Congress and the FCC need to develop market-based incentives that advance competition and innovation, while increasing minority and women entrepreneurship in the wireless communications space, especially in spectrum licenses and the operations of assets.
That’s the verbatim call to action by the Multicultural Media, Telecom and Internet Council (MMTC), which released a White Paper yesterday (Sept. 14) outlining “four incentives to cultivate minority ownership of commercial wireless spectrum.”
Specifically, MMTC finds that “Congress and the FCC can address the persistence of the negligible representation of minority- and women-owned business enterprises in the wireless industry through the development and support of incentives for minority and women-owned businesses (MWBEs).”
MMTC proposes that the focus be on secondary market transactions, which are largely used to facilitate the leasing or sale of large companies’ non-core spectrum holdings. It proposes the restoration and the refinement of the Tax Certificate Policy for immediate application to secondary market transactions, enabling sellers to defer payment of the capital gains taxes on the sale upon reinvestment in comparable property. This initiative requires legislation.
The MMTC also seeks consideration of voluntary secondary market transactions with MWBEs as factors in determining whether to report to Congress that the mobile wireless marketplace is competitive. “This initiative can be adopted by the FCC under its existing statutory authority,” the MMTC said.
Furthermore, the MMTC asks for the incorporation of voluntary secondary market transactions with MWBEs as part of mergers and acquisitions (“M&A”) regulatory review, including whether to give carrier rule waivers relating to ownership. This initiative can be adopted by the FCC under its existing statutory authority.
“Despite the FCC’s launch of several profitable and successful spectrum auctions over the last two years, the nominal participation of MWBEs continues at an abysmal pace,” stated MMTC President and CEO and co-author Kim Keenan. “We need to find alternatives that break the cycle of exclusion for MWBEs who can actually generate and return greater economic value to our communities. One thing is clear, if we continue on our current path of inaction, we will continue to leave minority and women-owned businesses out of even the chance to innovate and create opportunity in the nation’s telecommunications industry.”