand, this basically accomplishes the same thing by having would-be operators that have been pestering the FCC to resolve the matter and trying to get the FCC to adopt rules that favor their own technology/business model a chance to stop pretending that these rules are neutral and the opportunity to make their pitch directly to the FCC. It also cuts down on the number of steps until we actually have a functioning database and can start deploying the technology. Finally, having just gone back and looked at the 2008 Order, the FCC was fairly explicit (Par. 221) that this was always the plan.

And, as usual, I really wish the FCC would not sit around taking months to decide things and then want an immediate response out of us poor public interest folks with our limited resources.

But on the whole, I’m very happy indeed.

More below . . .

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Why Eliminating Handset Exclusivity Drops the Price of Cell Phones; or “How Is A BlackBerry Like A Pill?”

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Back in February, I bought a Samsung Omnia and regretted it almost immediately thereafter. So when my touch screen finally died, I resolved to get a BlackBerry Curve 8330, as my wife has one and recommended it. Yes, she is on Sprint and I am on Verizon, but you can get the same model on both networks.

I was totally unprepared for the sticker shock. $450. Why? Because I was not eligible to buy new equipment. Did I want a replacement Omnia? No, I decided I really did hate my Omnia $450 worth. Out of curiosity, I asked how much it would cost if I were getting a new contract. Answer: $150, plus a $100 rebate.

Verizon claims here in policy land that this represents a subsidy, which they can only do if they have handset exclusivity. Mind you, this model is not actually exclusive, but let that go. Could it really be that Verizon subsidizes my phone $400? That seems an awful lot. So I decided I would look on Best Buy, assuming that it would represent the actual unsubsidized retail price. So I went to bestbuy.com and plugged in Blackberry Curve 8330. Sure enough, the price for the Verizon phone was $499, close enough to $450 to make Verizon’s subsidy claim feasible.

Then I noticed something odd. The same model phone, but for Alltel, cost $680, for Sprint, $750, and for MetroPCS, $400. Why should the same model phone, purchased at the same place, have such a wild swing in price? Remember, these are the prices without the subsidies for buying a new contract, so it can’t be the difference in what the companies chose to provide. The Best Buy price should reflect the unsubsidized retail price. The only difference, in theory, is the plan, (unless we are pretending to make the same model available to every provider and really aren’t). How could the wireless plan make such a difference?

Then it occurred to me where else I’ve seen this dynamic. Go to the drug store and you can see three people getting exactly the same prescription. But one pays $10, another pays $120, and the third pays $500. How is that possible?

Before elaborating below, I will first make it clear that I am rather short on critical data because most of the critical data is proprietary. So what I’ve got is a tentative hypothesis based on observed facts rather than something I can say with certainty. But it is enough for me to say: “Hey! FCC! Go and use your regulatory powers to get the providers to fork over the necessary data to see if I’m right.”

More below . . .

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FCC “WiMAX Auction” Already Over — Not a Surprise, But Still Impressive.

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Some of you may recall that last month fellower Wetmachiner Greg Rose and I published our first industry report on the FCC’s Auction 86. We dubbed this the “WIMAX Auction” because the band at issue, the 2.5 GHz band, is the focus of major WIMAX activity in the U.S. and the report described the current state of the industry (including coverage maps for Clearwire and Sprint and the most extensive private database yet of who holds what in the band), likely outcomes in the auction, and what the behavior of bidders in the auction would tell us.

One prediction we made, that the auction itself would attract very little interest because it was an “ash and trash” auction of the leaving in the band, held up pretty well. The auction opened on October 27, and closed Friday, November 6. In other words, the entire auction lasted a week (4 bidding days) — which in FCC terms is greased lightning (the 700 MHz auction last year, for example, went on for 38 bidding days covering over 2 months). Total haul was $20 million, which will hopefully serve as a reminder to folks that spectrum auctions are not all multi-billion dollar gold mines.

As promised, we will release a post auction analysis available with the spectrum maps and databases for $799 within the next few months, once we (meaning Greg) have a chance to crunch the numbers and the round by round results. (Those who pre-ordered at the reduced rate when they bought the earlier report do not need to re-order). If you order now (the report is available through Muniwreless.com and through BroadbandCensus.com), you will not only pre-order the post-auction updates, but will get a copy of the original report with its industry analysis and coverage maps.

Stay tuned . . . .

Why Don’t Broadcasters Become “Spectrum Innovators?” Because They Like Being Broadcasters.

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Can’t help but take a brief break from the Net Neutrality craziness to be mildly amused at Adam Thierer over at Tech Liberation Front. We have an increasing number of reports that Blair Levin wants to bribe broadcasters to get off their spectrum as part of the national broadband plan. Adam is very excited by this and, of course, brings up the usual Libertarian argument that because property solves all problems, we should just make the broadcast licenses property of the broadcasters and let the endless innovation begin.

The problem with argument is that broadcasters could already do this. Under 47 USC 336(b), broadcasters can use their digital spectrum to provide “ancillary and supplementary services.” In a series of orders, the FCC has said that as long as full-power broadcasters provide one free over the air digital channel, they can do whatever they want with the remaining spectrum — including lease it out in the secondary markets to someone else. Under the statute, broadcasters need to pay a fee for any such ancillary services that would be the functional equivalent of what the broadcasters would have paid for the spectrum at auction (47 USC 336(e)), which the FCC has fixed at 5% of any annual revenue from the ancillary services.

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Proposed Wireless NN Rule “No Block, But Not No Lock?”

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An interesting tidbit from Washington Post Reporter Celia Kang’s interview with Ruth Milkman, the FCC’s Wireless Bureau Chief. Of interest, Milkman states that the application of network neutrality to wireless would still allow cellular companies to lock cell phones to wireless providers.

How are the proposed rules different from conditions on the C block during the 700 MHZ auction? There, net neutrality rules were put in place that allow any device to attach to the network and prevent Verizon Wireless, who won the spectrum, from blocking Web content.

The difference between what we are thinking about in the general NPRM (notice of proposed rule-making) and the C Block is that we are not proposing a no-locking rule. So I guess it’s no block but not no-lock. If consumers can get an unlocked device and not harm the network, the consumer ought to be able to attach that device to a network. Does a service provider have to unlock the device it provides to the consumer? The draft doesn’t go that extra step.

This is an interesting twist on the application of the third principle of the 2005 Internet Policy Statement:

To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to connect their choice of legal devices that do not harm the network.

(emphasis in original). This is generally taken as the application of the “Carterfone” principle (and the Internet Policy Statement cites the Carterfone decision in case anyone misses this point). This is the decision that held that AT&T could not refuse to allow you to connect any device, like and answering machine or a phone you owned or a dial-up modem, to the phone network.

Milkman is right that the freedom to connect to a network is not necessarily the same thing as the freedom to move a device that comes locked from one network to another. In the old days, it wasn’t necessary to say it that way because there weren’t other networks to attach your device. The question was whether somebody other than Ma Bell could make something and attach it to the phone network. By the time we got to multiple wireline networks serving the same neighborhood, the consumer electronics market was so well developed that the idea of trying to lock particular laptops or wireless routers to specific network providers did not make much sense. Indeed, even in the never ending fight over set-top boxes and cablecard, the fight is over the ability to attach to an MVPD network, not the ability to unlock a device and move it from one MVPD network to another.

Most of us have always assumed that network neutrality applied to wireless would include both “no blocking” of content and applications and “no locking” devices to networks. But I suppose it doesn’t have to be that way. And, of course, this does not stop the FCC from dealing with handset exclusivity separately.

Still, it comes as a bit of a surprise. Nice to have the heads up, and tip ‘o the hat to Celia for doing this series of interviews with important folks at the FCC.

Stay tuned . . . .

St. Cloud Muni System Saved by Citizen Users — “Waste” or “Success.”

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As reported by Esme Vos at Munireless, the St. Cloud Muniwireless system has been granted a reprieve. In an effort to lower municipal costs to avoid raising taxes, the town council voted on September 30 to shut down the wireless network. At a city council meeting two days later, a crowd of local residents showed up to protest the decision, resulting in a 120-day extension to reexamine the question.

St. Cloud’s political fight over its municipal wireless network cuts to the heart of one of the core debates in the national broadband plan. Do we regard connectivity as a service on the same level as schools, sewage, and public transportation — where we expect the city to subsidize the service because it provides needed social benefits? Or do we insist that we only provide broadband where it can pay for itself on a going forward basis (after some initial stimulus money to get the network built and get the ball rolling)? There is no doubt that for a city of 30,000, a fair number of people use the St. Cloud wireless network (at least 8500 unique connections/month) and enough regard it as sufficiently important to lobby their city council to keep the network in the face of a financial shortfall. At the same time, no one argues with the fact that the network costs the city $30K/month and seems likely to do so for the foreseeable future.

So how do we measure waste or success? I’ve argued on more than one occasion that we should look on these networks as the equivalent of a public transportation system. They don’t compete with cabs or car sales despite the fact that many people rely on them to avoid driving. In fact, cabs and auto dealers benefit because public transportation systems because they keep traffic manageable. And, as the iPhone and other smartphones continue to increase the demand for spectrum for data traffic, licensed wireless operators like AT&T are finding it beneficial to encourage customers to use wifi hotspots and offload the traffic whereas previously carriers resisted letting customers use wifi at all.

We have until February to debate how we want to incorporate this into our national broadband plan. Broadband as utility — where we encourage local governments to offer services like St. Cloud for the positive externalities for everyone even if it requires continuing subsidy? Or does it only make sense to have municipal broadband where it can pay for itself? With the final decision on St. Cloud now due in January 2010 — a month before the National Broadband Plan — it will be very interesting to see what the citizens of St. Cloud and their local government decide.

Stay tuned . . . .

So What's Up With That FCC Investigating Apple and AT&T Blocking Google Voice — Oh Wait, They Aren't . . .

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So while I was gone, Apple and/or AT&T turned down Google’s effort to get a Google Voice Application certified for the iPhone, so the FCC launched an investigation into the matter.

Except they didn’t. Not exactly. Which is extremely important on the delicate question of FCC authority. Actually, the FCC invited three companies involved in a very high-level spat on an issue pending before the FCC in two proceedings to provide them with useful information on how the market actually works.

I know, I know, this is all boring legal stuff that folks who care just about outcomes hate with a passion — or think is just cheap legal handwaving. But these things matter, both as a matter of law and and as a matter of policy. The fact is that the FCC is very carefully not exercising authority over anyone. The companies don’t even need to respond. However, if they fail to respond, they invite the FCC (and the rest of us) to assume the worst. Because allowing industry folks to foreclose needed agency action by simply refusing to provide necessary information is a crappy outcome we’ve lived with for the last 8 years (longer, really). Far smarter to invite industry folks to respond to questions, but decide that at some point you need to move with the information you have. Heck, if the FCC pulls that trick only once, I bet we’ll see lots more folks with relevant information willing to come forward.

So while I expect lots of folks to yammer about FCC authority on August 21 when the answers are due, they’ll be barking up the wrong tree. Won’t stop ’em, of course. But for those who would like a sense of what is actually going on from a legal/regulatory authority angle —

More below . . . . .

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D Block Drama Erupts! NENA Breaks Ranks! Wireless Carriers At War! Oh, the Humanity!

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Yes, for policy wonks in the summer, this is high drama. Once upon a time, before the 700 MHz auction, we used to have two very clear groups of stakeholders in spectrum policy land. We had public safety on one side and commercial wireless carriers on the other. (We also had us public interest folks, but no one — especially in the Wireless Bureau — gave a crap about us.) While these two groups might disagree internally, they solidified into utterly united and utterly opposing camps when confronting each other — regarding the battle for spectrum as a zero sum game with each side trying to wrestle every last MHz out of the other one.

But the 700 MHz changed all that. It cemented the spectrum advantage of AT&T and Verizon over all other carriers, breaking the commercial world into “AT&T and Verizon” and “carriers who need backhaul, roaming agreements, and special access — all of which they buy from AT&T and Verizon.” And it fractured consensus in the public safety community by creating the enormous loose end known as the “D Block.” As readers may recall (and if they don’t, you can check out my extensive coverage of the 700 MHz auction) the D Block was the private part of a public/private partnership where a private entity would bid and then build out the network, then enter into a sharing agreement with the public safety block. Sadly, for various reasons I will not rehash here, this didn’t work out.

And now, just when it looked like public safety was lining up behind AT&T and Verizon to lobby Congress to reallocate the D Block entirely to public safety, all Hell breaks loose. The “not Verizon and AT&T” wireless carriers have introduced a counter proposal to take back the 12 MHz on the public safety side of the partnership and auction the whole 22 MHz for commercial use as one, unpaired block. And they have received the backing, sort of, of the National Emergency Number Association (NENA).

What drama to greet the arrival of Chairman Genachowski and the finally fleshed out full FCC! Commercial wireless carriers at war! Public safety in disarray! Spectrum brother against spectrum brother in the ultimate spectrum policy smackdown!

I analyze the possible deals, the potential winners and losers, and my guesses on odds for success below . . . .

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Brief Update on Wireless Microphones: Where Mike Marcus and I Disagree

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As Mike Marcus pointed out in the comments on my previous wireless microphone piece and on his blog, he and I disagree on the advisability of allowing prisons to jam cell phone communication.

Let me begin by saying that Mike has both tremendous engineering chops as well as a thorough understanding of the FCC and the politics therein. He worked there for some ungodly amount of time in the Office of Engineering and Technology, and was a critical force in pushing the 1989 rule changes to Part 15 that made the unlicensed revolution possible. His comments are not to be taken lightly here.

Where Mike and I disagree is not so much on the primary data but on how much weight to assign things. This is not uncommon in the messy world of policy, and is why even people generally aligned with one another can disagree strongly on important matters of policy (and why I hate the tendency for people to start calling each other nasty personal names over such disagreements). That’s why it’s important to see where and how we disagree.

In addition to his blog post, Mike also consulted for the state correction facilities on their Petition for Rulemaking (“Prison jamming Petition” or “PJP”). Read through that and his blog post and we come up with the following:

1) We both agree this is a hard engineering problem. Whereas I am more skeptical (based on the folks I’ve talked to) that this can be done in a way that is effective, affordable, and without interference, Mike thinks it is possible for some prison environments. I stress this last because, as the PJP points out, even the most optimistic projection for the current level of technology makes it doubtful this will work in detention facilities in high-density population areas.

2) Which brings us to major point of disagreement #2, how much will this really help and is the trade off worth the risk. Mike readily acknowledges that this is no “magic bullet” that would solve the security problems. The question is whether it does enough to be worth taking the risk of interference and the risk that jammers will proliferate. I think no, Mike thinks yes. Part of the reason I think this is a bad idea is because my experience with bright line rules tells me that where you have so many people interested in cell phone jamming it is inevitable that whatever protections are put in place will be whittled away over time. In addition, in a messy field like engineering, we disagree a lot about how easy/hard it would be to neutralize jamming, a critical question on the cost/benefit analysis.

3) Finally, we both agree that the wireless industry needs to step up to the plate and work with detention authorities to make solutions other than jamming affordable for for prisons, and that the FCC needs to address the problem of charges for prison calls made under proper supervision.

I expect Mike’s well reasoned and narrow disagreement will be manipulated by those who want to exploit this for their own profit (yes, I’m looking at you CellAntenna). That’s unfortunate. I hope that the wireless industry and correction facilities can work together to develop real solutions to the problem of contraband cell phone use before Congress pushes through legislation that would do more for CellAntenna’s bottom line than it would for prison security.

Stay tuned . . . .

CellAntenna Scam Continues To Gain Momentum — Bummer.

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Regular readers may recall that I find CellAntenna’s continuing effort to leverage the problem of contraband cell phones to get the law changed so that they can sell cell phone jammers legally in this country not merely obnoxious and offensive, but downright dangerous. CellAntenna has proven real good at persuading state prison wardens that this technology solves their problems, despite the statements of frequency coordinators and public safety orgs that this is a real bad idea. The mainstream media, as is all too common these days, has generally acted like mindless cheer leaders without troubling to dig into whether cell phone jamming will actually work or not. The only decent in depth coverage was this Wired piece by Vince Beiser. For one thing, Beiser notes that prisoners can beat the jammers with a few sheets of aluminum foil.

I’ve blogged in a little more in-depth on this over here at Public Knowledge. We also (with additional sign ons from a number of other orgs) sent this letter to the Senate Commerce Committee in advance of tomorrow’s hearing so that at least someone is on record opposing this scam. Finally, for those of you who prefer the short, pithy medium of me staring into a camera and yakking about this, I give you my latest Five Minutes With Harold Feld The Prison Problem: Cell Phone Jamming and Shrimp Scampi.

Stay tuned . . . .