WASHINGTON (Reuters) – U.S. regulators may dedicate spectrum to free wireless Internet service for some Americans to increase affordable broadband service nationwide, the Federal Communications Commission said on Tuesday.What is the tradeoff? At a time of imposing deficits, the FCC could auction off the spectrum to the highest bidders lowering the deficit. Companies with winning bids value the spectrum more presumably because they can repackage it and sell services to end users. One function of markets is to allocate goods and services to those who value it most. An auction achieves that goal but a government give away does not. There is not such thing as a free lunch and this lunch is paid for by taxpayers and consumers who would be happy to buy products utilizing the spectrum that the government plans to give away.
The FCC provided few details about how it would carry out such a plan and who would qualify, but will make a recommendation under the National Broadband Plan set for release next week. The agency will determine details later.
One way of making broadband more affordable is to "consider use of spectrum for a free or a very low cost wireless broadband service," the FCC said in a statement.
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