AT&T CEO: FCC is Getting Better But Spectrum Situation Must Be Addressed

(Note:  We've added to our curated content collection with a new curated content page on spectrum issues. Take a look and send us your feedback.)

(Washington, DC)  The spectrum crunch in the U.S. is real and the Federal Communications Commission (FCC) is stepping up its game by speeding the pace of spectrum transfers AT&T Chairman and CEO Randall Stephenson said today.  Speaking at a Brookings Institution event here. Stephenson said "over the last three months, the pace for moving spectrum has been 60 to 90 days," referring to the FCC's ability to process and approve individual spectrum purchase deals AT&T has made.

The quicker pace in turning around the requested transfers "should be the norm and not the exception," Stephenson said, highlighting the sluggish rate at which AT&T contends the regulatory agency has handled these transactions in the past.  "We're trying to encourage the FCC to bring predictability to the industry.  I've commended the FCC here this morning because what we've seen is a stepped-up pace."

AT&T no doubt is still stinging from the Commission's refusal to approve the company's merger with T-Mobile, a deal driven by the need for spectrum.  The soft praise for the FCC signals a softer approach than AT&T has displayed since that deal was scuttled.

A more conciliatory tone toward the FCC could help AT&T as it goes about finding more spectrum.  The company will bid on 700 MHz spectrum that Verizon will sell off once its deal to purchase spectrum from a group of cable companies (SpectrumCo) goes through, Stephenson confirmed.  "It [Verizon's spectrum] pairs perfectly with ours.  If we were to have access to that spectrum, we would put it to work in 60 days."

AT&T hopes that the FCC's handling of the Verizon-SpectrumCo deal will yield some clues about what "the rules of the road" are regarding spectrum purchases.  "We are all waiting for the Verizon-Cableco deal to get approved because of the expectations we can glean from that deal," he said.

The meteoric rise of mobile devices will continue to strain AT&T's capacity, Stephenson said. "We're in a position today where we see exhaust in key markets."  Mobile data is the culprit, with voice and text services mere commodities, he said.  Addressing rival Verizon's announcement this morning that its phone service plans are shifting to data-centric options, Stephenson said "the value is in the data, and the voice and the texting are commoditized.  We've become a mobile data business.  Voice and texting are just apps that ride on top of this."

The dimensions of mobile communication are "mind-boggling," Glenn Hutchins, co-founder of investment firm Silver Lake said during the same event. "Today there are a billion devices that are handheld.  There are six billion mobile service subscriptions worldwide," which exceeds the total world population.

With most annual growth estimates hovering around 100% for mobile communications, "this is the biggest opportunity in the history of technology," Hutchins said.  But the fly in the ointment is not money to build the networks:  it's spectrum.

"This is not an industry that is lacking for capital investment.  The thing that will cause it to slow is lack of availability of spectrum," Hutchins said.

(Note:  We've added to our curated content collection with a new curated content page on spectrum issues. Take a look and send us your feedback.)


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