America's wireless broadband problem just got a lot worse

FCC veto of LightSquared's plans for massive wireless network may have also put the brakes on widespread 4G deployment

The issue of America's crumbling infrastructure isn't just about bridges, highways, and railroads. It's also about the overburdened cellular networks that power our wireless broadband and have become an indispensable part of our lives and our economy.

Little highlights the difficulty of fixing that electronic infrastructure better than the news that the FCC just clobbered a company that wanted to build a wholesale wireless broadband network. The reason: Its technology would allegedly interfere with GPS transmissions. The LightSquared case highlights an infrastructure issue that simply won't go away: the shortage of spectrum and the difficulty of building out wireless data services.

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"Everyone wants an aggressive broadband rollout and they want it quickly, but demand has accelerated to the point that innovative solutions are going to hit roadblocks like interference," says Michael Voellinger, a vice president at the Telwares telecommunications consultancy. "We're still dealing with an antiquated spectrum strategy, and the risk is there for some serious time and money to be wasted -- which appears to be the case for LightSquared."

The spectrum shortrage may or may not be real today, but it will be soon

Driven by bandwidth-heavy applications like streaming video and Skype, wireless broadband service is being strained as never before. Simply put, the carriers don't have space in the airwaves to, well, carry all that content. If that doesn't get fixed, and fixed soon, ambitious plans to build out 4G networks in populated areas and to expand cellular broadband service to underserved parts of the country will falter. You think AT&T's data service is bad now, just wait until even more people buy and use iPhones, Androids, and Windows 8 tablets.

But like everything connected to wireless, there's a nuance here. No one would disagree that today's spectrum is overcrowded. But is that because there simply isn't enough to go around, or is it because the carriers aren't using what they have very well? In other words, is there really a shortage of spectrum, or is there a constraint caused by carriers' poor use? As I said, it's a nuance. But if you care about the future of wireless, this isn't simply an academic issue.

For example, AT&T claimed it needed to buy T-Mobile because the smaller company's spectrum would fix AT&T's overtaxed data network. If AT&T was being honest, that would mean the Obama administration made a terrible mistake when it challenged the deal, forcing AT&T to abandon its plans. If AT&T, as many believe, was only interested in removing a competitor from the playing field, the spectrum issue may have been a fig-leaf excuse not to spend the money optimizing its network.

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