5G is this century’s first truly hard problem in that it is not just a technology issue, but also an economic, trade and national security issue. That complexity is itself part of the problem — we barely have the vocabulary, let alone the policy tools, to handle such a multi-faceted issue.
Achieving the fifth generation of wireless technology would be difficult enough in a solely domestic context, but add on the international component and race against China and you have the most complex and cross-cutting challenge we’ve yet faced.
Beating China and deploying 5G the right way requires innovative solutions — solutions like Federal Communications Commission Chairman Ajit Pai’s proposed spectrum auction. This auction would open up the C-band spectrum, fairly compensate the satellite companies currently occupying that spectrum, generate revenue for the government and allow the rapid build-out of 5G infrastructure.
Think of the 5G race as a track event: China left the starting block and is well down the stretch, while we’re still busy tying our shoelaces. Since 2015, China has outspent the United States by roughly $24 billion on wireless communications infrastructure, which is necessary to deploy 5G across the country. As a result, at one point in 2017, China built more 5G base stations in a three-month span than we did in three years.
The C-band auction will help us get off the starting line. We cannot afford to waste any more time, and the FCC’s proposal prioritizes speed by finding compromise in a debate about the auction’s proceeds. Some argue that the satellite companies currently occupying the C-band should be fairly compensated for transitioning off of the spectrum, and others argue that the vast majority of the proceeds should go to the Treasury Department.
The argument of those opposed to the FCC’s proposal is well-intentioned, as the basis of their perspective is that the taxpayer should reap the rewards of a government-run auction. But, this opposition ignores a few very important realities.
Over the last 40 years, satellite companies invested $50 billion in designing, manufacturing and launching satellites on the C-band. This investment is largely to thank for the auction’s projected revenue of up to $70 billion. Fairness aside, without the cooperation and clearing efforts of these companies, the 5G spectrum wouldn’t be available for at least 10 years due to litigation — a delay we can’t afford and that would put us further behind China in the 5G race.
The Trump administration understands the importance of providing satellite companies with incentives to transition off of this critical spectrum as quickly as possible, which is why the FCC’s proposal includes $9.7 billion in “acceleration payments” to the incumbent companies if target dates are met.
These payments are the focus of those opposing the plan. They argue that these funds should go to the Treasury and fund social programs. This is certainly a valid concern, but one that the FCC’s plan already eliminates. Mr. Pai’s proposal, as it stands, will actually increase — not decrease — the funds available for the Treasury that will benefit the taxpayer. The “acceleration payments” serve to provide fair compensation for the incumbent satellite companies, but they also account for the expected increase in revenue made available from the accelerated auction.
The FCC’s plan, which vastly improves our chances of deploying 5G before China, provides bidders with the certainty that they will be gaining access to critical 5G spectrum on an accelerated basis. C-band bidders’ confidence will drive up auction proceeds and raise more revenue for the Treasury. According to a new study, if the FCC’s proposal is adopted this week at the commission’s monthly meeting, revenues available for social programs can be expected to increase by nearly $1 billion.
China is deploying and dominating the global 5G network business. The United States is playing catch-up and, if we don’t act now, will be for the foreseeable future. If we lose the 5G race, American companies will be forced to rely on equipment manufactured by Chinese companies, companies that are owned by or beholden to the Chinese Communist Party. This means your data will be passing through a Chinese-run worldwide communications system. Executing the FCC’s proposal and opening up the 5G spectrum as quickly as possible is only the first step in making sure this future doesn’t come to fruition, but it is a critical one, nonetheless.
The United States cannot afford to waste any more time in the race to 5G, and we now have a plan to move forward. We may not have been first off the starting block, but this race is far from over. We can deploy 5G nationwide, unleash American business and beat China through American ingenuity and innovation. Mr. Pai’s proposal is a necessary part of the plan to beat China in the global race to 5G and ensure America’s national security and economic future.
• Mike Rogers, a former Republican U.S. representative from Michigan, was chairman of the Permanent Select Committee on Intelligence.
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