FCC demands AT&T prove spectrum scarcity claims
Emperor's clothes looking a little sheer
The US regulator has asked AT&T to provide documented proof of the forthcoming spectrum crunch, given that shortage justifies provides much of the justification for its merger with T-Mobile.
As part of its investigation into the proposed merger of AT&T and T-Mobile USA the FCC has requested "all plans, analyses, and reports" relating to how the combined operation will use its radio spectrum. Specifically the document (pdf, not as daunting as it first appears) asks AT&T to provide "any spectrum capacity constraints the Company is currently facing or the Company is projected to face in the future" - asking for proof that great efficiency is needed.
AT&T wants to merge with T-Mobile USA to create the largest operator in the USA, knocking Verizon Wireless off the top spot. AT&T argues that the merger will create "thousands of jobs" and enable "efficiencies in the use of spectrum" which are essential to a company that "faces severe spectrum and capacity constraints and cannot simply wait for the next major auction to address them".
The FCC wants to see the figures behind those statements, as well as information about how long the T-Mobile USA brand (and tariffs) will last and just how efficiently the merged company will be using its radio spectrum.
Despite the lack of supporting evidence the forthcoming "spectrum crunch" has become an accepted reality, and dictates government policy on both sides of the pond. Mobile operators regularly claim their customers have an insatiable demand for bandwidth, and the US and UK governments have both responded by making a commitment to release 500MHz of prime spectrum in the next decade or two, though quite what customers are going to do with that spectrum isn't clear.
For network operators the motivation is clear - the more spectrum that's available on the market the cheaper it becomes. The cost of infrastructure is high enough to keep new players out, so the existing operators can be expected to always argue that they need more radio spectrum even if they've no use for it.
There is an old adage that one can never have enough bandwidth (or processing speed, or storage), but there is a limit to how much bandwidth one can consume. Even in the fixed world headline connection speeds are topping out with customers taking more interest in data caps and reliability these days.
LTE (4G telephony) scales well, so a connection can ramp up for a download and quickly scale back down again when completed, so the spectrum can be used by someone else. More radio spectrum will make things faster, but we look forward to seeing if AT&T can really demonstrate that a lack of radio spectrum could lead to the collapse of civilisation, or even the collapse of AT&T. ®