Airwave Transfer Debate Renewed

Times Staff Writer

With the U.S. waging a war in Iraq that relies heavily on wireless communications, a controversial Bush administration plan to transfer valuable airwaves from the military to the mobile phone industry is coming under new scrutiny.

Accommodating growing consumer demand for high-speed mobile Internet access -- as well as for ordinary cell phone calls -- is a crucial challenge for the White House. The administration is trying to balance the wireless industry's voracious appetite for new spectrum capacity against national security concerns. There is also a potential government windfall that would come from the sale of billions of dollars' worth of military airwaves to mobile phone carriers.

"Spectrum is the lifeblood of our military," Steven Price, deputy assistant secretary of Defense for spectrum, told a congressional panel Tuesday. Price pointed out that in the war in Iraq, "we would not have been able to pinpoint and accurately target enemy leadership" without the wireless connections that link global positioning satellites to precision-guided bombs and missiles.

The wireless industry is eager for the military to vacate a slice of its spectrum, which is adjacent to commercial wireless spectrum and is therefore economical for firms to exploit.

With carriers unveiling a new generation of mobile phones complete with color screens, digital cameras and faster Internet access, advanced wireless services could spur $500 billion in economic growth and create 400,000 jobs over the next decade, Steven K. Berry, a senior vice president at the Washington-based Cellular Telecommunications & Internet Assn.,told the House panel.

The Bush plan calls for the Defense Department, which uses the earmarked airwaves for military satellite communications, to move some of its communications to an undeveloped part of the spectrum reserved for satellite use.

The White House didn't return a call seeking comment.

Administration officials have said they are sympathetic to the Pentagon's concerns but believe they can accomplish the airwave transfer without compromising national security.

The telecommunications subcommittee of the House Energy and Commerce Committee is weighing a bill that would establish a trust fund of about $1 billion to compensate the military for the move. It would be funded by proceeds from the sale of the airwaves relinquished by the Pentagon. Sen. John McCain (R-Ariz.) says he plans to introduce similar legislation in the Senate.

But the Defense Department's Price told the House panel that any relocation of military airwaves will be more expensive and protracted than envisioned by lawmakers. He also cautioned that it might hamper the military's ability to coordinate with allies whose combat communications equipment often operates on the same frequencies.

"The Department of Defense has been put on the defensive" by the government's push to wrest more spectrum for cell phone carriers, Price said.

Nancy Victory, an assistant secretary at the Commerce Department's National Telecommunications and Information Administration, told the House panel Tuesday that airwaves need not be "limited to defense and homeland security efforts."

"Wireless has also been a continuing area of growth and innovation for our economy," she said. "Spectrum must be made available so this growth and innovation can continue and our economic security can remain strong."

The Pentagon tends to overstate its spectrum needs because it doesn't pay for it, said Blair Levin, a telecom investment analyst for Legg Mason Wood Walker.

"It's always hard to know reality when you are dealing with the Defense Department" because it is so secretive, said Levin, a former chief of staff at the Federal Communications Commission. "But the simple act of putting a price on Defense Department spectrum would motivate them to be more efficient."

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