Obama endorses plan to boost wireless broadband

WASHINGTON Mon Jun 28, 2010 4:06pm EDT

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WASHINGTON (Reuters) - U.S. President Barack Obama endorsed on Monday plans by regulators to nearly double the spectrum now available for wireless devices.

The White House announced a plan modeled after proposals by the Federal Communications Commission to free up 500 megahertz of spectrum over the next 10 years to meet the demand for laptop computers and smartphones such as Apple Inc's popular iPhone.

Some estimates suggest the next five years will see an increase in wireless data of between 20 to 45 times 2009 levels, reflecting the burgeoning use of wireless devices.

The Federal Communications Commission, which manages commercial spectrum licenses, and the Department of Commerce, which oversees government spectrum, have been working together to locate unused spectrum.

Officials said they hope they can identify some spectrum by October 1 that can be made available within five years.

Paul Gallant, a telecommunications analyst with Concept Capital, said Obama's announcement is a plosive development for wireless infrastructure companies such as Alcatel-Lucent SA, American Tower Corp, Ciena Corp, and Tellabs Inc, among others.

The "White House's endorsement bolsters the outlook for spectrum goals" laid out by FCC Chairman Julius Genachowski in the recent National Broadband Plan, Gallant said.

Freeing up airwaves to meet the growing demands of the wireless industry is a major component of the FCC's National Broadband Plan to increase Internet subscribers and provide affordable access to rural and low-income families.

But early attempts to meet an expected growth in wireless devices have hit snags because broadcasters and some U.S. government agencies have balked. Obama's plan could help pressure spectrum holders to reconsider their positions.

Broadcasters are reluctant to give up spectrum because it could harm the public's ability to watch free programing and government agencies have cited national security concerns.

White House economic adviser Lawrence Summers said in a speech that broadcasters will not be forced to relinquish their spectrum and stations can enter into a voluntary program in which they will be paid for their airwaves.

"Ultimately, government will not make these decisions," Summers said during a speech at the New America Foundation.

"Our role is simply to set up a mechanism to help shift spectrum to its highest value uses -- as current licensees and prospective users see fit."

Broadcasters said they have already returned a large swathe of spectrum that was later auctioned to companies such as the two largest wireless providers, Verizon Wireless and AT&T Inc. Verizon Wireless is a venture between Verizon Communications Inc and Vodafone Group Plc.

"We appreciate FCC assurances that further reclamation of broadcast television spectrum will be completely voluntary," said Dennis Wharton, a spokesman for the National Association of Broadcasters.

"We're convinced that America can have both the finest broadband and broadcasting system in the world without jeopardizing the future of free and local TV service to tens of millions of viewers," Wharton said.

Administration officials said they are also looking into spectrum held by government agencies such as the Department of Defense and the National Oceanic and Atmospheric Administration, but agencies have been reluctant to give up their holdings, citing national security reasons.

Summers also said proceeds from spectrum auctions will be reinvested back into jobs-focused infrastructure projects such as the U.S. air traffic control system, high-speed rail and a national emergency response system.

"This initiative will catalyze private sector investment, contribute to economic growth, make revenue available to the federal government, and help to create hundreds of thousands of jobs," Summers said.

(Reporting by JoAnne Allen and John Poirier; editing by Andre Grenon)

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