Foundational Fairness

 

 6/27/18

My oldest daughter, Emma, is attending her first “away camp” this week. It’s going surprisingly well given the texts and pictures we’ve seen from the chaperones. I admit to having some mixed feelings – I miss Emma being home, but at the same time I am so excited for her to have this incredible experience and meet some potentially lifelong friends. Having just completed fourth grade, she is also still learning about how to treat others in a group dynamic (and how to stand up for herself when others may not be treating her well) – this camp is perfect for that type of learning given its mission and the input of older counselors to help create these foundational notions of fairness. But, I do struggle as a parent with the fact that we teach fairness and treating others with fairness and respect when life in the working world is often unfair, and sometimes patently so.

One of the most egregious examples of this that I have come across in my 25 years living and working “inside-the-beltway” in D.C. (a place that is, to put it mildly, not typically swayed by arguments of fairness in the first place) is the Federal Communications Commission’s (FCC) spectrum policy. The idea that one government regulatory agency run largely by unelected bureaucrats could tip the scales so heavily in favor of certain constituencies seems almost undemocratic – and almost unimaginable. And yet, this highly unfair situation is the reality. A naturally occurring phenomenon, spectrum is required to operate any wireless device or network. Electric, gas and water utilities have built out their own “private” communications networks in order to ensure highly reliable, safe and secure service, and therefore need highly reliable spectrum to underpin the wireless portion of those networks.

Under the Communications Act of 1934, the FCC is required to manage spectrum in the public interest. In the Balanced Budget Act of 1997, Congress modified the way spectrum had previously been managed by authorizing the FCC to award spectrum ownership through auction. This was thought, at the time, to be a way to maximize spectrum use and bring in needed revenue to the federal government. Importantly, the 1997 law exempted utilities from competitive bidding of spectrum, given the importance of utility services to the country. Despite these congressional actions, the FCC still treats utilities as any other commercial entity when it comes to spectrum acquisition. As a result, utilities often find themselves unable to compete with other huge, multinational enterprises for interference-free spectrum. Instead, many are forced to purchase spectrum in the secondary market or to make due with spectrum bands that aren’t optimal, but that have the benefit of being less desirable to commercial carriers and others and are, therefore, less subject to harmful interference.

Once a utility acquires spectrum, it partners with telecommunications equipment manufacturers to build out a network tuned specifically to that spectrum band, making it important for the utility to be able to operate on that band without interference. An example of how the FCC’s spectrum policies negatively impact utilities came when the FCC wanted to open it up to other users. Although unhappy, utilities had no choice but to move and many were able to acquire spectrum in the 6 GHz band and build out new networks (with new equipment, etc.). Aside from mission-critical utility networks, the 6 GHz band now houses critical infrastructure industries like railroads, pipeline companies, and emergency services. In early 2017, literally days before President Trump was inaugurated, the FCC Wireless and International bureaus, as well as the Office of Engineering and Technology, granted a waiver to a company called Higher Ground, LLC, allowing it to operate in the 6 GHz band. (Higher Ground is a SatPaq company providing satellite text messaging to extreme hikers and bikers.) The waiver was granted in contravention of the protests filed in the record, which were numerous. Why does it matter? Mobile operations, which were previously prohibited, in a band where critical infrastructure providers like utilities are housed can cause harmful interference to networks that cannot tolerate such interference for even a fraction of a second. In addition, Higher Ground would not be required to obtain prior coordination by an independent third party like everyone else in the band; instead, it was allowed to use its own untested, proprietary technology to coordinate its devices and mitigate the potential for interference.

Despite UTC’s (and others) protestations of this action and some sympathy from Members of Congress on this point, the waiver was just a small preview of what is to come in the 6 GHz band. FCC Chairman Ajit Pai just noted in a recent blog that the plan is to do a full-blown proposed rulemaking to review opening up the 6 GHz band, and the mid-band spectrum more broadly, to fixed and mobile operations on a licensed and unlicensed basis. Importantly, UTC advocated for a full-blown rulemaking, so we could demonstrate the interference that will occur and how it will impact utility operations. Still the argument made by the FCC, and others who support opening up the 6 GHz band is that spectrum is scarce, and people need their Netflix streaming, don’t you know? I am not going to lie, I love my Netflix. I also understand, however, that Netflix, nor much of anything for that matter, would work without reliable electricity. Oh, and water is kind of crucial, too, and so is natural gas.

A staffer at the FCC recently noted that utilities have long complained about spectrum policy at the FCC and wanted to know what’s new about our situation? What’s new? Well, first, just because our concerns may not be “new” doesn’t mean they are not valid. Clearly,  the FCC’s policies related to critical infrastructure spectrum and in this band, in particular, are unfair, and potentially harmful to critical infrastructure operations. And while this may not be “new,” it remains a significant problem. What is new, though, is the growing demand for spectrum, and the corresponding pressure on utilities to compete to acquire it. What else is new is the utility industry’s investment in grid modernization, smart grid, smart cities, and other infrastructure that requires additional spectrum. And the threats facing critical infrastructure owners and operators are increasing.  That’s new.

This is not isolated territory. Technology has helped us tap heretofore unheard-of reserves of oil and gas in this country, and these are all finite commodities. I get that managing finite commodities may be tough. But, the key question is, does the rest of the government, or the public for that matter, consider utilities on par with a SatPaq company for hikers and bikers in terms of underpinning our economy, security and safety? If the answer is no, and I think it is, then this highly unfair situation must change regardless if it means that policies in place for 40 years must change as well.

Maybe the bottom line lesson I must impart to my daughter: That while life is unfair, if you sit idly by and don’t speak up and use your resources to tilt the scales back to the middle, then you can’t complain. UTC is not idle.