With data usage fast rising and a number of companies interested in acquiring wireless spectrum to expand their offerings, analysts are predicting a massive spectrum crunch which might get worse by 2014. Gadgets, iPhones, television, radio, air traffic, military communications, police, medical wireless devices, smartphones, all need wireless spectrum to operate, and the government has dragged its feet on freeing up sectrum allotted to inefficient sectors.
Jeff Kagan, a telecom analyst, says that iPhones, iPads and now Android devices are gobbling up data at an increasingly alarming rate. Lack of wireless data spectrum will result in slower and dropped connections, low downloading speed and high prices. Julie Kearney of the Consumer Electronic Association, was quoted as saying that a data crunch could have adverse economic consequences, hurting consumers as well as wireless device makers and sellers. No spectrum means no buyers, which may ultimately lead to players leaving the industry.
A White House report recently talked about the impact of spectrum crisis on jobs, growth and investment via growth in wireless devices. This crisis was brought to the fore in the recent LightSquared debacle. A not-so-promising plan for next two years, but over the next decade, is put forward by Obama administration, to free up 500 MHz out of a restricted spectrum of 2500 MHz through voluntary auctions and streamlined government action. The National Association of Broadcasters, however, is of the opinion that the spectrum crunch is overrated and that superior technology including cells and antennas can solve the crisis.
Chris Guttman-McCabe, Vice President of regulatory affairs for the CTIA, the wireless industry trade group, said that broadcasters are ignoring the shift in the marketplace and that every mode of communication is moving to wireless, adding that every industrialized country is reallocating spectrum for wireless data. AT&T chairman Randall Stephenson was quoted as saying that if there is data overload, the speed of the mobile revolution will slow down and prices, download times and consumer frustration will all increase. He quotes in the Wall Street Journal that the FCC is taking important steps but it will still take six to eight years to put that spectrum to use and the country and consumers cannot wait that long.
Thomas Hazlett, head of George Mason University’s Information Economy, foresees that the use of newer technology can make up for less bandwidth, though this proposition is going to be quite expensive. He says that the government should go much further in reallocating spectrum to where the consumers and the market can really utilize it efficiently.