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UPDATE -- Verizon CEO: What spectrum crisis?

UPDATED at 4:40 p.m. with response from the FCC's chief of staff

Is the U.S. wireless market so short of airwaves that it could face a capacity crunch for the next generation of smartphones and tablets? The Federal Communications Commission thinks so. But Verizon Communications chief executive Ivan Seidenberg isn't so convinced.

“If video takes off, could we have a spectrum shortage in five or seven years? Could be, but I think that technology will tend to solve these issues,” Seidenberg said in a question and answer session at the Council of Foreign Relations last Tuesday.

The FCC responded Thursday to Seidenberg's comments, saying the carrier had long advocated for additional spectrum to be made available to the mobile industry. FCC's chief of staff, Edward Lazarus, said Seidenberg's comments "are rather baffling."

"The fact is Verizon plays a major role in building an overwhelming record in support of more mobile broadband spectrum, consistently expressing its official view that the country faces a looming spectrum crisis that could undermine the country's global competitiveness," Lazarus said in a blog posting.

According to a transcript of Seidenberg's interview by the Wall Street Journal’s online deputy managing editor, Alan S. Murray, the head of the nation’s largest wireless company said broadcasters who are loath to give up airwaves will “probably think, let me cash out and let me go do something different.” The comments were in reference to a proposal by the FCC to allow broadcasters to voluntarily give up spectrum and share proceeds from commercial auctions of those airwaves.

The comments were made amid a battle between wireless companies and their trade association and broadcasters over the use of over-the-air spectrum to be used for mobile broadband. The National Association of Broadcasters has argued that their television and radio members plan to use the airwaves they might not be using today for new business plans such as mobile television.

FCC Chairman Julius Genachowski has agreed with wireless trade group CTIA that the country is facing a “looming spectrum crisis,” in that there might not be enough airwaves to beef up wireless networks that are increasingly being used to access the Internet. In its national broadband plan, the FCC recommended 500 megahertz of spectrum be used for licensed and unlicensed high-speed Internet access.

Seidenberg, however, suggested the government’s aspirations might not be needed.

“So I think the market will settle it. So I don't think we'll have a spectrum shortage the way this document suggests we will,” he said referring to the FCC’s national broadband proposal.

By Cecilia Kang  |  April 8, 2010; 4:44 PM ET
 | Tags: verizon CEO spectrum crisis  
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It's AT&T's poorly run network that can't handle the current load.

Verizon can easily handle anything for the next 5-7 years.

Posted by: alice12 | April 8, 2010 4:51 PM | Report abuse

There's nothing baffling about Verizon's remarks. Verizon and Sprint both have huge hoards of unused spectrum due to the FCC's auction system, which allows incumbents to lock out smaller providers. Seidenberg's remarks are a great argument for spectrum caps, smaller geographic lot sizes, and larger preferences for small businesses.

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Posted by: ixicaovos | April 9, 2010 7:40 AM | Report abuse

Verizon's simply pointing out that you can address wireless capacity by

a) Building a proper network, with the proper density to the load
b) Leverage technology improvements to increase capacity

To put it another way, ATT thinks it's OK to have one tower serving a town of 30k, whereas verizon had 6 (true story) AT&T's approach simply wastes spectrum, and results in poor service (overloaded backhaul, dead zones, etc)..

There isn't really a spectrum crisis. There's a crisis in investment to appropriately build networks - mostly due to short sighted financial pressures. To Verizon's credit, they have not fallen for the opex/capex trap to the same extent as other carriers, and their network quality shows it.

Posted by: alexandriaobserver | April 9, 2010 8:00 AM | Report abuse

Band width? I'm still waiting for Verizon to make it possible for me to make a simple phone call from the comfort of inside my home.

Posted by: mikie44 | April 9, 2010 9:18 AM | Report abuse

There clearly is a spectrum crisis.

The problem may not necessarily be that more spectrum needs to be made available. The problem may just be that it is allocated inefficiently, or be warehoused by existing licensees.

Verizon, however, is likely in the best shape, spectrum wise, compared to its competitors. Why jeopardize that advantage by calling for more spectrum...

Posted by: ghokee | April 9, 2010 9:48 AM | Report abuse

Kind of sounds like a tobacco exec doesn't he.

Posted by: ArtHorizon | April 9, 2010 12:20 PM | Report abuse

Since 1996, many politicians and policy makers have decried deregulation of the mass media/broadcast industry claiming that too few “independent voices” are emerging after each consolidation. Alas, after all the stoned have been flipped in the garden, hundreds upon hundreds of TV operators remain in the U.S. with no one broadcasting licensee broadcasting to more than 41 percent of the U.S. population.

Now, ironically, the same forces opposed to deregulation of the mass media and broadcast industry are climbing over each other in support of taking spectrum away from independent TV licensees, potentially killing the broadcasters’ business models, to hand the spectrum over to the wireless industry, which has fewer than three dozen functioning, independent national operators. The wireless industry would grab its spectrum in an auction, in which the U.S. government can make a handsome multi-billion dollar profit. Verizon Wireless and AT&T Wireless currently brag about who covers more customers with AT&T boasting coverage of 98% of the U.S. population and Verizon Wireless likely beating that figure. Verizon Wireless, AT&T Wireless, Sprint, and T-Mobile devoured more than 70 percent of the last spectrum auction. One wonders why the same forces opposed to media deregulation are silent on this issue and have few problems now with such consolidation of the airwaves. I hate to be cynical, but could it be the flow of money to the U.S. Treasury? While not entirely analogous, this makes me think of Kelo v. City of New London.

The FCC needs to move slowly in this process and not attempt to harm the existing broadcast industry for the benefit of a few wireless operators “for the public good.”

Posted by: Jeff_in_DC | April 9, 2010 2:21 PM | Report abuse

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