The Supercommittee can increase revenues and add jobs through spectrum auctions
Few proposals lawmakers have been considering in recent weeks aimed at restoring our fiscal discipline have the immediate ability to generate revenue for the Treasury, stimulate direct domestic investment, spur innovation, and create jobs than spectrum auctions.
At the moment, spectrum is in short supply. Currently in use for “over the air” television delivery, which is consumed by fewer than 10 percent of American households, this underutilized spectrum could be reallocated for mobile broadband usage. Cisco estimates the volume of mobile data in the United States will double every year through 2014, increasing 39 times between 2009 and 2014, for a compound annual growth rate (CAGR) of 108 percent.
Industry studies have determined there are currently more than 276 million wireless subscribers in the United States, which represents a penetration rate of 89 percent. The number of subscribers increased by 40 percent between June 2005 and June 2009 while the number of wireless-only households nearly tripled.
This growth presents exciting possibilities for the future. Mobile broadband development is the top driver for technology innovation, enabling entrepreneurs to develop new technologies that will continue to move our economy forward. Whether it is mobile medicine or mobile payments, the ways our lives will be impacted and improved by these innovations are infinite. Unfortunately, with the massive shortfall of available spectrum, this mobile broadband revolution is being held back, denying innovators access to valuable development possibilities.
Opening up underutilized spectrum will increase revenue at a time when the United States needs it most. This is not a new concept. The FCC has successfully auctioned commercial licenses to use spectrum since the mid-1990s, raising over $50 billion for the U.S. Treasury and driving growth of the wireless industry to over $150 billion in annual revenue. According to the Congressional Budget Office, these auctions would generate revenues of approximately $24.5 billion. As a multiplier, the potential benefits to society as a whole are estimated to be 10 to 20 times the auction revenue.
One clear societal benefit is the potential for creating new jobs. By releasing 300 MHz of spectrum for mobile broadband services by 2016 through voluntary spectrum auctions - - no television station is forced into auctioning its spectrum - - an estimated 300,000 to 770,000 jobs will be created.
Another tangible effect of greater access to spectrum would be public safety benefits. By freeing up spectrum bandwidth in the years to come, emergency workers and first responders would be able to communicate more effectively in case of emergencies. This valuable spectrum could assist police, fire and EMT personnel in greater efficiency and interoperability, which would help to save lives.
There is widespread consensus in the technology industry that unless spectrum is released soon, we will lag behind other innovative nations in our ability to compete. It is imperative that our national focus is placed on the burgeoning mobile broadband market as we look for job creation, revenue generation, deficit reduction, increased public safety and cutting edge innovation.