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The weapons of the twentieth century are not as important as they once were for national security. The United States is in a global competition with China over markets, rule setting, and technological leadership. Networks and telecommunications, particularly wireless telecom like 5G, are essential tools in this competition, but current U.S. spectrum allocations are not optimized for the contest the United States is in now. Changing this requires rethinking national security to emphasize technological leadership and the ability to innovate, something the current administration has done well, except in spectrum. The United States is falling behind. To remain competitive, the United States will need to adjust how it has allocated radio spectrum to emphasize commercial innovation. The government-centric spectrum allocations of the last century will need to change if we are not to fall behind.
The spectrum issue is not about mobile phones and consumers. It is about the enterprise uses mobility will create in factories, hospitals, and businesses writ large. Earlier CSIS reports explain the value and use of spectrum. Spectrum-using technologies are crucial for the next phase of innovation and economic growth, but the United States is so preoccupied with its domestic battles over spectrum that it has lost sight of the larger contest over who will build the global infrastructures for the digital economy. If the current trend continues, China will be the builder of this century’s digital infrastructure.
Allowing this to happen would be an odd outcome given the effort the United States put into reversing China’s effort to have Huawei, China’s leading telecommunications company, provide the telecommunications infrastructure for the world. The U.S. effort on 5G has been a partial success, but an inability to lead in setting spectrum standards undercuts it. Most countries have aligned with China on spectrum allocations because the mid-band spectrum it and others have decided upon for licensed spectrum is best for modern telecommunications, but in the United States, it is reserved for government purposes.
The irony of course is that the U.S. military will have to operate in countries and regions where the spectrum it has reserved domestically for military use will be given over to commercial use (often using Chinese telecom equipment), creating interference problems for its tactical communications and intelligence opportunities for China. The United States’ answer is to seek concessions on spectrum use from other nations or simply turn up the power and override foreign commercial uses. There is a precedent for this: Russia, North Korea, and Syria use high-powered global positioning system (GPS) jamming, disrupting air travel in neighboring countries. These three nations are hardly the model for U.S. policy.
GPS jamming points to a central problem for the United States: the growing importance of electronic warfare (EW), an area where Russia has made significant improvements in its invasion of Ukraine and where some analysts believe China is also deploying superior capabilities. The United States is used to operating unchallenged in the EW domain against unsophisticated opponents. At one point, the U.S. Army even disbanded some EW units. The United States is no longer in an unchallenged environment and spectrum policy needs to take into account both the EW dilemmas the United States now faces and the pressing need for modernization. A recent CSIS report on the concrete impacts of spectrum allocation on U.S. national security interests will explore in depth the operational implications of U.S. spectrum leadership, including a particular focus on these electronic warfare considerations.
There is a general recognition that advanced technologies are a source of economic and military strength, but U.S. spectrum policymaking has not caught up with this. Innovation and the adoption of new technologies are the keys to the long-term growth that undergirds enhanced national power. Since the end of the Cold War, the source of advanced technologies has shifted from the government to the commercial sector. The countries that do best are those that are able to exploit commercial technological developments. Commercial technologies underpin modern military strength. The pace at which nations adopt new technologies will determine their power relative to others. So, it is disturbing to see the United States gridlocked on outdated spectrum allocations that undercut its ability to remain technologically competitive.
While the cumbersome spectrum management process the United States still uses is gridlocked, the administration is aware of the issue and hopes that spectrum-sharing solutions, where government and commercial users can use the same spectrum, will solve the problem. There are several challenges to turning this hope into reality. First, the world will not wait for the United States to invent its way out of a self-made spectrum shortage. Telecom investment occurs in cycles that take place over eight to ten years and spectrum-sharing technologies, should they actually work, will appear too late for the current cycle. This will happen irrespective of progress in the adoption of O-RAN (open radio access networks), a key part of wireless telecommunications and a technology that the United States hopes will undercut the market for Huawei equipment.
Similarly, the international body that allocates spectrum (in a global negotiation known as the WRC) will meet again in 2027 and even in the most optimistic scenarios, U.S. spectrum-sharing alternatives will not be ready for global deployment by then. This slow pace would be less of a problem if the United States did not face a powerful competitor—China—with the ability to produce advanced technology and a willingness to subsidize customers to get people to use its technology. This has already produced dominance in Africa and the Middle East, and as nations (including in Europe and Brazil) begin to migrate to 6G, U.S. spectrum policy may cede leadership in global telecommunications to China.
Put simply, the country that builds and maintains telecom infrastructure can, if it is unscrupulous, gain immense intelligence advantage. U.S. spectrum policy is a boost for Chinese espionage, including in the United States. The experience of European countries that used Huawei for 4G networks was that there was an uncontrollable risk of spying and disruption. This is not a commercial competition and U.S. spectrum policy cedes advantage to China.
U.S. spectrum policy is complicated by earlier decisions to allocate large bands of valuable spectrum to unlicensed use, for connectivity uses such as Wi-Fi. Other countries have allocated spectrum for Wi-Fi, but not to the degree as the United States, and in key bands, other countries have allocated it in whole or in part to 5G, leaving the United States largely isolated. Wi-Fi lacks the coverage and reliability needed to power the broad digital economy. It’s indicative that no other country has taken this approach. Sometimes going it alone as the United States has done with licensed spectrum allocation is a sign of leadership—and the United States is the world leader in consumer applications enabled by unlicensed spectrum. However, this creates an opportunity for China to lead in the licensed spectrum bands where the digital infrastructure for industrial uses and applications in health care, manufacturing, and logistics will be developed. Equally important, investors are reluctant to finance a digital infrastructure based on unlicensed spectrum. The risks are too high. The disproportionate focus on unlicensed was a strategic blunder that the present spectrum policy only makes worse.
The United States was a pioneer in spectrum use, but this now turns out to be a potential barrier to economic growth. The largest consumers of spectrum resources before the mobile phone were in government. Government incumbents, unsurprisingly, are reluctant to move from the spectrum they have been allocated given the expense and inconvenience. If the United States does not use a harmonized spectrum, it shrinks the economies of scale that trusted vendors need to compete with Huawei. If the United States was the only country to use spectrum this would not be as great a problem, but digitization is global and the competition to supply the digital market is intense. In simple terms, people will build devices to use specific spectrum bands for commercial purposes designated by the WRC. Essentially, if the United States does not use spectrum allocated everywhere else for commercial purposes, it will be handicapped in any competition.
While U.S. inaction protects spectrum-using technologies from the twentieth century, China has a more ambitious plan (judging from a consistent series of actions and investments it has taken). First, as with other areas of trade, it uses a variety of subsidies to offer telecommunications infrastructure technology at below-market prices. In the past, Huawei technology was not the best, but it is now at par with Western suppliers, comes with installation subsidies, and with packages of low-cost or no-cost financing and loans that the United States and its allies have been unable to match.
Building, installing, updating, and, in some cases, even operating a national telecommunications infrastructure provides an immense intelligence advantage. Subsiding Huawei let China assemble a global communications surveillance network (part of its larger effort to build a global technical intelligence system). U.S. spectrum policy plays right into China’s hands. The billions of cell phones that have become central to modern life and the infrastructure technology that supports them will use a different frequency allocation for the next generation of connectivity in factories, hospitals, logistics, and other commercial applications. Manufacturers of telecommunications equipment will choose to build to global standards (to get the biggest market).
The long-term effect is to undercut the U.S. competitive edge. Major network upgrades occur about every ten years—the world is at the start of another such upgrade with the deployment of the next generation of mobile technology. Each generation uses different radio frequency spectrum bands and new designs to work in those frequency ranges. U.S. spectrum policy is increasingly out of sync with the rest of the world since it reserves much more spectrum for military use and allocates more spectrum to short-range unlicensed technologies than other countries.
Remedying this will not be easy because of the deterioration in the U.S. ability to manage spectrum. The most prominent failure is the inability to renew the Federal Communications Commission (FCC)’s auction authority. Even though this is the administration’s preference, some agencies lobby Congress against it. Auction authority is important as it provides a mechanism for moving spectrum to new uses that support the United States’ ability to innovate and grow economically, and for recouping costs using under a Spectrum Relocation Fund (SRF), a George W. Bush administration initiative that needs to be updated for present needs. Previous auctions have raised billions of dollars that could be used to modernize equipment and, equally important, provide funding to allow the United States to complete its rip-and-replace program for telecom infrastructure.
Rip-and-replace compensated telecom companies to remove Huawei infrastructure equipment, given the risk of Chinese espionage. Unfortunately, the rip-and-replace program ran out of money, leaving Huawei equipment in about 20 percent of equipment (mainly in smaller companies, often located near sensitive military facilities). The price tag for this is a few billion dollars, difficult so far to appropriate, but renewed auction authority could finish the job of getting China out of U.S. telecommunications networks and provide tangible benefits to U.S. security. Renewed auction authority with congressionally designated bands for auction would provide the funds needed to finish rip and replace.
This burden falls mainly on Congress. Congress needs to renew FCC auction authorities, direct auction proceeds to be used not just for relocation but also for Department of Defense research modernization, and to finish rip-and-replace. The timing for action is short, perhaps a year or two since a failure to act puts the United States at the cusp of a great strategic blunder that will let an ambitious China build the network that forms the backbone of the global economy. Leading in artificial intelligence, quantum, or semiconductors will not change this; to the contrary, the spectrum shortage will actually handicap U.S. efforts to lead in these derivative technology efforts. The United States does not want to be known as the winner of the twentieth-century strategic technology competition, but the loser in the twenty-first century.
James A. Lewis is a senior vice president and director of the Strategic Technologies Program at the Center for Strategic and International Studies in Washington, D.C.
