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Today, Federal Communications Commission (FCC) Chairman Ajit Pai an unprecedented to auction off spectrum licenses, including incentive payments of up to $9.7 billion to satellite companies—money that would otherwise go to the U.S. Treasury.

The auction is for a key set of mid-band spectrum, the 3.7-4.2 GHz band (known as the C-Band), that is currently occupied by fixed satellite services, but mostly unused. The FCC plans to auction a large portion of this spectrum (280 megahertz) for mobile carriers to build faster 5G networks. In an effort to speedily move satellite operators off the lower portion of C-band, the Chairman’s proposal would require winning bidders who buy licenses in the auction to make additional “accelerated relocation payments” of up to $9.7 billion directly to the satellite companies. These payments would theoretically “incentivize” the satellite companies to move off the desired airwaves and consolidate into the upper portion of the band on a timeline set by the FCC.

OTI has strongly urged the FCC not to adopt such incentive payments, and recently submitted explaining why it would violate the law and set a bad precedent.

The following quote can be attributed to Michael Calabrese, director of the Wireless Future Project at �鶹������ý’s Open Technology Institute:

“It is disappointing that Chairman Pai would propose to stretch the FCC’s authority to require auction winners to make excessive windfall payments to foreign satellite companies that are not fully using C-band spectrum. That $9.7 billion will come straight out of taxpayers’ pockets.

“The FCC should give Congress a chance to pass legislation that clarifies its authority, sets reasonable incentive payments, and earmarks the revenue for rural broadband and public safety, as a bipartisan group of lawmakers in Congress have proposed.”