Fierce Wireless has a great column today(Opens in a new window) about something that should be on everyone’s radar: next year’s potential auctions of 600MHz wireless spectrum.

If you like the Internet (and who doesn’t?) this should be critically important to you because 600MHz spectrum can travel great distances and does an excellent job penetrating buildings. For a wireless carrier to have truly solid coverage, it needs a mix of low-frequency and high-frequency spectrum. Low-frequency airwaves pass through walls, although they don’t have tremendous data capacity; high-frequency networks are good for denser cities with lots of users in a small space.

Part of why Sprint and T-Mobile have always struggled with coverage relative to AT&T and Verizon is because they generally lack low-frequency licenses. AT&T, Verizon, U.S. Cellular, and some small rural carriers now own most of the 700MHz and 850MHz spectrum in the U.S. Most of Sprint’s and T-Mobile’s networks are on 1700MHz, 1900MHz, and 2100MHz.

The relative lack of low-frequency spectrum is why Sprint has hustled so hard to get LTE onto Nextel’s old 800MHz network, so it can complement its 1900MHz system. That’s coming soon, but while Sprint has Nextel spectrum nationwide, it’s broad but not very deep; there’s just not that much capacity.

AT&T and Verizon Should Sit This One Out
We established a while ago that this nation of more than 300 million people needs four competitive wireless carriers to avoid having the wireless world descend into the grim, slow-moving duopoly that characterizes our wired home Internet market. The FCC explained why in an extensive report when it shot down the AT&T/T-Mobile merger.

But AT&T and Verizon have deeper pockets than any other players, so they can win pretty much any auction they feel like. That means they get first pick at any new spectrum, which just increases their advantage. The two “twin Bells” have become too big to fail.

Without regulation, we’d probably only have two carriers right now, as AT&T would have bought T-Mobile, forcing Verizon to buy Sprint in response. For adequate competition to remain in place, other players need access to low-frequency spectrum. That’s not going to happen if AT&T and Verizon, or their proxies, are allowed to bid for all of it.

This doesn’t mean the government should throw the auction over to Sprint and T-Mobile. The goal is competition, not picking winners. Over the past few years, we’ve seen other players trying to enter the U.S. wireless market, most notably LightSquared. The key is not who wins the spectrum; it’s who doesn’t.

In Phil Goldstein’s Fierce Wireless column, he cites an analyst who said that AT&T and Verizon would probably be the fastest to build out the spectrum, offering the most coverage to the most people the most quickly. That’s probably true. But you have to look at the bigger picture: without adequate competition, they wouldn’t be doing so.

AT&T’s history with its LTE network proves this point. Back during the AT&T/T-Mobile merger morass, AT&T insisted that it would only be able to cover 80 percent of the nation with LTE if it wasn’t allowed to swallow T-Mobile. Well, it wasn’t allowed to do so, and it’s finding a way to cover 95 percent of the population with LTE. How? Why? Competition.

Revenue Isn’t The Highest Goal
There’s another issue that could complicate things here: an auction without AT&T and Verizon will make less money. With the weird rules of the 600MHz auction, that might also mean freeing up less spectrum, as some of that money needs to be used to pay off radio broadcasters.

But vibrant competition drives not tens of billions, but hundreds of billions of dollars of the economy. Goldstein’s column says that locking AT&T and Verizon out could reduce the government’s take from $31 billion to $19 billion. That could actually be a boon in the long term, as cheaper, high-quality spectrum could encourage new entrants to play. What if Google grabbed some to set up metropolitan area networks, or even cities or states did so themselves? And if ensuring competition means a little less spectrum is freed up now, it’ll probably become available further down the line as the wireless Internet space becomes yet more vibrant and profitable.

Think about it. We’re still living with spectrum allocation decisions made in the 1920s. That’s almost 100 years ago. The allocations made at these auctions are a very long-term thing, and they need to be made with the long-term competitive good of America in mind, and not the budget-balancing needs of the moment.

Vibrant wireless competition between more than two players drives innovation, opportunity, and jobs. That’s why this upcoming spectrum needs to go primarily to firms other than AT&T and Verizon Wireless.