From a purely engineering perspective we can calculate the optimal amount of interference for a particular band of spectrum. We want just enough to achieve coverage. Any more is simply a waste of power. It is that knowledge of a hypothetically perfect solution that leads us down the path of saying that spectrum should be auctioned off with the network built out by the winning bidder. That, and the idea of using the money generated from the auction to help with the budget deficit.
Both of these ideas are, however, deeply flawed. The purpose of government is to maximize not its own P&L but to generate the biggest total social improvement. Auctioning spectrum off generates a small short term gain for government but at the price of much reduced longterm benefit to society. Why? Because the winning bidder is now saddled with a big payment that they need to recover. That is (a) money not available for investing in the network and (b) to recover it the price for the network will be artificially high. Furthermore, by concentrating the investment in a few large entities financing and market structure (lack of competition) become the real limitations to network capacity and pricing.
Fortunately we now have proof that there is an alternative way that avoids these problem: unlicensed spectrum with good engineering standards. That’s what we have with WiFi and the results have been nothing short of astounding. You can learn more about just how much happens today via WiFi at WeHeartWiFi.
WeHeartWiFi is about more though than celebrating the success to date. It is about making more spectrum available for the same approach. The so-called white space spectrum is available for providing wireless broadband. The big question is whether that spectrum should be auctioned off or made available for unlicensed “Super WiFi.” To demonstrate the kind of solutions that this Super WiFi would make possible, the WeHeartWiFi project is operating several HeartSpots at SXSW. These are mobile WiFi hotspots for which the initial backhaul (connection to the main Internet) is over Super WiFi which is then connected to a Gigabit wired connection.
If you want more open innovation and the ability for many providers to invest in providing Super WiFi, head on over to WeHeartWifi, learn more and sign the letter to the FCC. If you are at SXSW go find and try out a Heartspot to see the technology in action. We at Union Square Ventures are excited about the possibilities here and are sponsors of WeHeartWifi.