What Is Unlicensed Spectrum and How Does It Contribute $95.8B Annually to the Economy?

What is Unlicensed Spectrum and how Does It Contribute $95.8B Annually to the Economy?

A new report from the Consumer Technology Association (CTA) estimates that Wi-Fi and other unlicensed wireless technologies generate $95.8 billion per year for the American economy in technology sales alone. The study underscores the importance that the FCC has put on opening up more unlicensed spectrum, pointing to the enormous benefits in investment and innovation that this policy produces for the country. CTA’s study expands on previous studies on the importance of unlicensed technologies that have examined indirect economic benefits by focusing on the immediate revenue generated by the sale of these devices.

So what is unlicensed spectrum? The term refers to the radio frequencies set up to drive innovation—they are open to any use and by anyone, as long as devices follow certain technical rules. Decades ago, the US was the first country in the world to create unlicensed spectrum and it was one of the best decisions the FCC ever made. Other frequency bands are either strictly limited to particular technologies (like TV and radio bands) or are auctioned for use only by a small group of companies (like cell phone bands). But unlicensed bands offer the most room to innovate. That’s why unlicensed bands gave us the most important wireless technology in the world—Wi-Fi—as well as Bluetooth, and many new smart home and smart city technologies.

Wi-Fi has been an unrivaled success for the country. More traffic travels over Wi-Fi than any other wireless technology. But as people use more Wi-Fi devices for more things every day, the unlicensed bands can get crowded. That’s why the FCC recently took action to free up more unlicensed space in the 5.9 GHz and 6 GHz bands. By freeing up more space for unlicensed use, the FCC increased Wi-Fi frequencies just as Americans need it most.

With this new spectrum, investment and growth continues to flow, leading to the impressive $95.8 billion boost to the U.S. economy, according to CTA’s report. As networks continue to outpace demand and reach multigigabit speeds, the stage is set for whatever groundbreaking innovative technology comes next. And as long as the FCC continues its policy of finding new unlicensed spectrum in the future, spectrum congestion won’t undermine innovation. A balanced spectrum policy that supports both unlicensed and licensed frequencies is therefore fundamental for the future success of America’s economy. To learn more about wireless spectrum, how it is allocated, and the role it plays in day-to-day life, be sure to read our position page.