700Mhz and Competition

markey.jpg Positions on future uses of the 700Mhz spectrum formerly occupied by analog TV aren’t just for presidential candidates anymore. Congress is hearing arguments:
Rep. Edward J. Markey (D-Mass.), who chairs the subcommittee that handles telecommunications and Internet issues, urged the FCC to “seize this opportunity to create an open-access opportunity for wireless service in this auction.” He added that wireless carriers are “exerting far too much control over the features, functions and applications that wireless gadget makers and content entrepreneurs can offer directly to consumers.”

FCC Auction Should Allow for Open Wireless Network, Say Lawmakers, By Kim Hart, Washington Post Staff Writer, Thursday, July 12, 2007; Page D08

Some search, VoIP, and computer companies say auctioning off some of that spectrum with open access requirements would promote competition, while telcos claim it would hurt their investments, stifle competition, and reduce revenues to the government from the auction. I think it may well reduce direct government auction revenues, but the economic benefits of real competition should be worth it. You’d think the nominally free market supporting telcos would agree with that.

Oh, except the competition would be competing with them….

As for the idea of an open auction stifling competition, we’ve seen that kind of twisted logic in the recent Brookings Institution paper that says broadband produces employment, but then defines employment in such a narrow way as to use it as an argument for “franchise reform”, i.e., promoting employment for the incumbent telcos. I’ll be more impressed when AT&T lands that striped bass it already promised.I don’t expect that will be any time soon.