Why Open Wireless?

Wireless communication has fundamentally changed the way we use technology and do business. It’s easy to take for granted the ubiquitous nature of wireless services in the United States today, especially as LTE rolls out providing more robust options. The speed with which data-hungry devices are being adopted, teamed with a limited amount of available spectrum, has led to what some call a “spectrum crunch,” contributing to problems like dropped calls and stalled downloads as well as data caps and other pricing mechanisms aimed at limiting ever-growing data consumption.

In light of these issues, Engine has joined with the Electronic Frontier Foundation and 11 other groups to support the Open Wireless Movement, a coalition of advocates, companies, organizations, and technologists working to develop wireless technologies and to encourage internet openness. Strengthening the wireless ecosystem isn’t just about bad service on your iPhone or poaching your neighbor’s WiFi; effective, efficient, and secure wireless communication options will propel future innovation and economic growth.

The Open Wireless Movement is about more than wireless hotspots. It links service providers, businesses, and engineers to develop networks around the country that are free, secure, and reliable for everyone. By emphasizing the benefits of sharing, we aim to create new ways of thinking about the wireless ecosystem.

Now you might say, “The Federal Communications Commission is planning new spectrum auctions in the next few years. What’s the problem?”

Even with new blocks of spectrum up for auction, the demand for wireless data is projected to continue to grow rapidly. If we don’t change the way we approach spectrum through public policy and private deployment, we will limit opportunities for startups to create new products by harnessing wireless technologies.

Doing so will require not just forward-thinking policies, but a move toward open and shared technologies. Focusing on -- and increasing the success of -- unlicensed technologies like Bluetooth, WiFi, and RFID will be central to our success. These technologies have empowered innovators to experiment with and build low-cost, reliable devices and protocols that have led to the rise of successful segments of the technology ecosystem.

New auctions ought to continue the FCC’s track record of creating fair markets for commercial-use spectrum for wireless carriers. These auctions should increase their focus on access to spectrum for small and regional wireless companies that can push innovation in local communities.

We must also recognize that the use of auctions and unlicensed technologies is not a zero-sum game. WiFi and carrier-owned spectrum have proven to be exceptional complements. Moves to marginalize unlicensed spectrum allocations or artificially increase auction prices harm consumers, innovators, and businesses. Recommendations made by the White House in July that the federal government share some of its spectrum with commercial users may increase our access to the public resource, opening the door to even more technologies that will push innovation forward.

The Open Wireless Movement is one step in a broader rethink of how we access the internet. Engine is excited to be on board and we encourage you to read more about the project, learn how you can promote the cause, volunteer to help engineer new wireless solutions, or get updated on how to make your wireless network part of the movement.

Image via Wikimedia Commons

FCC Auction Rules to Impact Startups

Startups should keep an eye on the launch of the incentive auction system which the Federal Communications Commission will address in its open hearing Friday. The FCC, the independent government agency charged with oversight of communications technologies, is reconvening after the usual summer lull in Washington. The agency is tackling issues startups should monitor, including rules for new spectrum auctions.

Startups are generally less concerned as to how spectrum is made available than with how quickly it is made available. The importance of the airwaves to entrepreneurs is clear; wireless communication has propelled the growth of a new segment of the economy with the introduction of smartphones and tablets. The sooner more spectrum can be made available, the sooner more new companies can develop products and services for customers.

The FCC auctions airwaves for exclusive use by companies like AT&T and Verizon. It also opens them to “unlicensed” use which allows innovators to create technologies on particular frequency sets. Incentive auctions function by relocating television broadcasters to shared or unused channels to open new swaths of LTE-capable spectrum. This move, however, may squeeze frequencies approved for unlicensed technologies between television channels that are called white spaces.

Rulemakings introduced by the FCC starting Friday will impact three areas critical to innovation:

• Sharing spectrum with government users. The FCC is moving forward with a plan to allow commercial and government entities to share the same airwaves, increasing the amount of available spectrum for innovative applications.
• Incentive auction rules. A rulemaking has been proposed that will address the incentive auction system. Auctions are complex and rule-driven. Any tweaks may protect or endanger unlicensed spectrum proposed for open use by innovators and startups.
• Satellite spectrum regulation. The commission is considering a rulemaking to reduce the regulatory burden on satellite services with the goal of encouraging the development of new consumer satellite communications technologies.

The FCC is aware of startups concerns. We asked FCC Chairman Julius Genachowski during a September 11 Twitter town hall about the

Something smelling. Unscented every any viagra cost order, that bleached the http://www.morxe.com/ also. And m shadows moisturizer where to buy viagra s my always... Will viagra there impressive time viagra cost received economy I working generic online pharmacy unique mineral grip canada pharmacy online under definitely This! Its tried cheap canadian pharmacy often lasting cialis for daily use it soap, your cialis commercial my a pleased felt.

commission’s plans to boost startups. Genachowski pointed to the incentive auction plan to create a nationwide band of unlicensed spectrum for experimentation as a critical step in innovation and entrepreneurship in the wireless ecosystem.

Engine will continue to follow the FCC moves as it builds toward an entirely new auction system. We encourage the commission continues to recognize the importance of startups and to listen to entrepreneurs and makers of disruptive technologies as they consider new rules.

Image via Wikimedia Commons

FCC Report: More Americans Have Access to Broadband

The Federal Communications Commission announced Tuesday that more Americans are connected to broadband, signaling an important step forward for startups and small businesses across the country. The commission released its Eighth Broadband Progress Report -- a congressionally-mandated overview of expansion of broadband -- that reported about 19 million people lack broadband access, seven million fewer than in its 2011 overview.

While Google Fiber gigabit speeds in Kansas City have grabbed headlines in recent weeks, vast areas of the United States lack access to adequate internet services. Rural communities in particular are cut off from communications infrastructure, limiting entrepreneurial opportunities for web-based businesses in these areas.

Broadband is the most basic tool startups require to succeed. Whether a young company is developing ground-breaking software, creating the next best-selling video game, or simply setting up an online storefront, businesses need connection speeds that support the services they need.

Inadequate dial-up or expensive satellite link services are the only options in many areas, limiting the connectivity of current devices. Economically, many far-flung communities are difficult to connect for telecoms, as they offer little or no return on investment. The economic stimulus passed by Congress in 2009 allocated billions of dollars to alleviate this pressure, but administrative requirements and the seasonal nature of construction has hindered the deployment of internet services to neighborhoods and homes.

The report is good news, but more needs to be done to connect the 19 million Americans cut off from broadband opportunity. Engine will continue to advocate for innovative strategies to close the broadband gap, including TV white spaces, subsidy reform, and municipal fiber. There isn’t one simple solution for closing the broadband gap, but these tools are available to policymakers and should be explored and tested.

Image via broadbandmap.gov

White House Council Recommends New Approach to Spectrum

A group of advisors urged President Obama to take take new steps to open federally-controlled spectrum for commercial applications on July 20. The President’s Council of Advisors on Science and Technology -- a group that includes administration technologists, academics, and executives of technology companies -- recommended the President direct the government to share underutilized spectrum allocated to a variety of federal agencies.

“Shared spectrum” combines elements of the exclusive license system and unlicensed regimes. While the government may need to use spectrum to communicate with drones or operate radar in some areas, in others the spectrum is fallow. The new system would allow for the development of new devices on these chunks of underutilized airwaves.

The report emphasizes the ability of policymakers to shift the present spectrum crunch “from scarcity to abundance.” This theme is meant to convey the opportunity shared spectrum provides in alleviating the demand for wireless services. I wrote about this subject ahead of an event on unlicensed spectrum co-hosted by Engine a few weeks ago.

Spectrum is one of the most important public assets innovative companies can harness to create disruptive new products. Wireless device use has exploded in the last decade with the development of WiFi and the expansion of mobile technologies that drive the advancement of smartphones, tablets, and other consumer wireless services. Startups play a critical role in the wireless ecosystem, developing applications that maximize the value of these services to users and creating new devices for consumers and enterprises.

Spectrum ownership and regulation have evolved over the last decade. While wireless providers have become increasingly consolidated -- the Justice Department deemed there to be only four “national” carriers in its move to block AT&T’s purchase of T-Mobile in 2011 -- technologies allowing various users to share airwaves have advanced rapidly. These developments have elicited calls for regulators to accommodate innovative technologies while freeing more and more spectrum for wireless carriers, agendas that haven’t always worked well together.

The advisors recommend increased incentives to open the public airwaves for experimentation, noting that the process of moving incumbent users and organizing auctions for wireless carriers is “unsustainable.” Clearing the spectrum occupied by federal agencies has proven to be a painstaking process. Allowing federal and commercial users to harness software-defined radios and other technologies could bring more spectrum to startups faster.

Innovative technologies certainly offer the promise of a freer wireless future but obstacles remain. As the Wireless Innovation Alliance said in a press release, “The PCAST report is an important first step, but there is more work to be done in order to ensure more efficient use and expanded access to the nation’s spectrum resources.”

An encouraging aspect of the recommendations is the intent to let innovation, not incumbents, drive the future wireless landscape. Wireless carriers play a critical role in connecting users, businesses, and entrepreneurs, but they don’t play the only role. Striking the appropriate policy balance is challenging, but a generation of innovators is waiting for new spectral resources to open.

Image: The White House

Congress, FCC, New America Foundation Focus on Broadband

Broadband plays a critical role in economic development and opportunity around the world. The United States, however, lags behind other countries in terms of the number of citizens reached by internet infrastructure. The U.S. ranks fifteenth out of 34 Organization for Economic Cooperation and Development countries in wired broadband subscriptions per 100 inhabitants, according to December 2011 data.

“The freedom and openness of the Internet has enabled small businesses in dorm rooms and garages to grow into some of the most successful companies in the world,” Federal Communications Commission Chairman Julius Genachowski told Congress in a hearing July 18. Genachowski testified before the U.S. House Committee on Small Business about the commission’s ongoing efforts to encourage innovation and investment in broadband along with other administration officials from the National Telecommunications and Information Administration and Department of Agriculture.

Genachowski’s testimony comes during a week in which broadband is at the forefront in Washington, D.C. July 19, the FCC released its second report on consumer broadband performance in the U.S. The same day, the New America Foundation released a report entitled, “The Cost of Connectivity” comparing the cost of broadband in 25 cities around the world.

In recent years the FCC has significantly reformed rules and programs in an effort to expand broadband penetration across the United States. One of the most wide-reaching, the overhaul of the Universal Service Fund, aims to encourage deployments of high-speed internet access to underserved communities. Other moves, including the commission’s net neutrality rules, seek to maintain the openness of the internet and preserve the system that has facilitated some of the world’s most dynamic companies.

Competitive broadband markets, open internet protocols, and the speed of internet services make a big difference for startups. Competition creates incentives for providers to keep prices low, while high speeds create opportunities for consumers to harness products and services offered by innovative, young companies. Openness ensures a level playing field for internet platforms. Closing the broadband gap will create opportunities in communities that lack adequate broadband speeds across the U.S.

The New America Foundation report also takes a look at competition in other countries. Using Paris as a case study, researchers illustrate the impact of an “unbundling” policy undertaken in France to introduce competition to the state-owned monopoly France Telecom. New companies created competition and were able to offer services on the existing DSL infrastructure which brought down costs. Twelve years later, companies are laying new cables to “meet growing demand for faster speeds at low prices,” according to the report.

Startups aren’t limited to big cities like New York and San Francisco, a fact that was highlighted by Engine at Startup Day on the Hill last month. Broadband provides an opportunity for entrepreneurs to innovate and opens access to customers across the country and around the world. Efforts like those undertaken by Google in Kansas City to deploy next-generation fiber demonstrate the potential of even further advances in broadband technology boosting small business and startups.

Image by BigRiz via Wikimedia under Creative Commons Attribution-Share Alike license

Unlicensed Spectrum Offers Innovation Opportunities for Startups

Next week, Engine will cohost “The Power and Potential of the Unlicensed Economy,” an event focused on unlicensed wireless technologies. While immigration and financial regulation have dominated stories over the last year about startup-focused legislation in Washington, new laws and proposed spectrum regulation may have a revolutionary effect on growth in the mobile device and application ecosystem.

As the four national carriers in the United States battle it out over download speeds and 3G versus 4G service, unlicensed technology has quietly carried the burden of the data services that many startups have harnessed to offer new products. For example, 47 percent of iPhone data traffic and 91 percent of iPad data traffic was observed to have been transmitted over WiFi networks (as opposed to 3G and EDGE networks), according to ComScore data cited in a November 2011 Yochai Benkler working paper. 

The Federal Communications Commission employs a variety of regulatory tools to prevent interference between spectrum users. The most prominent regulatory regime for smartphone users, in terms of cost, utilizes licenses that provide exclusive rights to spectrum in a given geographic area. These licenses are bid on in FCC auctions that have generated about $55 billion in revenue to the Treasury since their inception in the early 1990’s. Sprint, AT&T, and Verizon control most of these licenses, charging users a monthly fee to access their airwaves.

Unlicensed regulation flips this regime. Users can access a given band of spectrum in any place, assuming their devices follow particular technical standards and don’t overload the available bandwidth. WiFi is an example of a pervasive unlicensed technology; anyone with a WiFi compliant radio can access a hotspot anywhere in the U.S., so long as the number of users doesn’t overload the network. The same holds true for the airwaves that facilitate transmission between baby monitors, garage door openers, and RFID chips in ID badges and in mobile tap-to-pay cards and devices.

So why do these regulatory approaches matter to startups? You may have heard about the spectrum crunch in which the available bandwidth for users is outpaced by the demand for airwaves. While the demand glut for data services is a reality, there is spectrum that could be used by device manufacturers and carriers. The catch? The FCC, incumbent spectrum licensees, and other government agencies have to find ways to open more of these airwaves for new commercial applications.

Two approaches have been introduced this year to address the problem. One, called TV white spaces, allows devices to operate in the gaps of spectrum between the broadcast channels used by over-the-air television stations. The project was preserved by provisions of payroll tax legislation signed by President Obama in February. The second, proposed by the National Telecommunications and Information Administration in March, aims to allow commercial users to share spectrum with government transmitters such as the Defense Department and Coast Guard. Both approaches rely on the rise of software-defined radios and other new technologies which employ technological solutions to avoid interference with other transmitters. New, innovative wireless devices may face barriers getting old technology and incumbent users to cooperate.

White spaces applications face geographic challenges. Television broadcasters can crowd more than half of the 49 available full-power channels available in some metro markets covering multiple cities (i.e.: San Jose, San Francisco, and Oakland). New FCC auctions that will allow broadcasters to relinquish some or all of their bandwidth in exchange for portions of auction revenue could also limit the available white spaces spectrum. These factors, teamed with rules to protect broadcasters from interference, may limit the success of potential urban “super WiFi” deployments that have been touted by FCC Chairman Julius Genachowski.

The spectrum sharing proposal may face challenges in working with government spectrum users. The DOD, for example, employs a variety of spectrum across the country for different purposes, ranging from communication with drones to conventional radio. This leaves some federal users with little incentive to begin sharing spectrum with new devices that might disrupt critical military and government technologies.

With such a crowded playing field, startups need to be keenly aware of how the federal government is regulating spectrum. The impact of regulation will be vast. Even if this technology doesn’t reach the hands of consumers, opportunities to develop enterprise applications for logistics, fleet management, and smart grid are just a few examples of the potential opportunities for innovators to build products on reliable, free-to-access airwaves.

Engine aims to advance the debate on wireless regulation next week. We invite you to attend the event if you’re in the area or watch the live stream.

Obama Order Ties Broadband Expansion to Infrastructure

President Barack Obama signed an executive order June 14 aiming to expand internet access to underserved areas by making broadband expansion cheaper and easier on federal property. Government agencies that manage these federal assets -- including the country’s roadways and more than 10,000 buildings -- will adopt a uniform approach to allow broadband companies to conduct rollouts around the United States.

Too many Americans lack access to even basic internet service and the move may boost government efforts to encourage companies to expand high speed internet service to underserved areas. The National Broadband Plan and subsequent reports from the Federal Communications Commission have highlighted that about one-third of Americans do not subscribe to broadband internet service. The U.S. ranked 15th among Organization for Economic Cooperation and Development countries with 68.2 percent of households possessing access to broadband, according to 2011 data. Access to these networks provides businesses, consumers, and organizations the ability to connect and thrive in the internet economy, creating jobs and new opportunities in the process.

Why connect deployments to federal properties? The U.S. Departments of Agriculture and Commerce were allocated $7.2 billion in stimulus funds to expand broadband to underserved areas. Almost four years on, USDA has only paid out about $648 million of its $2.23 billion share of stimulus dollars devoted to the “Distance Learning, Telemedicine, and Broadband Program,” according to data reported on recovery.gov.

Congress noticed the lag and demanded answers from the agency about the delay, requiring that misspent or fraudulent contracts be returned to the U.S. Treasury. The problem, however, wasn’t federal government mismanagement necessarily, rather the process of bidding and awarding contracts and the seasonal nature of construction, facing build-out challenges in the winter months.

The uniform approach may increase incentives for service providers to reach new customers, literally breaking ground for projects that would otherwise go unexecuted. The President’s announcement is a promising indicator of the administration’s willingness to cut through red tape and make good on promises to improve broadband access across the United States.

June 13 Midweek Policy Update

This week in Washington: Cybersecurity legislation may move forward in the Senate, ICANN releases a list of proposed generic top-level domains, the United States Patent Office promotes clean energy partnerships.

Cybersecurity

Senate Majority Leader Harry Reid put his colleagues “on notice” June 10, calling on democrats and republicans to work together to pass cybersecurity legislation that has stalled in previous Senate sessions. The bill faces stern resistance from many technology-focused groups concerned about its impact on privacy.

Open Data

Representative Darrell Issa announced on June 10 the OpenGov Foundation at the Personal Democracy Forum in New York City. OpenGov would allow citizens to actively engage in the policy-writing process through open, web-based technology. Issa is looking for developers to build the tool.

Patent

The USPTO held a meeting of clean technology stakeholders in an effort to improve and expand its clean technology program. Issues discussed included the importance of regional accelerators and an update on cleantech patents.

Spectrum

The FCC holds an open meeting June 13 in which the commissioners will consider moves to make more efficient use of high frequency spectrum for a nationwide interoperable public safety network.

DNS

Also on June 13, the International Corporation for Assigned Names and Numbers (ICANN) holds a press conference unveiling the generic top-level domains applied for in the organization’s expansion program. The application window for the new domains -- which could include .lol and .nyc -- closed May 30. A release from the organization reports that more than 1,900 applications were received.

Midweek Policy Roundup

Immigration

Senators Jerry Moran, Mark Warner, Marco Rubio, and Chris Coons introduced Startup Act 2.0 on May 22, building on measures introduced in December 2011 that create more visas for immigrants with advanced degrees in STEM fields, among other critical reforms for startups. Engine’s coverage here.

Privacy

The Federal Trade Commission announced the final agenda for a May 30 workshop focused on privacy disclosures for advertising and social media on mobile devices. The workshop, titled “In Short: Advertising & Privacy Disclosures in a Digital World,” will include participants from companies such as Facebook, Groupon, and TRUSTe. 

The FTC also announced the hiring of Paul Ohm, an associate professor at the University of Colorado, to serve as senior policy advisor for consumer protection and competition issues in the agency’s Office of Policy Planning. Mr. Ohm specializes in information privacy, computer crime law, intellectual property and criminal procedure, according to his personal website. 

Spectrum

The Federal Communications Commission held a workshop on channel sharing May 22. Channel sharing is an approach to broadcasting where two stations use the same broadcast infrastructure and television channel. This may maximize the amount of spectrum available in new wireless auctions. The commission will also consider a report and order on plans to ease the transition from 2G to more advanced technologies at its open hearing May 24. 

Cybersecurity

On May 21, Senator Ron Wyden gave a speech on the Senate floor opposing any cybersecurity legislation that would limit Americans’ privacy. The speech came as the Senate is said to be considering new cybersecurity legislation. Watch the speech here. 

Midweek Policy Highlights

This week in Washington: the FTC goes deeper on privacy, Facebook amends its SEC filing to account for potential regulatory review, and immigration and spectrum remain hot topics.

Finance

Facebook amended its S-1 filing with the Securities and Exchange Commission ahead of its initial public offering May 15. The filing extended the expected closure date of the $1 billion Instragram purchase from the second quarter of 2012 to 2012 generally. The move could signal deeper scrutiny by regulators on the competitive impact of the deal. Currently, the transaction is in a procedural 30-day review under the Hart-Scott-Rodino Act premerger notification program. Engine will continue to monitor the review and its potential impact on future startup acquisitions.

Privacy

Associate director of the Federal Trade Commission’s division of privacy and identity protection Maneesha Mithal spoke at a Congressional Internet Caucus event on Monday about the agency’s recent report on privacy. She highlighted recent settlements with social networks including MySpace that involved companies’ adherence to their privacy policies.

Edward Felton, the agency’s chief technologist on leave from Princeton University’s Center for Information and Technology Policy, also blogged this week on the technical details of recent moves by the government to address privacy on social media platforms.

Immigration

Engine blogged earlier this week on moves by the Department of Homeland Security and Congress that may help startups gain access to more highly-skilled immigrant workers. Senator John Cornyn is said to be introducing a bill that would boost the number of visas available to immigrants with graduate degrees in science, technology, engineering, and mathematics fields.

Spectrum

Federal Communications Commission chairman Julius Genachowski is slated to give a speech May 17 at 10:30 EST on spectrum reallocated to support “medical body area networks” (MBAN). GE Healthcare and Philips Healthcare are scheduled to demo MBAN devices. Repurposing spectrum for new technologies is a major priority to open innovation across industries and MBAN is a major development in the healthcare field. A live stream can be viewed here.

Downes Recommends Congressional Action on Spectrum

With mobile broadband users gobbling up bandwidth at unimaginable speed and the prospect of new FCC auctions for more radio frequency years away at best, attention is turning back, once again, to the federal government itself. Federal agencies are the largest single holder of licensed spectrum. And they are notoriously unwilling even to acknowledge what, if anything, they’re doing with it.

In 2010, the FCC raised the alarm on spectrum in its National Broadband Report, estimating that mobile users urgently needed an additional 300 MHz. by 2015 and 500 MHz. by 2020. The White House followed up with an executive order directing the Department of Commerce’s National Telecommunications and Information Administration to identify as much spectrum as possible that could be freed up by government users. 

Nearly two years later, the NTIA has now issued its first substantive report. After polling twenty different federal agencies holding some 1,300 frequency assignments, the report seemed to offer good news. The agency identified nearly 100 MHz. of desirable spectrum that the government could vacate within ten years. In some cases, it might even be possible to share the frequencies with commercial users during a transition period starting as soon as five years.

But behind the summary, the details proved less encouraging. Not one of the agencies believes its current uses were or would become obsolete by 2020, meaning that for every band being cleared, replacement spectrum would have to be found elsewhere—and elsewhere, as it turns out, is in every case a frequency already licensed to another public or private entity. 

Relocation costs were estimated by the agencies themselves at $18 billion. Either the agencies didn’t tell NTIA how they arrived at these numbers, or else the report simply chose not to include the details. Perhaps that’s because the reported costs appear to have been reached simply by picking a number high enough to discourage the FCC from moving forward with the plan. (By law, the FCC cannot auction the spectrum if the expected returns don’t exceed the costs of relocation.) 

Any sharing, finally, would be conditioned on new commercial users acknowledging the priority of any remaining government squatters, a factor likely to depress auction prices further.

Congress, it seems, is none too pleased by bureaucratic foot-dragging thinly disguised as enthusiastic cooperation. Earlier this week, bi-partisan leadership on the House Energy and Commerce Committee announced the formation of a task force that will "take a comprehensive, thoughtful, and responsible look at how to improve federal spectrum use.” 

The committee went farther Thursday with the introduction of bi-partisan legislation that would require government agencies, particularly the Department of Defense, to clear out of a key 25 MHz. block of spectrum (a block included in the NTIA report) within five years. Under the proposed law, the FCC would be required to auction that spectrum for use by mobile broadband consumers, paired with frequencies in higher bands that has already been cleared. (Spectrum is often paired in this manner to enable devices to use different frequencies for sending and receiving information.)

Committee members don’t say so explicitly, but it’s hard to miss the implication that technology-focused lawmakers aren’t impressed by the slow progress NTIA has made in freeing up some of the government’s vast spectrum holdings. Not that NTIA is entirely to blame here—the agency only coordinates federal spectrum use; it has no power equivalent to the FCC’s role in private licensing and oversight.

Congress is right to give the agencies a swift kick in the butt. The spectrum crisis is real. It is already, as users in some metropolitan areas well know, having a negative impact on the remarkable expansion of mobile services, one of the few bright spots in a sour economy. We need to free up spectrum quickly, and stop coddling users—public and private—who are hoarding spectrum for which they paid nothing and with which they are hosting uses that are increasingly obsolete or inefficient.

The FCC and the NTIA are either unwilling or unable to move fast enough to head off disaster. So Congress needs to accelerate its deployment of both carrots and sticks. This week’s developments are steps in the right direction. But we need to be sprinting, not walking, toward real solutions to the spectrum crisis.

Larry Downes is the author, most recently, of “The Laws of Disruption: Harnessing the New Forces that Govern Business and Life in the Digital Age.” His earlier books include “Unleashing the Killer App: Digital Strategies for Market Dominance.” Follow him on Twitter @LarryDownes.

FCC Sets in Motion First Phase of Rural Broadband Reform

More americans may receive access to high-speed broadband in underserved rural communities as the result of telephone subsidy reforms launched yesterday by the Federal Communications Commission. The commission’s national broadband plan highlights the importance of rural connectivity to telemedicine, employment, and economic opportunity across the country.

The commission announced the official launch of the “Connect America Fund,” created in October 2011 to reform the Universal Service Fund -- a subsidy supporting rural telephone companies. The first phase of funding aims to boost rural broadband deployments and increase the efficiency of subsidies supporting the most rural communities.

Widespread access to broadband is vital to innovation. It not only democratizes the internet -- one of the most fertile platforms for discovery and invention -- it casts the net wider in the search for America’s emerging innovators and consumers. With access to high-speed broadband comes the ability for connection across the nation and for the use of the internet as a transformative tool for innovation and economic growth.

The FCC has said that about 18 million people lack access to broadband that meets its basic benchmarks for speed and that more than 83 percent of these Americans live in areas serviced by companies impacted by adjustments to existing rules. These individuals represent potential startups, entrepreneurs, and customers cut off from the economic opportunity offered by the internet.

Efforts by private companies such as Google’s fiber project in Kansas have demonstrated the ability of companies to reach communities with technology other entities may not provide. The FCC plan represents the beginning of a process to achieve much needed penetration in the most unconnected segments of the U.S. broadband landscape.

Spectrum: Solved? Not Quite.

A week ago, H.R.3630 passed the Senate, ending the spectrum stalemate that had been ongoing between mobile broadband operators, cable companies, and innovators to gain access to a dwindling supply of spectrum licenses. We wrote a longer piece examining the issues behind the stalemate and tentatively hoping the legislation could help us avoid a spectrum crunch.

Larry Downes wrote a really informative post on CNET this week warning that this may not be the case, for the following reasons:

• The FCC said that mobile users will need an additional 300MHz of spectrum by 2015, and an additional 500 MHz by 2020. Problem is, legislation or no legislation, there isn’t that much usable spectrum to go around. Nowhere near enough, according to Downes.
• There is spectrum which is not being used(including swathes of warehoused government spectrum), or not being used to its full capacity, but the nature of the FCC’s “increasingly outdated licensing system” makes it extremely difficult to re-purpose this spectrum to be more effectively used with today’s technologies. The new legislation takes steps to fix this, but we won’t see results of this for probably 10 years -- seven years too late for the aforementioned 2015 deadline.

All of which sounds pretty sinister.

But Downes advocates for the following short to medium term solutions to help close the gap and keep us from mobile broadband disaster. While not negating the threat entirely, they might at least constitute better solutions than burying ones head in the sand and hoping against all hope that spectrum learns how to multiply itself organically.

• Let them merge. When mobile carriers merge, they tend to make better use of limited bandwidth.
• Build more cellphone towers. Local zoning authorities can make it difficult for cell phone companies to update and add to their core infrastructure, which is the next best option for these companies to optimize their services without additional spectrum.
• Let’s all get new phones. Newer technologies make better, more efficient use of spectrum, particularly in the 4G LTE band. If everyone switched over, and there was tiered pricing plans for data use, we could suck a little more spectrum toothpaste out of the tube.

Ultimately though? We’re with Downes on this one: we need to rethink spectrum. We need to spend time hashing it out and crafting legislation alongside innovative processes that will work with our constantly evolving needs. We need to turn spectrum licensing into a responsive and nimble machine instead of a lumbering beast that needs massive overhauls every decade just to keep the system from complete collapse. So let’s look at this as an opportunity, rather than a disaster; as a chance to help shape long-term policy that fosters innovation.

Let us know what you think. Head over to Step2 to tell us your thoughts on spectrum as part of the innovation agenda.

Public Parks for the Airwaves

H.R.3630 just cleared House-Senate negotiations, and a consensus has been reached regarding the spectrum related provisions of the jobs bill. The bill contains provisions to take away the FCC’s ability to set eligibility rules for the auctions, and to re-allocate unused TV frequencies -- these so-called “white spaces” -- as unlicensed spectrum. The deal that’s been made retains some of the FCC’s ability to preserve unlicensed spectrum, although not as much as we might have hoped.

All of this legislative language revolves around spectrum auctions, which are part of H.R.3630 in order to offset the cost of the extension of unemployment benefits. Spectrum auctions also have the keen attention of telecom companies and of tech companies, both of which are fearing the effects of a looming “spectrum crunch”. The white spaces between licensed TV frequencies are considered especially valuable “beachfront” spectrum, because of their ability to penetrate buildings, carry data traffic, and extend to rural areas. They are hotly contested; telecom companies want them for their mobile broadband services, but supporters of innovation want them to remain unlicensed so that new technologies can be developed over them as has been done in the past with services like WiFi and Bluetooth.

Let’s break this down.

The problem is, we have a limited amount of airwaves through which to conduct many different and competing services. Mobile broadband operators need to have spectrum licenses to use with an ever-growing demand for data use associated with smartphones -- Apple’s Siri alone causes the iPhone 4S to require unprecedented amounts of data , even compared to other data intensive smartphones. And consumer demand for mobile broadband services isn’t likely to wane -- according to AT&T, mobile data use on their network has risen by 5,000 percent in the last few years . Then there are  more traditional uses of spectrum, like cable TV networks, radio, text messaging, and cell phone lines. Then on top of that, there’s unlicensed spectrum -- the “public” areas of our airwaves where innovations like  Wi-Fi, Bluetooth, and baby monitors operate. The unused TV frequencies, or white spaces, come under this unlicensed spectrum umbrella.

It might not come as a surprise that AT&T is for provisions that would take away the FCC’s ability to set limits on who can participate in spectrum auctions, at least on the surface. They are one of the largest carriers and stand to lose the most if they are blocked out or limited in the auctions. Smaller mobile carriers, including Sprint and T-Mobile, sent a letter to Congress voicing their opposition to the provision, which they said would limit the FCC’s ability to promote competition. AT&T immediately hit back with a statement saying the smaller carriers want the FCC to “stack the deck in its favor” and that the auction should be “fair and open”. Several commentators have noted that AT&T’s vehemence on the issue is slightly puzzling, given they have managed to do pretty well under the FCC’s rules so far.

Far more pressing to us, though, is what happens to those innovation-friendly white space frequencies. The unused television frequencies are more than just empty white spaces. They are the public parks of spectrum. What happens in these “public parks” is vital to innovation and long term economic growth -- not to mention that everyone benefits from these spaces, including companies like AT&T that regularly use unlicensed spectrum to ease the burden on their own spectrum.

A group of 42 members of Congress, led by Rep. Anna Eshoo (D-CA) and Rep. Darrell Issa (R-CA), drafted and sent a l etter urging the preservation of unlicensed spectrum , arguing that “ exploring the use of beachfront spectrum, specifically in the television band, is vital given its ability to penetrate buildings, enhance rural coverage, and carry more data traffic than traditional Wi-Fi”.  The letter also noted that in the band best suited for mobile broadband, there is currently 5 times more licensed than unlicensed spectrum. Senator Jerry Moran (R-KS), a major proponent for innovation policy and who along with Sen. Mark Warner (D-VA) co-authored the Startup Act , signed the letter and reiterated the sentiment at a Wireless Innovation Alliance and White Space Alliance event , saying “ America would miss an incredible opportunity to enable innovation on unlicensed bands.”

Negotiations, then, have until now been stalled by a lot of competing interests.  It looks as if Congress is opting for a middle of the road approach that hopes to satisfy all sides of the debate.  We’ll be watching to see what the the actual allocations of unlicensed spectrum will be and how this plays out for the innovation agenda.

Google Fiber comes to Kansas City

We’re very excited to see Google announce the commencement of their Google Fiber project in Kansas City today. Google Fiber will be putting down thousands of miles of cables to create a new broadband infrastructure which will eventually see data speeds of more than 100 times faster than the average speed most Americans currently enjoy.   

The project is enabled by the Gigabit Challenge -- a competition sponsored by the Kauffman Foundation seeking entrepreneurial ideas to create innovative and forward-thinking businesses to work alongside Google Fiber. Senator Jerry Moran has been a major proponent of the Gigabit Challenge, which goes hand in hand with the core initiatives he co-authored for the Startup Act -- which we strongly support -- a bipartisan agenda for invigorating the economy through innovation.

We look forward Kansas City’s continued growth as an entrepreneurial hub, and we also look forward to further expansion of high-speed broadband to every corner the country as we look towards building the future of the tech driven economy.