Part two of a series by Policy Fellow Rachel Allen

We all know what it’s like to be stuck in traffic at rush hour. We may remember a time when there were less cars on the road, and you could count on getting to where you want to go. But now there are more cars than ever and only a few lanes to travel on. What’s worse is, the tolls for getting on this highway keep going up and up.

This same situation is happening with something called spectrum—the highway that our phone calls, radio broadcasts and TV signals travel on to get to your iPhone, television set or computer screen. We are living at a time when there a range of ways to access music on our various devices: whether it’s through streaming services like Spotify and Pandora, or through Internet radio services like Sirius satellite radio. But even as legitimate music services continue to proliferate, there is increased concern from both government and industry that there won’t be enough spectrum to support our growing demand for mobile media [PDF]. Federal policies on how our spectrum is managed will have a huge impact on how musicians connect with audiences (and how fans access music) through mobile technologies.

What is Spectrum?

Spectrum is what we generally think of as the “airwaves”—the invisible radio frequencies that we use to send sound and video through the air. You can think of spectrum as a multi-lane highway for mobile devices—different technologies use different lanes to send and receive messages.  When you text someone, or listen to streaming music on your phone, you are using a different lane or band of spectrum than you would when listening to the radio or watching TV. If you want to know more about how different frequencies are classified, check out this doozy of a chart [PDF].

We generally think of the airwaves as free—something unlimited and available for everyone. But like the highway, spectrum isn’t unlimited—there are only a certain number of cars that can travel on each lane at any given time. The Federal Communications Commission (FCC) is responsible for “zoning” spectrum and making sure that different radio signals don’t result in head-on collisions.

In fact, the federal government began to regulate spectrum due to one of the biggest collisions in all of history: the sinking of the Titanic. On that fateful night, it was thought that radio interference may have prevented another ship from sending warning signals to the Titanic about the icebergs ahead. Taking the disaster into consideration, the Radio Act of 1912 established the federal government’s right to regulate spectrum so that different broadcasters wouldn’t get their signals crossed.

Nowadays, the FCC licenses spectrum to different companies for particular uses. The way that spectrum is licensed has had a huge impact on artists and innovation in the past. As we’ve discussed in our 2002 research report, Radio Deregulation: Has It Served Citizens and Musicians?, when Clear Channel scooped up thousands of radio licenses following the Telecommunications Act of 1996, the diversity of voices on the airwaves dramatically diminished.

In terms of the telecom industry, there are two companies that own the biggest—and most valuable—piece of the spectrum pie: AT&T and Verizon. These two companies have over 75 percent of the so-called “beachfront” low-frequency spectrum and claim over two-thirds of all U.S. mobile subscribers. Low-frequency spectrum is prized because it is ideal for cell phones—it can cover greater distances and push through thick walls. The more low-frequency spectrum a carrier has, the better the service. Verizon and AT&T’s acquisition of lots of low-frequency spectrum is part of why they dominate the wireless market, while competitors Sprint and T-Mobile lag behind in terms of subscribers and revenue.

So What’s the Problem?

There isn’t enough spectrum. Or rather, there is growing concern due to the exponential growth of mobile technologies, that the FCC hasn’t zoned out enough spectrum to support our data use. In just one year, individual monthly data consumption has increased by 250 percent It is also estimated that smart phones produce as much traffic as 50 basic phones. Even though mobile providers are spending billions on infrastructure to support this massive amount of data, without more spectrum, mobile service may suffer which could result in dropped calls, slow download and upload speeds and poor coverage.

What’s more of a concern is that Verizon and AT&T’s growing duopoly over the wireless market can drive up the costs of regular cell phone service. In the past few years, Verizon and AT&T have done away with their unlimited data plans and have started imposing caps, charging customers extra if they use more than a small amount of data per month. Without many choices in terms of carriers, there’s nothing stopping these companies from charging more for our data, which would be bad for musicians and artists who rely on heavy bandwidth services to get their stuff out there.

Possible Solutions

In order to free up more spectrum, The National Broadband Plan proposes to free up 500 megahertz of spectrum over the next ten years through what’s known as incentive auctions—voluntary auctions in which broadcasters are encouraged to sell off their underused spectrum in exchange for a share of the profit. In other words, spectrum that was once used for services such as over-the-air broadcast television will be repurposed to provide better, and faster broadband in hard to reach areas.

Incentive auctions seem like a good solution at first but there are some potential pitfalls. John Bergmayer of Public Knowledge and our own Casey Rae have both written about how spectrum auctions can sometimes increase the spectrum gap, leading to more consolidation in the wireless market. In the past, the FCC has used a spectrum screen—a soft limit on how much spectrum one company can acquire—in order to prevent certain companies from taking too much of the spectrum pie. For example, a spectrum screen was used to block the AT&T/T-Mobile merger. In the upcoming 600 MHz auction, the Department of Justice has urged the FCC to impose rules that would limit the amount of spectrum AT&T and Verizon could acquire in certain markets. This restriction would allow Sprint and T-Mobile to gain valuable low-band spectrum, which may be a way to even the spectrum playing field.

Another possible solution to the problems of both spectrum scarcity and mobile broadband competition is for the FCC to free up more unlicensed spectrum. What is unlicensed spectrum? Going back to our highway metaphor, unlicensed spectrum is kind of like the H.O.V. lane of spectrum—you have to share the lane in order to bypass the other traffic lanes. Unlicensed spectrum is used for stuff like Wi-Fi, but it can be used for all kinds of technologies—baby monitors, garage door openers, even the plastic security tags on clothing! Unlicensed spectrum is also essential for wireless microphones that are used in concert venues as well as schools, churches and other performance spaces.

The benefits of freeing up unlicensed spectrum are that it could spur innovation and allow more people to access broadband. Unlicensed spectrum is already essential for our laptops, cell phones and other mobile technologies. A Stanford study [PDF] shows that these mobile technologies have thrived in large part due to the use and availability of Wi-Fi networks. The Presidents Council of Advisors on Science and Technology published a report showing the many benefits of spectrum sharing technologies [PDF]. Indeed, the FCC has recently proposed to zone out 195 MHz of 5GHz spectrum—the super powerful low-band kind—in order to boost Wi-Fi networks across the country.

This, too could be a powerful thing for local music communities — especially those without access to quality broadband. Certain parts of the country are expensive and difficult to lay fiber (or even copper) wire; the hope is that further innovation in this area of the spectrum band will make it easier and more cost-effective to get high-speed internet to those in remote areas.

If this seems too abstract, consider the experiences of Alex Shapiro — a celebrated composer who lives on an island off of Washington state. Back in 2009, Alex testified at the FCC about how important broadband access is to her life and work. And we’re sure the same is true for creative entrepreneurs of all disciplines.

Stay tuned for the next installment in this series, where we’ll look more closely at data caps.