License Flexibility Not an End in Itself, Muleta Warns
FCC Wireless Bureau Chief John Muleta said the FCC is willing to give carriers flexibility in how they use their licenses but companies are well advised to tailor their arguments to show how this flexibility will lead to greater competition. “Flexibility by itself I don’t think is enough,” he said.
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The FCC deals with a recurring argument, Muleta observed at the Practising Law Institute. “The question is always either an existing licensee or a new licensee coming in saying, ‘I need more flexibility,'” Muleta said: “'I need to do things better. I need to have operational autonomy. I need to have technical autonomy to do something else with the license.'” Muleta advised the regulatory lawyers that the best argument for flexibility is that it will lead to greater competition. “It can’t simply be give me flexibility,” he said. “That sounds like a monopolist who said just give me flexibility and I'll figure out how to use it. That can’t be.”
Muleta said this competition can be outside the traditional wireless space. “The world has changed, so the competition can be intermodal competition,” he said. “You need to make the argument that you're going after broadcast or mass media types of services or you're going after data services or you're going after services that aren’t traditionally provided using this type of spectrum.” Muleta said licensees must also show the ability to enforce the opportunity costs of using the spectrum. “This is a statutory obligation that we have, especially when it comes to commercial spectrum users,” he said. “The case that must be made is, ‘Hey, there is marketplace discipline on our use of the spectrum.'”
Muleta also said one trend that the FCC is tracking is a growing tendency by states to try to regulate wireless. During a panel in the morning Gregg Rothschild, minority counsel to the House Commerce Committee, said he expected wireless carriers to make legislation limiting state oversight of wireless a priority in the 109th Congress. “This is really sort of a change in attitude that’s taking place in the state regulatory area,” Muleta said. “There are two things in play. There is a combination of sort of poorer customer experience and poor understanding about the fundamentals of radio that combine to create the perceived need for regulation… The other thing is when you have 170 million subscribers that really changes the sort of tax base nature of this service.”
On another issue, Muleta warned that public safety wireless in the U.S. is “basically broken” and not through any fault of safety agencies. “It’s because what we're facing as a threat has changed,” he said. “What we have is a model that was built for a different era, a different threat matrix, a different way of cooperating and today it’s not working.” Muleta also said that addressing wireless’s role in a new intercarrier compensation regime and enhancing wireless coverage will be major issues that will have to be addressed by the bureau in coming months.