Spectrum squeeze: The battle for bandwidth

July 27, 2011: 5:00 AM ET

So much data - so little space.  A big fight is brewing over who gets the best parts.

By Tara Moore, reporter

We all know that our use of mobile data and video is exploding. But not everyone understands that the bandwidth needed to operate that technology is limited -- and at risk of overload. The radio spectrum is a fixed range of frequencies, controlled by the federal government (which owns 59%). Now a debate over who most deserves the "sweet spot" best suited for mobile video and data communications, the range from 225 MHz to 3,700 MHz, is heating up. Below, the current situation.

Political stalemate

The 2010 National Broadband Plan called for 500 additional megahertz (MHz) of spectrum to be reallocated for broadband use. Where that new space will come from was left up to the FCC and legacy licensees -- but no one can agree. The FCC -- with support from AT&T (T), Verizon (VZ), and Sprint (S) -- is pushing TV broadcasters to auction off an additional 120 MHz, but the National Association of Broadcasters says that's unfair to poor viewers with no other access to TV. The impasse means the auctions are stalled.

Spectrum reallocation - is it enough?

Since the 1990s the FCC has held 91 spectrum auctions, raising more than $50 billion; most recently, Verizon and other telcos were able to buy new spectrum in 2008. But the telecom providers claim that if they don't get more, service will suffer.

Fewer TV viewers vs. a mobile data explosion

The trend is indisputable: Broadcast television viewership is declining, and it has been for the past two decades. But since the birth of the iPhone and the Android operating system, mobile data use has exploded. By 2015 traffic will be some 20 times its 2010 level.

--Sources: FCC, Spectrumwiki, Nielsen, CTIA, National Association of Broadcasters, Cisco, Rysavy Research

This article is from the July 25, 2011 issue of Fortune.

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