Congress May Examine FCC's Role In Auctioning Off Wireless Spectrum; GOA Raises Questions; Should future auctions try to maximize revenue or foster competition?(INTERNET & TECHNOLOGY)

Byline: REINHARDT KRAUSE

Congress might get more involved in setting rules for auctioning off radio spectrum, a process that has been in the hands of the Federal Communications Commission.

In 1993, Congress authorized the FCC to award spectrum licenses "through a system of competitive bidding." The agency has since held 59 auctions, mostly for wireless and satellite services, and raised $14.4 billion for the U.S. treasury.

The FCC's auction authority expires Sept. 30, 2007. A report expected this month from the Government Accountability Office, an arm of Congress, recommends that the FCC continue to hold spectrum auctions.

An early draft of the GAO report, however, offers no clear consensus on some major issues involving auctions. Those include whether auctions should be set up to maximize government revenue, spur competition or promote the efficient use of spectrum.

All those issues are coming to a head as spectrum becomes available over the next few years for speedy wireless Internet services. One auction -- of airwaves now used for analog TV -- could raise as much as $10 billion, a study says.

"Spectrum is scarce real estate," said Scott Cleland, president of Washington-based research firm Precursor. "(Auction rules) are about zoning for scarce real estate. There will always be major (lobbying) and fights over spectrum policy, how it's paid for and allocated."