In the mid-1970s, the late Senator William Proxmire (D-WI) started an informal “Golden Fleece Award” for public officials he determined squandered public money or mismanaged scarce resources. The award sought to punish these troubled souls and serve as a strong deterrent against future irresponsible behavior. Don’t look now, but Senator Proxmire’s spirit might need to start polishing an award for an idea by a company called NextNav, which is hawking a spectrum-swapping petition all across Washington. NextNav’s proposal pursues a massive government handout and would cost the country billions by disrupting a wide range of transportation, utility, industrial, security, and government systems and upending millions of consumer devices. Here’s why the Golden Fleece award should be broadened to include pitches from companies that seek to abuse the U.S. government for financial gain.
For those unfamiliar, NextNav has asked the government to convert its underperforming spectrum licenses into more valuable ones, for free, based on a promise that it will offer a backup for GPS based on terrestrial technology. Specifically, under its proposal, NextNav’s underutilized, separated, and localized licenses—which have sizable coverage gaps—would be magically transformed into a larger, exclusive, nationwide, high-powered prime spectrum asset, licensed to one company without an auction. For perspective, these new licenses could be worth a fortune (as in billions with a B). It’s a great deal for NextNav.
NextNav’s filings try to justify this by claiming that the spectrum swap is needed to create a GPS backup. But this is a mirage. NextNav has admitted it would sell or lease the vast majority of its spectrum asset for corporate profit, using less than 5% of its exclusive spectrum to backup GPS. So, NextNav wouldn’t really use the gift of powerful new licenses to deliver backup GPS services; it would instead lease them out to others for some yet-to-be-realized commercial or industrial use. That’s like trading swampland to the government for a city block, promising to use it to build a police station, then selling it to the highest bidder and pocketing the money.
It’s also important to recognize that NextNav doesn’t even need the spectrum swap to build a GPS backup. Its hurdle isn’t the FCC’s rules; it’s NextNav’s ability to execute. It has already developed a terrestrial location identification technology using its current licenses – except that the company readily admits it is unprofitable. That’s the rub: this effort isn’t about providing a backup for GPS or anything altruistic; it’s about generating revenue through expected license leasing, with profits likely intended to benefit its investors and shareholders.
The numerous comments already submitted to the FCC clearly demonstrate that NextNav’s proposal has not been well received, for understandable reasons. State highway authorities and E-ZPass have demonstrated that it will disrupt the nation’s tolling systems. Industrial and logistics companies have shown that it will interfere with their ubiquitous RFID systems. And security companies have shown it will undermine home security, fire protection, and health monitoring systems.
Moreover, this entire effort ignores the reality that NextNav’s proposed system is unlikely to work comprehensively to serve as a GPS backup. Our country’s varied terrain makes it extremely difficult to achieve widespread wireless coverage with this type of system. Any such network would inevitably have dead zones, unable to deliver reliable or consistent service. Imagine what would happen if GPS worked in urban and suburban areas but not in vast expanses of rural America – or anyplace where cell coverage was not good. And even if NextNav somehow pulled this off, they would still need to get their technology into every smartphone, car, and other GPS-powered device in the country. Does anyone think all this will ever happen?
So, why is NextNav doing this? Maybe because NextNav doesn’t actually have to deliver a fully workable plan for its proposal to succeed. Indeed, they just need to paste the pieces together and sell them well enough. Taking advantage of the demand for a viable GPS backup technology might just be enough to coax the right officials into suspending rationality and endorsing it.
Make no mistake, spectrum swaps can make sense in many cases. The broadcast incentive auction, for example, converted traditional licenses into digital television licenses and freed spectrum for 600 MHz wireless service. But here, the trade is all one-sided: NextNav gets all the benefits, while the American public receives empty promises for something that probably doesn’t work – and at great cost.
At its core, NextNav’s petition is about exploiting American spectrum resources for private gain. Somewhere, Senator Proxmire is probably laughing while shaking his head, wondering how such bad ideas still manage to gain any traction.