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Make much more efficient use of active spectrum: Should you picture wireless spectrum as being a freeway, that highway is getting jammed with trucks carrying huge plenty of YouTube and Netflix (NFLX).New network systems can get these trucks to generate significantly closer with each other, freeing up capacity. Verizon (VZ, Lot of money five hundred), AT&T (T, Fortune five hundred) and Sprint (S, Lot of money 500) are deploying a "4G" technology called Long Term Evolution, which adds about six to eight times a lot more potential than a traditional 2G network.The problem is that the vast majority of cellular customers don't have 4G-capable devices. Even Apple's (AAPL, Fortune five hundred) iPhone isn't there yet.LTE has nowhere near the same level of national coverage as less-efficient 2G and 3G services. Even if carriers offered incentives to get customers to buy 4G phones, they would still need their 2G and 3G networks to keep users connected in non-4G areas.

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Down the highway, some analysts predict that even 4G's extra capability won't be enough."You can try to be more efficient, but we're really nearing the end of that," says Ken Rehbehn, an analyst with Yankee Group. "It's reaching the point of diminishing returns as we push up against the boundaries of physics."Get people off the cell network: Another solution is to simply get customers to stop using so significantly spectrum.It's easier to cram a lot much more data into wires than into airwaves -- that's why your home broadband is generally much faster than your smartphone. Offloading mobile traffic to Wi-Fi connections is an efficient way to lighten the load.Carriers are using carrots and sticks to shift traffic. The sticks: tiered pricing models and speed limits for the biggest bandwidth hogs. The carrots: free Wi-Fi in crowded areas. AT&T has hotspots in packed places like New York City's Times Square and programs many of its phones to connect to them automatically.


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The tactic is working. About 22% of traffic from mobile devices will travel over non-carrier networks in 2016, according to estimates from Cisco (CSCO, Lot of money 500). That's double today's rate.Add spectrum: "The lever of last resort is to go out and acquire a lot more spectrum," says PwC's Hays. "That's a costly proposition, as well as one with a limited supply."There's vacant spectrum out there in the wild. The problem is that some of it is held by companies and government agencies that can't or won't make good use of it, and a whole lot of it is unsuitable for wireless broadband.That's why the industry cheered last week when the Federal Communications Commission gained congressional approval to auction off a large chunk of some of the highest-quality spectrum around. The FCC is expected to raise $15 billion by holding incentive auctions for TV broadcasters, which could voluntarily choose to give up their spectrum and either go dark or share a channel with another local broadcaster.The auctions won't happen until 2014 at the very earliest. Bidding will be fierce: The FCC's last major auction, in 2008, raised almost $20 billion and drew bids from all of the industry's power players.