President Clinton on Friday ordered government agencies to work with the Federal Communications Commission and the private sector to hasten adoption of high-speed wireless communications technology.
Armed with a new report saying US high-tech giants, such as America Online , risk falling behind foreign competitors, such as Japan and Finland, Clinton asked agency heads to identify radio spectrum requirements for the so called "third-generation" wireless technology.
The technology is designed to provide voice and high-speed mobile access to the Internet, at speeds equivalent to those of a cable modem.
Current wireless devices were designed to transmit voice and brief text messages and cannot handle digital multimedia and other content requiring high-capacity transmissions.
A new generation
"Over the last five years, the information technology sector has accounted for nearly one-third of US economic growth, and has generated jobs that pay 85 percent more than the private sector average," Clinton said in a statement.
"The action I am taking today will help US high-tech entrepreneurs compete and win in the global marketplace," he said.
Clinton's order was accompanied by a report by his Council of Economic Advisers urging speedy allocation of spectrum for the high-speed networks, saying delays could let US firms fall behind foreign competitors.
"First-mover advantages can be important in many telecommunications markets, so profits from establishing an early lead in these markets can be substantial," the report said.
United States lagging
Other developed countries, such as Finland, Japan, Britain and the Netherlands, have already designated new portions of the radio spectrum specifically for third-generation devices. The United States is not scheduled to auction off portions of the spectrum until September 2002.
According to the study, some of the difficulty stems from the fact that three of the spectrum bands under consideration in the US are currently used by analog cellular service providers, the Department of Defense, fixed wireless providers, satellite broadcasters, school systems and private video teleconferences.
Many of the other countries, by contrast, do not face such problems.
Clinton, in his memorandum, directed the commerce secretary to work with the FCC and other agencies to develop a plan to select spectrum for the high-speed wireless systems by Oct. 20 and to issue an interim report by Nov. 15.
The FCC, which already has been examining possible spectrum for third generation technology, and the National Telecommunications and Information Administration, is expected to identify spectrum by July 2001 in order to auction licenses to competing applicants by Sept. 30.
A global imperative
Earlier this year, the World Radiocommunication Conference specified three spectrum areas for potential third-generation use.
The report by the Council of Economic Advisors warned that delays in the United States would cause global leaders in the Internet industry, such as AOL and Amazon.com to fall behind industry hubs already forming in other countries, notably Finland.
Finland, which allocated its third-generation spectrum licenses in March 1999, is the home of Nokia, the world's largest mobile phone maker.
Citing data that the annual consumer benefit from today's wireless telephone services is estimated at US$53 billion to US$111 billion, the study said consumer benefits from high-speed services will likely be of a similar scale.
Companies also should reap substantial gains, the study said. Recently completed spectrum auctions in Europe raised US$150 to US$600 per capita, a good indicator of the amount of benefit providers expect to gain from high-speed operations.
The study cautioned, however, that such benefits should be weighed against the possible costs of moving incumbent users.
