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Spectrum Tragedies

Spectrum Tragedies. Thomas Hazlett twhazlett@yahoo.com International Telecommunications Society Berlin, Germany Session 6.2 * September 5, 2004. Common Interest Tragedies. Tragedy of the Commons “not enough” ownership Over-utilization Tragedy of the Anti-commons “too much” ownership

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Spectrum Tragedies

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  1. Spectrum Tragedies Thomas Hazlett twhazlett@yahoo.com International Telecommunications Society Berlin, Germany Session 6.2 * September 5, 2004

  2. Common Interest Tragedies • Tragedy of the Commons • “not enough” ownership • Over-utilization • Tragedy of the Anti-commons • “too much” ownership • Under-utilization • Heller (1998) – Moscow storefronts & kiosks • In reality, same general phenomenon • Lee Ann Fennell (2004) Spectrum Tragedies ITS-Berlin

  3. Busy Sidewalks, Vacant Storefronts Spectrum Tragedies ITS-Berlin

  4. Multiple Spectrum Tragedies • MMDS – license fragmentation • Textbook ‘anti commons’ • WISPs – excessive entry • Textbook ‘commons’ Spectrum Tragedies ITS-Berlin

  5. Brisk Wireless Business (kiosks) • CMRS  189 MHz • $90 billion in annual revenue • Consumer surplus ~ $80 billion per year • CS/PS > 10 Spectrum Tragedies ITS-Berlin

  6. Economic Activity Across Bands (2003, USA) Spectrum Tragedies ITS-Berlin

  7. MMDS/ITFS • 190 MHz @ 2.5 MHz • Dispersed ownership • Many non-profits • Adjacent interference problems => hold-up • Licenses sell @ 99% discount from CMRS Spectrum Tragedies ITS-Berlin

  8. “Deinterleaving”

  9. Tragedy in Licensed Spectrum • Exclusive use rights assigned • But with extreme fragmentation • Little social value produced • Tragedy of anticommons (under use) • Tragedy of the commons (reform is public good) Spectrum Tragedies ITS-Berlin

  10. Coordination of Unlicensed Use • Government allocation rules • Power limits • Technical standards • Service categories • Property owners • IT departments • Vertically integrated users • Technology vendors Spectrum Tragedies ITS-Berlin

  11. Commons Relatively Useful for • Corporate/campus • Rules imposed by institution (Intel, CMU) • Spectrum within the walls • Baby monitors, cordless phones/PCs • Rural WISPs • Point to point (beams) Spectrum Tragedies ITS-Berlin

  12. Commons Relatively Unsuccessful for  • Wide Area Networks Spectrum Tragedies ITS-Berlin

  13. Coordination by Part 15 Rules “Wireless Internet Service Providers (WISPs) are using unlicensed spectrum to provide innovative services in rural areas but are finding it difficult to provide adequate signal coverage because of our current Part 15 power limits.” SEPARATE STATEMENT OF COMMISSIONER KEVIN J . MARTIN Re: Facilitating Opportunities for Flexible, Efficient, and Reliable Spectrum Use Employing Cognitive Radio Technologies (ET Docket No. 03-108); Authorization and Use of Software Defined Radios (ET Docket No. 00-47), Notice of Proposed Rulemaking and Order (Dec. 30, 2003). Spectrum Tragedies ITS-Berlin

  14. Unlicensed WISPs on Scarcity This is not just coffee shop WiFi we are discussing… These services are part of the infrastructure of our communities now on a worldwide scale. The aggressive adoption of these bands has come with little protections to WISPs and their high profile customers and is in danger of creating a disastrous implosion if nothing is done to remedy the impending interference hazards on the horizon. WISPs have no rights to the spectrum they use… Spectrum Tragedies ITS-Berlin

  15. Property Rights I want to suggest a policy to help solve these issues and provide unlicensed use of this band simultaneously. I propose a new policy called the WISP Homestead Policy… Homestead status would be given to WISPs who register with the FCC and provide documentation proving active use… John Scrivner, Mt. Vernon. Net, Inc., WISP Homestead Policy Proposal For WISP Use of the ITFS Band, Comment filed with Federal Communications Commission, WT 03-66(March 19, 2004). Spectrum Tragedies ITS-Berlin

  16. Spectrum Coordination Costs • LANs  low • WANs  high (many potential conflicts) • Efficient market organization is to pay an agent to coordinate • Wireless networks with EAFUS rights invest in complementary infrastructure to increase value of spectrum Spectrum Tragedies ITS-Berlin

  17. Spectrum Sharing to Introduce New Technology Spectrum Tragedies ITS-Berlin

  18. Where’s McCaw? Clearwire got its start in the wireless business using 2.4 GHz unlicensed spectrum in several markets. The company decided to sell its businesses in several markets and switch to using licensed spectrum in Jacksonville because “that’s where the future and all the new technology is,” according to White. Annie Lindstrom, Carrying the MDS/ITFS Torch, Shorecliff Comm Mag (Sept/Oct 2003). Spectrum Tragedies ITS-Berlin

  19. Conclusion • Extreme fragmentation of Licensee rights dissipates value of Licensed Spectrum • Extreme fragmentation of Use rights in Unlicensed • Is compatible with short-range applications • Is difficult to overcome for wide area applications Spectrum Tragedies ITS-Berlin

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