Federal Communications Commission chairman Julius Genachowski on Tuesday declined to comment on the $39 billion AT&T-T-Mobile merger during an appearance at the CTIA Wireless trade show in Orlando.
Referrring to it as the "proposed transaction that was just announced," Genachowski said "of course you'll understand that I'm not going to comment on that."
The FCC - and the Department of Justice - will likely examine the proposed merger, though thus far the commission has not commented publicly. Members of Congress, however, have said they will take a "close look" at the proposed deal.
During a panel discussion after Genachowski's speech, Sprint CEO Dan Hesse said he was "concerned" about the AT&T-T-Mobile deal.
"If you look at wireless subscribers and post-paid [users], today the big two have 67 percent market share. If [the deal] is allowed to proceed it would be 79 percent market share," Hesse said. "I do have concerns that it would stifle innovation and that too much power would be in the hands of two," Hesse continued.
Ultimately, however, "my opinion doesn't matter; I think the FCC and the DOJ will have something to say about that," Hesse said.
Verizon, which also appeared on the panel, was not as critical or forthcoming. "We'll be watching what goes on here, there may be things market-by-market that are of interest, but we're very, very confident in our position," said Dan Mead, president and CEO of Verizon Wireless. "We're not going to get distracted by this."
Genachowski's presentation, meanwhile, focused primarily on the spectrum crunch and the expansion of broadband, two of his favorites topics of late.
"[The] explosion in demand for mobile services places unsustainable demands on our invisible infrastructure – spectrum. Spectrum is the oxygen that allows all of these mobile innovations to breathe," Genachowski said. "Whether or not most Americans know the physics of spectrum, they know what it feels like to have a dropped call or a slow connection or cranky Wi-Fi."
Today's smartphones use 24 times the amount of spectrum than traditional cell phones, while tablets use 120 times more, he said.
"The amount of spectrum available for mobile broadband represents about a threefold increase over where we were a few years ago," Genachowski said. "Sounds good, except that analysts forecast a 35X increase in mobile broadband traffic over the next five years. Cisco has projected a nearly 60X increase between 2009 and 2015."
To solve this, Genachowski reiterated his call for voluntary spectrum auctions - allowing TV broadcasters and satellite providers to sell off unused spectrum. They would get a cut of the proceeds, while the rest would be added to the US Treasury.
"The incentive auction proposal provides an incentive-based, market-driven path to tackle the spectrum crunch. It's the right idea at the right time," Genachowski said.
President Obama said recently that such auctions could raise an estimated $27.8 billion, which would be used for things like an interoperable public safety network. After the costs of the investments proposed by Obama, he said that could also reduce the deficit by $9.6 billion over the next 10 years.
Ralph de la Vega, president and CEO of AT&T Mobility, meanwhile, defended his company's purchase of T-Mobile, saying that the deal will help solve the spectrum crisis. In a Monday conference call, AT&T said T-Mobile customers will get access to AT&T's spectrum, and the deal will free up T-Mobile's AWS spectrum for LTE use.
As a result, AT&T can proceed with 4G efforts as soon as the deal is closed, rather than having to wait for the government to organize new spectrum auctions.
"You're talking about a 10-year process," John Stankey, president and CEO of AT&T Business Solutions, said of the auctions.