Faced with a monstrous $ 1.7 trillion deficit, President Obama Invites tacking on the spectrum of the license fee for wireless operators, to help generate revenue for the government.
Obama Administration proposal was poorly expressed in the new budget plan for 2009 and 2010, presented on Thursday. In this regard, the Administration proposes to add new fees to be paid by wireless carriers that wireless spectrum license from the government.
These annual fees start at $ 50 million in 2009 and jump to $ 200 million in 2010, reported Reuters. The fee will gradually increase over the next 10 years to 550 million dollars per user per year, creating a total of $ 4.8 billion over the next decade.
The proposed fees in addition to royalties, the operators have already paid the federal government as part of its wireless auctions. Federal Communications Commission auction was to leave the range of wireless telephone companies and other organizations since 1990. These auctions provide the licensed owners of exclusive rights to spectrum in exchange for cash.
For many years, these auctions have caused billions of dollars to the federal government. In the last auction, which ended in March 2008, was on the 700 MHz block of spectrum, which is being vacated by broadcasters after the mandated digital TV transition. This valuable spectrum generated record $ 19.6 billion.
But the wireless spectrum is a limited resource. And the government goes out of the ether at an auction. In fact, Obama Administration predicts that it will only be able to generate about $ 4.8 billion of proceeds from auctions of wireless in the next 10 years.
Even though the additional charges could help the Government to halve by 2013 the deficit, as well as to help him fund several new initiatives in the cost, it can be done with great resistance from the mobile operators.
So far, none of the four largest wireless communications in the U.S. - AT & T, Sprint Nextel, T-Mobile USA and Verizon Wireless - has been willing to comment on this proposal. And CTIA Wireless Industry Association said that there were still studying the issue.
“We are currently studying the details of this proposal and hope to participate in the next stages of this matter”, CTIA, in a statement.
The previous range of fee proposals were strongly opposed to the wireless industry, and there is no reason to believe that the industry will support them at this time. Big difference this time is that Democrats controlled Congress might be more willing to support President Obama plans.
For more information about the proposal is expected later this spring, when the administration releases a more detailed budget package. But any changes in fees would require legislation. And my guess that the wireless industry will be hard to fight against it.