WASHINGTON, September 14, 2023 – Rural mobile providers are urging the Federal Communications Commission to consider an alternative to the reverse auction funding model the agency proposed for a future 5G fund.

The fund has been in limbo since 2020 due to mapping issues. It makes $9 billion available for 5G mobile broadband infrastructure in areas unlikely to be served without subsidies.

With access to newer, granular data on mobile broadband coverage in the U.S., the FCC released on August 31 a notice proposing updates to the program’s methodologies for defining areas eligible for funding and seeking comment on potential new provisions like extending support to Puerto Rico and the Virgin Islands. The proposal is slated to be discussed at the agency’s open meeting on September 21. 

Ahead of that discussion, the Rural Wireless Association has met with FCC officials five times in the last month to reiterate the same concerns over the program’s reverse auction model. Under this procedure, providers would compete to develop the cheapest cost structure for serving an area with the minimum required speeds – at least 35 Mbps upload and 3 Mbps download in the case of the 5G Fund.

Rural providers are concerned because some areas served by carriers receiving support from legacy funding programs like the Mobility Fund will be eligible for auction. If those carriers lose at auction, the RWA says, the reduction in federal funds might make them unable to continue operating their infrastructure and leave other areas covered by their networks without service.

“There is no ‘safety valve’ put in place that would protect these networks built with federal dollars and maintained by legacy support mobile carriers,” the association wrote in an ex parte filing on Wednesday.

The RWA has proposed the commission seek comment on allowing these providers to opt out of the reverse auction if they are an area’s sole mobile carrier. In such a scenario, the group also wants the FCC to consider subsidizing 5G upgrades based on predicted costs.

WASHINGTON, July 14, 2023 – A report by wireless trade association CTIA showed that the United States is making strides towards 5G development, and that the wireless standard is expected to add $1.5 trillion in GDP and 4.5 million of new jobs over the next decade.

Breaking the benefit down by geography, the study showed that 5G has contributed $139 billion to GDP growth in New York City, $65 billion to the Seattle area, $43 billion to Dallas, and $20 billion to San Diego.

The United States has emerged as a frontrunner among its global counterparts in terms of 5G availability, according to CTIA, with 54% coverage. This percentage appears to position it ahead of South Korea by nearly 20 percentage points, while surpassing China’s rate of 27% and more than three times the United Kingdom’s rate of 17%.

The report draws upon a 2021 study by BCG, 5G Promises Massive Job and GDP Growth in the U.S., February 2021, and supplements additional numbers sourced to prior CTIA reports. The trade group attributed the $275 billion of investment by service providers on infrastructure buildouts and enhancement. About $35 billion was spent in  2021.

5G’s faster deployment rate, increased consumer adoption, and superior performance compared to its 4G predecessor make it a key player in bridging the digital divide and mitigating climate change and strengthening national security, CTIA said.

Despite the progress made, the report reiterated the need to obtain more licensed mid-band spectrum to enable network expansion.

“This required a coordinated effort, starting with Congress re-establishing the Federal Communications Commission’s auction authority and auction pipeline,” urged the report.

The commission’s authority to license spectrum has expired in March and has not been renewed.

We have all heard the pitch for 5G—a faster, better, and more interconnected mobile ecosystem. But it’s so much more than that. It allows children to transform the world into their classroom with augmented reality. It enables surgeons to operate on patients from hundreds of miles away. Because 5G networks can carry an almost immeasurable amount of data over their networks, smart cities, precision agriculture, and other AI-enabled applications are now becoming a reality.

We were only able to achieve such strides in 5G because our government made releasing spectrum—the invisible real estate that makes your mobile device work—a national priority. For example, Congress, in a bipartisan effort, passed the MOBILE NOW Act in 2018, which, among other things, created a spectrum pipeline for commercial 5G use. At the speed of 5G, the Federal Communications Commission (FCC) responded with its 5G FAST Plan and opened up more than six gigahertz of spectrum for licensed 5G services, including more than 600 megahertz of mid-band spectrum to auction to augment our 5G capacities.

Their work paid off.

5G speeds are increasing. According to the IEEE—the preeminent standards group for wireless technology, “[w]ireless carriers like Verizon and AT&T have recorded speeds of one gigabyte per second.” To put that in perspective, that’s, as IEEE continues, “even faster than a fiber-optic cable connection.” Due to the comparable speeds to fiber, it’s no wonder why 92% of users access broadband services through their mobile device.

The 5G revolution has also been a boon to our economy. It has enabled 4.5 million jobs and will contribute a total of $1.5 trillion to the United States’ gross domestic product by 2025. The added competition from wireless providers have also put more money in consumers’ pockets as monthly internet bills have decreased by 14% to 42% on average over the past 5 years.

5G is also helping carriers reach those on the wrong side of the digital divide. Because of 5G’s wireless nature, it is more adept than fiber at reaching those in hard-to-connect regions of the country, such as the hollers of the Appalachians or the vast plains of the American West. This allows it to fill in the gaps where fiber options are untenable.

Even in 2022, we were still going strong. FCC Chairwoman Jessica Rosenworcel carried out the 5G FAST Plan by auctioning off more mid-band spectrum in the 2.5 gigahertz and 3.45 gigahertz bands.

But we have a problem. We’ve have no spectrum left in the pipeline. Even if we did, the FCC’s spectrum auction authority has lapsed for the first time ever.

The good news is that Congress is making progress on restoring the FCC’s auction authority.

The bad news is the legislative process  is going to take some time to complete.

But there are things the FCC can do to promote 5G today.

Specifically, it can issue T-Mobile’s 7,156 spectrum licenses it purchased last year in the FCC’s 2.5 GHz auction. These licenses allow T-Mobile to access invaluable mid-band spectrum that can fuel its 5G networks and expand their reach. Better yet, T-Mobile said they can start lighting up areas as soon as the FCC issues its license. Better service from T-Mobile means: more competition in the 5G space, more folks connected, and ultimately even lower prices for consumers across the board.

So what’s the hold up?

The FCC argues that it cannot act without its auction authority. That’s a strange conclusion because the 2.5 gigahertz auction occurred before its authority expired—and T-Mobile has already paid for the licenses. And the FCC issued spectrum licenses for six decades without auction authority. Frankly, the FCC doesn’t need auction authority to issue licenses it already lawfully granted. Indeed, a bipartisan group of former FCC general counsels all agree that the lack of auction authority is not a legal barrier for the agency.

The FCC should reconsider its prior conclusion and think about other authorities it can use to get this spectrum to market. If need be, it can grant T-Mobile temporary access while seeking comment on its authority, but doing nothing is not an option. We need our leaders at the FCC to make the right calls while Congress finds more spectrum.

The fate of 5G and beyond depends on it.

Joel Thayer is president of the Digital Progress Institute and an attorney based in Washington, D.C. The Digital Progress Institute is a nonprofit seeking to bridge the policy divide between telecom and tech through bipartisan consensus. Greg Guice is director of Public Knowledge. This piece is exclusive to Broadband Breakfast.

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