WASHINGTON (AP) -- The federal government is developing plans to treat airwaves as commodities to be bought and sold on the open market.

Federal Communications Commission (FCC) officials say they are working on rules that would create a trading system in which telecommunications companies could bid on frequencies that are owned by other companies but are underused.

FCC Chairman Bill Kennard has laid out a series of steps to better utilize existing portions of the airwaves. For example, license holders that aren't using all of their frequencies could post that availability on a website for other interested companies.

"This is an innovative and efficient approach to licensing," Kennard said.

Under the current system, the government licenses each user and regulates what frequencies and signal power it can use. The oldest licenses were given free; recent ones were sold to the industry. The rights have never been bought and sold in a secondary market.

Government officials worry that demand for airwaves is outstripping supply because of the proliferation of cellular telephones, pagers, satellite services and other wireless devices. The volume of traffic on the internet, the FCC says, doubles every 100 days, increasingly through wireless connections such as cell phones and handheld computers.

"For your industry and for the commission, the biggest challenge is the dwindling supply of quality spectrum," Kennard told the wireless industry at a convention last month.

In deregulating the spectrum to create the new market, the FCC would be enabling licensees who own the rights to a slice of the airwaves to profit from any surplus, such as parts not in use 24 hours a day.

The FCC is expected to auction frequencies this spring that are particularly good for delivering wireless internet service to home and handheld computers. These currently belong to analog TV broadcasters using channels 60 to 69. Those broadcasters will eventually shift to digital and have to give up those analog channels, but that could take years.

Kennard is urging broadcasters currently occupying those analog channels to voluntarily negotiate deals with the auction winners so that the airwaves can start being put to use to provide wireless data and other services as soon as possible.

Also, the commission this week is looking into a new technology that would enable devices like cell phones to receive signals from different frequencies. Called software-defined radio, the technology uses a computer chip rather than a receiver. It could allow wireless carriers to create a network for their services from a patchwork of frequencies.