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New research on how to inject federal spectrum into private markets

by on September 10, 2015 · 1 comment

The most pressing challenge in wireless telecommunications policy is transferring spectrum from inefficient legacy operators like federal agencies to the commercial sector for consumer use.

Reflecting high consumer demand for more wireless services, in early 2015 the FCC completed an auction for a small slice of prime spectrum–currently occupied by federal agencies and other non-federal incumbents–that grossed over $40 billion for the US Treasury. Increasing demand for mobile services such as Web browsing, streaming video, the Internet of Things, and gaming requires even more spectrum. Inaction means higher smartphone bills, more dropped calls, and stuttering downloads.

My latest research for the Mercatus Center, “Sweeten the Deal: Transfer of Federal Spectrum through Overlay Licenses,” was published recently and recommends the use of overlay licenses to transfer federal spectrum into commercial use. Purchasing an overlay license is like acquiring real property that contains a few tenants with unexpired leases. While those tenants have a superior possessory right to use the property, a high enough cash payment or trade will persuade them to vacate the property. The same dynamic applies for spectrum. Continue reading →

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Tom Hazlett on the history and economics of spectrum

by on March 16, 2010 · 0 comments

Tom HazlettNow that the broadband plan is out, and the FCC has its sights set on 500 MHz of broadcast spectrum, come listen to what it all means. In the latest episode of the Surprisingly Free Conversation podcast, Thomas Hazlett, Professor of Law & Economics and Director of the Information Economy Project at George Mason University School of Law, discusses the economics of spectrum. The discussion also turns to the history of spectrum regulation, ongoing inefficiencies in the current system, and suggestions for possible improvements.

Listen to other episodes and remember to subscribe to the podcast using RSS or iTunes.

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What the U.K. Can Teach the U.S. on Spectrum Reform

by on November 11, 2008 · 6 comments

What’s the right way to allocate the airwaves? For years and years and years, the governing policy of federal communications was that the electro-magnetic spectrum was too “scarce” to be left to the devices of the marketplace. This kind of reasoning has always lacked substance. As I wrote in a piece occoccasioned by the rise of indecency enforcement:

Congress began regulating broadcasters in 1927 on the grounds of scarcity. In return for free and exclusive use of a given wavelength, broadcasters agreed to serve the “public interest, convenience, and necessity” — or at least to do what Congress and the FCC ordered. One element of this agreement was a ban on obscene, indecent and profane language. This scarcity theory has always lacked substance. Nobel Prize-winning economist Ronald Coase’s reputation is based, in part, on a notable paper he wrote in 1959 that criticized the rationale behind the FCC’s command and control regime of licensing broadcasters. “It is a commonplace of economics that almost all resources in the economic system (and not simply radio and television frequencies) are limited in amount and scarce, in that people would like to use more than exists,” Coase argued in his seminal essay. From Shouldn’t FCC Rules Over Indecency Just Grow Up? Reflections on Free Speech and Converging Media

The FCC eventually came to realize that it could endow electromagnetic frequencies with property rights-like characteristics. In 1993, under Bill Clinton and a Democratic congress, the United States finally moved to such a system — at least in those frequencies used by cell-phone operators. As in so many other ways, broadcasters have remained immune from historical trends.

This backdrop is important to understand our current moment in wireless policy. Tomorrow, on Wednesday, November 12, at 4 p.m., those near Washington will be able to gain insight into how other nations have approached radio frequency regulation. The Information Economy Project at the George Mason University School of Law ( Disclosure: I’m the Assistant Director at the Information Economy Project, a part-time position that I currently hold) will host its next “Big Ideas About Information Lecture” featuring an address by Dr. William Webb, a top policy maker at OFCOM, the U.K. telecommunications regulator.

OFCOM’s ambitious liberalization strategy, announced in 2004, permits the large majority of valuable frequencies to be used freely by competitive licensees, offering an exciting and informative experiment in public policy.  Dr. Webb’s lecture, “Spectrum Reform: A U.K. Regulator’s Perspective,” will offer a timely progress report for the American audience.

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Events Overtaking Net Neutrality

by on November 8, 2008 · 10 comments

The conventional Beltway wisdom would be that net neutrality legislation should have a real chance now with the election of President-Elect Barack Obama and strengthened Democratic majorities in the Senate and House.

But there are two recent developments which make the case for net neutrality regulation less compelling.

Free Airwaves

The Federal Communications Commission approved the use of unlicensed wireless devices to operate in broadcast television spectrum on a secondary basis at locations where that spectrum is open, i.e., the television “white spaces.” In other words, a vast amount of spectrum will soon be available to provide broadband data and other services, and the spectrum will be free.

George Mason University Professor Thomas W. Hazlett notes that

[S]ome 250 million mobile subscribers in the US paid about $140 billion to make 2 trillion minutes’ worth of phone calls in 2007, accessing just 190MHz of radio spectrum. The digital TV band, in contrast, is allocated some 294MHz—and it’s more productive bandwidth. Tapping into this mother lode would unleash powerful waves of rivalry and innovation.

Continue reading →

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Net Neutrality and White Spaces, from the Wireless Communications Association

by on November 7, 2008 · 5 comments

SAN JOSE, Nov. 7 – This morning I’ve posted two articles on BroadbandCensus.com about the Wireless Communications Association’s conference here.

Net Neutrality Advocates: Wireless Carriers’ Network Management Must be ‘Reasonable’

SAN JOSE, November 7 – Emboldened by their summertime victory against Comcast, advocates of network neutrality said Thursday that the next front in battle for the principle would be against wireless carriers who make “unreasonable” network management decisions. read more

FCC Chairman Kevin Martin’s Incredible Silicon Valley Wi-Fi Adventure

SAN JOSE, November 6 – It was Kevin Martin’s day to suck up praise from Silicon Valley. The chairman of the Federal Communications Commission – for about two more months – came to the Wireless Communications Association’s annual conference here on Thursday to be feted by many Googlers, including company co-founder Larry Page. read more

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If the U.S. Goes With ‘White Spaces,’ What of the Rest of the World?

by on November 5, 2008 · 6 comments

With the Federal Communications Commission’s decision to allow “white spaces” devices at its open meeting on Election Day, it may make sense to ask: how are other nations approaching the issue of “white spaces”? Do other countries that make use of flexible and transferable spectrum licensing find that taking the approach that the FCC took on Tuesday — allowing unlicensed wireless devices to share vacant television frequencies — helps or hinders in getting more spectrum available for the “highest and best use”?

As readers of this blog are probably aware, I work part-time at the Information Economy Project at George Mason University School of Law, which sits at the intersection of academic research and telecommunications policy.

IEP is pleased to sponsor one of its “Big Ideas About Information” Lecture next Wednesday, November 12, at the law school in Arlington. The school is conveniently located at the Virginia Square/GMU Metro station, and is a short ride away from downtown Washington.

At 4 p.m. on November 12, William Webb, the head of research and development and the senior technologist at OFCOM, the British telecommunications regulator, will be speaking about this and other subjects. The title of his remarks is: “The Theory, Practice, Politics and Problems of Spectrum Reform: A U.K. Regulator’s Perspective,” and you can learn more about it here, or by clicking on the badge below.

Admission is free, but seating is limited. To reserve your spot, please email me, Drew Clark, at this address: iep.gmu@gmail.com

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Special Election Day Telecom Blog Post and News Report

by on November 4, 2008 · 9 comments

I’ve just posted two new entries over at BroadbandCensus.com (in addtion to the one about FCC v. Fox Televisions Stations) below. Now, I’ve got to go and vote.

The pieces at BroadbandCensus.com include a blog post about the real issue in white spaces: not broadcasters versus techies, but keeping the current Swiss-cheese arrangement in the airwaves versus clearing the broadcasters out of their radio frequencies entirely.

Also, in a special election day news report, myself and Drew Bennett have written about the delay in the vote over the universal service fund and intercarrier compensation overhauls.

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Leading U.K. Telecom Official to Deliver Major Lecture at George Mason University

by on October 23, 2008 · 5 comments

William Webb, Head of Research and Development at OFCOM, to speak about ‘The Theory, Practice, Politics and Problems of Spectrum Reform’ on November 12

ARLINGTON, VA., October 23 – With the transition to digital television in the United States less than four months away, disputes about the airwaves used by broadcasters are raging here and around the globe.  A world-class expert will soon weigh in on how one country, the United Kingdom, views the challenges of bringing radio spectrum allocation into the 21st Century.

On Wednesday, November 12, 2008, the Information Economy Project at the George Mason University School of Law will host its next Big Ideas About Information Lecture, featuring an address by Dr. William Webb, a top policy maker at OFCOM, the U.K. telecommunications regulator.

OFCOM’s ambitious liberalization strategy, announced in 2004, permits the large majority of valuable frequencies to be used freely by competitive licensees, offering an exciting and informative experiment in public policy.  Dr. Webb’s lecture, “The Theory, Practice, Politics and Problems of Spectrum Reform,” will offer a timely progress report for the American audience.

Webb’s lecture will be the sixth in a prestigious series that has included Nobel Laureate Vernon Smith and noted economist David Porter on how FCC license auctions have worked; Martin Cooper, the “father of the cellphone,” on spectrum allocation; Brian Lamb, founder and CEO of C-SPAN, on the policies that enabled the cable network to launch;  former Federal Communications Commission Chairman Dennis Patrick, on the decision to abolish the “Fairness Doctrine” in 1987; and University of Minnesota Professor Andrew Odlyzko, on financial bubbles in high-technology industries.

Dr. Webb’s Lecture will review the century-long history of radio spectrum regulation. For almost all of that century, the policy-maker has micro-managed spectrum use, defining services, technologies and business models deployed by wireless operators. The inefficiencies embedded in this approach have triggered calls for liberalization since the pioneering work of economist Ronald Coase in the 1950s.

While efforts to relax administrative control have generally met great political resistance, some substantial progress has been made with the emergence of mobile telephone networks over the past two decades.  Policy makers in some nations are now seeking to achieve bolder changes. The regulator in the United Kingdom, OFCOM, has emerged as a leader in this campaign.

After the Labour Government commissioned a landmark 2002 study authored by economist Martin Cave, OFCOM moved aggressively to assist the emergence of property rights in frequencies, the institutional switch enabling market allocation of radio spectrum.

This lecture, delivered by a key OFCOM policy official and a noted spectrum technology expert in his own right, dissects the liberalization process in Great Britain and offers lessons learned. This experience promises great insight for the U.S. and other countries struggling to enact pro-consumer policy reforms.

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White Spaces Battle Heats Up as Broadcast Networks Seek ‘Time Out’

by on October 23, 2008 · 13 comments

Over at DrewClark.com, earlier today I reported today that television networks – which in recent years have had a strained relationship with local broadcasters on a variety of fronts – joined with the National Association of Broadcasters in calling for a time out on the politically simmering issue of “white spaces.” Here’s the start of the story, and you can read the full post at DrewClark.com

WASHINGTON, October 23 – The top executives of the four major broadcast networks on Thursday urged the head of the Federal Communications Commission to delay a vote on a politically simmering issue that pits broadcasters against Google and high-tech executives.

In the letter, the CEOs of CBS Corp., NBC Universal and Walt Disney, and the chief operating officer of News Corp., urge that the FCC exercise caution before taking irreparable action with regard to the vacant television channels known as “white spaces.”

Google and the other technology executives, including Microsoft, Motorola, Philips and others, want the FCC to authorize electronic devices that capable of transmitting internet signals over vacant television bands.

The network executives – CBS’s Leslie Moonves, Disney’s Robert Iger, NBC’s Jeffrey Zucker and Peter Chernin of News Corp. – want a time out.

They join their local broadcasting colleagues, as well as manufacturers and users of wireless microphones, like the National Football League and Boadway theater owners, who have been actively lobbying the issue.

[…]

Read the rest of the story at my blog, DrewClark.com – The Politics of Telecom, Media and Technology

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