Thursday, February 25, 2010

Genachowski Dreams Big for 21st Century Mobile Broadband

I still like Julius Genachowski. There I said it. From everything that he's said since becoming chairman of the Federal Communications Commission, it appears to me that He Gets It and his policies are good for the long term growth of the mobile marketing industry. His most recent speech at the New America Foundation in Washington continues to illustrate his grasp of what needs to be done to move an infrastructure so mired in the days of vacuum tube radios and black and white TVs into the new century of mobile smartphones, video on demand, and location-based services.

You can read the entire text of his speech here in Giselle Tsirulnik's column of the Mobile Marketer, and you can quickly browse some of the points that I especially like below.

I like how he starts out his speech with a simple sound bite to serve as the rallying cry, "we are lagging behind when it comes to broadband." When I was in business school, I learned that the key to initiating organizational change - especially in times of laissez-faire status quo - is to clearly articulate a crisis that everyone can relate to. In this case, Genachowski's opening remarks appeals to the competitive nature and the drive to succeed that historically compels our national psyche.

All eyes will be on the FCC next month whey they are scheduled to announce their National Broadband Plan to Congress. Genachowski gives a five-point summary of this plan:
  1. Accelerate mobile broadband deployment by recovering and reallocating spectrum
  2. Revise outdated policies to reflect 21st century technologies and opportunities
  3. Remove barriers to broadband buildout
  4. Lower the cost of deployment
  5. Promote competition

While each of these points have merit in themselves, the devil, they say, is in the details. I clearly see government's role in helping to recover and reallocate unused spectrum, and to revise outdated policies. But call me a cynic: putting government in the same sentence with removing barriers, lowering costs and promoting competition strikes me as an oxymoron.

The answer to growth for the mobile ecosystem is "more bandwidth". We can all agree to that. But the problem is, unlike vegetables, you can't grow spectrum. The spectrum is what it is - it is a finite resource, and the problem is that somebody somewhere already owns the spectrum that mobile broadband needs to grow.

Says Genachowski,
"One of the best ways for us to achieve the right balance in the supply and demand of spectrum is to establish market-based mechanisms that enable spectrum intended for the commercial marketplace to flow to the uses the market values most.

The Broadband Plan will recommend one such mechanism. It will propose a "Mobile Future Auction" -- an auction permitting existing spectrum licensees, such as television broadcasters in spectrum-starved markets, to voluntarily relinquish spectrum in exchange for a share of auction proceeds, and allow spectrum sharing and other spectrum efficiency measures.

Now, I’ve mentioned broadcast spectrum – so let me be clear: the recommendation is for a voluntary program."

Yeah right...

I can just see all the television network executives choking with laughter when they heard that idealistic statement of hubris and wishful thinking.

If you owned vast tracks of open undeveloped land and you learned that within ten years an entire city will be built on your land - the land that you solely own - would you voluntarily give it up in exchange for a share of the auction proceeds?

Uh huh...

The reality is that TV networks are on a downward trajectory as viewing audiences are moving to other forms of video entertainment. The fact that bland reality-based shows have replaced high-production quality dramas underscores the cost-cutting wave that is sweeping an industry disparately grasping for new ideas to grow.

Spectrum - unused as it may be - is one of the last golden egg assets that these networks own. The day that the FCC can convince even one of the networks to voluntarily give up its spectrum license, is the day that I'm looking out for flying bacon.

But don't get me wrong. I truly agree with Genachowski. In order to grow, the mobile ecosystem absolutely needs more spectrum - spectrum that unfortunately is firmly held in the grasps of the TV networks. It may just boil down to an Obama-esque "stimulus program" courtesy of your taxes and mine to get them to give it up.

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