FCC Must Promote Competition Between 5G & Satellite-based Internet Providers

FCC Must Promote Competition Between 5G & Satellite-based Internet Providers
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As the United States government seeks to expand broadband access for Americans, the Federal Communications Commission (FCC) should allow competition between terrestrial 5G broadband and fixed-satellite internet providers. Currently, the FCC is reviewing its licensing rules of the 12 GHz spectrum — which has significant potential for improving America’s internet infrastructure. If the science suggests potential, the FCC should work with existing spectrum licensees to allow both 5G and satellite companies to share the 12 GHz band.

The Biden Administration’s American Jobs Plan signals a renewed interest in expanding internet access. While subsidies for low-income Americans might increase broadband access in the short term, there is no alternative to competition for reducing subscription costs. To increase competition, the FCC needs to expand the available spectrum for 5G internet, which will allow greater competition between 5G broadband and fixed-satellite internet providers.

Despite great potential, the United States lags Japan, China, and South Korea in mid-band licensing and 5G deployment. That is why the FCC needs to expand the mid-band spectrum for 5G networks — which the Government Accountability Office views as a leading challenge to broadband deployment. Between 6 GHz and 24 GHz, the 500 MHz band  between 12.2 and 12.7 GHz is the only spectrum band available for terrestrial use. By allowing this band for 5G use, the FCC can expand the available mid-spectrum band for 5G use by more than a double.

Under the current FCC arrangement, several companies — including AT&T, Dish, RS Access, and SpaceX — share the 12.2-12.7 GHz spectrum. Currently, these companies use the spectrum for multiple purposes, including satellite broadband, video distribution through direct broadcast satellite (DBS), and terrestrial one-way fixed communication for data and video usage. However, outdated rules — namely power limits and a ban on two-way communications — prevent the existing licensees from using this spectrum to offer 5G internet. That is why Dish, RS Access, and several associations have urged the FCC to review these rules and allow existing licensees to offer two-way broadband services and 5G internet service using the 12 GHz band. 

Faced with this proposal, AT&T (which owns DirectTV) and SpaceX argue that spectrum sharing might interfere with video distribution and satellite broadband, respectively. Indeed, when the FCC created the existing MVDDS rules in 2000, the existing technology of those days prevented effective spectrum sharing. However, technological advances since then have made it possible for different companies to share spectrum for video distribution and one-way wireless communications without interference. That is one reason why Dish — which already uses the 12 GHz band for DBS video distribution — also seeks to offer two-way broadband and 5G internet services and compete with AT&T, Verizon, and T-Mobile.

Furthermore, recent technological progress makes it likely that existing licensees can effectively share the spectrum and offer 5G internet without interfering with satellite-based internet services such as SpaceX. While the FCC needs to determine the exact technology to do so, the Competitive Carriers Association, the Computer and Communications Industry Association, the internet and competitive networks association INCOMPAS, and New America Foundation’s Open Technology Institute argue that “increasing current power limitations in the band and allowing two-way use would result in little or no disruption to existing co-primary operations.”

Furthermore, the federal government has already provided SpaceX 15,500 MHz of spectrum free of cost, meaning that the 12.2-12.7 band represents only 3 percent of the total spectrum available to SpaceX. Therefore, SpaceX can use its remaining 97 percent of its licensed spectrum to provide fixed-satellite internet services. It is also worth keeping in mind that the FCC had previously notified SpaceX of other possible uses of the 12.2-12.7 spectrum — which SpaceX did not heed. In contrast, Amazon decided not to initiate a claim for the 12 GHz band for its Kuiper  satellites. Therefore, while the FCC should work with SpaceX and AT&T to ensure that the mid-band range can be shared effectively without interference, protectionist calls should not be used as excuses to disallow spectrum sharing for 5G providers.

To maximize the reach of two-way broadband and 5G networks using the 12GHz band, the FCC should also consider instituting a “use-it-or-share it policy.” This policy will allow the primary licensees to lease unused portion of their licensed spectrum to local internet service providers, enabling them to provide internet services in areas unprofitable for large companies. Providing such flexibility can go a long way towards expanding broadband and 5G access to consumers currently underserved by existing internet providers.

As the Biden administration and the FCC seek to expand broadband access, they must prioritize competition between internet providers. Reforming antiquated spectrum rules and allowing two-way broadband and satellite-based internet providers to share 12 GHz spectrum and compete with each other is a right step in that direction.

Ryan Nabil is a research fellow at the Competitive Enterprise Institute, a free market think tank.

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