FCC Readies Two Auctions for Ultra High Frequency Spectrum

The Federal Communications Commission (FCC) will begin the first of two auctions for extremely high-frequency spectrum licenses, testing out how valuable these radio waves are considered. Up until now, wireless carriers have judged these high-frequency ranges to be useless, but the advent of 5G wireless services has changed that assessment. Signal frequencies above 1 gigahertz can carry more data for current 4G networks, often positioned above low-frequency bandwidth, and also help launch 5G networks.

The Wall Street Journal reports that, “these frequencies aren’t far removed from TV broadcasts … [and] sometimes the only signals providing cellular coverage across rural areas.” The FCC will first “auction off licenses around 28 gigahertz and follow it with a second auction for licenses above 24 gigahertz … [with] early use focuses on urban zones where the signals can strengthen existing cellular capacity or replace cable service.”

Currently, Verizon Communications holds most of the 28 gigahertz licenses, having acquired them via a $3.1 billion purchase of startup Straight Path Communications.

Next year, the FCC will also hold three more auctions “to encourage the use of ‘millimeter wave’ spectrum, so called because its wavelengths are so close together they are measured in millimeters.”

“This isn’t spectrum that goes very far,” said AT&T Inc. technology chief Andre Fuetsch. “However, this spectrum, because it’s so much higher in frequency, enables much higher speeds.” AT&T’s plan is to use these licenses for “more-reliable alternatives to Wi-Fi in offices and businesses” as well as “ultrafast downloads in specific urban pockets where people are on the move.”

Verizon is using its licenses “for small-scale home broadband service” that will “beam Internet connections straight through customers’ windows, avoiding the expense and inconvenience of a technician’s home visit.”

The downside of these millimeter-wave frequencies is that they are easily blocked by walls and trees, requiring companies to “blanket neighborhoods with clusters of small cellular stations that are both costly and controversial.” The U.S. is “among the first countries to raise cash by selling” these frequencies. Comcast and Charter are not participating in the auctions, and “some companies are waiting for the FCC to auction off mid-band spectrum, but many licenses won’t be available until late next year at the earliest.”

The FCC is also looking to “reshuffle spectrum used for satellites,” an initiative that “could take several years to yield results.” Although the last auction for TV airwaves in 2017 brought in almost $20 billion, “analysts say it is hard to estimate how much cash the spectrum sales will raise because the technology to use it is still young.” At the University of Delaware, professor Dennis Prather said that, “the burden will fall on manufacturers to produce enough cheap equipment to use the airwaves.”

“There is no technology out there that you can just get and deploy,” he said. “It has to be developed.”