The Federal Communications Commission recognizes that highly versatile mid-band spectrum—between 2.5GHz and 4.2GHz—is needed to win the race to 5G, the faster and more efficient wireless network that will connect people and machines to just about everything.
Last year, the FCC issued a notice of proposed rulemaking with the goal of making more flexible use of the 2.5GHz Educational Broadband Service (EBS) spectrum, currently only licensed to educational institutions, and has been expected to come to a decision on how to make this 5G-friendly spectrum available this summer.
The time for action is now, and the need is great—the commission stopped issuing new EBS licenses 23 years ago, leaving the 2.5GHz band unused or underutilized in about half of the country.
Mid-band EBS frequencies sit in a spectrum “sweet spot.” They are low enough to cover large areas but have the bandwidth to carry high-capacity services. The 2.5 GHz band is the largest band of contiguous spectrum below 3GHz and, with its high functionality, could be wind at our backs in the race to 5G.
Not only could EBS spectrum help ensure American global dominance in next-generation connectivity, but it could speed transformative technologies, including the Internet of Things (IoT).
Putting frequencies in the 2.5GHz band into an incentive auction could both “honor the educational history of this spectrum and make for its more effective use in the present,” according to FCC Commissioner Jessica Rosenworcel, a proponent of creating a voluntary auction for the spectrum.
What does that educational history entail? In 1960, John F. Kennedy told the National Association of Educational Broadcasters that shoring up the “shameful weaknesses” of the nation’s classrooms was a question of “national survival.” Kennedy called television, the leading audiovisual technology of the time, an instrument “with the potential to teach more things to more people in less time than anything yet devised,” saying it “seems a providential instrument to come to education’s aid.”
To that end, he signed the Educational Television Act in 1962, providing funds for noncommercial television broadcasting. The FCC then formed the Instructional Television Fixed Service (ITFS) to bring educational TV to the classroom.
While TV took off outside school walls, the idea behind the ITFS didn’t get far off the ground. Funding for equipment was lacking and asking teachers to be TV producers was unrealistic. So large tranches of the airwaves set aside for the ITFS lay fallow. To address the shortcomings, in 2005, the FCC converted ITFS into the Educational Broadband Service (EBS), recognizing that technologies more advanced than television might allow Kennedy’s vision to be realized.
Most Licenses Leased
Technology was transforming the world, but the EBS stayed stuck in the past. So, with the FCC’s go-ahead, many educational organizations leased their EBS licenses to commercial entities, including mobile carriers (the FCC estimates that, today, more than 90% of the EBS licenses held by educational institutions are leased to other entities).
Since, for the most part, EBS licenses are currently in the hands of commercial users, auctioning the spectrum to the highest bidders would recognize the reality of what is happening today and promote efficiency in spectrum allocation and usage. It would also enrich educational institutions that opt to participate.
Commissioner Rosenworcel’s idea for a voluntary incentive auction has been gaining momentum as an approach that would maximize the educational value of the EBS spectrum. Incentive auctions first pay the entity that holds the license, with the money left over going to the government.
In the recent broadcast incentive auction, broadcasters received $10 billion, and approximately $8 billion went to the U.S. Treasury. And according to Fred Campbell, director of Tech Knowledge, educational institutions that hold EBS licenses would substantially benefit from an incentive auction:
Pricing data from previous FCC auctions indicates that EBS licensees’ spectrum rights would be worth from 1.8 to 14.5 times more, on average, if the spectrum was sold on a commercial basis through a voluntary incentive auction. For example, EBS spectrum that the school board for Pinellas County, Fla., is leasing for a total of $16,725,656 over a 30-year period would be worth from $32,939,861 to $157,059,121 at auction (2 to 9.3 times more than the total lease payments).
Institutions Could Retain or Sell
In an incentive auction, educational institutions that have developed the EBS could keep those frequencies. Institutions wanting to cash out could sell.
Following an auction, the government’s share of the proceeds could go toward helping schools find innovative ways to make progress toward closing the “homework gap”, as envisioned by Commissioner Rosenworcel. She coined the term homework gap to characterize the fact that up to one in three households do not subscribe to broadband service while most teachers assign homework involving an online component.
As the FCC moves toward a final rule that will determine the future utilization of the 2.5GHz EBS spectrum band, a voluntary incentive auction would be highly beneficial. While honoring JFK’s original idea, it would accelerate U.S. leadership in the race to 5G.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.
Rick Boucher was a member of the U.S. House of Representatives for 28 years and chaired the House Energy and Commerce Committee’s Subcommittee on Communications and the Internet. He is honorary chairman of the Internet Innovation Alliance (IIA) and a partner in the Washington, D.C., office of Sidley Austin.