CEI Joins Coalition Letter Against Nationalizing 5G
Dear Senator Thune,
We write to thank you for your recent letter supporting the American competitive approach to 5G deployment, which is private sector driven and private sector led.[1] We agree that nationalizing 5G and experimenting with untested models for 5G deployment is not the way the United States wins the 5G race. Deployment of 5G should not rely on the government but should focus on unleashing the private sector and the free market.
We too are concerned with the Department of Defense Request for Information on a government-managed process for 5G development and are alarmed with how quickly it is proceeding.[2] Even more disturbing are the rumors[3] that the RFI was only for show and that the DoD already has an RFP it plans to greenlight.
Taxpayers should not foot the bill for something that the private sector is already committed to doing through a free market approach. America’s private companies have invested decades of research, spent tens of billions of dollars, and are already deploying 5G across the country at a breakneck pace. There are three U.S. companies – AT&T, Verizon, and T-Mobile – who have spent billions[4] in recent years building national 5G networks, and another, DISH, which is also building a network. The idea of government entering the 5G business has been rejected by policymakers on both sides of the aisle.[5] More mid-band spectrum is all they need to turbo charge deployment. It makes no sense to think that the DoD, starting from zero, could deploy these networks faster or more efficiently. It would cost tens of billions of taxpayer dollars and take decades to build a network from scratch to nationalize our communications system.
For example, we are still waiting for the final results of a spectrum sharing plan that began 10 years ago in the Citizens Broadband Radio Service (CBRS) spectrum band.[6] CBRS is 150 MHz of spectrum in the 3.5 GHz to 3.7 GHz range that was originally used by the Navy and some commercial satellite providers. The FCC designated the band for sharing among three tiers of users: incumbent users, licensed users and unlicensed users. The auction for licensed use began in July 2020 and concluded in September 2020. The carriers who won these licenses are in the beginning stages of building out their 5G networks. There is no reason to pull the rug out from under them now.
The implications of the DoD RFI are counter to the Administration’s recent actions. The President has repeatedly said that the private sector should lead the U.S. in 5G innovation.[7] In August 2020, President Trump announced that 100 megahertz of contiguous, coast-to-coast mid-band spectrum in the 3.45-3.55 GHz band would be made available for commercial 5G deployment. DOD Chief Information Officer Dana Deasy commented, “With this additional 100 MHz, the U.S. now has a contiguous 530 megahertz of mid-band spectrum from 3450-3980 MHz to enable higher capacity 5G networks.”[8] Here, the Administration and DoD collaborated to ensure no compromise to military preparedness, while also ensuring the free market, competitive U.S. economy can drive America’s winning position in the 5G race.
A government-run 5G backbone, wholesale network, or whatever name it goes by, is nationalization of private business. Spectrum sharing is something that must be considered as the nation moves forward with private networks, but it is not a reason for a government takeover. For a government-run network to happen, the federal government would have to either renege on licenses granted to private users or hoard spectrum at the expense of private industry. Either approach would upend well-established licensure policies at the FCC that establish certainty in operating and maintaining complex networks and create massive unnecessary delays to launching 5G networks. Moreover, the government should not be in the business of “competing” with private industry. That’s the business model of China and Russia, not the United States.
This concept has failed in other countries. Other countries experimented with nationalized networks and these attempts have failed. For example, in 2011, Russia gave away spectrum to a company that promised lower prices and sweeping deployments via a wholesale network built with Huawei equipment. Three years later, that company gave up after reaching barely a quarter of Russia.[9] Meanwhile, in that same time, the U.S. industry built out LTE to nearly 96 percent of Americans.[10] Similar experiments in South Africa and Mexico have also failed.[11]
Spectrum does not belong to the military. If after discovering new efficiencies, the DoD has discovered ways to put spectrum allocated to it to better use, the government should clear the spectrum while making sure military needs are still met. Spectrum sharing between government and private users, like the CBRS band, or relocating government users and then auctioning the available spectrum with proceeds going to the American people, are both viable and tested. Military users should not build a network simply for financial gain including some kind of revenue sharing. The DoD sits on billions of dollars of spectrum assets without accounting for it on their balance sheets – if the DoD has excess capacity, it should be auctioned for the benefit of the American taxpayer.
The best approach toward collaboration between DoD and the private sector is cleared licensed spectrum for flexible use or coordinated sharing on bands among federal users and private licensed and unlicensed users, with proceeds going to the taxpayers. Nationalization or excessive regulatory intervention stalled other nations in the race to 4G. America won that race and the competitive process soared ahead, leading to economic gains for in networking, standards and technology, and eventually prompting the creation of the App Economy.[12] The race to 5G will be won if the private sector once again leads the way and the government does not get in the way.
Thank you for your leadership on this critically important issue. We hope you will continue your efforts to slow down the process on this disruptive proposal and to roll back any efforts to nationalize 5G development and deployment.
Respectfully,
Grover G. Norquist
President
Americans for Tax Reform
Douglas Holtz-Eakin*
President
American Action Forum
Jennifer Huddleston*
Director of Technology & Innovation Policy
American Action Forum
Phil Kerpen
President
American Commitment
Daniel Schneider
Executive Director
American Conservative Union
Krisztina Pusok, Ph.D.
Director of Policy and Research
American Consumer Institute
Stephen Pociask
President and CEO
American Consumer Institute
Brent Wm. Gardner
Chief Government Affairs Officer
Americans for Prosperity
Andrew F. Quinlan
President
Center for Freedom and Prosperity
Jeffrey Mazzella
President
Center for Individual Freedom
Tom Schatz
President
Council for Citizens Against
Government Waste
Ashley Baker
Director of Public Policy
The Committee for Justice
Jessica Melugin
Associate Director
Center for Technology & Innovation
Competitive Enterprise Institute
Jim Edwards
Executive Director
Conservatives for Property Rights
Matthew Kandrach
President
Consumer Action for a Strong Economy
Katie McAuliffe
Executive Director
Digital Liberty
Jason Pye
Vice President of Legislative Affairs
FreedomWorks
George Landrith
President
Frontiers of Freedom
Jessica Anderson
Executive Director
Heritage Action for America
Mario H. Lopez
President
Hispanic Leadership Fund
Carrie Lukas
President
Independent Women’s Forum
Heather R. Higgins
CEO
Independent Women’s Voice
Bartlett D. Cleland
Executive Director
Innovation Economy Institute
Wayne T. Brough, PhD.
President
Innovation Defense Foundation
Ian Adams
Executive Director
International Center for Law and Economics
Tom Giovanetti
President
Institute for Policy Innovation
Silvia Elaluf-Calderwood*
Professor
The iSchool at Syracuse University
Andrea O’Sullivan
Director, Center for Technology & Innovation
James Madison Institute
Seton Motley
President
Less Government
James Czerniawski
Policy Analyst, Tech and Innovation
Libertas Institute
Zach Graves
Head of Policy
Lincoln Network
Brandon Arnold
Executive Vice President
National Taxpayers Union
Eric Peterson
Director
Pelican Center for Technology & Innovation
Lorenzo Montanari
Executive Director
Property Rights Alliance
Jeffery Westling
Technology Resident Fellow
R Street Institute
Karen Kerrigan
President & CEO
Small Business & Entrepreneurship Council
James L. Martin
Founder/Chairman
60 Plus Association
Saulius “Saul” Anuzis
President
60 Plus Association
David Williams
President
Taxpayer Protection Alliance
James E. Dunstan
General Counsel
TechFreedom
Roslyn Layton, PhD
President Elect
Transition Team for
Federal Communications Commission
2016-2017
Mark A. Jamison, PhD
President Elect
Transition Team for
Federal Communications Commission
2016-2017
Casey Given
Executive Director
Young Voices