text: GAO-12-118 Published: Nov 23, 2011. Publicly Released: Dec 23, 2011.
  Since 1994, FCC has made over 520 megahertz (a measure of quantity) of spectrum available for new uses, such as wireless broadband, through a process that can be lengthy. Because most of the usable spectrum in the United States has been allocated to existing uses, FCC must change its rules to move spectrum from an existing use to a new use, a process known as repurposing spectrum. Yet, this process can be lengthy—from 7 to 15 years for the six repurposings that GAO reviewed. Four factors contribute to the time it takes FCC to repurpose spectrum: the regulatory nature of the process, which to some extent is guided by statute; opposition of incumbent users, who could be required to vacate spectrum; coordination challenges between FCC and the National Telecommunications and Information Administration (NTIA), which oversees federal agencies' use of spectrum, on the repurposing of federal spectrum for commercial use; and concerns about interference from users of spectrum in adjacent bands of spectrum. FCC has identified voluntary approaches that it thinks could speed the process, but these approaches generally require congressional approval and face some stakeholder opposition.
  Experts and stakeholders had mixed views on FCC's plans and recent actions to meet future spectrum needs. The National Broadband Plan included a set of recommendations to FCC, FCC and NTIA jointly, and Congress, aimed at meeting future spectrum needs. Some recommendations garnered broad support, including recommendations to auction certain bands of spectrum and enhance research and development. However, experts' and stakeholders' opinions diverged on other recommendations, such as reallocating a portion of spectrum from television to wireless broadband. Opinions also varied on FCC's progress in implementing the recommendations. In some instances, these conflicting opinions arose from participants' divergent positions in the industry, with, for example, incumbent licensees such as broadcasters opposing recommendations that they believe could impose burdens or costs on their businesses.
  Experts and stakeholders GAO contacted strongly supported extending FCC's auction authority, but varied in their opinions on potential changes to auctions. Since 1994, FCC has used auctions to assign mutually exclusive licenses to commercial entities providing certain wireless services. GAO previously reported that auctions were effective in assigning licenses to entities that valued them the most; were quicker, less costly, and more transparent than mechanisms FCC previously used to assign licenses; and were an effective mechanism for the public to realize a portion of the value of a national resource used for commercial purposes. Experts and stakeholders responding to GAO's survey strongly supported extending FCC's auction authority—53 of 65 respondents supported extending FCC's authority. However, experts and stakeholders held varied opinions on potential changes to auctions. For example, respondents generally supported actions that would provide a clear road map detailing future auctions, which could reduce uncertainty. In contrast, a proposal to require winners of auctions to pay royalties based on their revenues rather than the full amount of their winning bids up front garnered the least support.
  Among other things, GAO examined (1) the extent to which FCC has made spectrum available for new commercial uses and the time taken to do so, (2) experts' and stakeholders' views on FCC's plans and recent actions to meet future spectrum needs, and (3) experts' and stakeholders' views on the continued use of auctions to assign spectrum. To address these objectives, GAO reviewed FCC's plans, notices, and orders; reviewed six instances in which FCC made spectrum available for new commercial uses; and surveyed 30 experts and 79 industry stakeholders about their views on FCC's efforts to make spectrum available for new uses, its plans and actions to meet future needs, and its continued use of auctions (the survey had a 68 percent response rate).
  Given the continued success of FCC's use of auctions, and the overwhelming support among experts and stakeholders for extending FCC's auction authority, Congress may wish to consider extending FCC's auction authority beyond the current expiration date of September 30, 2012.
  The Federal Communications Commission (FCC) was provided with authority to use auctions to assign mutually exclusive licenses for certain subscriber-based wireless services in the Omnibus Budget Reconciliation Act of 1993. Auctions are a market-based mechanism in which FCC assigns a license to the entity that submits the highest bid for specific bands of spectrum. FCC implemented its auction authority conducting its first auction in 1994. In subsequent years, Congress modified and extended FCC's auction authority, including exempting some licenses from competitive bidding, such as licenses for public safety radio services and noncommercial educational broadcast services. As of June 30, 2011, FCC had conducted 79 auctions to select between competing applications for the same license, which had generated nearly $52 billion for the U.S. Treasury. However, FCC's auction authority was scheduled to expire on September 30, 2012. In a 2011 report, we reported that experts and stakeholders responding to our survey, by large margins, supported extending FCC's authority to assign mutually exclusive licenses by auction beyond the September 30, 2012, expiration date. In particular, 53 of 65 experts and stakeholders supported extending FCC's auction authority. We also previously reported that FCC's use of auctions to assign spectrum appeared to have had little to no negative impact on end-user prices, infrastructure deployment, and competition. We also reported that FCC's implementation of auctions had mitigated problems associated with comparative hearings and lotteries, which FCC previously used to assign licenses. Therefore, we recommended that Congress consider extending FCC's auction authority beyond the September 30, 2012, expiration date. Congress passed and on February 22, 2012, the President signed the Middle Class Tax Relief and Job Creation Act of 2012 (Public Law No. 112-96). This law extended FCC's auction authority until September 30, 2022. By extending FCC's auction authority, Congress and the President help promote the efficient assignment of spectrum licenses and allow the public to realize a portion of the value of a national resource used for commercial purposes.
  BroadbandCellular telephonesFederal regulationsLicensesRadioResearch and developmentSpectrumSpectrum managementStrategic information systems planningStrategic planningSurveysTelecommunicationsTelevisionWirelessStakeholder consultations