Spectrum Management: Better Knowledge Needed to Take Advantage of
Technologies That May Improve Spectrum Efficiency (28-MAY-04,	 
GAO-04-666).							 
                                                                 
Recent advances in technologies that rely on the use of the	 
radiofrequency spectrum have turned science fiction of the past  
into reality. Cellular telephones, wireless computer networks,	 
global positioning system receivers, and other spectrum-dependent
technologies are quickly becoming as common to everyday life as  
radios and televisions. Further, these technologies have become  
critical to a variety of government missions, including homeland 
security and strategic warfare. However, with the increased	 
demand, the radio-frequency spectrum--a resource that once seemed
unlimited--has become crowded and, in the future, may no longer  
be able to accommodate all users' needs. As a result, there has  
been a growing debate among spectrum policy leaders about how to 
use spectrum more efficiently. To help inform these debates, GAO 
was asked to look at agencies' investments in spectrum efficient 
technologies and how the nation's spectrum management system may 
affect the development and adoption of these technologies.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-04-666 					        
    ACCNO:   A10249						        
  TITLE:     Spectrum Management: Better Knowledge Needed to Take     
Advantage of Technologies That May Improve Spectrum Efficiency	 
     DATE:   05/28/2004 
  SUBJECT:   Information resources management			 
	     Radio frequency allocation 			 
	     Telecommunication					 
	     Telecommunication industry 			 
	     Spectrum efficiency				 

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GAO-04-666

United States General Accounting Office

                     GAO Report to Congressional Requesters

May 2004

SPECTRUM MANAGEMENT

Better Knowledge Needed to Take Advantage of Technologies That May Improve
                              Spectrum Efficiency

                                       a

GAO-04-666

Highlights of GAO-04-666, a report to congressional requesters

Recent advances in technologies that rely on the use of the radiofrequency
spectrum have turned science fiction of the past into reality. Cellular
telephones, wireless computer networks, global positioning system
receivers, and other spectrum-dependent technologies are quickly becoming
as common to everyday life as radios and televisions. Further, these
technologies have become critical to a variety of government missions,
including homeland security and strategic warfare.

However, with the increased demand, the radio-frequency spectrum-a
resource that once seemed unlimited-has become crowded and, in the future,
may no longer be able to accommodate all users' needs. As a result, there
has been a growing debate among spectrum policy leaders about how to use
spectrum more efficiently. To help inform these debates, GAO was asked to
look at agencies' investments in spectrum efficient technologies and how
the nation's spectrum management system may affect the development and
adoption of these technologies.

GAO is making six recommendations intended to facilitate greater
investment by federal agencies in spectrum efficient technologies.
Overall, the agencies indicated their commitment to promoting greater
flexibility and more efficient use of radio spectrum.

www.gao.gov/cgi-bin/getrpt?GAO-04-666.

To view the full product, including the scope and methodology, click on
the link above. For more information, contact Katherine V. Schinasi at
(202) 512-4841 or [email protected].

May 2004

SPECTRUM MANAGEMENT

Better Knowledge Needed to Take Advantage of Technologies That May Improve
Spectrum Efficiency

The nine federal agencies that GAO reviewed-which are among the largest
users and investors in technologies and systems impacting spectrum use-
have made some investments in technologies that provide improved spectrum
efficiency. However, these investments have tended to occur when agencies
needed to make greater use of available spectrum to meet a mission
requirement-not by an underlying, systematic consideration of spectrum
efficiency. For example, as a result of growing spectrum constraints, the
Department of Defense (DOD), the Federal Aviation Administration, and the
National Aeronautics and Space Administration began investing in
technologies that would increase the throughput of information while using
smaller segments of their available spectrum. However, agencies also
consider other factors-including cost and technical and operational
concerns-that may dissuade them from investing in spectrum efficient
technologies. For example, DOD may need to use more spectrum to meet an
operational requirement to field a jam-proof and accurate radar for
military aircraft.

The current structure and management of spectrum use in the United States
does not encourage the development and use of some spectrum efficient
technologies. Because the spectrum allocation framework largely
compartmentalizes spectrum by types of services (such as aeronautical
radio navigation) and users (federal, nonfederal, and shared), the
capability of emerging technologies designed to use spectrum in different
ways is often diminished. For example, software-defined cognitive
radios-radios that adapt their use of the spectrum to the real-time
conditions of their operating environments-could be used to sense unused
frequencies, or "white spaces," and automatically make use of those
frequencies. It may also be possible to use software-defined cognitive
radios to exploit "gray spaces" in the spectrum-areas where emissions
exist yet could still accommodate additional users without creating a
level of interference that is unacceptable to incumbent users-to increase
spectrum efficiency. Currently, however, the spectrum allocation system
may not provide the freedom needed for these technologies to operate
across existing spectrum designations, and defining new rules requires
knowledge about spectrum that spectrum leaders do not have. At the same
time, there are few federal regulatory requirements and incentives to use
spectrum more efficiently. While the National Telecommunications and
Information Administration (NTIA) is responsible for managing the federal
government's use of spectrum and ensuring spectrum efficiency, NTIA
primarily relies on individual agencies to ensure that the systems they
develop are as spectrum efficient as possible. Agencies' guidance and
policies, however, do not require systematic consideration of spectrum
efficiency in their acquisitions. The lack of economic consequence
associated with the manner in which spectrum is used has also provided
little incentive to agencies to pursue opportunities proactively to
develop and use technologies that would improve spectrum efficiency
governmentwide.

Contents

  Letter

Results in Brief
Background
Agencies' Decisions to Invest in New Technologies Are Generally

Driven by Factors Other Than Achieving Spectrum Efficiency Federal
Spectrum Management System May Limit the Development

and Adoption of Spectrum Efficient Technologies Conclusions
Recommendations for Executive Action Agency Comments and Our Evaluation

                                       1

                                      2 4

10

17 28 28 29

Appendix I Comments from the Department of Commerce

Appendix II	Comments from the Federal Communications Commission

Appendix III	Comments from the Department of Homeland Security

  Tables

Table 1: Five Steps Associated with the Command-and-Control Approach to
Spectrum Management 6 Table 2: Descriptions and Key Examples of Existing
or Emerging Technologies That Can Improve Spectrum Utilization 9 Table 3:
Agency Research and Development Investments in Technologies That May
Improve Spectrum Efficiency 12

  Figure

Figure 1: NTIA's Spectrum Measurement Van 22

Abbreviations

AGILE Advanced Generation of Interoperability for Law

Enforcement DARPA Defense Advanced Research Projects Agency DHS Department
of Homeland Security DOJ Department of Justice FAA Federal Aviation
Administration FCC Federal Communications Commission FCS Future Combat
Systems GHz gigahertz IWN Integrated Wireless Network JTRS Joint Tactical
Radio System KHz kilohertz NSF National Science Foundation NTIA National
Telecommunications and Information

Administration NEXCOM Next Generation Air/Ground Communications OMB Office
of Management and Budget TTNT Tactical Targeting Network Technology TSAT
Transformational Satellite UWB ultra-wideband

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separately.

United States General Accounting Office Washington, DC 20548

May 28, 2004

The Honorable Tom Davis
Chairman, Committee on Government Reform
House of Representatives

The Honorable Adam Putnam

Chairman, Subcommittee on Technology, Information Policy,
Intergovernmental Relations, and the Census Committee on Government Reform
House of Representatives

Over the past several decades, the development and use of
telecommunications and information technology has expanded dramatically,
greatly increasing the use of the radio-frequency spectrum. Cellular
telephones, wireless computer networks, and global-positioningsystem
receivers are quickly becoming as common to everyday life as radios and
televisions. Wireless communications have become critical to private
industry and a variety of government missions-ranging from scientific
research and public safety to homeland security and strategic warfare. As
a result, the radio-frequency spectrum, which once seemed unlimited, has
become crowded and, in the future, may no longer be able to accommodate
all users' needs.

Because of the growing demand for spectrum, there has been increased
attention in spectrum management policy debates on ways to improve the
efficient and effective use of spectrum. This has led to a growing
interest in technologies that can provide more efficient use of spectrum.
Therefore, you asked us to (1) determine whether federal agencies are
investing in developing spectrum efficient technologies and the key
factors they consider in making these investments and (2) determine the
extent to which the nation's system for managing government and private
sector use of spectrum facilitates the development and adoption of these
technologies.

Our review focused on federal agencies that are among the largest users of
technologies and systems impacting spectrum use-the Department of Defense
(DOD), the Federal Aviation Administration (FAA) within the Department of
Transportation, the Department of Homeland Security (DHS), the Department
of Justice (DOJ), and the National Aeronautics and Space Administration
(NASA)-as well as the National Science

Foundation (NSF), which funds research on spectrum-related technologies.
To determine whether agencies were investing in technologies that might
improve spectrum efficiency, we reviewed agency budget and investment
planning documents and sought additional information from agency officials
on specific programs and projects. To assess the key factors that
influenced agency investment decisions, we interviewed agency officials
and reviewed various documents and studies.

To determine the extent to which the nation's spectrum management system
facilitates the development and adoption of these technologies, we
interviewed officials at the two agencies responsible for spectrum
management in the United States-the Federal Communications Commission
(FCC) and the Department of Commerce's National Telecommunications and
Information Administration (NTIA)-and reviewed these agencies' spectrum
management policies and procedures. We reviewed processes established by
the federal spectrum management system and individual agencies for
addressing new technologies. We also met with officials at the agencies we
reviewed to discuss the challenges of developing and adopting new
technologies under the current spectrum management system. In addition, we
interviewed experts and reviewed studies from private sector organizations
that are examining spectrum policies and technologies-including the Center
for Strategic and International Studies and the National Academy of
Sciences-and attended several private-and government-sponsored conferences
and forums on national spectrum management issues and new spectrum
technologies.

We performed our work from June 2003 through May 2004 in accordance with
generally accepted government auditing standards.

The agencies that we reviewed have made some investments in technologies
that provide improved spectrum efficiency. However, these investments have
been primarily driven by the imperatives of their individual missions-not
by an underlying, systematic consideration of spectrum efficiency. For
example, as a result of growing spectrum constraints, DOD, FAA, and NASA
began investing in technologies that would increase the throughput of
information while using smaller segments of their available spectrum.
These investments were needed to meet mission-specific requirements and
goals, such as DOD's need for enhanced communications capabilities to meet
its goal of information superiority and network-centric war-fighting, and
FAA's need to meet growing demands for air traffic control communications.
In addition to

  Results in Brief

mission requirements, agencies consider other factors and tradeoffs-
including cost and technical and operational concerns when making
investment decisions. However, some of these considerations may dissuade
agencies from investing in spectrum efficient technologies. For example,
to meet an operational requirement to field jam-proof and accurate radar
for military aircraft, DOD may need to use more spectrum.

The current structure and management of spectrum use in the United States
may limit the development and use of some spectrum efficient technologies.
Because the spectrum allocation structure largely compartmentalizes
spectrum by types of services (such as aeronautical radio navigation) and
users (federal, nonfederal, and shared), the capability of emerging
technologies that are designed to use spectrum in different ways is often
diminished. For example, technologies like software-defined cognitive
radios can be adapted to operate in virtually any segment of spectrum and,
in the future, may be able to adapt to realtime conditions and make use of
underutilized spectrum in a given location and time. Currently the
spectrum allocation system, however, may not provide the freedom needed
for these technologies to operate across existing spectrum designations.
Moreover, defining new rules to accommodate these emerging technologies
requires knowledge about spectrum use that is not currently available. For
example, NTIA and FCC do not have a sufficient understanding of the
spectrum environment, including how and how much spectrum is used, and
lack agreed-upon models to assess spectrum efficient technologies. At the
same time, there are few federal regulatory requirements and incentives
for agencies to use spectrum more efficiently. While NTIA is responsible
for managing the federal government's use of spectrum and ensuring
spectrum efficiency,1 NTIA primarily relies on individual agencies to
ensure that the systems they develop make as efficient use of the spectrum
as possible. Agencies' guidance and policies, however, do not require
systematic consideration of spectrum efficiency in their acquisitions. The
lack of economic consequence associated with the manner in which spectrum
is used has also provided little incentive to agencies to pursue
opportunities proactively to develop and use technologies that would
improve spectrum efficiency governmentwide.

1 FCC has authority over all nonfederal spectrum use, including the use of
spectrum by state and local governments.

Background

We are making six recommendations to help facilitate greater consideration
and investment by federal agencies in spectrum efficient technologies.
Specifically, we are recommending that the NTIA Administrator and the FCC
Chairman jointly take actions to build more flexibility into the spectrum
allocation system where feasible and gain a better understanding of the
current spectrum environment and spectrum efficient technologies to
increase the use of these technologies. We are also recommending that the
NTIA Administrator take actions to encourage agencies to use spectrum more
efficiently. In commenting on the draft report, FCC supported our
recommendations. The Department of Commerce also commented on the draft,
though it did not specifically address our recommendations.

The radio-frequency spectrum supports a vast array of government and
commercial services, including radio and television broadcasts, personal
communications services, satellite communications, wireless local area
networks, public safety communications, air traffic control, scientific
research, and radar-based weather forecasting. The radio spectrum spans a
range of frequencies within the electromagnetic spectrum from about 3
kilohertz (kHz) to 300 gigahertz (GHz), but most of its use is
concentrated in the lowest 1 percent of these frequencies-sometimes
referred to as the "beachfront property" of the radio spectrum.2 Advances
in technology have greatly expanded the usable portions of the
radio-frequency spectrum and have led to more efficient means of using the
available spectrum. Simultaneously, these advances have created
opportunities to provide new spectrum-dependent services, which have led
to even greater demand on the limited available spectrum.3

2 Radio waves are a form of electromagnetic energy, propagating through
space at the speed of light. The number of waves that pass a given point
per second defines the frequency of a radio wave in cycles per second, or
hertz. Kilohertz (kHz), megahertz (MHz), and gigahertz (GHz) describe
frequencies of thousands, millions, and billions of hertz, respectively.
The radio spectrum above 100 MHz and below 3 GHz has propagation
characteristics that are well suited for services such as mobile phones,
radio and television broadcasting, some satellite communication systems,
radars, and aeronautical telemetry systems.

3 Nearly 30 years ago, GAO reported that technology was creating demands
for spectrum faster than it was creating methods to meet those demands.
See U.S. General Accounting Office, Information on Management and Use of
the Radio Frequency Spectrum-A Little-Understood Resource, B-159895
(Washington, D.C.: Sept. 13, 1974).

The spectrum is managed to maximize the benefits derived from this limited
resource, while mitigating interference among various users.4 Within the
United States, the spectrum is managed jointly by the NTIA, within the
Department of Commerce, and the FCC. NTIA is principally responsible for
developing and articulating domestic and international telecommunications
policy5 and for managing the federal government's use of the radio
spectrum. FCC has authority over all nonfederal spectrum use, including
the use of the spectrum by state and local governments.

In managing the spectrum, FCC and NTIA have largely used a
"commandand-control" approach, which dictates how each segment of the
radio spectrum can be used and who can use it. This approach generally
involves five steps: allocation, adoption of service rules or technical
standards, certification, assignment, and enforcement. Table 1 describes
each step.

4 Interference occurs when two or more radio signals interact in a manner
that disrupts or degrades the ability of these signals to convey
information successfully to their intended receivers. However, the extent
and impact of interference depends on the technologies used both to
transmit and receive radio signals, and the types of services and
applications supported.

5 Each country makes its own allocations of spectrum use; therefore,
allocation decisions may differ in other regions of the world and in other
countries. However, because radio wave propagation obeys the laws of
physics and cannot be forced to respect national borders, spectrum
management decisions (particularly allocation decisions) generally have
been coordinated internationally. The International Telecommunication
Union (ITU), a specialized agency of the United Nations, holds World
Radiocommunication Conferences every 3 to 4 years to coordinate spectrum
decisions and address other pressing international spectrum management
issues.

Table 1: Five Steps Associated with the Command-and-Control Approach to
Spectrum Management

Step Actions taken by FCC and NTIA

Allocation 	Particular segments, or "bands," of the radio spectrum are
designated for specific types of services-for example aeronautical radio
navigation-with bands of varying widths.

Adoption of service rules Rules and standards specify the required
technical and

or technical standards 	operational characteristics of the radios (or
other radiofrequency devices) that will use the allocated band, such as
radiated power limits, channel bandwidth and location, levels of
acceptable interference, and other service-specific or band-specific
rules.

Certification 	Major federal systems that directly use the radio-frequency
spectrum must be certified by NTIA, as required by the Office of
Management and Budget (OMB) Circular A-11, to be assigned a bandwidth. An
agency first determines if the system it proposes to field is "major"-that
is, the system could cause significant impact on the radio-frequency
spectrum-then conducts the necessary technical studies of the proposed
system, selects potential frequency bands, coordinates with other agencies
involved, and prepares and files a certification application to NTIA for
review. FCC similarly certifies nonfederal systems.

Assignmenta	Once service rules and technical standards have been
established, portions of the allocated band are assigned- typically, to
individual users or service providers operating within a certain
geographic area through a variety of mechanisms.

Enforcement 	Spectrum monitoring, interference reporting, and other
regulatory mechanisms are used to enforce allocations, technical standards
and service rules, and unique geography-based assignments.

Source: GAO.

aNot all spectrum use requires an assignment. For example, many familiar
"unlicensed" wireless devices-such as cordless phones, baby monitors,
garage door openers, and wireless Internet access devices-are allowed to
operate within certain spectrum bands provided they do not cause harm to
assigned users and accept any interference received.

NTIA and FCC implement the command-and-control approach differently
because of differences in their missions. For example, NTIA assigns
spectrum resources through an administrative process that emphasizes
interdepartmental advice and coordination among federal agencies, while
FCC has used a number of administrative processes including comparative
hearings and lotteries as well as its authority to assign spectrum through

auctions.6 However, because so much of the spectrum is shared between
federal and nonfederal users, FCC and NTIA must coordinate their
management of spectrum.7

For many decades, command-and-control has been the most commonly used
approach for managing the spectrum. However, as both the usage of and
demand for spectrum have exploded over the past decade, the disadvantages
of the command-and-control approach have become increasingly apparent. For
example, in October 2001, the FCC Chairman noted that it is becoming
difficult for government officials to determine the best use for spectrum
and to repeatedly adjust allocations and assignments of spectrum to
accommodate new spectrum needs and new services. The President has
similarly noted that the existing legal and policy framework for spectrum
management has not kept pace with the dramatic changes in technology and
spectrum use and can discourage the introduction of new technologies.

In June 2002, the FCC Chairman established a Spectrum Policy Task Force to
help identify and evaluate changes in spectrum management policy and to
provide specific recommendations to FCC for ways to evolve from the
current command-and-control approach to a more integrated, marketoriented
approach. In November 2002, the Task Force reported its findings and
recommendations to FCC.8 While noting that no single regulatory model
should be applied to all spectrum, the Task Force recommended that FCC
pursue a spectrum management policy that includes both exclusive spectrum
usage rights granted through market-based mechanisms and creates open
access to spectrum "commons," with command-and-control regulation used in
limited circumstances. In January 2003, we issued a report recommending a
commission be established to conduct a comprehensive examination of
current U.S. spectrum policy. 9 In May 2003, the President signed an
executive

6 47 USC S: 309(j).

7 For more information on how spectrum is managed, see U.S. General
Accounting Office, Telecommunications: Better Coordination and Enhanced
Accountability Needed to Improve Spectrum Management, GAO-02-906
(Washington, D.C.: Sept. 30, 2002).

8 Federal Communications Commission, Spectrum Policy Task Force Report; ET
Docket No. 02-135 (Washington, D.C.: Nov. 2002).

9 U.S. General Accounting Office, Telecommunications: Comprehensive Review
of U.S. Spectrum Management with Broad Stakeholder Involvement Is Needed,
GAO-03-277 (Washington, D.C.: Jan. 31, 2003).

memorandum establishing the federal government's "Spectrum Policy
Initiative" to develop recommendations for improving spectrum management
policies and procedures for the federal government and to address state,
local, and private spectrum use.10

Although work under the President's initiative is ongoing, the initiative
recognizes, along with the findings of the 2002 FCC Task Force, that
existing and emerging technologies create the potential for future radios
and other radio-frequency devices and systems to use spectrum more
efficiently.11 Efficiency may be accomplished through improvements to a
broad set of technologies and applications. Table 2 provides descriptions
and key examples of such technologies and applications that can improve
the utilization of spectrum.

10 The initiative consists of two courses of spectrum-related activity:
(1) an interagency task force to focus on improving spectrum management
policies and procedures to stimulate more efficient and beneficial use of
government spectrum and (2) a series of public meetings that will assist
the Department of Commerce in developing a detailed set of recommendations
for improving policies and procedures for use of spectrum by state and
local governments and the private sector, as well as the spectrum
management process as a whole.

11 In addition, the NSF is currently sponsoring a study at the National
Academy of Sciences on wireless technology advances and associated
implications for spectrum management policy.

Table 2: Descriptions and Key Examples of Existing or Emerging
Technologies That Can Improve Spectrum Utilization

Technology Description Key examples

Radio frequency Encompasses a broad set of radio-frequency  o  "Smart"
antennas that can selectively amplify desired component-level
components-transmitters, receivers, and signals while canceling out
competing signals.

antennas (and their enabling technologies)-  o  Modulation and channel
coding can also influence how that can improve spectrum utilization. much
spectrum is needed to transfer encoded voice data.

Other component-level 	Encompasses a broad set of other (non-radio  o 
More advanced algorithms to encode and digitally frequency) radio
components including digital compress a human voice can greatly reduce the
processors and associated algorithms to radio's data transfer
requirements.

compress data, and batteries for handheld  o  Improving the efficiency of
a handheld radio's battery

devices. 	can allow it to accomplish more sophisticated data compression,
modulation and coding, and thus indirectly, influence the radio's ability
to use spectrum more efficiently.

Network-level 	Technologies and related network or spectrum management
practices that can significantly improve information transfer and spectrum
efficiency as well as mission effectiveness.

Other enabling Includes investments in various technologies technologies
that may yield improvements to spectrum utilization and efficiency.

Off-loading technologies 	Technologies that are being developed, which
would facilitate "off-loading"-that is, relocating certain communications
requirements from highly congested radiofrequency spectrum to higher
radio-frequency bands and non-radio-frequency portions of the
electromagnetic spectrum.

o  	Improvements to an ad-hoc network's routing strategies can enable more
efficient use of available network resources, including spectrum
resources.

o  	Advanced quality of service algorithms may enable a diverse set of
network users with very different requirements and mission-driven
priorities, to operate on a single network and share the spectrum
resources of the entire network; these algorithms can grant high priority
to the rapid transmission of critical communications and lower priority to
routine message traffic.

o  	Advancements in microelectronics and semiconductors have enabled
greater processing power in smaller lighter weight packages. These
advancements continue with the development of semiconductor technologies
that may greatly improve upon the performance of today's radio-frequency
components.

o  	Research directed toward improving models of the ionosphere can lead
to more efficient use of some frequency bands.

o  	Research is under way to further the use of lasers to communicate at
very high data rates.

Source: GAO.

Many spectrum efficient technologies have both component-level and
network-level attributes. For example, some "smart" antennas can pinpoint
the source signal and selectively amplify it while canceling out competing
signals. In addition, because smart antennas direct transmitted

power toward desired receivers, the level of interference experienced by
other spectrum users is reduced. This adaptive behavior may be controlled
by local sensors but may also be cued by information provided through the
radio's network. Similarly, software-defined radios, unlike traditional
radios, have operating parameters (such as the operational frequency and
modulation type) that are determined by software, meaning they can be
programmed to transmit and receive on many frequencies and to use any
desired modulation or transmission format within the limits of their
hardware designs; as with smart antennas, the programmed operating
parameters of the radio may be controlled internally or may be cued
through the radio's network.

FCC and NTIA are both charged with promoting the efficient and effective
use of the radio spectrum. NTIA has told us that ensuring efficient use of
the spectrum is a major NTIA goal reflected throughout most of its
spectrum management processes, which include

o  setting standards for equipment that use the radio spectrum,

o  	certifying that proposed new systems conform with existing spectrum
allocations and associated standards, and

o  	requiring justification of frequency assignment requests and
continuous review of existing frequency assignments.

Additionally, NTIA is responsible for conducting spectrum analyses and
research to keep abreast of the latest spectrum efficient technologies
that are appropriate for government use and for developing and adopting
automated information systems that support the spectrum management
processes and facilitate appropriate spectrum conservation measures.

Federal agencies have made some investments in technologies that may
provide improved spectrum efficiency. However, their decisions to invest
in those technologies are primarily driven by their individual missions-
not by an underlying, systematic consideration of spectrum efficiency.
Agencies generally do not identify spectrum efficiency as a distinct
category of technology investment. Other considerations that influence
agencies' technology decisions include technical and operational concerns
and costs that may make spectrum efficient technologies impracticable.

  Agencies' Decisions to Invest in New Technologies Are Generally Driven by
  Factors Other Than Achieving Spectrum Efficiency

    Agency Mission Is a Key Factor in Determining Investments in New
    Technologies

Determining investments that may improve spectrum efficiency is difficult
because agencies do not clearly identify spectrum-related investments in
their budgets. However, using published budget and other information
provided to us by each of the nine agencies, we identified projects that
might result in improved spectrum efficiency and spoke with agency
officials about their technology investments. Based on this review, we
identified 335 fiscal year 2004 federally funded projects that potentially
included funding for spectrum efficient technologies.12 Funding for these
projects totaled approximately $1.8 billion.13 These investments cover a
wide range of technologies that can affect spectrum use, including the
compression of raw source data, advanced radios, and network improvements.
The military services and Defense Advanced Research Projects Agency
(DARPA) combined are by far the largest federal investors in new
technologies that use the spectrum. In contrast, the Departments of
Justice and Homeland Security have small research and development budgets
and tend to rely on technologies that are commercially available. Table 3
provides the total fiscal-year-2004 funding identified for each agency's
projects related to spectrum efficiency and highlights major areas of
investment.

12 Amounts included for NSF are based on funds provided grantees in 2003.

13 We did not verify the reliability of the funding information, however,
it comes from published agency budget documents and program officials.

Table 3: Agency Research and Development Investments in Technologies That
May Improve Spectrum Efficiency

                             (Dollars in millions)

                           Areas of major investment

Total funding for fiscal year 2004Agency

related to spectrum efficiency

                   DARPA     Antenna technologies, laser               $339.7 
                              communications, transistor      
                             technologies, and cognitive      
                                    communications            

                   U.S. Air Force         Software defined radio/laser  649.4 
                                                        communications 
                        U.S. Army               Software defined radio  381.9 
           U.S. Navy/Marine Corps              Software defined radios  172.4 
                             NASA       Optical (laser) communications   41.8 
                              DOJ                                          0a 
                              DHS                                          0b 
                              FAA   Air traffic control communications  165.8 
                                                     and digital radar 

                NSF          Interference avoidance and                 14.8c 
                          measurement, networking, antenna       
                          technologies, data compression,        
                       error correction, and cognitive radio     
                                                        research 

Source: GAO.

Note: Investments include amounts invested in projects undertaken with a
stated goal of improving radio-frequency spectrum and projects where
spectrum efficiency is not a stated goal but a possible outcome (including
enabling technologies like software defined radios). These investments
also include projects to off-load/achieve communications in non-radio
portions of the electromagnetic spectrum, for example, laser
communications. Because of the difficulty identifying relevant projects
and quantifying relevant investments in projects where spectrum efficiency
may be only a small component, actual investment numbers may be higher or
lower.

aDOJ focuses on the acquisition of commercial-off-the-shelf equipment.

bWhile DHS is not currently funding research and development into
technologies to provide improved spectrum efficiency, it expects to in the
future.

cNSF grants funded in fiscal year 2003. According to agency officials, NSF
has recently initiated a number of spectrum efficiency projects, including
a study of programmable wireless networking, on which it plans to allocate
at least $8 million per year.

Agency investments in technologies that provide greater spectrum
efficiency have tended to occur when agencies need to make greater use of
available spectrum to meet a mission requirement and the additional
spectrum is not readily available, as is the case with DOD. Specifically,
DOD systems are requiring greater bandwidth to transmit intelligence and
surveillance information, facilitate enhanced communications capabilities,

and conduct electronic warfare-which DOD considers essential to meeting
its key strategic goal of information superiority. As a result, DOD has
made significant investments in new systems that, in part, address
problems related to insufficient spectrum, as the following examples
illustrate:

o  	Joint Tactical Radio System (JTRS): To address key communications
shortfalls and significantly improve military capabilities, DOD has begun
to make significant investments in software-defined radios, which offer
the potential of more efficient spectrum use in the future without the
need for expensive and complex hardware changes. In 1997, DOD initiated
the JTRS program to develop and apply this technology and to bring
together separate service-led programs into a joint software-defined radio
development effort. JTRS radios are intended both to interoperate with
existing radio systems and to provide military users with more flexible
communications capabilities in the future.

o  	Air Force's Transformational Satellite (TSAT) Program: The Air Force
is exploring new technologies that enable communications in higher
radio-frequency bands, which are much less congested, and in
non-radio-frequency portions of the electromagnetic spectrum.
Nonradio-frequency technologies will enable next-generation military
satellites to communicate at very high data rates using lasers. As a
result, information can be transferred without relying on the
radiofrequency spectrum.

o  	DARPA's Tactical Targeting Network Technology (TTNT) Program: TTNT
program aims to demonstrate a high-capacity sensor data system that could
enable networks of strike aircraft to accomplish their missions. In
particular, certain missions require the rapid sharing of targeting sensor
data among a large ad-hoc network of strike aircraft. Currently, the U.S.
military's airborne tactical data links cannot support a large network of
aircraft simultaneously due to spectrum constraints. TTNT is expected to
provide a data rate 10 to 25 times higher than the current airborne
tactical data link in an equivalent amount of spectrum.

Other agencies have made some investments in spectrum efficient
technologies, and like DOD, these investments were largely driven by
agency mission, as in the following examples:

o  	NASA's Mars Laser Communications Demonstration Project: NASA
anticipates a significant increase in the near future in demand

for long-haul communications services from deep space to Earth. As a
result, it has undertaken the Mars Laser Communications Demonstration
Project-a joint project with the Massachusetts Institute of Technology's
Lincoln Laboratory-to develop a laser-based communications system that
would transfer information without relying on the radio-frequency
spectrum. Such a system would facilitate bandwidth-hungry instruments,
such as imaging systems and radar to be used in deep space exploration.

o  	Federal Aviation Administration's Next Generation Air/Ground
Communications (NEXCOM) Initiative: In 1990, FAA began the NEXCOM
initiative in response to growing demands for air-to-ground air traffic
control communications. By replacing current analog radios with digital
radios, the program is expected to achieve greater spectrum capacity using
the same spectrum currently allocated for air traffic control
communications. Each of NEXCOM's 25 kHz channels will support four voice
circuits, instead of the one circuit supported by the current system.

o  	DOJ's Integrated Wireless Network (IWN) System: While Justice is not
investing directly in research and development into technologies to
improve spectrum efficiency, it has undertaken a joint effort-the IWN
system-with the Departments of Homeland Security and Treasury to provide
improved interoperability of communications within the federal
law-enforcement community. New equipment being acquired under the IWN
system, such as new land mobile radios, will significantly increase
spectrum efficiency.

    Other Factors That Influence Agencies' Investment Decisions

Besides mission objectives, several other factors, such as technical and
operational considerations and cost-effectiveness, influence agencies'
technology investments. In considering these factors, agencies may
determine that using more spectrum efficient technologies is impractical.

If an agency developed a system solely to minimize spectrum usage or
optimize spectrum efficiency, the system may also include other less
desirable or unacceptable operational characteristics-that is,
characteristics that are incompatible with accomplishing an agency
mission. For example, the Army's Future Combat Systems (FCS)14-the

14 FCS is an information network linking a suite of 18 new manned and
unmanned ground vehicles, air vehicles, sensors, and munitions.

centerpiece of the Army's plan to transform to a lighter, more agile, and
more capable force-will rely on superior information to see and hit the
enemy first. Future Combat Systems' capabilities depend, in part, on the
ability of the Army's network to collect, process, and deliver vast
amounts of information such as imagery and communications that will
require much higher spectrum usage. Operational considerations also can
affect radar aboard military aircraft. Such radars must operate in
unfriendly and stressed conditions, including exposure to enemy jamming
capabilities and flight speeds of up to 1800 to 2000 kilometers per hour.
Aircraft radars must also function while the aircraft is conducting
evasive maneuvers to avoid threats such as enemy missiles. According to
DOD officials, the bandwidth used by aircraft radars is directly related
to the radar's accuracy. As a result, limiting the radar's bandwidth could
result in the aircraft engaging a wrong target or other unwanted
consequences. Also, some federal agencies that intend to operate
spectrum-dependent systems outside of the United States may have to
compromise the application of more efficient technologies in order to
acquire spectrum access in other countries. For example, in developing
communications and radio navigation systems for aircraft, FAA is largely
limited to using globally allocated bands that are designated for
aeronautical services.

In addition, agencies need to make tradeoffs between spectrum efficiency
and cost. For example, a new type of smart antenna, called an adaptive
array, can extend the range of communications systems and minimize
interference. Although more efficient in its use of spectrum, this new
technology is generally more expensive than traditional antenna
technology, and, as a result, these technologies may not be considered or
developed unless justified by mission needs. Similarly, the Department of
Justice's Advanced Generation of Interoperability for Law Enforcement
(AGILE) program is coordinating the efforts of federal, local, state, and
regional public safety organizations to achieve interoperable
communications. However, local, state, and regional organizations may lack
funding to replace their legacy radio systems and radio infrastructure
with the most efficient systems available. As a result, these
interoperability and funding concerns may dictate what technologies can be
selected for use in new federal systems and may limit the degree of
spectrum efficiency achieved.

    Agencies' Technology Planning Processes Do Not Identify Spectrum Efficiency
    as an Investment Area

To help manage their investment decisions, some agencies have established
science and technology planning processes to identify longterm
technological needs, establish research and technology priorities, and
coordinate research activities. These processes enable policy makers and
implementers to adjust the allocation of agency resources to meet changing
requirements for fulfilling agency missions. However, the agencies'
science and technology planning processes that we reviewed do not specify
spectrum efficient technologies as an investment area. For example, FAA's
research and development strategy does not focus specifically on achieving
spectrum efficiency; rather, it emphasizes improving the overall
efficiency of the nation's air traffic control systems-which may require
making better use of the spectrum. Similarly, the military services'
science and technology planning processes emphasize achieving overall
operational efficiency and effectiveness, which may or may not result in
improved spectrum efficiency. A DOD official within the Office of the
Assistant Secretary of Defense for Networks and Information Integration
acknowledged that spectrum efficiency does not receive the same level of
attention as science and technology efforts to improve more conventional
weapons systems' performance requirements such as lethality and
survivability.

However, DOD has taken initial steps to consider spectrum efficiency by
revising its policy and guidance on spectrum management. Specifically,
DOD's Electromagnetic Spectrum Management Strategic Plan-which was issued
in December 2002 -has five core principles, including one that recognizes
the need to invest in new spectrum efficient technologies. In addition,
the strategic plan established a goal to improve spectrum utilization
through technological innovation. As part of developing a strategy for
DOD, the Defense Spectrum Office15 has begun to study emerging
technologies and future war fighter requirements. In addition, DOD
convened a group of technologists last year to discuss spectrum
technologies and how to link them more directly to DOD's science and
technology planning process. Because these efforts are in their early
stages, they have not yet resulted in policy changes or modifications to
investment plans. Similarly, NASA is working on an electromagnetic
spectrum management strategy, which is in the final stages of review
before release.

15 The Defense Spectrum Office has the responsibility within DOD for
supporting the Assistant Secretary of Defense for Networks and Information
Integration in establishing national and international strategies for new
technologies that may affect how spectrum is used, occupied, or managed by
the department.

  Federal Spectrum Management System May Limit the Development and Adoption of
  Spectrum Efficient Technologies

The current structure and management of spectrum in the United States-
allocating bands of spectrum to certain users for specific uses-may limit
the development and adoption of some emerging technologies that promise
improved spectrum efficiency. However, redefining this structure and
management of spectrum to take full advantage of future opportunities to
improve spectrum efficiency could be difficult due, in part, to the lack
of flexibility in the spectrum allocation system, policy makers' limited
knowledge about spectrum use and new and emerging technologies, as well as
a lack of agreed-upon models to assess these technologies. At the same
time, there are few regulatory requirements and incentives to encourage
agencies to develop and use spectrum more efficiently. The current federal
regulatory framework and system certification process tend to focus only
on major systems that directly use the radio spectrum and their compliance
with existing standards to avoid interference-not on spectrum efficiency.
A lack of incentives to achieve spectrum efficiency also limits agencies'
consideration of spectrum efficient technologies in the acquisition of
systems. However, providing such incentives is challenging, in part,
because financial considerations must be balanced with mission needs.

    Current Spectrum Structure and Management Could Constrain Efforts to Use
    Spectrum More Efficiently

To manage the use of the radio-frequency spectrum in the United States,
FCC and NTIA allocated the spectrum into federal, nonfederal, and shared
bands and designated specific bands for specific uses, such as broadcast
radio and television. Historically, this structure has served a valuable
function. In addition to seeking to avoid interference among users, the
structure has enabled spectrum leaders to balance government and
commercial interests, provide stability and design certainty for equipment
manufacturers, and accommodate a certain level of increased demand by
apportioning spectrum for future uses. However, the current allocation
structure has proven effective largely because technologies operated
within a fairly narrow range of spectrum. While emerging technologies that
use wider segments of spectrum or move across segments of spectrum may be
able to operate within current demarcations, greater efficiencies may be
achievable if these technologies were allowed to operate in an environment
that provides more operational freedom than the current structure.

With nearly all of the spectrum allocated and access rights granted to
users, such freedom tends to require increased "sharing" of the

spectrum16-that is, allowing more than one user to transmit radio signals
on the same frequency band.17 In working to increase spectrum sharing,
spectrum leaders will need to carefully consider the impacts on incumbent
users' operations and define appropriate rules to mitigate those impacts.

However, attaining agreement on such rules may be difficult and could
result in operational constraints that reduce the promise of increased
spectrum efficiency. For example, radios that are largely defined by their
software components could provide greater efficiencies if software enabled
them to operate in a shared environment-as DOD hopes to do with JTRS.
Currently, DOD is developing 34 waveforms18 for use in JTRS radios. Of
these, 33 waveforms are to be operationally identical to their respective,
already fielded, traditional radio counterparts and, consequently, will be
able to operate in the current spectrum structure. However, these
waveforms will be no more efficient than their existing radio
counterparts. While the remaining waveform promises to achieve greater
spectrum efficiency in providing voice, video, and data services, it
requires access to a wider swath of the spectrum, which JTRS program
officials believe will challenge the current spectrum structure and
certification process because it could impact other users' operations.
JTRS program officials stated that for the near term, some of the concerns
associated with the new waveform could be addressed by using software
"lockouts" to ensure that sensitive bands are protected. However, to
achieve greater efficiency, JTRS program officials believe that spectrum
sharing issues will need to be worked out, and spectrum policies and rules
will need to be adjusted.

16 Greater freedom could also be achieved through "band clearing"-moving
incumbent users to other parts of the spectrum. Because this reallocation
could take significant time and funding to accomplish, band clearing is
difficult to implement.

17 In a shared spectrum allocation, "primary" users have priority over the
use of a frequency and "secondary" users must defer to the primary user.
Users may also be designated as "coprimary," in which the first operator
to obtain authority to use the spectrum has priority to use the frequency
over another primary operator.

18 A waveform is the representation of a signal that includes the
frequency, modulation type, message format, and/or transmission system. In
general usage, the term waveform refers to a known set of characteristics,
for example, frequency bands (VHF, HF, UHF), modulation techniques (FM,
AM), message standards, and transmission systems. In JTRS, the term
waveform is used to describe the entire set of radio functions that occur
from the user input to the radio-frequency output and vice versa. A JTRS
waveform is implemented as a re-useable, portable, executable software
application that is independent of the JTRS operating system, middleware,
and hardware.

As software-defined radios become more sophisticated, the challenge in
employing them will become even greater. For example, software-defined
cognitive radios-radios that adapt their use of the spectrum to the
realtime conditions of their operating environments-could be used to sense
unused frequencies, or "white spaces," and automatically make use of those
frequencies. According to FCC, many portions of the radio spectrum are not
in use for significant periods of time and that tapping into these white
spaces-both temporal and geographic-could significantly increase spectrum
available for use.19 It may also be possible to use software-defined
cognitive radios to exploit "gray spaces" in the spectrum-areas where
emissions exist but that could accommodate additional users without
raising the overall noise level in a band to a level unacceptable to
incumbent users-to increase spectrum efficiency.20

However, employing the technologies needed to exploit these spaces could
present significant problems of interference. Currently, FCC is exploring
a new approach to cognitive radios and interference control and
management21 based on the concept of measuring "interference
temperature."22 Under this concept, the interference temperature in a
given band would be measured, and devices receiving these measurements
would restrict their operations in order to maintain the interference
temperature at or below a prescribed limit for that band. In the simplest
case, the entire process would take place within an individual device,
such as a software-defined cognitive radio capable of measuring the
interference temperature at its location and making a decision to transmit

19 FCC Spectrum Policy Task Force Report; ET Docket No. 02-135
(Washington, D.C.: Nov. 2002).

20 DOD's DARPA has a major effort under way (the Next Generation
Communications Program) to develop enabling technologies and system
concepts to dynamically use the spectrum through real-time sensing of the
spectrum environment and adjustment of radio operations to take advantage
of white and gray space opportunities. Its goal is to increase spectrum
access by a factor of 10.

21 FCC Notice of Proposed Rulemaking and Order In the Matter of
Facilitating Opportunities for Flexible, Efficient, and Reliable Spectrum
Use Employing Cognitive Radio Technologies; FCC 03-322 (Dec. 30, 2003);
FCC Notice of Inquiry and Notice of Proposed Rulemaking in the Matter of
Establishment of an Interference Temperature Metric to Quantify and Manage
Interference and to Expand Available Unlicensed Operation in Certain
Fixed, Mobile and Satellite Frequency Bands; FCC 03-289 (Nov. 28, 2003).

22 "Temperature" refers to a measure of the undesired radio-frequency
power in a particular band and location. FCC's Spectrum Policy Task Force
developed the concept of an interference temperature to characterize and
quantify undesired (interfering) transmitters' contributions to
radio-frequency energy at a receiver's location.

or not transmit based on this measurement plus its own contribution of
radio-frequency energy. However, the interference temperature concept is
controversial and in the view of many has yet to be successfully
demonstrated in a practical context. NTIA believes that more study is
needed to determine what might be the "correct" tool for quantitatively
controlling interference between mobile and unlicensed transmitting
devices that share spectrum with existing telecommunication facilities.

    Lack of Knowledge and Varying Perspectives about Spectrum May Further
    Constrain the Use of More Spectrum Efficient Technologies

The extent to which emerging and future technologies, such as those that
would exploit white and gray spaces, could be utilized to increase
spectrum efficiency is dependent on the degree of freedom these
technologies would be provided to operate across the spectrum. While
unconstrained operation may not be realistic-given the sensitivity of
certain uses of spectrum-it may be possible to develop policy-based rules
to maintain some constraints, such as blocking the use of certain
frequency bands, while allowing greater freedom in other areas of
spectrum. Defining such rules, however, requires a level of understanding
of the spectrum environment-including how and how much spectrum is
used-and spectrum efficient technologies that NTIA and FCC do not
currently have. For example, in 2002, the FCC's Spectrum Policy Task Force
noted that in order to define rules for the implementation of the
interference temperature concept, additional knowledge-including the need
to acquire data on the current ambient noise levels for different
frequency bands and geographic regions-would be required.23 To that end,
the Task Force recommended a systematic study of the spectrum environment.

Currently, NTIA has the capability to capture knowledge needed to better
understand the radio spectrum environment through a radio spectrum
measurement program, which it established in 1973 to assess whether
spectrum is being used in accordance with applicable regulations and to
provide information to prevent or resolve interference problems involving
federal government systems.24 However, the measurement program is

23 Under the proposed approach, an interference temperature metric would
establish maximum permissible levels of interference, thus characterizing
the "worst case" environment in which a receiver would be expected to
operate. Different threshold levels would then be set for each band,
geographic region or service based on an understanding of the radio
frequency environment.

24 FCC and FAA also have spectrum-monitoring capabilities.

limited to measuring and recording radio signals between 10 kHz and 20 GHz
at selected sites through equipment housed in a single van (see fig. 1)25
and in portable suitcases. As such, the van has been used primarily to
help reach consensus on difficult or unusual interference and spectrum
sharing problems having a high national importance. For example, such
measurements have assisted in reaching some consensus on the use of
ultra-wideband (UWB) devices, expanded 5 GHz unlicensed device operation,
and broadband over power lines. According to NTIA, all of these activities
directly support the Administration's goals related to facilitating
emerging technologies. However, the last compliance-type measurements were
conducted in the mid-1980s. According to NTIA, these measurements were
discontinued because of a lack of resources and generally low benefits
provided to national spectrum management. NTIA has also discontinued its
broadband spectrum surveys-which covered the spectrum from about 100 MHz
to 20 GHz.26 The last broadband survey measurements were made in the San
Francisco area in 1995 with results reported in 1999.

25 In fiscal year 2002, NTIA received $2.1 million to replace the van. The
replacement van was used for the first time in the summer of 2003.

26 The term "broadband" used in this context refers to a survey of
multiple radio frequency bands. The use of the term here does not refer to
technologies that encompass all evolving high-speed digital technologies
that provide consumers integrated access to voice, highspeed data,
video-on-demand, and interactive delivery services.

Figure 1: NTIA's Spectrum Measurement Van

Source: NTIA.

In addition, NTIA lacks sufficient information to more accurately model
and test the impact of emerging technologies to determine their likely
operational characteristics. For example, NTIA must typically rely on
federal agencies to provide information on the technical characteristics
of their radio communication systems. According to NTIA officials, this
information has been insufficient to perform detailed analyses of some
technologies. Furthermore, since NTIA and FCC have different spectrum
management responsibilities-federal and nonfederal, respectively-they have
different perspectives on spectrum use. NTIA tends to focus on protecting
the federal government's use of the spectrum from harmful
interference-especially in areas critical to national security and safety-
while FCC tends to focus on maximizing public access to and use of the
spectrum. As a result, NTIA and FCC have different perspectives on the
assumptions and operational scenarios that should be used to assess
potential interference from new technologies. This divergence can lead to
difficulties in establishing agreed-upon service rules and technical
standards, resulting in delays in accommodating new technologies.

The effect of limited knowledge and varying perspectives on defining
policy-based rules is demonstrated in the government's recent efforts to
accommodate commercially developed low-power UWB devices,27 which offer
greater utilization of the spectrum in a shared environment. Potential
uses include radar imaging of objects buried underground or behind walls
and short-range, high-speed data transmissions. Because UWB devices
transmit over large swaths of spectrum and emit into spectrum used by both
federal and nonfederal users, NTIA and FCC have shared responsibilities in
their use. However, there has been considerable debate over how much
interference UWB devices would cause to other spectrum users-with
particular concern for protecting the Global Positioning System and public
safety systems. For example, NTIA was concerned that allowing UWB systems
to emit intentionally into certain bands would cause potential
interference to vital federal government services. To assess the potential
impact of introducing UWB devices into the spectrum environment, NTIA had
to make assumptions about the devices' characteristics and simulate their
transmissions because commercial UWB devices were not available for
testing.

In February 2002-after substantial debate among NTIA, FCC, and other
interested parties-FCC established rules to allow the development and
marketing of unlicensed, low-power UWB devices in a limited frequency
range and with power limitations, based in large measure on standards
recommended by NTIA.28 However, FCC has expressed its intent to revisit
the adopted standards eventually because of its concern that the standards
may be overly stringent-reflecting technical analyses of "worst case"
scenarios, not real-life operating conditions-and could unnecessarily
constrain development of UWB technology.29 Conversely, some federal
agencies remain concerned that not enough is known about how UWB interacts
with existing systems, including the aggregate effect of large numbers of
UWB devices. According to FCC officials, UWB device manufacturers
expressed concerns that their investments in components that comply with
the adopted standards would be lost if a less restrictive order is adopted
too soon. In February 2003, FCC made minor changes to

27 UWB devices employ very narrow or short duration pulses to create
wideband transmissions.

28 NTIA has also established similar rules governing federal use of
low-power UWB devices.

29 The lack of technologies capable of providing users with real-time
knowledge of spectrum environments has required an approach to spectrum
management based on worst-case assumptions to minimize interference.

UWB regulations but opted not to make any significant changes to the
existing UWB technical parameters, citing the lack of experience with UWB
devices and concerns that any major changes to the rules for existing UWB
product categories would be disruptive to current industry product
development efforts.

    Federal Requirements to Invest in Spectrum Efficient Technologies Are
    Limited

NTIA is responsible for promoting the efficient and effective use of
spectrum that has been assigned to federal users. However, the current
regulatory framework and system certification process for federal spectrum
use tend to focus on compliance with existing standards to avoid
interference, not on spectrum efficiency. Furthermore, agency regulations
do not systematically require the consideration of spectrum efficiency in
the development and acquisition of systems.

While NTIA's certification process helps avoid interference, it does not
directly consider whether the fielded system would use too much spectrum
or could incorporate other technologies to improve spectrum efficiency. In
general, NTIA's certification process focuses on maintaining the integrity
of the current spectrum structure by ensuring that

o  	fielded systems operate in a frequency band allocated for the type of
service they provide, such as maritime mobile radio;

o  	frequency assignments are available for systems to operate in their
intended operational environment; and

o  	the technical characteristics of fielded systems are compatible with
the operation of other systems, that is, they will not significantly
interfere with others.

NTIA's ability to influence spectrum use is also somewhat limited because
it only receives and reviews spectrum certifications for "major" federal
systems that directly use the radio-frequency spectrum-that is, systems
that could have significant impact on other users of the radio spectrum-
with each agency determining which of its systems are major. In addition,
systems that utilize spectrum, but are not direct transmitters or
receivers of radio waves, such as network routing strategies, are not
subject to the certification process and therefore not within NTIA's
influence. Finally, NTIA officials told us that in general, individual
agencies have not identified and reported their long-term requirements for
spectrum. These officials also indicated that telecommunication
investments are not easily identifiable because agency budget submissions
do not break out or otherwise provide the ability to readily identify
investments for systems that require spectrum. Although agencies must
obtain spectrum

certification prior to submitting budget proposals to OMB for approval, as
required by OMB Circular A-11, NTIA officials told us that OMB does not
routinely receive this information from NTIA nor systematically review and
coordinate intended spectrum use during its review of agency budget
submissions. Because agency investment in radio spectrum dependent systems
cannot be readily identified, NTIA officials also stated that NTIA has
generally had to react to spectrum demands as they become apparent through
the certification process as opposed to planning for future spectrum use.

NTIA has generally relied on agencies to ensure that their systems are as
spectrally efficient as possible.30 However, the acquisition guidance and
policies of the agencies we reviewed do not require the systematic
consideration of spectrum efficiency in the design and development of
systems. Similar to NTIA's certification process, these agencies' internal
certification procedures tend to focus on avoiding significant
interference among systems. For example, FAA's policy for the use of radio
spectrum identifies spectrum efficiency as a broad objective, but its
certification process focuses mainly on equipment characteristics and
compliance with NTIA standards and national and international spectrum
allocation rules. While DOD's acquisition policies and procedures require
system developers and acquirers to consider spectrum supportability, they
do not specifically require consideration of spectrum efficiency. Ensuring
spectrum supportability could ultimately result in some spectrum
efficiencies. However, we have previously reported that DOD's weapons
programs often failed to obtain, consider, or act on spectrum
supportability knowledge during the early stages of acquisition,31 as
required by DOD policy. Several weaknesses underlie this failure,
including program managers' lack of awareness of spectrum certification

30 A few NTIA policies and technical standards do specifically require
federal agencies to improve efficiency in a few portions of the spectrum.
For example, in 1992, the Congress directed NTIA to adopt and implement a
plan for federal agencies with existing mobile radio systems to use more
spectrum efficient technologies. In response, NTIA required all federal
agencies to upgrade their land-based mobile systems through narrowbanding,
a process for reducing the amount of spectrum needed to transmit a voice
signal, by 2008. NTIA also established a trunking program for land mobile
systems in certain areas of the country. The trunking technique allows
systems to share a common set of voice radio channels to conserve
spectrum. For more information on NTIA's efforts to promote efficiency
through its narrowbanding and trunking policies for land mobile radios,
see GAO-02-906.

31 U.S. General Accounting Office, Spectrum Management in Defense
Acquisitions, GAO-03-617R (Washington, D.C.: Apr. 30, 2003).

requirements, out-of-date and unclear spectrum management publications,
competing demands of program mangers, and a lack of effective enforcement
mechanisms for existing spectrum certification requirements.32

    Creating Incentives to Encourage the Development and Use of Spectrum
    Efficient Technologies Is Challenging

The fact that spectrum is virtually cost free may influence whether
agencies consider spectrum efficiency and invest in spectrum efficient
technologies. Currently, agencies have little or no economic incentive to
use the radio-frequency spectrum more efficiently because they pay only
small administrative fees for its use. Once it is allocated and users gain
access to the spectrum, there are generally no financial incentives for
them to consider accommodating other users, or in many cases, even to move
to more efficient technologies. Incentives-both governmentwide and
agencywide-could theoretically go a long way in encouraging agencies to
proactively develop and use spectrum efficient technologies. However,
incentives may not be appropriate, desirable, or feasible in all
circumstances.

In the private sector, the goals of maximizing profits can be a strong
incentive to increase efficiency and utilization of the spectrum. For
example, firms offering cell phone service may use various technologies,
such as modulation techniques, to increase the number of cell phone users
in a particular band. While market-based incentives promote efficiency,
this model is not easy to apply to the federal sector-largely because
government agencies need to balance their missions of providing public
benefit with achieving economies and the difficulty of finding ways to
apply these economies.

For more than a decade, NTIA and others have considered the use of
market-based incentives to promote spectrum efficiency in the federal
government. In its 1991 report U.S. Spectrum Management Policy: Agenda for
the Future, NTIA suggests exploring with FCC various fee proposals that
would invoke the forces of supply and demand to create market-based
mechanisms for spectrum management. Following this report, NTIA imposed
agency fees to cover its administrative costs, which amount to about $55
per assignment. In November 2002, FCC's Spectrum Policy Task Force Report
also discussed the use of fees to improve

32 In our April 30, 2003, report, we made several recommendations aimed at
addressing these weaknesses.

spectrum efficiency in the public sector where market forces may be
inadequate to spur efficiency. In October 2003, the Center for Strategic
and International Studies reported that market approaches such as licenses
that can be traded or sold would allow the market to determine the most
efficient use of the spectrum.33 The President's Spectrum Policy
Initiative, chaired by the Secretary of Commerce, is currently examining
issues of spectrum efficiency. Adopting market-based incentives to
encourage spectrum efficiency is not limited to the United States. To
varying degrees, Australia, Canada, and the United Kingdom have put in
place mechanisms to reflect the opportunity costs associated with
government spectrum use. These mechanisms include auctions and
incentive-based fees, more flexible licenses, and secondary markets. The
three countries have reported more flexibility in reassigning and
allocating spectrum to its most efficient use.

However, creating viable economic incentives to achieve spectrum
efficiency in the U.S. federal government may be difficult. As we have
previously reported,34 NTIA could face several challenges if it decides to
use such incentives. First, implementing a market-based approach may be
difficult for some agency functions that are critical and unique, such as
public safety and national defense. Second, incentives that would require
greater flexibility among license holders of spectrum may ultimately
result in problems of interference. Although flexibilities have resulted
in improved spectrum efficiency in other countries, these flexibilities
may not apply to the United States because of the unique and worldwide
missions of the U.S. military and the divided structure and missions of
the U.S. spectrum management system. Third, it is unclear whether
licensees would have the right to buy and sell spectrum, and what rights
would be conferred and under what circumstances rights would be granted.
Finally, while it may be possible to impose fees on federal agencies' use
of assigned spectrum, it is far from obvious how such fees or other
economic incentives could be applied to agencies' opportunistic use of
white and gray spaces in the spectrum-as would be the case with
software-defined cognitive radios, which adapt their use of the spectrum
in real time. In its 2002 report, FCC also acknowledged that there are
instances where

33 Center for Strategic and International Studies, Spectrum Management for
the 21st Century: A Report of the CSIS Commission on Spectrum Management,
(Washington, D.C.: Oct. 2003).

34 GA0-03-277.

regulation, as opposed to a market-oriented approach, is more appropriate.

Conclusions

Recommendations for Executive Action

With the rapid advances in telecommunications technology and the
increasing demand-both public and private-for radio-frequency spectrum,
NTIA and FCC are faced with the daunting task of achieving greater
spectrum efficiency while maintaining the level of services that users
have come to expect. Further development and use of spectrum efficient
technologies may provide an answer to this dilemma without negatively
affecting the ability of agencies to carry out their missions; however,
users have not actively pursued these technologies because there are few
regulatory requirements or incentives to do so and because factors
associated with the nation's current spectrum management system may not
encourage the use of these technologies. To ensure the most efficient use
of spectrum, it will be necessary to rethink the current environment in
which spectrum is managed, define requirements, and examine the
requirements and incentives needed to encourage agencies to promote new
and emerging technologies for achieving spectrum efficiency. Efforts
currently under way at the national level, such as the President's
Spectrum Policy Initiative, provide an opportunity to establish
appropriate policies and mechanisms, including incentives, to facilitate
greater consideration of spectrum efficiency and create a more flexible,
adaptable spectrum management environment that allows emerging
technologies to fulfill their potential of spectrum efficiency. Without
greater flexibility and incentives, efficiency may remain an unmet
promise, and the growing demand for spectrum may soon threaten agencies'
ability to meet their missions.

We are making six recommendations to help increase the development and
adoption of spectrum efficient technologies. Specifically, we recommend
that the NTIA Administrator and the FCC Chairman jointly

o  	assess and determine the feasibility of redefining the spectrum
allocation system to build in greater flexibility where appropriate to
facilitate emerging technologies;

o  	develop and implement plans to gain a more thorough and on-going
understanding of the current spectrum environment; and

o  	strengthen efforts to develop jointly accepted models and
methodologies to assess the impact of new technologies on overall spectrum
use and increase opportunities to permit testing of those technologies.

  Agency Comments
  and Our Evaluation

To better ensure federal agencies consider and invest in spectrum
efficient technologies, we further recommend that the NTIA Administrator

o  	establish guidance for agencies to determine and report their future
spectrum requirements;

o  	strengthen NTIA's spectrum certification process to more directly
address spectrum efficiency; and

o  	determine approaches, where appropriate, for providing incentives to
agencies to use spectrum more efficiently and then pilot and measure the
effectiveness of those approaches.

We provided a draft of this report to the agencies that we reviewed. The
Department of Commerce, FCC, and DHS provided written comments (reprinted
as appendixes I, II, and III, respectively), and DOD, DOT, NASA, and NSF
provided oral comments. DOJ did not have comments.

FCC in commenting on the draft report supported our recommendations and
indicated it would work with NTIA to incorporate the report's findings and
recommendations in future work. FCC also emphasized a number of actions it
has taken to encourage and facilitate new technologies that might improve
spectrum efficiency. The Department of Commerce did not comment on our
recommendations but noted that NTIA and FCC "have met regularly to explore
areas of common focus in spectrum management." While we agree that meeting
regularly is an important step toward building a more cohesive spectrum
management process, it is not clear that these discussions have addressed
or will address our recommendations to improve spectrum efficiency.
Continued difficulty in reaching consensus between NTIA and FCC will
hinder opportunities to accommodate new technologies and users and improve
spectrum efficiency.

Several of the agencies' comments indicated their commitment to promoting
greater flexibility and more efficient use of radio spectrum. Overall, the
comments from agencies, other than NTIA and FCC, were generally technical
in nature and were incorporated where appropriate. In addition, the
agencies provided a few comments relating to our findings and
recommendations. Most notably as follows:

o  	NSF observed that future use of spectrum through software-defined
cognitive radios could adversely affect the operation of sensitive radio
telescopes that NSF supports. We agree that this is a valid concern
because these systems are "passive"-or receive only-and their use of

spectrum could go unnoticed. As noted in this report, when seeking to
increase spectrum sharing, spectrum leaders will need to carefully
consider incumbent users operations and define appropriate rules to
obviate those impacts.

o  	NSF, as well as DHS, also commented on our recommendations directed to
the NTIA Administrator. Specifically, NSF noted that incorporating
spectrum efficiency measures into the certification process of major
systems could prove difficult and suggested either deleting or modifying
the recommendation to focus on incentives. However, our recommendation
does not call for the creation of measures but rather emphasizes the need
for NTIA to focus on efficiency when considering certification. But in
doing so, NTIA may determine that measures are an appropriate means to
help increase spectrum efficiency and may be applicable in some cases.
Further, we have recommended that NTIA take action to determine
appropriate incentives for agencies to use spectrum more efficiently.
Therefore, we did not modify our recommendations. Contrary to NSF, DHS
stated that incentives do not apply to the government. While we recognized
that incentives may not be applicable or desirable in all circumstances,
we believe that there may be opportunities to use incentives to promote
consideration of spectrum efficiency, and therefore recommended that such
opportunities be explored.

We are sending copies of this report to the Acting Assistant Secretary of
Commerce for Communications and Information and Administrator of the NTIA,
the Chairman of the Federal Communications Commission, the other agencies
we reviewed, and interested congressional committees. We will also make
copies available to others upon request. In addition, the report will be
available at no charge on the GAO Web site at http://www.gao.gov.

If you or your staffs have any questions about this report, please contact
me at (202) 512-4841 or John Oppenheim at (202) 512-3111. Other
individuals making key contributions to this report are Bruce Thomas, Jay
Tallon, Gary Middleton, Karen Sloan, and Allison Bawden.

Katherine V. Schinasi
Managing Director
Acquisition and Sourcing Management

                     Page 32 GAO-04-666 Spectrum Management

Appendix II: Comments from the Federal Communications Commission

Appendix II: Comments from the Federal Communications Commission

Appendix II: Comments from the Federal Communications Commission

                        Appendix III: Comments from the
                        Department of Homeland Security

Appendix III: Comments from the Department of Homeland Security

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