Wednesday, December 3, 2008

The AWS-3 Plot Thickens

Martin is trying to sweeten the deal for his AWS-3 spectrum auction proposal by adding a "use it or lose it" provision. If the winner of the auction does not build out their no-fee wireless internet network to all areas within 5 years, it will lose its license in the non-covered areas. Those areas will then apparently revert to an unlicensed regime. The WSJ article and Reuters articles don't give much detail, but it's clear that the Chairman is doing some strategic leaking.

WASHINGTON -- Federal Communications Commission Chairman Kevin Martin is proposing giving innovators free unlicensed access to valuable airwaves if the company that buys a license to the channels doesn't meet tough requirements to build a nationwide Internet network.

The proposal has been added to a pending auction of the airwaves. The FCC is scheduled to vote on rules for the sale on Dec. 18. Mr. Martin wants the company that buys the airwaves to devote at least 25% of the spectrum to free Internet access for 95% of the country. The no-cost Internet service also would be smut-free for users under 18. Adult users could opt out of the filter blocking pornographic content.

Mr. Martin said Wednesday that he has circulated two versions of the auction item -- one with the unlicensed provision and one without -- for the other commissioners on the five-member body to review before the meeting. The FCC will vote on only one version, depending on which version the other commissioners prefer, Mr. Martin said.

Mr. Martin wants to sell a nationwide license to the airwaves rather than give the channels to entrepreneurs because he wants to promote free Internet access. By adding a clause that would give away airwaves where there isn't an Internet network after five years, Mr. Martin hopes that the owner of the channels would have an added incentive to build a network.

Mr. Martin said Wednesday that both versions of the auction item include a "use it or lose it" provision in which the owner of the channels would lose spectrum where there is no Internet access. The owner of the channels would "continue to serve whatever area they've built out," he said.

Martin also recently leaked the fact that he is proposing that adults can verify their identity to avoid the porn filter initially mandated for all users of of the no-fee service. I helped author some comments to the FCC explaining why this filter was a bad idea, so an opt-out mechanism could theoretically be a good development... if age verification were viable, and if you thought that adults were eager to identify themselves as possible porn-lovers, and if we assumed that all adults had credit cards. In short, filtering is not a great option even with those caveats.

It all gets decided on the 18th. You can read the latest comments.

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