John Legere, CEO of T-Mobile, is encouraging mobile consumers to contact the Federal Communications Commission (FCC) and pressure the agency to establish better rules in its next wireless spectrum auction set for the first half of 2016. According to Legere, hopefully with consumer feedback, regulators will be swayed to adopt more favorable rules that guarantee fair competition for wireless carriers in the future.
Spectrums are radio waves that are used to transmit phone calls, text messages, videos, and other signals over the air. Soon, the federal government will be having another wireless spectrum. But as often happens in these auctions, Verizon Wireless and AT&T usually emerge as the winners because, as two of the biggest wireless carriers in the United States, they also have the most money to spare in purchasing spectrum. Right now, the big two hold over 70 percent of the entire spectrum. That leaves other carriers (T-Mobile, for instance) basically scribbling and scrabbling for essentially crumbs from the table.
Right now, the FCC is busy formulating rules for upcoming auction that will let TV broadcasters resell their unused airwaves to wireless carriers. The agency is scheduled to vote on these rules in July.
For years, T-Mobile has been lobbying FCC regulators to set more fair rules for its wireless spectrum auctions. Legere is even accusing Verizon Wireless and AT&T of unduly influencing FCC regulators to favor the two biggest carriers over other smaller carriers. As the most vocal among the affected wireless carriers, T-Mobile has formed an alliance with other companies, including Sprint, Dish Network, and various regional wireless carriers. Together, they are requesting the FCC to boost the reserve supply of spectrum during the auction, so as to allow wireless carriers not named Verizon and AT&T to bid for airwaves.
Last year, the FCC already had started to rein in Verizon's and AT&T's participation in the auction, specifically establishing a reserve of spectrum for smaller carriers. But it appears that this reserve is too little, or at least T-Mobile and its coalition would like to think so.
According to Legere, if the reserve is not increased, mobile users will see a future dominated by a two headed monopoly consisting of Verizon and AT&T. Aside from this, consumers could face more expensive bills, stunted innovation, and lackluster customer service -- basically what Verizon and AT&T are already offering right now, Legere argues.
Wireless spectrums are particularly valuable for T-Mobile and other smaller carriers. Having new airwaves would definitely allow them to improve wireless coverage, especially in rural areas. More importantly, having more spectrum would allow them to grow their business and gain new subscribers.
As for next year's auction, it is critical because the FCC stated that it would be the last big wireless spectrum auction below 1 GigaHertz. The agency does not expect any spectrum below 1 GigaHertz to ever be distributed again, which means that so much is riding in this upcoming last big auction.
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