Wireless & Spectrum Policy

A couple of years ago I plugged Jerry Brito’s spectrum commons paper. What I said in that post is still true:it’s a great paper that highlights the central challenge of the commons approach. Specifically, a commons will typically require a controller, that controller will almost always be the government, and there’s therefore a danger of re-introducing all the maladies that have traditionally afflicted command-and-control regulation of spectrum.

I’m re-reading the paper after having read the FCC’s spectrum task force report, and while I still agree with the general thrust of Jerry’s paper, I think he overstates his case in a few places. In particular:

Only if spectrum is first allocated for flexible use, with few if any conditions on its use, can a commons or a property rights regime help overcome the inefficiencies of command-and-control spectrum management. For example, if spectrum is allocated for flexible use, a property rights regime will allow the owner of spectrum to put it to the most valuable use or sell it to someone who will. Similarly, if there are no restrictions on use, a commons will allow anyone to use the spectrum however she sees fit, thus overcoming command-and-control misallocation.

However, while title to spectrum could theoretically be auctioned off in fee simple with no strings attached, a government-created and -managed commons will always have its usage rules set through a command-and-control process. Users of a government commons might not be explicitly restricted in the applications they can deploy over the spectrum, but they will have to comply with the sharing rules that govern the commons. Sharing rules, which will be established through regulation, will in turn limit the types and number of applications that can be deployed.

I think the difficulty here is that just as Benkler and Lessig over-idealize the commons by ignoring the inevitable role for government in setting standards, so this over-idealizes the spectrum property regime. It’s not true that spectrum “could theoretically be auctioned off in fee simple with no strings attached.” The key thing to remember here is that electromagnetic waves don’t respect boundaries established by the legal system. There will always be a need for technical rules to prevent interference between adjacent rights holders. If you hold a spectrum right in a geographic territory adjacent to mine, the government is going to have to have some rules about how much of your transmissions can “leak” onto my property before it counts as a trespass.
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Over at Techdirt I respectfully disagree with Adam’s broadside against Tim Wu’s “absurd” piece on the broadband cartel.

Tim Wu’s an ideologically savvy guy, and he’s a master at deploying libertarian rhetoric in defense of not-very-libertarian proposals. I get that, and I’m perfectly willing to call him out when he does so. But in other cases, Wu makes arguments that are just straight-forewordly libertarian. For example, I’m finding it hard to detect the hidden socialist message in this passage:

Our current approach is a command and control system dating from the 1920s. The federal government dictates exactly what licensees of the airwaves may do with their part of the spectrum. These Soviet-style rules create waste that is worthy of Brezhnev.

Many “owners” of spectrum either hardly use the stuff or use it in highly inefficient ways. At any given moment, more than 90 percent of the nation’s airwaves are empty.

Now, as I say in my Techdirt post, Wu would take this line of reasoning in a somewhat different direction than most of us libertarians would. Wu wants to allocate more spectrum to use as a commons, whereas TLFers would generally like to see it allocated to a system of private ownership. But the op-ed isn’t an argument for spectrum commons, it’s an argument against the FCC’s current command-and-control model.

Even if Wu’s article were a brief for spectrum commons, I think we should remember what Adam so eloquently wrote in 2002:

The intellectual battle between adherents to the property rights and commons models of spectrum governance has been a refreshing telecommunications debate for two reasons. First, at the heart of both models is a desire to promote increased flexibility, innovation, and efficient use of the spectrum resource. More important, both groups generally agree that the current command-and-control system is a complete failure and must be replaced. Indeed, both commons and property rights proponents question the continuing need for the FCC in this process at all. Second, and perhaps because of these preceding points, this war of ideas has not been characterized by the rancor typically witnessed in other telecom industry disputes.

Exactly right. So I hope we can dial down the rancor a couple of notches, acknowledge that Wu makes some valid (even, dare I say it, libertarian) points, and engage the arguments Wu actually makes, rather than trying to ferret out the secret agenda lurking behind his words.

WASHINGTON, July 28 – By combining better public information, market mechanisms and smarter systems of subsidization, the government can play a positive role in funding infrastructure investments in telecommunications, according to three reports released Friday by the Brookings Institution.

The papers, released on Friday at an event that also featured an address by Virginia Gov. Tim Kaine, are part of a Brookings Institution initiative promoting investments in infrastructure – both physical, transportation investments, as well as new ways to spur improvements in the telecommunications infrastructure.

“No economy improves with a declining infrastructure,” said Kaine, a Democrat. “Unless you make that high-tech investment easy by telecom access, you won’t get” improvements in your state’s economic condition, he said.

Brookings, a liberal-leaning think tank, released the reports as part of an initiative dubbed the “Hamilton Project.” The project seeks to put forward policy ideas that “embrac[e] a role for effective government in making needed public investments,” according to the think tank.

Read the complete story at BroadbandCensus.com

Tom Hazlett’s latest column in the FT tries to make us all pay more attention to the Clearwire deal. Even those of us here at the TLF have been remiss in following the venture. As Tom points out, the fact that open-spectrum and net-neutrality stalwarts such as Google and Intel are in bed with Comcast and Sprint tells us a lot. He writes:

Municipal Wi-Fi Adieu. When local government networks were the rage, circa 2003, their loudest corporate backer was Google. Broadband for all via “free” unlicensed spectrum, smart radios and just a gentle nudge from City Hall. Politicians from Philadephia to Portland drank the Kool-Aid. But Google just paid $500m to jump to the Clearwire ship. The change in strategy speaks volumes: municipal wi-fi is considered small opportunity for Google and no threat to Clearwire.

Fleeing the “Spectrum Commons”. Five years ago, Intel was pressuring US regulators for more unlicensed bands. It won – the Federal Communications Commission dumped hundreds of MHz into the market. The bump was little noticed – short-range apps continued to work, but not much else developed. Meanwhile, wireless phone networks – providing wide area, mobile service – were booming. But regulators held off new allocations for a decade, starving the sector just when it was upgrading to high-speed data networks.

New Clearwire boasts WiMAX, “wi-fi on steroids”, as its technological innovation, but note: this WiMAX runs on licensed frequencies. That is an economic choice, not a technical one. Only with the control afforded by exclusivity will these companies invest in the networks that, they hope, will make consumers sing. The “spectrum commons”? Been there, done that. This wireless broadband innovation aims to do what no one has done in unlicensed – and betting $14bn on it.

Net Neutrality Not. Clearwire consortium members are not passive investors. Buying in, they become network friends with benefits. The cable ops will retail service. McCaw’s NextNet is the lead gear maker. Motorola supplies handsets. Intel’s chips are plugged in. And Google’s search engine gets its own button on the phones, a cute efficiency copied from the wildly popular DoCoMo network in Japan. If the NTT model, where the carrier extracts payment from mobile apps for a preferred spot on the wireless web, is “open” – then “open” all capitalists must be. Richly, NTT is a member in good standing in Google’s Open Handset Alliance.

Now, the question my friends on the other side will rightly ask is, where’s the beef? Here it is. Any ideas how fast it will grow?

Progress & Freedom Foundation released a new report this week entitled “A Primer on the US Mobile Television Market,” by Joseph S. Kraemer, Ph.D., who is an Adjunct Fellow at PFF and a Director at Law and Economics Consulting Group. It’s not a policy piece; it just focuses on the projected growth of the mobile television marketplace over the next few years. Kraemer explains why “mobile video is forecasted to explode over the next four or five years.” He notes that it is the logical evolution of the television marketplace:

mobile digital television is a logical extension of the digitally-driven development of television from passive entertainment to an interactive, high value, versatile medium. Each stage builds upon the set of earlier stages. “Personal television” adds functionality and value to “web TV” which did the same to “digital television” which, in turn, did the same to “analog broadcast television.” The development process is additive and cumulative. Although critically important, mobile television is just one aspect of the evolving “personal television” stage.

TV evolution
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The following commentary appears in the current issue of Opastco Advocate, a monthly newsletter published by the Organization for the Promotion and Advancement of Small Telecommunications Companies. Reprinted by permission.

Most Americans who have high-speed Internet can’t imagine life without broadband. How could you connect to the Internet of today without it? In today’s world, broadband is as basic as running water and electricity. And yet the U.S. is falling behind globally. As a technology reporter, I’ve been writing about the battles over broadband and the Internet for nearly a decade in Washington. Yet there is one fact about which nearly everyone seems to be in agreement: if America wants better broadband, America needs better broadband data.

That’s why I’ve recently started a new venture to collect this broadband data, and to make this data freely available for all on the Web, at http://BroadbandCensus.com.

The information and news that is available for free at BroadbandCensus.com is more important now than ever before. The FCC has just made important changes to how it will collect data from carriers. The agency may make even more significant changes in the near future. Public and private sector groups of all stripes are demanding, ever more loudly, that government take steps toward a national broadband policy. That cannot be done without solid information about broadband. Finally, many large carriers are beginning to implement plans to meter out bandwidth in tiers and with usage caps. This marketplace development makes the mission of an independent monitoring Website like BroadbandCensus.com even more critical.

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A few days ago, I posted an essay about the recent history of “moral panics,” or “technopanics,” as Alice Marwick refers to them in her brilliant new article about the recent panic over MySpace and social networking sites in general.

I got thinking about technopanics again today after reading the Washington Post’s front-page article, “When the Phone Goes With You, Everyone Else Can Tag Along.” In the piece, Post staff writer Ellen Nakashima discusses the rise of mobile geo-location technologies and services, which are becoming more prevalent as cell phones grow more sophisticated. These services are often referred to as “LBS,” which stands for “location-based services.”

Many of phones and service plans offered today include LBS technologies, which are very useful for parents like me who might want to monitor the movement of their children. Those same geo-location technologies can be used for other LBS purposes. Geo-location technologies are now being married to social networking utilities to create an entirely new service and industry: “social mapping.” Social mapping allows subscribers to find their friends on a digital map and then instantly network with them. Companies such as Loopt and Helio have already rolled out commercial social mapping services. Loopt has also partnered with major carriers to roll out its service nationwide, including the new iPhone 3G. It is likely that many other rivals will join these firms in coming months and years.

These new LBS services present exciting opportunities for users to network with friends and family, and it also open up a new world of commercial / advertising opportunities. Think of how stores could offer instantaneous coupons as you walk by their stores, for example. And very soon, you can imagine a world were many of our traditional social networking sites and services are linked into LBS tools in a seamless fashion. But as today’s Washington Post article notes, mobile geo-location and social mapping is also raising some privacy concerns:
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WASHINGTON, July 2 – Broadband growth in the United States has effectively stalled over the past five months, a possible victim of the economic slowdown, according to a report released Wednesday by the Pew Internet & American Life Project.

Some 55 percent of all adult Americans now have a high-speed internet connection, or a broadband connection, in their home, according to the report, “Home Broadband Adoption 2008.”

That number compares with 47 percent of adult Americans with broadband in early 2007, and 54 percent in December 2007. Hence broadband growth over the previous 12 or 13 months has dramatically tapered off.

The growth rate in broadband adoption from 2007 to 2008 was 17 percent. That compares favorably to the 12 percent growth recorded in the 2006 to 2007 timeframe, according to Pew’s annual studies in 2007 and 2008.
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Oakland Wireless appears to be in trouble. Add it to the list.

[Actually, is anyone out there keeping a running tally of the muni failures? If so, let me know so I can just start linking to it instead of all the random blog links. ]

Global handset manufacturing giant Nokia has purchased the shares they didn’t already own in Symbian, Ltd., the company formed in 1998 as a partnership among Ericsson, Nokia, Motorola and Psion and the developer of the Symbian mobile operating system, by far the world’s leading OS for “smart mobile” phones with 67% of the market, followed by Microsoft on 13%, with RIM on 10% (source).

But wait, there’s more (per Engadget)!

Here’s where it gets interesting, though: rather than taking Symbian’s intellectual private for Nokia’s own benefit, the goods will be turned over to the Symbian Foundation, a nonprofit whose sole goal will be the advancement of the Symbian platform in its many flavors. Motorola and Sony Ericsson have signed up to contribute UIQ assets, while NTT DoCoMo (which uses Symbian-based wares in a number of its phones) will be donating code as well.

Other Symbian Foundation members include Texas Instruments, Vodafone, Samsung, LG, and AT&T (yep, the same AT&T that currently sells precisely one Symbian-based phone), so things could get interesting. The move clearly seems to be a preemptive strike against Google’s Open Handset Alliance, LiMo, and other collaborative efforts forming around the globe with the goal of standardizing smartphone operating systems; the writing was on the wall, and Symbian didn’t want to miss the train. Total cash outlay for the move will run Nokia roughly €264 million — about $410 million in yankee currency.

Other reports note that the Symbian Foundation will eventually take Symbian open source, and that this move is as much as response to Apple’s closed iPhone platform as it is to Gogole’s open Android and LiMo platforms.  (Although it is intriguing to note that AT&T, Apple’s exclusive U.S. partner for the iPhone, is among the backers of the new Symbian Foundation, perhaps indicating that even AT&T is hedging its bets.)

The fact that we will soon see three open source platforms (counting Google’s Android and LiMo) competing for market share provides yet another measure of the exceptionally high degree of competition in the wireless industry.  Continue reading →