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 1 
 Remarks  of 
 Michael  K.  Powell  Chairman 
 Federal  Communications  Commission 
 at  the 
 Silicon  Flatirons  Telecommunications  Program  University  of  Colorado  at  Boulder 


 BROADBAND  MIGRATION  III:  NEW  DIRECTIONS  IN  WIRELESS  POLICY 
 October  30,  2002  [as  prepared  for  delivery] 


 I.  Introduction 
 Good  afternoon.  I  want  to  thank  Professor  Phil  Weiser  and  the  Silicon  Flatirons  Telecommunications  Program  for  inviting  me  to  Boulder.  I  can  think  of  no  better  place  than  the 
 foothills  of  the  Rockies  to  talk  about  --  what  else  --  the  broad  new  vistas  and  open  spaces  in  spectrum  policy  presented  by  technological  innovation.  The  mountains  we  must  climb  to 
 achieve  these  opportunities  are  indeed  steep  and  the  climb  is  long  and  demanding    but  like  all  accomplishments  it  begins  with  a  single  step.  Today  I  would  like  to  begin  that  process  by  setting 
 out  some  of  my  thoughts  about  the  next  generation  of  spectrum  policy. 
 Spectrum  policy  reform  is  a  crucial  initiative.  Effective  spectrum  policy  is  essential  to  traditional  spectrum-  based  services,  such  as  mobile  phones  and  Direct  Broadcast  Satellite. 
 However,  the  rewards  of  sound  spectrum  policies  go  far  beyond  traditional  stakeholders    they  are  integral  parts  of  the  long  term  success  of  FCC  initiatives  in  Broadband,  Competition  Policy, 
 Media  Regulation,  and  Homeland  Security.  Ultimately,  like  all  of  our  focus  areas,  spectrum  policy  must  strive  to  maximize  the  unique  benefits  offered  by  spectrum-  based  services  and 
 devices  to  the  American  people. 
 II.  Spectrum  Policy:  At  the  Center  of  Other  Policy  Objectives 


 First,  let  me  explain  how  our  spectrum  policy  reform  initiatives  further  the  Commissions  other  important  objectives.  A  little  over  a  year  ago,  I  outlined  a  5-  pronged  agenda  that  would 
 guide  the  FCCs  work  and  our  role  in  the  Digital  Broadband  Migration.  That  is,  breakthroughs  in  technology  will  drive  an  exodus  from  existing  analog  platforms  to  digital  architecture.  The 
 new  networks  would  be  more  efficient  and  provide  opportunities  for  an  expanded  array  of  applications  and  communications  services  for  consumers.  The  notion  of  migration  was  that  the 
 transition  would  be  long,  and  perhaps  arduous,  but  was  nonetheless  essential  for  survival.  In  addressing  this  migration,  I  outlined  five  specific  areas  for  Commission  attention:  (1)  Broadband 
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 Deployment,  (2)  Competition  Policy,  (3)  Re-  examination  of  the  Foundations  of  Media  Regulation,  (4)  Homeland  Security,  and,  our  focus  today,  (5)  Spectrum  Policy.  When  we 
 improve  the  way  that  spectrum  is  regulated    increasing  access,  availability,  and  efficiency    our  other  four  initiatives  are  also  advanced.  Here  are  just  a  few  potential  examples: 


   Broadband  Deployment:  Spectrum-  based  paths  to  homes  and  businesses  hold  great  promise  for  the  delivery  of  high  speed  internet.  These  paths  ride  on  a  variety  of 
 platforms:  fixed  and  mobile,  terrestrial  and  satellite,  licensed  and  unlicensed. 
   Competition  Policy:  Consumers  are  beginning  to  cut  the  cord.  Consumers,  especially  university  students,  are  doing  it  more  and  more    replacing  their  wireline  phones  with 


 mobile  phones  and  other  mobile  devices  for  their  core  communications  needs.  Licensed  wireless  services  have  been  a  resounding  success  at  introducing  facilities-  based  local 
 competition. 
   Media  Regulation/  Digital  Television:  At  its  core,  the  DTV  transition  is  about  using  the  spectrum  resource  more  efficiently  and  effectively.  Whether  its  the  broadcasters  of  the 


 future  or  new  spectrum-  based  services  in  the  old  analog  bands,  digital  television  and  spectrum  policy  are  essential  companions.  Similarly,  perhaps  the  most  important 
 developments  for  media  consumers  over  the  past  decade  has  been  the  phenomenal  growth  and  introduction  of  satellite  television  and  radio  as  alternative    and  spectrally-  based   
 platforms  for  digital  multichannel  video  and  audio  services. 
   Homeland  Security:  Spectrum  is  an  essential  input  in  the  continuing  fight  against  terrorism,  a  force  multiplier  for  our  military  and  an  everyday  necessity  for  public  safety 


 officials.  We  must  continue  to  work  with  the  Administrations  Homeland  Defense  leadership  as  well  as  the  public  safety  and  critical  infrastructure  communities  within  the 
 FCCs  jurisdiction  to  ensure  that  adequate  spectral  resources  are  available  to  facilitate  reliable  and  interoperable  communications. 


 The  common  link  in  all  of  these  policy  areas  that  I  have  just  briefly  described,  and  of  course  our  spectrum  policies,  is  the  growing  centrality  of  the  consumer;  shifting  more  control  to 
 consumers  to  choose  their  communications  service,  their  provider,  their  equipment,  and  their  quality  of  service.  Sound  spectrum  policy  is  a  central  component  of  the  great  digital  migration 
 for  all  Americans. 


 III.  Consumers  Deserve  a  New  Spectrum  Policy  Paradigm 
 All  consumers,  whether  they  are  John  and  Jane  Q.  Public  or  the  Boulder  Police  Department,  deserve  a  new  spectrum  policy  paradigm  that  is  rooted  in  modern-  day  technologies 
 and  markets.  We  are  living  in  a  world  where  demand  for  spectrum  is  driven  by  an  explosion  of  wireless  technology  and  the  ever-  increasing  popularity  of  wireless  services. 


 Nevertheless,  we  are  still  living  under  a  spectrum  management  regime  that  is  90  years  old.  It  needs  a  hard  look,  and  in  my  opinion,  a  new  direction.  Historically,  I  believe  there  have 
 been  four  core  assumptions  underlying  spectrum  policy:  (1)  unregulated  radio  interference  will  lead  to  chaos;  (2)  spectrum  is  scarce;  (3)  government  command  and  control  of  the  scarce 
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 spectrum  resource  is  the  only  way  chaos  can  be  avoided;  and  (4)  the  public  interest  centers  on  government  choosing  the  highest  and  best  use  of  the  spectrum. 
 Todays  environment  has  strained  these  assumptions  to  the  breaking  point.  Modern  technology  has  fundamentally  changed  the  nature  and  extent  of  spectrum  use.  So  the  real 
 question  is,  how  do  we  fundamentally  alter  our  spectrum  policy  to  adapt  to  this  reality?  The  good  news  is  that  while  the  proliferation  of  technology  strains  the  old  paradigm,  it  is  also 
 technology  that  will  ultimately  free  spectrum  from  its  former  shackles. 
 1.  Interference  Leads  to  Chaos 
 From  1927  through  to  today,  interference  protection  has  always  been  at  the  core  of  federal  regulators  spectrum  mission.  The  Radio  Act  of  1927  empowered  the  Federal  Radio 
 Commission  to  address  interference  concerns.  While  interference  protection  remains  essential  to  our  mission,  interference  rules  that  are  too  strict  limit  users  ability  to  offer  new  services;  rules 
 that  are  too  lax  may  harm  existing  services.  I  believe  the  Commission  should  continuously  examine  whether  there  are  market  or  technological  solutions  that  can    in  the  long  run    replace 
 or  supplement  pure  regulatory  solutions  to  interference. 
 The  FCCs  current  interference  rules  were  typically  developed  based  on  the  expected  nature  of  a  single  services  technical  characteristics  in  a  given  band.  The  rules  for  most  services 
 include  limits  on  power  and  emissions  from  transmitters.  Each  time  the  old  service  needs  to  evolve  with  the  demands  of  its  users,  the  licensee  has  to  come  back  to  the  Commission  for  relief 
 from  the  original  rules.  This  process  is  not  only  inefficient,  it  can  stymie  innovation. 
 Due  to  the  complexity  of  interference  issues  and  the  RF  environment,  interference  protection  solutions  may  be  largely  technology-  driven.  As  an  illustration  of  the  shortcomings  of 
 our  current  rules,  I  will  point  to  a  lesson  I  learned  from  my  first  technological  mentor,  the  University  of  Colorados  own  Dale  Hatfield.  Dale  taught  me  that  interference  is  not  solely 
 caused  by  transmitters,  which  many  seem  to  assume    and  on  which  our  regulations  are  almost  exclusively  based.  Instead,  interference  is  often  more  a  product  of  receivers;  that  is  receivers  are 
 too  dumb  or  too  sensitive  or  too  cheap  to  filter  out  unwanted  signals.  Yet,  our  decades-  old  rules  have  generally  ignored  receivers. 


 Not  all  gaps  in  the  Commissions  current  interference  approach  are  quite  as  obvious  as  the  lack  of  receiver  standards.  The  Commission  will  also  be  challenged  to  understand  diverse 
 and  rapidly  changing  communications  technologies  and  their  interference  policy  impact.  Emerging  communications  technologies  are  becoming  more  tolerant  of  interference  through 
 sensory  and  adaptive  capabilities  in  receivers.  That  is,  receivers  can  sense  what  type  of  noise  or  interference  or  other  signals  are  operating  on  a  given  channel  and  then  adapt  so  that  they 
 transmit  on  a  clear  channel  that  allows  them  to  be  heard.  Our  new  policies  should  facilitate  and  support  such  innovative  technologies  that  may  increase  spectral  efficiency. 


 Both  the  complexity  of  the  interference  task  --  and  the  remarkable  ability  of  technology  (rather  than  regulation)  to  respond  to  it  --  are  most  clearly  demonstrated  by  the  recent  success  of 
 unlicensed  operations.  According  to  the  Consumer  Electronics  Association,  there  is  already  a 
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 complex  variety  of  unlicensed  devices  in  common  use,  including  garage  and  car  door  openers,  baby  monitors,  family  radios,  wireless  headphones,  and  millions  of  wireless  Internet  access 
 devices  using  Wi-  Fi  or  Bluetooth  technologies.  Yet  despite  the  sheer  volume  of  devices  and  their  disparate  uses,  manufacturers  have  developed  technology  that  allows  receivers  to  sift 
 through  the  noise  to  find  the  desired  signal. 
 Our  mission  should  be  to  build  a  policy  that  recognizes  the  diverse  and  complex  opportunities  presented  by  changes  in  the  role  of  interference  in  spectrum  policy. 


 2.  Scarcity 
 Much  of  the  Commission's  spectrum  policy  was  driven  by  the  assumption  of  acute  spectral  scarcity  -  the  assumption  that  there  is  never  enough  for  those  who  want  it.  Under  this 
 view,  spectrum  is  so  scarce  that  government  rather  than  market  forces  must  determine  who  gets  to  use  the  spectrum  and  for  what.  The  spectrum  scarcity  argument  shaped  the  Supreme  Court's 
 Red  Lion  decision,  which  gave  the  Commission  broad  discretion  to  regulate  broadcast  media  on  the  premise  that  spectrum  is  a  unique  and  scarce  resource.  Indeed  most  assumptions  that 
 underlie  the  current  spectrum  model  derive  from  traditional  broadcasting. 
 But  just  as  the  presumptions  of  Red  Lion  and  similar  broadcasting  regulation  based  on  scarcity  have  been  called  into  doubt  by  the  proliferation  of  media  sources,  so  too  must  we 
 question  the  continued  utility  of  the  pervasive  scarcity  assumption  for  spectrum-  based  services.  The  Commission  has  recently  conducted  a  series  of  tests  to  assess  actual  spectrum  congestion  in 
 certain  locales.  These  tests,  which  were  conducted  by  the  Commission's  Enforcement  Bureau  in  cooperation  with  the  Task  Force,  measured  use  of  the  spectrum  at  five  major  U.  S.  cities. 
 The  results  showed  that  while  some  bands  were  heavily  used,  others  either  were  not  used  or  were  used  only  part  of  the  time.  It  appeared  that  these  "holes"  in  bandwidth  or  time  could  be  used  to 
 provide  significant  increases  in  communication  capacity,  without  impacting  current  users,  through  use  of  new  technologies.  Although  not  dispositive,  these  results  call  into  question  the 
 traditional  assumptions  about  congestion.  Indeed  it  appears  that  most  of  spectrum  is  not  in  use  most  of  the  time. 


 But  even  these  results,  if  generally  applicable,  would  be  less  important  if  it  were  not  for  the  birth  of  new  technological  tools  that  allow  the  public  to  take  advantage  of  available  spectrum 
 resources  without  diminishing  other  users  rights.  Todays  digital  migration  means  that  more  and  more  data  can  be  transmitted  in  less  and  less  bandwidth.  Not  only  is  less  bandwidth  used, 
 but  innovative  technologies  like  software  defined  radio  and  adaptive  transmitters  can  bring  additional  spectrum  into  the  pool  of  spectrum  available  for  use.  Scarcity  will  not  be  replaced  by 
 abundance;  there  will  still  be  places  and  times  when  services  are  spectrum  constrained.  However,  scarcity  need  no  longer  be  the  lodestar  by  which  we  guide  the  spectrum  ship  of  state. 


 3.  Government  Command  and  Control 
 While  the  wireless  world  has  changed  rapidly,  government  spectrum  policy  continues  to  be  constrained  by  allocation  and  licensing  systems  from  a  bygone  era.  Change  is  inhibited  by 
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 the  mother  may  I  phenomenon    businesses  must  go  to  the  FCC  for  permission  before  they  can  modify  their  spectrum  plans  to  respond  to  consumer  demand. 
 The  theory  back  in  the  1930s  was  that  only  government  could  be  trusted  to  manage  this  scarce  resource  and  ensure  that  no  one  got  too  much  of  it.  Unfortunately,  spectrum  policy  is  still 
 predominantly  a  command  and  control  process  that  requires  government  officials  --  instead  of  spectrum  users  --  to  determine  the  best  use  for  spectrum  and  make  value  judgments  about 
 proposed  --  and  often  over-  hyped  --  uses  and  technologies.  It  is  an  entirely  reactive  and  too  easily  politicized  process. 


 Although  Congress  and  the  Commission  have  actually  begun  shifting  away  from  this  model,  the  Commission  still  finds  itself  continually  deciding  and  revisiting  difficult  technical 
 questions  concerning  spectrum  allocation,  geographical  coverage,  system  configurations,  channelization,  eligibility,  auction  exemptions,  transferability,  out-  of-  band  emissions,  and  other 
 technical  criteria.  Anyone  who  has  been  in  Washington  more  than  five  minutes  knows  that  government  decision-  making  is  measured  in  months  and  years  rather  than  milliseconds.  Even 
 with  auctions  and  a  shift  to  more  market-  oriented  policies,  it  is  painfully  obvious  that  we  are  still  operating  a  kilobyte  spectrum  regulation  device  in  a  gigabyte  spectrum  world. 


 In  the  last  twenty  years,  two  alternative  models  to  command  and  control  have  developed,  and  both  have  flexibility  at  their  core.  First,  the  exclusive  use  or  quasi-  property  rights  model, 
 which  provides  exclusive,  licensed  rights  to  flexible-  use  frequencies,  subject  only  to  limitations  on  harmful  interference.  These  rights  are  freely  transferable.  Second,  the  commons  or  open 
 access  model,  which  allows  users  to  share  frequencies  on  an  unlicensed  basis,  with  usage  rights  that  are  governed  by  technical  standards  but  with  no  right  to  protection  from  interference.  The 
 Commission  has  employed  both  models  with  significant  success.  Licensees  in  mobile  wireless  services  have  enjoyed  quasi-  property  right  interests  in  their  licensees  and  transformed  the 
 communications  landscape  as  a  result.  In  contrast,  the  unlicensed  bands  employ  a  commons  model  and  have  enjoyed  tremendous  success  as  hotbeds  of  innovation.  These  successes  give  us 
 some  real-  world  experience  on  new  and  innovative  alternatives  to  command  and  control,  and  we  will  undoubtedly  use  both  models  as  we  move  forward. 


 4.  Public  Interest 
 The  fourth  and  final  element  of  traditional  spectrum  policy  is  the  public  interest  standard.  The  phrase  (or  something  similar),  public  interest,  convenience  or  necessity  was  a 
 part  of  the  Radio  Act  of  1927  and  likely  came  from  other  utility  regulation  statutes.  The  standard  was  largely  a  response  to  the  interference  and  scarcity  concerns  that  were  created  in  the 
 absence  of  such  a  discretionary  standard  in  the  1912  Act.  The  public  interest,  convenience  and  necessity  became  a  standard  by  which  to  judge  between  competing  applicants  for  a  scarce 
 resource    and  a  tool  for  ensuring  interference  did  not  occur.  The  public  interest  under  the  command  and  control  model  often  decided  which  companies  or  government  entities  would  have 
 access  to  the  spectrum  resource.  At  that  time,  spectrum  was  not  largely  a  consumer  resource    but  rather  was  accessed  by  a  relatively  select  few.  However,  Congress  wisely  did  not  create  a 
 static  public  interest  standard  for  spectrum  allocation  and  management. 
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 Indeed,  if  the  Commission  is  to  do  its  job,  the  public  interest  must  reflect  the  realities  of  the  marketplace  and  current  spectrum  use.  Today,  I  would  suggest  that  full  and  complete 
 consumer  choice  of  wireless  devices  and  services  is  the  very  meaning  of  the  public  interest.  Certainly  government  telling  consumers  what  types  of  services  and  devices  they  should  have  or 
 own  is  not  my  view  of  the  publics  interest. 
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 So,  how  do  we  develop  a  policy  that  moves  us  from  the  four  mainstays  of  traditional  spectrum  management  into  a  more  compelling  model  for  this  century?  Since  Professor  Coase 
 started  the  discussion  on  spectrum  and  property  rights  with  his  seminal  article  in  1959,  we  have  had  academic  conferences,  reams  of  economic  papers,  scores  of  academics  debating  the  merits  of 
 FCC  spectrum  policy  and,  yet,  only  a  modest  amount  of  spectrum  has  been  moved  into  new  paradigms.  That  is  why  I  established  the  Spectrum  Policy  Task  Force:  to  lay  the  foundation  for 
 a  new,  bold  approach  to  spectrum  policy  that  would  help  us  break  out  of  the  box. 
 IV.  Spectrum  Policy  Reform 
 In  June  2002,  we  created  the  Spectrum  Policy  Task  Force  to  provide  specific  recommendations  to  the  Commission  for  ways  to  develop  a  more  integrated,  market-  oriented 
 spectrum  policy  approach  that  provides  greater  certainty,  minimal  regulatory  intervention,  and  greater  benefits  to  consumers.  The  Task  Force  will  assist  the  Commission  in  evaluating  policies 
 regarding  interference  protection,  spectral  efficiency,  effective  public  safety  communications,  and  various  spectrum  usage  models.  In  the  end,  the  Task  Forces  mandate  is  to  think  creatively 
 and  comprehensively  about  our  full  panoply  of  spectrum  policies    and  provide  an  intellectual  foundation  for  future  policy. 


 In  only  a  few  months,  the  Task  Forces  team  of  high-  level,  multi-  disciplinary  professional  FCC  staff    economists,  engineers  and  attorneys    from  across  the  Commissions 
 Bureaus  and  Offices  has  solicited  over  200  comments  from  the  public  on  a  wide  range  of  questions,  held  four  public  workshops,  and  will  soon  submit  its  findings  and  recommendations.  I 
 believe  that  the  upcoming  Report  will  serve  as  a  catalyst  for  long-  needed  changes  in  spectrum  policy. 


 So  what  are  some  of  the  key  steps  toward  reform? 
 1.  Ad  Hoc,  Rigid  Interference  Rules  Evolve  to  a  New  Paradigm  for  Interference  Prediction  and  Avoidance    Interference  Temperature. 


 The  time  has  come  to  consider  an  entirely  new  paradigm  for  interference  protection.  A  more  forward-  looking  approach  requires  that  there  be  a  clear  quantitative  application  of  what  is 
 acceptable  interference  for  both  license  holders  and  the  devices  that  can  cause  interference.  Transmitters  would  be  required  to  ensure  that  the  interference  level    or  interference 
 temperature  --  is  not  exceeded.  Receivers  would  be  required  to  tolerate  an  interference  level. 
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 I  anticipate  that  the  Commission  will  be  seeking  a  lot  of  input  from  the  technical  community  on  these  new  interference  concepts  because  this  would  mark  a  significant  change. 
 Rather  than  simply  saying  your  transmitter  cannot  exceed  a  certain  power,  we  instead  would  utilize  receiver  standards  and  new  technologies  to  ensure  that  communication  occurs  without 
 interference,  and  that  the  spectrum  resource  is  fully  utilized.  So,  for  example,  perhaps  services  in  rural  areas  could  utilize  higher  power  levels  because  the  adjacent  bands  are  less  congested 
 therefore  decreasing  the  need  for  interference  protection. 
 During  my  time  at  the  Commission,  we  have  been  forced  repeatedly  to  reject  applications  for  new  services  because  the  receivers  of  nearby  services  were  so  poorly  made  that  they  could 
 not  tolerate  the  interference  caused  by  the  new  service.  By  looking  at  the  spectral  environment  more  comprehensively  and  dynamically  through  the  more  focused  measurement  of  interference 
 temperature  at  the  receiver,  we  better  distribute  the  responsibilities  for  spectrum  use  and  achieve  greater  value  for  American  consumers. 


 2.  Scarcity  Mitigated  by  Access  to  the  4  th  Dimension    Time 
 In  analyzing  the  current  use  of  spectrum,  the  Task  Force  took  a  unique  approach,  looking  for  the  first  time  at  the  entire  spectrum,  not  just  one  band  at  a  time.  This  review  prompted  a 
 major  insight:  there  is  a  substantial  amount  of  white  space  out  there  that  is  not  being  used  by  anybody.  The  ramifications  of  the  insight  are  significant.  It  suggests  that  while  spectrum 
 scarcity  is  a  problem  in  some  bands  some  of  the  time,  the  larger  problem  is  spectrum  access    how  to  get  to  and  use  those  many  areas  of  the  spectrum  that  are  either  underutilized  or  not  used 
 at  all. 
 One  way  the  Commission  can  take  advantage  of  this  white  space  is  by  facilitating  access  in  the  time  dimension.  Since  the  beginning  of  spectrum  policy,  the  government  has  parceled 
 this  resource  in  frequency  and  in  space.  We  permitted  use  in  a  particular  band  over  a  particular  geographic  region  often  with  an  expectation  of  perpetual  use.  Like  Einstein  who  dramatically 
 theorized  on  the  importance  of  the  time  dimension  almost  90  years  ago,  the  Commission  now  should  also  look  at  time  as  an  additional  dimension  for  spectrum  policy.  How  well  could  we  use 
 this  resource  if  our  policies  fostered  access  in  frequency,  space  and  time? 
 Technology  has,  and  now  hopefully  FCC  policy  will,  facilitate  access  to  spectrum  in  the  time  dimension  that  will  lead  to  more  efficient  use  of  the  spectrum  resource.  For  example,  a 
 software  defined  radio  may  allow  licensees  to  dynamically  rent  certain  spectrum  bands  when  they  are  not  in  use  by  other  licensees.  Perhaps  a  mobile  wireless  service  provider  with  software 
 defined  phones  will  lease  a  local  businesss  channels  during  the  hours  the  business  is  closed.  Similarly  sensory  and  adaptive  devices  may  be  able  to  find  spectrum  open  space  and  utilize  it 
 until  the  licensee  needs  those  rights  for  their  own  use.  In  a  commercial  context,  secondary  markets  can  provide  a  mechanism  for  licensees  to  create  and  provide  opportunities  for  new 
 services  in  distinct  slices  of  time.  By  adding  another  meaningful  dimension,  spectrum  policy  can  move  closer  to  facilitating  consistent  availability  of  spectrum  and  further  diminish  the  scarcity 
 rationale  for  intrusive  government  action. 
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 3.  Command  and  Control  Regulation  Transitions  to  Flexibility 
 Historically  the  Commission  often  limited  flexibility  via  command  and  control  regulatory  restrictions  on  which  services  licensees  could  provide  and  who  could  provide  them.  Any 
 spectrum  users  that  wanted  to  change  the  power  of  their  transmitter,  the  nature  of  their  service,  or  the  size  of  an  antenna  had  to  come  to  the  Commission  to  ask  for  permission,  wait  the 
 corresponding  period  of  time,  and  only  then,  if  relief  was  granted,  modify  the  service.  Todays  marketplace  demands  that  we  provide  license  holders  with  greater  flexibility  to  respond  to 
 consumer  wants,  market  realities  and  national  needs  without  first  having  to  ask  for  the  FCCs  permission.  I  believe  license  holders  should  be  granted  the  maximum  flexibility  to  use  --  or 
 allow  others  to  use  --  the  spectrum,  within  technical  constraints,  to  provide  any  services  demanded  by  the  public.  With  this  flexibility,  service  providers  can  be  expected  to  move 
 spectrum  quickly  to  its  highest  and  best  use. 
 Such  flexibility  should  not  come  at  the  cost  of  clearly  defined  rules.  The  rapid  pace  of  the  markets  and  technology  requires  the  Commission  to  continue  to  define  clearly  even  the  more 
 expansive  rights  of  flexible  licenses.  Without  clarity,  there  is  little  certainty  for  the  consumer,  for  the  licensee  in  building  business  plans,  or  for  the  capital  markets  as  to  the  value  of  the 
 licenses.  Although  our  licensed  services    such  as  mobile  wireless  services    have  thrived  in  the  marketplace,  the  Commission  has  not  maximized  the  public  interest  benefits  that  could  be 
 created  by  these  licensees.  For  example,  if  the  agency  were  to  define  the  interference  temperature  in  the  licensed  service  bands,  it  would  establish  a  clear  watermark  beyond  which 
 interference  would  not  be  permitted  to  rise.  This  certainty  and  stability  would  protect  the  investment-  backed  expectations  of  incumbents  and  their  investors,  while  opening  spectrum  to 
 innovative  uses  under  clearly  specified  parameters. 
 4.  The  Public  Interest  in  Spectrum  Policy  is  Now  More  Informed  by  the  Consumer  Interest 


 We  need  a  new  spectrum  policy  that  fits  a  new  paradigm  of  putting  the  consuming  public  into  the  assessment  of  the  spectrum  public  interest.  This  does  not  mean  that  the  Commission 
 will  overlook  the  larger  public  interest  goals  such  as  national  defense,  public  safety,  and  critical  infrastructure.  But  it  does  mean  that  we  should  develop  policies  that  avoid  interference  rules  that 
 are  barriers  to  entry,  that  assume  a  particular  proponents  business  model  or  technology,  and  that  take  the  place  of  marketplace  or  technical  solutions.  Such  a  policy  must  embody  what  we  have 
 seen  benefit  the  public  in  every  other  area  of  consumer  goods  and  services    choice  through  competition,  and  limited,  but  necessary,  government  intervention  into  the  marketplace  to  protect 
 such  interests  as  access  to  people  with  disabilities,  public  health,  safety  and  welfare. 
 Spectrum  policy  was  once  an  obscure  abstraction  for  most  Americans.  But  today  Americans  experience  first  hand  the  challenges  of  dropped  cell  phone  calls    or  limits  on  cable 
 competition    or,  for  the  early-  adopters  among  us,  interference  on  their  wireless  LANs.  These  are  no  longer  abstractions    they  are  spectrum  policy  problems    interference  debates,  spectrum 
 allocation  decisions,  and  choices  between  licensed  and  unlicensed  uses.  The  government  must  respond  to  these  challenges    because  the  consumer  impact  of  our  failure  to  do  so  is  too  great  to 
 ignore    and  the  American  people  increasingly  know  it. 
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 As  do  their  leaders.  On  Capitol  Hill,  a  number  of  members  have  expressed  interest  and  advanced  thoughtful  proposals  on  spectrum  reform.  Similarly  the  Bush  Administration  has  been 
 an  active  participant  in  the  spectrum  policy  dialog.  At  the  Department  of  Commerce,  NTIA  Administrator  Nancy  Victory  hosted  a  spectrum  policy  summit  just  this  spring.  Participants 
 representing  a  broad  range  of  interests  --  government,  consumers,  industry  and  public  safety  -  gathered  to  develop  innovative  spectrum  policy  recommendations.  Many  others  are  doing  their 
 own  studies  and  holding  conferences  on  spectrum  policies:  the  General  Accounting  Office;  think  tanks,  such  as  the  Center  for  Strategic  and  International  Studies  and  the  CATO  Institute;  and 
 universities,  including  my  host  today,  the  University  of  Colorado.  And  the  Commission  and  the  Task  Force  are  at  the  epicenter  of  this  national  dialog.  I  look  forward  to  working  with  anyone 
 and  everyone  with  good  ideas  on  how  to  move  spectrum  policy  forward. 
 The  Task  Forces  work  will  not  be  merely  an  intellectual  exercise  in  creative  policy.  Hopefully  the  report,  and  the  constructive  dialogue  it  will  initiate,  will  provide  the  framework,  or 
 blueprint,  for  how  we  will  approach  spectrum  policy  in  the  future. 
 That  framework  is  not  just  a  long  term  process.  It  provides  a  significant  action  plan  for  the  next  quarter.  In  the  coming  months,  I  will: 


   Direct  the  Task  Force  to  produce  its  report  for  public  release; 
   Initiate  a  dialog  with  members  of  Congress  on  what  legislative  steps  will  assist  in  developing  a  more  effective  spectrum  policy  approach  for  the  benefit  of  consumers; 


   Explore  ways  in  which  the  interference  temperature  concept,  increased  spectrum  access  and  more  flexible  rights  may  enhance  the  public  interest; 
   Strive  to  make  more  spectrum  available  for  licensed  and  unlicensed  use; 
   Recommend  that  the  Commission  at  its  December  meeting  initiate  a  Notice  of  Inquiry  that  builds  on  the  Task  Force's  work. 


 V.  Conclusion 
 We  are  truly  at  a  crossroads  in  the  spectrum  policy  component  of  the  digital  migration.  We  must  make  critical  decisions  that  balance  the  interests  of  existing  spectrum  users  and 
 potential  new  entrants  to  ensure  that  there  is  every  opportunity  and  incentive  to  put  spectrum  to  its  highest  and  best  use  for  the  benefit  of  all  consumers. 


 It  is  important  to  remember  that  at  the  end  of  the  day,  we're  not  necessarily  looking  for  one  right  path  to  our  destination.  There  is  no  one-  size-  fits-  all  model  for  spectrum  policy.  We 
 may  well  find  that  there  are  multiple  approaches  to  the  spectrum  policy  peak  that  should  be  pursued  in  different  contexts  in  different  spectrum  bands  over  short,  medium  and  long-  term 
 horizons.  As  with  any  accomplishment  worth  achieving,  the  climb  will  likely  be  strenuous  but  the  rewards  at  the  summit  are  immeasurable. 


 Thank  you. 
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