Riding the Wrong Wave

Why the government’s plans to auction off spectrum to wireless carriers won’t help innovation

Your television, cell phone, and GPS talk to the rest of the world over electromagnetic waves. All of the wave frequencies used for commerce and government communication—roughly from 9,000 cycles per second to 275 billion cycles per second—are together referred to in Washington as “the spectrum.” Two agencies manage it: The Federal Communications Commission handles commercial and state use, and the National Telecommunications and Information Administration runs federal applications. The FCC licenses pieces of the spectrum to private companies, such as radio and television broadcasters, but all of it belongs, legally speaking, to the U.S. There is a finite amount of it, and everybody wants some.

That is causing problems. Last February, Cisco Systems estimated that mobile data will increase 26-fold from 2010’s numbers by 2015. Almost one-third of this will move through Wi-Fi networks, which use unlicensed spectrum and don’t burden wireless carriers such as AT&T or Verizon Wireless. But the carriers have adopted the phrase “spectrum crunch,” designed to make vivid the pain of a hypothetical moment when there are more data than the available spectrum can handle.