Phony "nationalized" and "wholesale" labels are poisoning spectrum sharing proposals for the 3.1-3.55GHz band
A holistic, sharing approach could add an impactful 450MHz to 5G efforts
The FCC recently concluded its celebrated C-band auction, siphoning $81 billion from the coffers of the mobile companies in exchange for 280MHz of spectrum. This midband spectrum is so valuable for 5G that the FCC is rightly moving forward with putting more midband spectrum to commercial use. Unfortunately, however, good ideas such as sharing spectrum between military and commercial uses which could bring 450MHz of spectrum to commercial use—enough to make an impact— are being labeled as a “nationalized” or “wholesale” 5G network, a political poison pill, which couldn’t be further from the truth.
It seems to have started with the curious presence of “win the race to 5G and establish a national high-speed wireless Internet network” in Trump’s campaign platform. Then, Karl Rove-backed Rivada Networks was caught with their hand in the cookie jar, trying to award themselves a no-bid contract to “wholesale” DoD’s valuable mid-band spectrum. The light of day on the Rivada proposal, and a DoD RFI that appeared to hint at that direction, raised alarms and 19 GOP Senators wrote Trump a letter saying, essentially, “what are you doing?”.
At the other end of the spectrum (pun intended), the mobile companies want the government to move forward with relocating military users off the 100Mhz 3.45-3.55GHz, which will take years, and privatize this spectrum through an auction. This auction approach is what the mobile companies know and love. The licenses are essentially perpetual, and they get to treat it as an asset. Apparently they don’t mind the huge price tags that come along with it. And of course they don’t have to share with anyone.
Caught in the crossfire are thoughtful attempts to solve problems and progress solutions—like spectrum sharing. The case for sharing is straight-forward. The military needs spectrum access, and is not going to permanently give up large blocks. If the military can keep priority use of their spectrum block but allow commercial use when it is unused, we can make available the whole large block adjacent to the already-in-use CBRS band. If the military needs the spectrum for radar (which only comes into play on the coasts), sensors pick up their presence and private operators can’t use it until the military is done.
There are lots of good proposals along these lines. Michael Calabrese for Open Technology Institute wrote to the FCC suggesting instead of the “incremental approach premised on clearing and auctioning only the 3450-3550MHz sub-band based on an exclusionary C-band auction format, OTI believes that it should be possible to open more spectrum, and sooner, by extending or adapting the three-tier CBRS framework [to the 3100-3550MHz bands]”. Another supporter is Comcast, who recently filed a letter with the FCC lauding the successful CBRS band and encouraging the Commission to use a similar approach promoting “innovation and competition” when proceeding with the next phase of midband spectrum.
No one has a longer history supporting this sharing than Eric Schmidt, former CEO of Google and the former Chair of the Defense Department’s Defense Innovation Board. Schmidt has been a proponent of sharing spectrum between military and civilian uses since the 2012 Obama PCAST Report that spurred the successful CBRS band spectrum sharing framework. Schmidt submitted a letter in response to DoD’s RFI, outlining how spectrum sharing could work.
Schmidt’s proposal is DoD would allow one or more private companies to use DoD spectrum in exchange for allowing the military priority access to a 5G network. It wouldn’t be a “nationalized” or “wholesale” network at all. The private companies would be operating their private network on a lease from DoD. He actually suggests that it should be a $0 lease—after all, the private companies are giving DoD priority access to a network. Instead of the $82 billion of private capital transferred to Uncle Sam in the C-Band auction, private operators in this spectrum would have $0 in spectrum costs.
How, then, did thoughtful, rational private-sector-driven ideas get labeled as a “nationalized” network? I did some digging to understand where things went off the rails. As discussed, the mobile networks are interested in what they know—selling off this spectrum so they can use it without sharing. With Trump fumbling around suggesting a “national 5G network” and Rivada proposing to take rents for themselves as “wholesalers”, the mobile companies sensed an opportunity to kill a bunch of ideas they don’t like, labeling the Schmidt proposal as “nationalization” along with Trump and Rivada.
A close read of the WSJ back and forth between Schmidt and Jonathan Salter, head of USTelecom, shows Salter continually trying to define anything other than his approach as “national” and “wholesale”. Then on December 8, Morning Tech says Schmidt “unsettled telecom executives” with support for “assigning a third-party wholesaler to dole out the Pentagon’s prime airwaves.” The root of that misunderstanding seems to stem from this Incompas discussion where Chip Pickering gives Schmidt two choices: FCC auctions 100MHz or a model that allows “commercial use on a wholesale basis” (see 10:05). While Schmidt does express his preference for the latter over the former given a binary choice, it is abundantly clear from this answer—and the whole discussion—that he favors a shared spectrum model between DoD and commercial users.
As a threshold issue, we can’t let terms like “nationalized” and “wholesale” have a seat at the table when no one is seriously proposing those approaches. From there, as Acting Chairwoman Rosenworcel said at the time, it’s going to require a “whole-of-government” approach to meaningfully and quickly change our 5G situation. The current approach of 280MHz here and 100MHz there is not going to change anything, especially when the relocation of incumbents takes years. Spectrum sharing puts 450MHz on the table quickly through an established sharing framework. The government, working together, could make it happen.