There’s an interesting debate brewing on these pages between former House speaker Newt Gingrich and Federal Communications Commission (FCC) commissioner Brendan Carr on how to make the move to super-fast 5G wireless networks and how to protect America in the process.
By way of background, I founded the House Internet Caucus back when Gingrich was speaker. We didn’t see eye-to-eye on very much, but I welcomed his occasional interest in technology.
On this issue, though, he is wrong, and Commissioner Carr is right. The best — really the only — way to ensure the fastest possible deployment of 5G technology and to preserve American leadership in wireless is to follow the path that has driven American leadership in 4G. The private sector, not the government, must take the lead, and the primary government role should be to continue selling 5G spectrum to the private sector at auction.
In January of last year, it was reported that the Trump administration was considering, in effect, nationalizing at least part of the 5G spectrum by having one government-owned network. This poorly considered idea was rejected the very next day by the administration’s own FCC chairman, Ajit Pai. We all hoped that the notion had been squelched.
Now, however, Gingrich has revived the controversy, first with a piece widely interpreted as favoring nationalization and then in his response to Commissioner Carr here at NRO. In the latter article, Gingrich calls for a “public-private partnership [with] shared spectrum available for a carrier-neutral, wholesale-only, nationwide 5G network.”
While he suggests that the government-fostered wholesale network be built with private capital, he doesn’t say from where the money would come, and he clearly envisions a broad government role. What would that role be? How would a wholesale network work with multiple companies contributing to its construction and multiple carriers utilizing it for services? Gingrich doesn’t say, but if the rules for FCC spectrum auctions are complex and take too long to resolve, one can only imagine how difficult it would be to create rules for one network that multiple providers are supposed to finance and share.
Gingrich is preoccupied with the notion that Chinese companies will build 5G networks in other countries, arguing that to counter those efforts, we need government involvement in the development of our own 5G network. This leap of logic is particularly hard to comprehend because the major carriers in the U.S., with strong government urging, have already decided not to buy core wireless technology developed by Chinese companies. Our carriers today purchase routers and other hardware from providers outside of the U.S., including Nokia and Erickson, since no U.S. companies currently compete in that market. But the intelligent parts of the networks — the computer chips, software, and back-end operations — are already provided by leading American companies, including QUALCOMM, Juniper, and Cisco. Our government can and seems willing to prevent Chinese equipment providers from expanding into our market, and building a government network in the U.S. will do nothing to blunt Chinese expansion abroad.
Gingrich claims that a government-fostered national 5G network with shared access is necessary to unleash the power of deep liquid financial markets, enable market price discovery, and promote a culture of innovation. Those are exactly the virtues that have underpinned our wireless supremacy to date.
Our liquid financial markets powered the investments that enabled America to lead the world in 4G. As for market price discovery, that’s precisely what our spectrum auctions — the very thing Gingrich criticizes — accomplish. We have an unrivaled culture of innovation with a network that is the envy of the world and the platform for Google, Facebook, Amazon, and other edge providers that are among the world’s most innovative companies. Moving to a government-overseen network both is unnecessary and would put that success at risk.
Spectrum-sharing does not address any perceived need, nor would it appear to make the network more resilient or secure, or even offer a better platform on which for edge providers to innovate.
Gingrich is right in pointing to the painful absence of broadband in large swaths of rural America; innovative new approaches may be needed to address this urgent concern. A role for government in providing grants to rural electric and telephone cooperatives and other providers willing to build out may be a partial answer, but Gingrich is not proposing a rural-only solution, and creating a national, government-overseen 5G network doesn’t appear to offer obvious improvements, even for rural America.
In short, major American commercial operators have the incentives they need to get to market quickly. They are not sitting on their hands and certainly not willingly ceding global leadership to China. This is not the time for the government to be in the market as a wholesaler to multiple companies whose systems are competing. That’s a recipe for confusion, slow deployments, potential additional points of failure, and the ceding of American leadership.
Commissioner Carr is right: Our current policies, which have established American leadership in 4G, have narrowed the digital divide, raised Internet speeds, and put us on the path to having a far stronger deployment of 5G than Asia will by 2022.
As we say in the mountains, if it ain’t broke, don’t fix it.