By: Mike Montgomery
As seen on Daily Kos
In the wireless industry it’s possible to be first and third at the same time.
Take, for example, wireless provider Sprint, which was recently acquired by the Japanese firm SoftBank for a little more than $20 billion. It’s a good-sized sum for America’s third-largest wireless provider—but then, that ranking applies only to number of customers, not its spectrum holdings.
While Sprint has only half as many subscribers as Verizon or AT&T, they happen to hold twice as much wireless spectrum – the invisible airwaves that enable mobile devices to send and receive data – thanks to their recent full buyout of Clearwire. Amazingly, Sprint has shown an uncanny ability to simultaneously win and lose, taking the gold medal in spectrum and a bronze in customers.
With their riches in spectrum holdings and underperformance as a business, it’s no wonder the company found itself in the middle of a bidding war between SoftBank and U.S. satelliteprovider DISH.
The point here isn’t to bash Sprint. They’re trying to run their business shrewdly, even if sitting on their airwaves hoard, while pining for more, risks hurting their customers and potentially their shareholders. But Sprint’s enviable spectrum position also shows that when it comes to the allocation of spectrum for wireless providers, industry rank isn’t as cut and dried as the number of customers in your flock.
This distinction is particularly important in light of calls by some carriers, including Sprint, and government officials to artificially limit the two largest wireless providers from the FCC’s upcoming spectrum incentive auctions based on the gap in subscribers between Sprint and Verizon/AT&T. Instead of banging the drum on Capitol Hill about how bad they’ve got it, Sprint should be trying to get more consumers to use their network.
Nevertheless, Sprint’s obvious spectrum advantage coupled with the fact that provider T-Mobile recently joined forces with fellow provider MetroPCS—a move that places the German-owned company in a much stronger, competitive position—the wireless industry is far more competitive than Sprint would like the world to know.
Competitive industries serve a great benefit to consumers by delivering better services at lower prices. Those on the side of restricting the involvement of certain providers from the FCC’s auctions are actually arguing against consumers. Tens of millions of people just want their phones and tablets to function as designed and want to enjoy exciting new technologies that rely on advanced mobile broadband. The FCC should consider that AT&T and Verizon have the most customers because consumers choose to use their networks. By restricting their auction participation, the FCC isn’t creating more choices for consumers — it’s hamstringing the choices consumers have already made. That’s not a win for anybody.
As the old saying goes, it’s not personal, it’s just business. Sprint has the airwaves it needs to take care of its customers and then some, and the same goes with T-Mobile. But without open spectrum auctions, millions of Americans are at risk of receiving diminished service for their hard-earned dollars. To them, that makes it personal.