Spectrum Management: Federal Government's Use of Spectrum and Preliminary Information on Spectrum Sharing
Released: 2012-09-13T00:00:00


Highlights: section_title: Why GAO Did This Study
paragraphs: Demand for spectrum is increasing rapidly with the widespread use of wireless broadband devices and services. However, nearly all usable spectrum has been allocated either by NTIA for federal use or by the Federal Communications Commission (FCC) for commercial and nonfederal use. Federal initiatives are under way to identify federal spectrum that could be repurposed or possibly shared by federal users or wireless broadband providers and other nonfederal users. This statement discusses how NTIA manages spectrum to address governmentwide spectrum needs and the steps NTIA has taken to repurpose spectrum for broadband. As part of an ongoing review, the statement also discusses preliminary information on the factors that prevent spectrum sharing and actions that can encourage sharing and efficient spectrum use. This testimony is based on GAO's prior work on federal spectrum management and ongoing work on spectrum sharing. GAO analyzed NTIA processes, policies and procedures, and interviewed relevant government officials, experts, and industry stakeholders.

section_title: What GAO Found
paragraphs: The National Telecommunications and Information Administration (NTIA) is responsible for governmentwide federal spectrum management, but GAO reported in 2011 that NTIA’s efforts in this area had been limited. In 2003, the President directed NTIA to develop plans identifying federal and nonfederal spectrum needs, and in 2008, NTIA issued the federal plan. GAO found it did not identify governmentwide spectrum needs and did not contain key elements and conform to best practices for strategic planning. Furthermore, NTIA’s primary spectrum management operations do not focus on governmentwide needs. Instead, NTIA depends on agency self-evaluation of spectrum needs and focuses on mitigating interference among spectrum users, with limited emphasis on overall spectrum management. Additionally, NTIA’s data management system is antiquated and lacks internal controls to ensure the accuracy of agency-reported data, making it unclear if reliable data inform decisions about federal spectrum use. NTIA is developing a new data management system, but implementation is years away.

Despite these limitations, NTIA has taken steps to identify spectrum that could potentially be made available for broadband use. For example, in 2010 NTIA evaluated various spectrum bands and identified 115 megahertz of spectrum that could be repurposed within the next 5 years. In doing so, NTIA worked with a special steering group consisting of the Assistant Secretaries with spectrum management oversight in agencies that were the major stakeholders in the spectrum bands under consideration. For each of the identified bands, NTIA reviewed the number of federal frequency assignments within the band, the types of federal operations and functions that the assignments support, and the geographic location of federal use.

In addition to efforts to repurpose spectrum, industry stakeholders have also suggested that sharing spectrum between federal and nonfederal users be considered to help make spectrum available for broadband. Our ongoing work has identified several barriers that limit sharing. Primarily, many users may lack incentives to share assigned spectrum. Typically, paying the market price for a good or service helps to inform users of the value of the good and provides an incentive for efficient use. But federal agencies pay only a small fee to NTIA for spectrum assignments, and may, in some contexts, have little incentive to conserve or share it. Federal agencies may also have limited budgets to upgrade to more spectrally-efficient equipment that would better enable sharing. Nonfederal users are also reluctant to share spectrum. For instance, license holders may be reluctant because of concerns that spectrum sharing could encourage competition. A lack of information on federal spectrum use may limit users’ ability to easily identify spectrum suitable for sharing.

GAO’s ongoing work suggests that some actions might provide greater incentives and opportunities for more efficient spectrum use and sharing. These actions could include assessing spectrum usage fees to provide economic incentive for more efficient use and sharing, expanding the availability of unlicensed spectrum, and increasing the federal focus on research and development of technologies that can enable spectrum sharing and improve spectral efficiency. However, all of these actions also involve challenges and may require further study.

section_title: Letter
paragraphs: Thank you for the opportunity to testify today on issues related to  spectrum management and spectrum sharing practices in the United  States. Radio frequency spectrum enables wireless communications  services critical to the U.S. economy and a variety of government  functions, such as scientific research and national defense. Spectrum  capacity is necessary to deliver wireless broadband to consumers and  businesses and broadband deployment stimulates economic growth and  boosts the nation’s capabilities in areas such as education and health  care. As the U.S. experiences significant growth in commercial wireless  broadband services, the demand for spectrum has increased and  additional capacity will be needed. However, nearly all usable spectrum  has been allocated either by the National Telecommunications and  Information Administration (NTIA) for federal government use or by the  Federal Communications Commission (FCC) for commercial and other  nonfederal use. Virtually no “green fields” of spectrum are currently  available to allocate to new uses or technologies.

Currently, federal government initiatives are under way to identify  spectrum that can be made available to meet the nation’s increased  demand for commercial wireless broadband services. In particular, the  National Broadband Plan recommended that 500 megahertz (MHz) of  spectrum be made newly available for broadband use within the next 10  years, and in June 2010, the President issued a memorandum directing  NTIA to begin identifying federal spectrum that can be made available for  wireless broadband. Solutions geared toward greater sharing of  spectrum among users—federal and nonfederal—have become attractive  because of the potential access to more spectrum and opportunities to  use spectrum more efficiently that sharing presents. The President’s  Council of Advisors on Science and Technology (PCAST) recommended  that 1,000 MHz of spectrum previously occupied only by federal users be  shared with nonfederal users.

GAO, Spectrum Management: NTIA Planning and Processes Need Strengthening to  Promote the Efficient Use of Spectrum by Federal Agencies, GAO-11-352 (Washington,  D.C.: April 12, 2011). (IRAC).provided in our 2011 report. We conducted our work related to federal  management and use of spectrum from May 2010 to April 2011 and our  work related to spectrum sharing from September 2011 to September  2012. All of our work was conducted in accordance with generally  accepted government auditing standards. We provided a draft of this  statement related to spectrum sharing to FCC and NTIA officials to obtain  their comments. FCC and NTIA provided technical corrections, which we  incorporated where appropriate.
subsections: section_title: Background
paragraphs: The radio frequency spectrum is the part of the natural spectrum of  electromagnetic radiation lying between the frequency limits of 3 kilohertz  (kHz) and 300 gigahertz (GHz). Not all spectrum has equal value. The  spectrum most highly valued generally consists of frequencies between  225 MHz and 3700 MHz, as these frequencies have properties well suited  to many important wireless technologies, such as mobile phones, radio,  and television broadcasting. According to NTIA, as of September 2012,  federal agencies had exclusive access to about 18 percent of these high- value frequencies, and nonfederal users had exclusive licenses to about  33 percent. The remainder of this spectrum is allocated to shared use.  However, in many cases in these shared bands, federal or nonfederal  uses may dominate and actual sharing is nominal. NTIA has concluded  that overall, approximately 43 percent of these high-value frequencies are  predominantly used by federal operations.

Federal agencies use spectrum to help meet a variety of missions,  including emergency communications, national defense, land  management, and law enforcement. Over 60 federal agencies and  departments combined have over 240,000 frequency assignments.  Agencies and departments within the Department of Defense have the  most assignments, followed by the Federal Aviation Administration, the  Department of Justice, the Department of Homeland Security, the  Department of the Interior, the Department of Agriculture, U.S. Coast  Guard, the Department of Energy, and the Department of Commerce,  respectively. These federal agencies and departments hold 94 percent of  all federally assigned spectrum. Nonfederal entities (which include  commercial companies and state and local governments) also use  spectrum to provide a variety of services. For example, state and local  police departments, fire departments, and other emergency services  agencies use spectrum to transmit and receive critical voice and data  communications, while commercial entities use spectrum to provide  wireless services, including mobile voice and data, paging, broadcast  radio and television, and satellite services (see fig. 1).

In the United States, responsibility for spectrum management is divided  between NTIA and FCC. NTIA and FCC jointly determine the amount of  spectrum allocated for federal, nonfederal, and shared use. After this  allocation occurs, in order to use spectrum, nonfederal users must follow  rules and obtain authorizations from FCC to use specific spectrum  frequencies, and federal users must follow rules and obtain frequency  assignments from NTIA. In order for nonfederal users to share federal  spectrum, NTIA and FCC are jointly involved in the process. The  nonfederal party petitions FCC, and FCC in turn coordinates rulemakings  and licenses with NTIA through IRAC. NTIA manages sharing between  federal users on a day-to-day basis. If federal users are requesting  frequency assignments in exclusive nonfederal or shared bands, that  request is coordinated through IRAC with FCC. If sharing is solely  between nonfederal users in exclusive nonfederal bands, sharing is  generally governed by FCC rules and does not go through NTIA, unless  there could be out-of-band interference. In addition to its spectrum  allocation and authorization duties, NTIA serves as the President’s  principal advisor on telecommunications and information policy and  manages federally assigned spectrum, including preparing for,  participating in, and implementing the results of international radio  conferences, as well as conducting extensive research and technical  studies through its research and engineering laboratory, the Institute for  Telecommunication Sciences. NTIA has authority to issue rules and  regulations as may be necessary to ensure the effective, efficient, and  equitable use of spectrum both nationally and internationally. It also has  authority to develop long-range spectrum plans to meet future spectrum  requirements for the federal government.

Spectrum sharing can be defined as the cooperative use of common  spectrum. In this way, multiple users agree to access the same spectrum  at different times or locations, as well as negotiate other technical  parameters, to avoid adversely interfering with one another. For sharing  to occur, users and regulators must negotiate and resolve where  (geographic sharing), when (sharing in time), and how (technical  parameters) spectrum will be used (see fig. 2).

Spectrum sharing also occurs with unlicensed use of spectrum, since it is  accessible to anyone using wireless equipment certified by FCC for those  frequencies. Equipment such as wireless microphones, baby monitors,  and garage door openers typically share spectrum with other services on  a non-interference basis using low power levels to avoid interference with  higher priority uses. In contrast with most licensed spectrum use,  unlicensed spectrum users have no regulatory protection against  interference from other licensed or unlicensed users in the band.  However, unlicensed use is regulated to ensure that unlicensed devices  do not cause undue interference to operations with a higher priority. For  example, in the 5 GHz band, wireless fidelity (Wi-Fi) devices share a  band with military radar subject to the condition that the Wi-Fi devices are  capable of spectrum sensing and dynamic frequency selection; if radar is  detected, the unlicensed user must immediately vacate the channel.

section_title: NTIA’s Processes for Managing Federal Spectrum Lack Governmentwide Focus and Accountability
subsections: section_title: NTIA’s Spectrum Management Efforts
paragraphs: As the federal agency authorized to develop national spectrum policy,  NTIA has been directed to conduct several projects focused on reforming  governmentwide federal spectrum management and promoting efficiency  among federal users of spectrum; however, we reported in 2011 that its  efforts in this area had resulted in limited progress toward improved  spectrum management. NTIA has authority to, among other things,  establish policies concerning assigning spectrum to federal agencies,  coordinate spectrum use across federal agencies, and promote efficient  use of spectrum by federal agencies in a manner which encourages the  most beneficial public use. As such, NTIA has a role in ensuring that  federally allocated spectrum is used efficiently. According to NTIA’s  Redbook and agency officials, efficient use includes ensuring that federal  agencies’ decisions to use spectrum to support government missions  have been adequately justified and that all viable tradeoffs and options  have been explored before making the decision to use spectrum- dependent technology, and ensuring that these tradeoffs are continuously  reviewed to determine if the need for spectrum has changed over time.  NTIA’s primary guidance to federal agencies is technical guidance  provided through NTIA’s Redbook concerning how to manage assigned  spectrum.

In 2003, the Bush Administration directed NTIA to develop strategic  plans, and in March 2008, NTIA issued its report on federal spectrum use  entitled the Federal Strategic Spectrum Plan. While the intent of the  Federal Strategic Spectrum Plan was to identify the current and projected  spectrum requirements and long-range planning processes for the federal  government, we reported in 2011 that the final plan is limited in these  areas. For example, the plan does not identify or include quantitative  governmentwide data on federal spectrum needs. Instead, NTIA’s plan  primarily consists of a compilation of the plans submitted by 15 of the  more than 60 agencies that use federal spectrum. Additionally, due to the  fact that they contained limited information regarding future requirements  and technology needs, NTIA concluded that its “long-range assumptions  are necessarily also limited.” Furthermore, NTIA’s plan did not contain  key elements and best practices of strategic planning.

section_title: NTIA Focuses on Interference Mitigation Rather than on Best Use of Spectrum across Government
paragraphs: NTIA’s primary spectrum management operations include authorizing  federal frequency assignments and certifying spectrum-dependent  equipment for federal users; however, these processes are primarily  focused on interference mitigation as determined by IRAC and do not  focus on ensuring the best use of spectrum across the federal  government. In 2011, we found that the process as established by federal  regulations for review and approval of frequency assignment and system  certification was technical in nature, focusing on ensuring that the new  frequency or system that an agency wants to use would not interfere with  another agency’s operations. According to NTIA officials, this focus on  day-to-day spectrum activities, such as interference mitigation, is due to  the agency’s limited resources. This focus, while important, makes limited  consideration about the overall best use of federally allocated spectrum.  Therefore, NTIA’s current processes provide limited assurance that  federal spectrum use is evaluated from a governmentwide perspective to  ensure that decisions will meet the current and future needs of the  agencies, as well as the federal government as a whole.

section_title: NTIA’s Current Data Management System Is of Limited Usefulness
paragraphs: NTIA’s data management system is antiquated and lacks transparency  and internal controls. In 2011, we reported that NTIA collects all federal  spectrum data in the Government Master File (GMF), which according to  NTIA officials is an outdated legacy system that was developed primarily  to store descriptive data. These data are not detailed enough to support  the current analytical needs of NTIA or other federal users, as the system  was not designed to conduct such analyses. NTIA does not generate any  data, but maintains agency-reported spectrum data in the GMF, which are  collected during the frequency assignment and review processes.

NTIA’s processes for collecting and verifying GMF data lack key internal  controls, including those focused on data accuracy, integrity, and  completeness. Control activities such as data verification and  reconciliation are essential for ensuring accountability for government  resources and achieving effective and efficient program results. In 2011,  we reported that NTIA’s data collection processes lack accuracy controls  and do not provide assurance that data are being accurately reported by  agencies. Rather, NTIA expects federal agencies to supply accurate and  up-to-date data submissions, but it does not provide agencies with  specific requirements on how to justify that the agencies’ spectrum  assignments will fulfill their mission needs.

NTIA is developing a new data management system—the Federal  Spectrum Management System (FSMS)—to replace the GMF. According  to NTIA officials, the new system will modernize and improve spectrum  management processes by applying modern information technology to  provide more rapid access to spectrum and make the spectrum  management process more effective and efficient. NTIA projects that  FSMS will improve existing GMF data quality, but not until 2018.  According to NTIA’s FSMS transition plan, at that time data accuracy will  improve by over 50 percent. However, in the meantime it is unclear  whether important decisions regarding current and future spectrum needs  are based on reliable data.

section_title: NTIA Has Taken Steps to Identify Spectrum for Future Wireless Broadband Use
subsections: section_title: NTIA Efforts to Identify Spectrum for Broadband
paragraphs: In response to the government initiatives to make a total of 500 MHz of  spectrum available for wireless broadband, in 2010 NTIA (1) identified  115 MHz of federally allocated spectrum to be made available for wireless  broadband use within the next 5 years, referred to as the Fast Track  Evaluation, and (2) developed an initial plan and timetable for repurposing  additional spectrum for broadband, referred to as the 10-Year Plan.

Fast Track Evaluation. NTIA and the Policy and Plans Steering Group  (PPSG) identified and recommended portions of two frequency bands,  totaling 115 MHz of spectrum within the ranges of 1695–1710 MHz and  3550–3650 MHz to be made available for wireless broadband use. For  each of these bands, NTIA reviewed the number of federal frequency  assignments within the band, the types of federal operations and  functions that the assignments support, and the geographic location of  federal use. Since clearing these bands of federal users and relocating  incumbent federal users to new bands was not an option in the given time  frame, the bands that NTIA recommended be made available will be  opened to geographic sharing by incumbent federal users and  commercial broadband.  10-Year Plan. By a presidential memorandum, NTIA was directed to  collaborate with FCC to make available 500 MHz of spectrum over the  next 10 years, suitable for both mobile and fixed wireless broadband use,  and complete by October 1, 2010, a specific plan and timetable for  identifying and making available the 500 MHz for broadband use. publicly released this report in November 2010. In total, NTIA and the  National Broadband Plan identified 2,264 MHz of spectrum to analyze for  possible repurposing, of which 639 MHz is exclusively used by the federal  government and will be analyzed by NTIA. Additionally, NTIA will  collaborate with FCC to analyze 835 MHz of spectrum that is currently  located in bands that are shared by federal and nonfederal users.  Furthermore, NTIA has stated that it plans to seek advice and assistance  from CSMAC, its federal advisory committee comprised of industry  representatives and experts, as it conducts analyses under the 10-Year  Plan.

Unleashing the Wireless Broadband Revolution, 75 Fed. Reg. 38387. previously evaluated for reallocation, and in 2001, we reported that at the  time adequate information was not currently available to fully identify and  address the uncertainties and risks of reallocation.

section_title: Industry Concerns with the Usefulness of the Identified Spectrum
paragraphs: Industry stakeholders, including wireless service providers,  representatives of an industry association, and a think tank representative  we contacted in 2011 expressed concerns over the usefulness of the  spectrum identified by NTIA in the Fast Track Evaluation, since most of  the spectrum identified (100 of the 115 MHz) is outside the range  considered to have the best propagation characteristics for mobile  broadband. Overall, there has been limited interest in the bands above 3  GHz for mobile broadband use because, according to industry  stakeholders, there has been minimal development of mobile broadband  in bands above 3 GHz and no foreseeable advances in this area at this  time.

According to industry representatives, the 1755–1780 MHz band that  NTIA considered as part of the Fast Track Evaluation has the best  characteristics for mobile broadband use, and it is internationally  harmonized for this use. NTIA did not select this band to be made  available in the 5-year time frame due to the large number of federal  users currently operating there. However, NTIA identified it as the first  band to be analyzed under the 10-Year Plan to determine if it can be  made available for commercial broadband use. An industry stakeholder  has stated that the 1695–1710 MHz band identified by NTIA in the Fast  Track Evaluation is the second-best alternative for wireless broadband if  the 1755–1780 MHz band were not made available; however, the 1695– 1710 MHz band is not currently used internationally for wireless  broadband, which may reduce device manufacturers’ incentive for  developing technology that can be used in these frequencies.

section_title: Some Users Lack Incentives and Face Several Barriers to Sharing Spectrum, and Cannot Easily Identify Available Spectrum to Share
subsections: section_title: Some Users Lack Economic Incentives to Share Spectrum
paragraphs: While federal spectrum users often share spectrum among themselves,  they may have little economic incentive to otherwise use spectrum  efficiently, including sharing it with nonfederal users. From an economic  perspective, when a consumer pays the market price for a good or  service and thus cannot get more of it without this expense, the consumer  has an incentive to get the most value and efficiency out of the good as  possible. If no price is attached to a good—which is essentially the case  with federal agencies’ use of spectrum—the normal market incentive to  use the good efficiently may be muted. In the case of federal spectrum  users, obtaining new spectrum assignments may be difficult, so an  agency may have an incentive to conserve and use the spectrum it  currently has assigned to it or currently shares efficiently, but the extent of  that incentive is likely weaker than if the agency had had to pay a market  price for the all of their spectrum needs. As such, federal spectrum users  do not fully face a market incentive to conserve on their use of spectrum  or use it in an efficient manner. The full market value of the spectrum  assigned to federal agencies has not been assessed, but, according to  one expert, would most likely be valued in the tens of billions of dollars.  Similarly, many nonfederal users, such as television broadcasters and  public safety entities, did not pay for spectrum when it was assigned to  them and do not pay the full market price for their continuing use of  spectrum so, like federal agencies, they may not fully have market-based  incentives to use spectrum efficiently.

While licensed, commercial users who purchased spectrum at auction  generally have market incentives to use their spectrum holdings  efficiently, these users also have incentives that work against sharing  spectrum, except in those instances where the incumbent licensee is  unlikely to build out its network or offer services to a particular area, such  as in certain remote, sparsely populated areas. FCC officials and industry  stakeholders and experts told us that these users may prefer not to share  their unused spectrum because they are concerned about the potential  for interference to degrade service quality to their customers. Also, they  may prefer to not give potential competitors access to spectrum. Industry  stakeholders and experts also said that companies seeking spectrum  may prefer obtaining exclusive spectrum licenses over sharing spectrum  that is licensed to another company or federal user, given uncertainties  about regulatory approvals, interference, and enforcement if interference  occurs.

section_title: Several Barriers Can Deter Users from Sharing Spectrum
paragraphs: There are several barriers that can deter sharing. One such barrier is that  federal agencies will not risk mission failure, particularly when there are  security and public safety implications. According to the agency officials  we contacted, federal agencies will typically not agree to share spectrum  if it puts achieving their missions at risk. The officials stressed that when  missions have security and safety implications, sharing may pose  unacceptable risks. For example, the military tests aircraft and trains  pilots over test ranges that can stretch hundreds of miles, maintaining  constant wireless contact. The ranges, according to officials, cannot  share the communication frequencies because even accidental  interference in communications with an aircraft could result in  catastrophic mission failure. Further, sharing information about such  flights could expose particular pilots and aircraft, or the military’s larger  mission, to increased risk.

According to FCC officials, concerns about risk can drive conservative  technical standards that can make sharing impractical. In general, the  technical analyses and resulting standards are based on worst-case  scenarios, and not on assessments of the most likely scenario or a range  of scenarios. Moreover, in contrast to FCC’s open rulemaking process,  there is little opportunity for public input to the standards setting process.  Stakeholders may meet or have discussions with NTIA and the relevant  federal agencies, but this occurs without any formal public process. Nor  do stakeholders have any effective means to appeal other than by asking  FCC to reject NTIA’s analysis or standards.

Another barrier is that spectrum sharing can be costly. Stakeholders told  us that sharing federal spectrum can be costly for both the nonfederal and  federal users seeking to share for the following reasons:

Mitigation of potential interference can be costly in terms of equipment  design and operation.

Users applying to share federal frequencies may find that those  frequencies are being used by more than one federal agency or  program. As a result of needing to mitigate inference for multiple  users, costs to share spectrum in that band could increase.

Federal users often use and rely on proven older technology that was  designed to use spectrum to meet a specific mission and typically is  not conducive to operating as efficiently or flexibly as the state-of-the- art technologies might now allow. Limited budgets may prevent them  from being able to invest in newer technology which can facilitate  easier sharing.

Additionally, we found that spectrum sharing approval and enforcement  processes can be lengthy and unpredictable. FCC and NTIA processes  can cause two main problems when nonfederal users seek to share  federal spectrum, or when nonfederal users share with one another,  according to stakeholders:

The spectrum-sharing approval process between FCC and NTIA can  be lengthy and unpredictable, and the risk associated with it can be  costly for new entrants. FCC officials told us that its internal processes  can potentially last years if requiring a rulemaking to accommodate  shared use of spectrum. In addition to that time, NTIA officials said  that IRAC’s evaluation of potential harmful interference could take  months. In one example, the Department of Defense, along with other  federal agencies and nonfederal entities, currently shares a spectrum  band between 413-457 MHz with a nonprofit medical devices provider  for use in implant products for veterans. It took approximately 2 years  (from 2009 to 2011) for FCC and NTIA to facilitate this arrangement,  as FCC required a rulemaking and NTIA required a lengthy evaluation  of potential interference. This nonprofit is funded by an endowment  and was not dependent on income from the device to sustain itself  during this process, but such delays, and the potential for a denial,  could discourage for-profit companies from developing and investing  in business plans that rely on sharing federal spectrum.

Stakeholders we interviewed told us that when federal or nonfederal  users share spectrum, both parties have concern that harmful  interference may affect their missions or operations if the other party  overreaches or does not follow the agreement. They also fear that the  enforcement actions that are taken by FCC will happen too slowly to  protect their interests or that enforcement outcomes can be  unpredictable.

section_title: Users May Be Unable to Easily Identify Spectrum Suitable for Sharing
paragraphs: Besides lacking incentives and overcoming other barriers, users may also  have difficulty identifying spectrum suitable for sharing because data on  available spectrum is incomplete or inaccurate, and information on some  federal spectrum usage is not publicly available. According to NTIA  officials, coordinating spectrum sharing requires accurate data on users,  frequencies, locations, times, power levels, and equipment, among other  things. We recently reported that both FCC’s and NTIA’s spectrum  databases may contain incomplete and inaccurate data. Further, federal  agency spectrum managers told us that agencies have not been asked to  regularly update their strategic spectrum plans, in which they were  required to include an accounting of spectrum use.

As mentioned, NTIA is developing a new data system that officials believe  will provide more robust data that will enable more accurate analysis of  spectrum usage and potential interference, which may in turn identify  more sharing opportunities. In addition, recently proposed legislation  would require in part that FCC, in consultation with NTIA and the White  House Office of Science and Technology Policy, prepare a report for  Congress that includes an inventory of each radio spectrum band they  manage. The inventory is also to include data on the number of  transmitters and receiver terminals in use, if available, as well as other  technical parameters—coverage area, receiver performance, location of  transmitters, percentage and time of use, a list of unlicensed devices  authorized to operate in the band and description of use—that allow for  more specific evaluation of how spectrum can be shared. However,  experts and federal officials we contacted told us that there may be some  limitations to creating such an inventory. For instance, measuring  spectrum usage can be difficult because it can only be accomplished on a  small scale and technologies to measure or map widespread spectrum  usage are not yet available. Additionally, FCC and NTIA officials told us  that information on some federal spectrum bands may never be made  publicly available because of the sensitive and classified nature of some  federal spectrum use.

section_title: Incentives and Opportunities to Share Could Be Expanded
paragraphs: We have previously reported that to improve spectrum efficiency among  federal agencies, Congress may wish to consider evaluating what  mechanisms could be adopted to provide incentives and opportunities for  agencies to move toward more efficient use of spectrum, which could free  up some spectrum allocated for federal use to be made available for  sharing or other purposes. Federal advisors and experts we talked to  identified several options that could provide incentives and opportunities  for more efficient spectrum use and spectrum sharing by federal and  nonfederal users, which include, among others: (1) assessing spectrum  usage fees; (2) expanding the availability of spectrum for unlicensed  uses; and (3) increasing the federal focus on research and development  of technologies that can enable spectrum sharing and improve spectral  efficiency.

Assessing spectrum usage fees. Several advisory groups and spectrum  industry experts, including those we interviewed, have recommended that  spectrum fees be assessed based on spectrum usage. As previously  mentioned, with the exception of administrative fees for frequency  assignments, federal users incur no costs for using spectrum. As such,  federal users may have little incentive to share spectrum assigned to  them with nonfederal users or identify opportunities to use spectrum more  efficiently—except to the extent that sharing or more efficient use helps  them achieve their mission requirements. In 2011, the CSMAC Incentives  Subcommittee recommended that NTIA and FCC study the  implementation of spectrum fees to drive greater efficiency and solicit  input from both federal and nonfederal users who might be subject to  fees. The National Broadband Plan has also recommended that  Congress consider granting FCC and NTIA authority to impose spectrum  fees on unauctioned spectrum license holders—such as TV broadcasters  and public safety entities—as well as government users. Fees may help  to free spectrum for new uses, since licensees who use spectrum  inefficiently may reduce their holdings or pursue sharing opportunities  once they bear the opportunity cost of letting it remain fallow or  underused. Further, FCC officials told us that they have proposed  spectrum usage fees at various times, including in FCC’s most recent  congressional budget submission, and requested the legislative  authorities to implement such a program.

While noting the benefits, the CSMAC Incentives Subcommittee report  mentions specific concerns about the impact of spectrum fees on  government users. For instance, some CSMAC members expressed  concern that fees do not fit into the federal annual appropriations process  and new appropriations to cover fees are neither realistic nor warranted in  the current budget environment. Other members suggested that fees will  have no effect because agencies will be assured additional funds for their  spectrum needs. Similarly, the National Broadband Plan notes that a  different approach to setting fees may be appropriate for different  spectrum users, and that a fee system must also avoid disrupting public  safety, national defense, and other essential government services that  protect human life, safety, and property.

To address some of the concerns regarding agency budgets, the recent  PCAST report recommended the use of a “spectrum currency” process to  promote spectrum efficiency. Rather than using funds to pay for  spectrum, federal agencies would each be given an allocation of synthetic  currency that they could use to “buy” their spectrum usage rights. Usage  fees would be set based on valuations of comparable private sector uses  for which the market has already set a price. Agencies would then have  incentive to use their assignments more efficiently or share spectrum. In  the PCAST proposal, agencies would also be rewarded for making  spectrum available to others for sharing, by being reimbursed for their  investments in improving spectrum sharing from a proposed Spectrum  Efficiency Fund.

Expanding the availability of spectrum for unlicensed use. Unlicensed  spectrum use is inherently shared spectrum access, and according to  spectrum experts we interviewed and other stakeholders, unlicensed use  of spectrum is a valuable complement to licensed spectrum and more  spectrum could be made available for unlicensed use. Spectrum for  unlicensed use can be used efficiently and for high value applications, like  Wi-Fi, for example. Increasing the amount of spectrum for unlicensed use may allow more users to share without going through lengthy  negotiations and interference mitigations, and also allow for more  experimentation and innovation.

More recently, FCC has provided unlicensed access to additional  spectrum, known as TV “white spaces,” to help address spectrum  demands. The white spaces refer to the buffer zones that FCC assigned  the television broadcasters to mitigate unwanted inference between  adjacent stations. With the more efficient TV transmission capabilities that  resulted from the digital television transition, the buffer zones are no  longer needed and FCC approved the previously unused spectrum for  unlicensed use. To identify available white space spectrum, devices must  access a database which responds with a list of the frequencies that are  available for use at the device’s location. As an example, one local  official explained that his city uses TV white space spectrum to provide a  network of public Wi-Fi access and public safety surveillance functions.

Increasing the federal focus on research and development of  technologies. Several technological advances promise to make sharing  easier, but are still at early stages of development and testing. For  example, various spectrum users and experts we contacted mentioned  the potential of dynamic spectrum access technology. If made fully  operational, dynamic spectrum access technology will be able to sense  available frequencies in an area and jump between frequencies to  seamlessly continue communication as the user moves geographically  and through the spectrum. According to experts and researchers we  contacted, progress has been made but there is no indication of how long  it will be before this technology is fully deployable. Such new technologies  can obviate or lessen the need for extensive regulatory procedures to  enable sharing and can open up new market opportunities for wireless  service providers. If a secondary user or sharing entity employs these  technologies, the incumbent user or primary user would theoretically not  experience harmful interference, and agreements and rulemakings that  are currently needed may be streamlined or unnecessary to enable  sharing.

Although industry participants indicated that extensive testing under  realistic conditions is critical to conducting basic research on spectrum  efficient technologies, we found that only a few companies are involved in  such research and may experience challenges in the testing process.  Companies tend to focus technology development on current business  objectives as opposed to conducting basic research that may not show an  immediate business return. For example, NTIA officials told us that one  company that indicated it would participate in NTIA’s dynamic spectrum  access testing project removed its technologist from the testing effort to a  project more closely related to its internal business objectives.  Furthermore, some products are too early in the development stage to  even be fully tested. For example, NTIA officials also said six companies  responded to NTIA’s invitation to participate in the previously mentioned  dynamic spectrum access testing project. However, only two working  devices were received for the testing, and a third device received did not  work as intended. Other companies that responded told NTIA that they  only had a concept and were not ready to test an actual prototype.

Recent federal advisory committee recommendations emphasize the  importance of funding and providing incentives for research and  development endeavors. For example, to promote research in efficient  technologies, PCAST recommended that (1) the Research and  Development Wireless Innovation Fund release funds for this purpose  and (2) the current Spectrum Relocation Fund be redefined as the  Spectrum Efficiency Fund. As discussed, this adjustment would allow for  federal agencies to be reimbursed for general investments in improving  spectrum sharing. Similarly, CSMAC recommended the creation of a  Spectrum Innovation Fund. Unlike the Spectrum Relocation Fund, which  is strictly limited to the actual costs incurred in relocating federal systems  from auctioned spectrum bands, the Spectrum Innovation Fund could  also be used for spectrum sharing and other opportunities to enhance  spectrum efficiency.

section_title: Conclusions and Recommendations
paragraphs: Radio frequency spectrum is a scarce national resource that enables  wireless communications services vital to the U.S. economy and to a  variety of government functions, yet NTIA has not developed a strategic,  governmentwide vision for managing federal use of this valuable  resource. NTIA’s spectrum management authority is broad in scope, but  NTIA’s focus is on the narrow technical aspects of spectrum  management, such as ensuring new frequency assignments will not  cause interference to spectrum-dependent devices already in use, rather  than on whether new assignments should be approved based on a  comprehensive evaluation of federal spectrum use from a  governmentwide perspective. Lacking an overall strategic vision, NTIA  cannot ensure that spectrum is being used efficiently by federal agencies.  Furthermore, agencies are not required to submit justifications for their  spectrum use and NTIA does not have a mechanism in place to validate  and verify the accuracy of spectrum-related data submitted by the federal  agencies. This has led to decreased accountability and transparency in  how federal spectrum is being used and whether the spectrum-dependent  systems the agencies have in place are necessary. Without meaningful  data validation requirements, NTIA has limited assurance that the  agency-reported data it collects are accurate and complete.

In our April 2011 report, we recommended that NTIA (1) develop an  updated plan that includes key elements of a strategic plan, as well as  information on how spectrum is being used across the federal  government, opportunities to increase efficient use of federally allocated  spectrum and infrastructure, an assessment of future spectrum needs,  and plans to incorporate these needs in the frequency assignment,  equipment certification, and review processes; (2) examine the  assignment review processes and consider best practices to determine if  the current approach for collecting and validating data from federal  agencies can be streamlined or improved; and (3) establish internal  controls for management oversight of the accuracy and completeness of  currently reported agency data. With respect to our first  recommendation, NTIA has not developed an updated strategic plan and  previously noted that the Presidential Memorandum of June 28, 2010,  and the Wireless Innovation Initiative provide significant strategic direction  for NTIA and the other federal agencies. In September 2012, NTIA  officials told us that NTIA intends to update its strategic plan by October  2013. NTIA concurred with our other two recommendations and is taking  action to address them. For example, NTIA has proposed approaches to  implement new measures to better ensure the accuracy of agency- reported data, and is taking steps to implement internal controls for its  data management system in a cost efficient manner.

With respect to spectrum sharing, there are currently insufficient  incentives to encourage more sharing, and even if incentives were  created, several barriers to sharing will continue. Options to address  these issues in turn create new challenges, and may require further  study.

Chairman Walden, Ranking Member Eshoo, and Members of the  Subcommittee, this concludes my prepared statement. I will be happy to  respond to any questions you may have at this time.

section_title: GAO Contact and Staff Acknowledgments
paragraphs: For further information on this testimony, please contact me at (202) 512- 2834, or by e-mail at goldsteinm@gao.gov. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this statement. Individuals making key contributions to this  testimony include Sally Moino and Andrew Von Ah, Assistant Directors;  Amy Abramowitz; Colin Fallon; Bert Japikse; Elke Kolodinski; Maria  Mercado; Erica Miles; and Hai Tran.

This is a work of the U.S. government and is not subject to copyright protection in the  United States. The published product may be reproduced and distributed in its entirety  without further permission from GAO. However, because this work may contain  copyrighted images or other material, permission from the copyright holder may be  necessary if you wish to reproduce this material separately.


Question-summary annotations: questions: question: What did GAO report about the NTIA's efforts in spectrum management?
answer: The National Telecommunications and Information Administration (NTIA) is responsible for governmentwide federal spectrum management, but GAO reported in 2011 that NTIA’s efforts in this area had been limited.

question: What was the NTIA directed to do in 2003?
answer: In 2003, the President directed NTIA to develop plans identifying federal and nonfederal spectrum needs, and in 2008, NTIA issued the federal plan.
child_questions: question: How successful was NTIA in this task?
answer: GAO found it did not identify governmentwide spectrum needs and did not contain key elements and conform to best practices for strategic planning. Furthermore, NTIA’s primary spectrum management operations do not focus on governmentwide needs. Instead, NTIA depends on agency self-evaluation of spectrum needs and focuses on mitigating interference among spectrum users, with limited emphasis on overall spectrum management.

question: What is the state of NTIA's data management system?
answer: Additionally, NTIA’s data management system is antiquated and lacks internal controls to ensure the accuracy of agency-reported data, making it unclear if reliable data inform decisions about federal spectrum use.
child_questions: question: What is being done to address this?
answer: NTIA is developing a new data management system, but implementation is years away.

questions: question: What has NTIA taken steps to do in spite of its limitations?
answer: Despite these limitations, NTIA has taken steps to identify spectrum that could potentially be made available for broadband use.
child_questions: question: What is an example of one of these steps?
answer: For example, in 2010 NTIA evaluated various spectrum bands and identified 115 megahertz of spectrum that could be repurposed within the next 5 years.
child_questions: question: How did NTIA get input from major stakeholders?
answer: In doing so, NTIA worked with a special steering group consisting of the Assistant Secretaries with spectrum management oversight in agencies that were the major stakeholders in the spectrum bands under consideration.

question: How did NTIA review each identified band?
answer: For each of the identified bands, NTIA reviewed the number of federal frequency assignments within the band, the types of federal operations and functions that the assignments support, and the geographic location of federal use.

questions: question: What do industry stakeholders suggest regarding spectrum?
answer: In addition to efforts to repurpose spectrum, industry stakeholders have also suggested that sharing spectrum between federal and nonfederal users be considered to help make spectrum available for broadband.
child_questions: question: What barriers are there that limit sharing?
answer: Our ongoing work has identified several barriers that limit sharing. Primarily, many users may lack incentives to share assigned spectrum.

question: What is the benefit of paying market price for a good or service?
answer: Typically, paying the market price for a good or service helps to inform users of the value of the good and provides an incentive for efficient use.
child_questions: question: Why is this not true of federal agencies?
answer: But federal agencies pay only a small fee to NTIA for spectrum assignments, and may, in some contexts, have little incentive to conserve or share it. Federal agencies may also have limited budgets to upgrade to more spectrally-efficient equipment that would better enable sharing.

question: Why is this also not true of nonfederal users?
answer: Nonfederal users are also reluctant to share spectrum. For instance, license holders may be reluctant because of concerns that spectrum sharing could encourage competition.

question: Why is users' ability to identify spectrum suitable or sharing limited?
answer: A lack of information on federal spectrum use may limit users’ ability to easily identify spectrum suitable for sharing.

questions: question: What does GAO's ongoing work regarding spectrum use suggest?
answer: GAO’s ongoing work suggests that some actions might provide greater incentives and opportunities for more efficient spectrum use and sharing.
child_questions: question: What could these actions include?
answer: These actions could include assessing spectrum usage fees to provide economic incentive for more efficient use and sharing, expanding the availability of unlicensed spectrum, and increasing the federal focus on research and development of technologies that can enable spectrum sharing and improve spectral efficiency. However, all of these actions also involve challenges and may require further study.

questions: question: How is demand for spectrum changing?
answer: Demand for spectrum is increasing rapidly with the widespread use of wireless broadband devices and services.
child_questions: question: Why is it hard to meet the current demand?
answer: However, nearly all usable spectrum has been allocated either by NTIA for federal use or by the Federal Communications Commission (FCC) for commercial and nonfederal use.
child_questions: question: How are federal initiatives attempting to solve this issue?
answer: Federal initiatives are under way to identify federal spectrum that could be repurposed or possibly shared by federal users or wireless broadband providers and other nonfederal users.

question: What does this statement discuss?
answer: This statement discusses how NTIA manages spectrum to address governmentwide spectrum needs and the steps NTIA has taken to repurpose spectrum for broadband. As part of an ongoing review, the statement also discusses preliminary information on the factors that prevent spectrum sharing and actions that can encourage sharing and efficient spectrum use.
child_questions: question: How is this testimony connected with GAO's ongoing work with spectrum sharing?
answer: This testimony is based on GAO's prior work on federal spectrum management and ongoing work on spectrum sharing.

question: How did GAO conduct their assessment?
answer: GAO analyzed NTIA processes, policies and procedures, and interviewed relevant government officials, experts, and industry stakeholders.