Washington lobbying campaigns have become more sophisticated, expanding to include the hiring of economists at prestigious universities to write research papers, to file counterarguments, and to attend meetings with the Federal Communications Commission to explain complex theories. Companies pay for their own research to help establish a body of work supporting their positions for the record.

AT&T

Verizon

T-Mobile

Sprint Spectrum limits “are likely to reduce auction revenues by billions of dollars, which will adversely affect the Federal budget deficit.”

— Haile, Meidan, Orszag Yale University

Philip Haile

Economics professor Virginia Tech

Jeffrey Reed

Professor of electrical and computer engineering Columbia University

Yeon-Koo Che

Professor of economic theory University of California, Berkeley

Michael Katz

Director of the Center for Telecommunications and Digital Convergence University of Pennsylvania

Michael Kearns

Professor of computer and information science Compass Lexecon

Mark Israel

Executive vice president

Andres Lerner

Executive vice president

Jonathan Orszag

Senior managing director

Maya Meidan

Senior economist “Proposals to restrict the participation of Verizon and AT&T in the Incentive Auction do not address any real world problem.”

— Marx Duke University

Leslie M. Marx

Economics professor Universiy of Maryland

Dan Vincent

Economics professor “A very minor change to” an AT&T example showing how spectrum limits can reduce revenue “produces greater revenue with limits than an auction with no spectrum-aggregation limits.”

— Rosston and Skrzypacz Stanford University

Gregory Rosston

Deputy director of the Stanford Institute for Economic Policy Research

Andrzej Skrzypacz

Economics professor American University

Jonathan Baker

Law professor of antitrust and economic regulation University of Maryland

Peter Cramton

Economics professor University of Cologne

Achim Wambach

Economics professor TWS Partners AG

Vitali Gretschko

Senior consultant

Stephen Knapek

Partner Past European spectrum auctions indicate there’s no evidence that spectrum limits affect auction revenues, but “they do appear to have been effective at maintaining the number of mobile operators in the marketplace.”

— Cave and Webb Imperial College Business School

Martin Cave

Visiting professor and deputy chair of the U.K. Competition Commission Surrey University

William Webb

Visiting professor and president-elect of the Institution of Engineering and Technology

Source: Federal Communications Commission filings

Buying academic research

But tracking traditional lobbying doesn’t tell half the story of the spectrum influence game.

Wireless carriers have hired economists from some of the most prestigious universities to conduct research to support specific positions and attend FCC meetings where they can explain arcane auction theories and rebut other economists’ papers filed by their rivals.

“With this [spectrum auction], the number of factors that go into what is right and wrong is very complicated and subject to debate,” Public Knowledge’s Feld said, “so this has been an extraordinary boon to academic economists. If you do spectrum auction research, you are making a lot of money now.”

AT&T has assembled the largest team of consultants and economists, most from top universities including Yale, Columbia, and the University of Pennsylvania.

One of the key studies the company has cited during its meetings with the FCC, according to the center’s research, was conducted by Philip Haile, an economics professor at Yale University, with co-authors Maya Meidan, an economist at the consulting firm Compass Lexecon LLC, and Jonathan Orszag, also at Compass Lexecon, a former member of President Bill Clinton’s National Economic Council.

The authors conclude the government would lose up to $13.4 billion if the FCC institutes the mildest limitations and twice that if tougher restrictions are followed. In a footnote on the front page of the study, the authors disclose that the study “was supported by funding from AT&T.”

T-Mobile has the second-largest team, with Greg Rosston, deputy director of Stanford University’s Institute for Economic Policy Research and a former deputy chief economist at the FCC, figuring prominently. Rosston and another Stanford economist proposed a bidding process in which spectrum limits are sequentially eased if not enough revenue is raised under the caps. T-Mobile also paid Jonathan Baker, an economist at American University, who argued spectrum limits can increase auction revenue.

“We have retained a number of experts … to help us respond and provide expert guidance on complex issues,” said T-Mobile’s O’Regan. He declined to disclose how much T-Mobile paid the economists, saying the compensation was “consistent with what gets charged in the market and the field” for such research.

Enjoying financial support

Verizon also has paid a former FCC economist on its team, Leslie Marx, who researches auction theory at Duke University’s Fuqua School of Business. Marx concluded in her research submitted to the FCC that an auction with no limits increases revenue and the amount of spectrum applied for mobile use.

AT&T and Verizon didn’t reply to repeated requests to comment on its spending on spectrum lobbying and support of research and associations.

Sometimes relationships are less obvious. Economists at Georgetown University’s Center for Business and Public Policy Research — including a former undersecretary of commerce in the Clinton administration and a former director of the Congressional Budget Office, Congress’ economic research arm — published a study in April 2013 that found spectrum limits would result in “a less robust and competitive auction and reduce auction revenues by as much as 40 percent” and slow the transition to faster networks, all arguments that are similar to AT&T’s and Verizon’s.

The center states on its website that it “has enjoyed the financial support” of AT&T and the Verizon Foundation and more than a dozen other organizations. John Mayo, an economics professor and executive director of the center, said the financial support didn’t lead to the study or influence its conclusions. He declined to say how much AT&T and Verizon gave to the center.

Spectrum caps “is an important topic that the Center’s experts in telecommunications policy proposed would be ripe for research, ultimately leading to our study,” Mayo said in an email. “The research methods, analysis, and findings in all Center studies are designed and determined solely by the authors and are released subject to internal quality review with no external input.”

The authors state on the front page of the study that their research “is not dependent upon any of the policy positions of current, previous or prospective Center supporters.”

“You can have a peer-reviewed journal article with good data by distinguished scholars that comes to a conclusion that goes to a corporate point of view, and that’s fine,” American University’s Thurber said. “But we should clearly know that it does [support a corporate view], and then we can make a judgment about whether there is a conflict of interest.”

Sprint has been much less active. The company filed a study by two European economists who found “restrictions on the amount of sub-1 GHz spectrum operators can acquire at auction have not resulted in any reduction in auction revenue in the myriad European nations that have adopted them.”

Sprint and T-Mobile also have funded groups supporting spectrum limits. The two carriers and Dish each gave between $10,000 and $24,999 in 2013 to the New America Foundation, which has met with the FCC to argue for caps on frequencies, according to the New America Foundation website.

“As always we are aligned with the other consumer groups and we are all in a coalition with the smaller carriers,” the foundations’ Calabrese wrote in an email. The financial support from T-Mobile, Sprint and Dish, however, was “not for any research papers or anything in particular.”

Free Press, a consumer advocacy and journalism organization in Washington that supports restricting spectrum purchases and has testified before Congress, doesn’t accept money from corporations and has funded no independent research, according to the group’s website. Public Knowledge has received donations from all four carriers for an awards program, and Sprint gave money to the group to analyze FCC spectrum data to develop Public Knowledge’s position on limits, according to Feld.

But consumer groups are outgunned by AT&T and Verizon. With their big spending on traditional lobbying and funding of associations, think tanks and universities, the corporations play the influence game better than anyone else, said Kevin Werbach, who studies Internet and communications policy at the University of Pennsylvania’s Wharton School of Business.

“This is their core competency, and they have been playing this game for a long time,” Werbach said. “These are companies that support foundations and other groups that do a lot of good work, but in the end are strategically designed to advance [AT&T’s and Verizon’s] interests.”

FCC Chairman Tom Wheeler arrives on Capitol Hill in Washington, D.C., to testify before the House Energy and Commerce Committee in December 2013. (Susan Walsh/AP)

Two sides of Wheeler

FCC commissioners are scheduled to vote on proposed auction rules, including whether it will include limits, at its May 15 meeting. That could open another round of public comments, and at that point the lobbying “will hit its peak,” said an executive at one of the wireless carriers.

Two of the Democrats on the commission, Jessica Rosenworcel and Mignon Clyburn are likely to support limits. The two Republicans, Ajit Pai and Michael O’Rielly, are less likely to.

That leaves the affable FCC chairman, Tom Wheeler, who President Barack Obama appointed last year, to decide. Wheeler knows a lot of about lobbying, having headed up the National Cable Television Association, one of the biggest lobbying spenders in Washington, and the Cellular Telecommunications & Internet Association.

Wheeler, who wields a lot of power as chairman, hasn’t indicated how he would vote. At a speech at his alma mater, Ohio State University, he described himself both as “a rabid believer in the marketplace” and as “an unabashed supporter of competition.”

“A key goal of our spectrum allocation efforts is ensuring that multiple carriers have access to airwaves needed to operate their networks,” he then said.

It remains to be seen which Wheeler will show up to vote — the former lobbyist who fought federal regulations and whom AT&T lobbyist called “an inspired pick to lead the FCC” or the Obama appointee who believes that the wireless market needs more, not less, competition.