The End of Spectrum Scarcity -- an article and a comment on the article -- resend toclarrify comment from IEEE reference

[Dave Farber <dave () farber net>]

[ The IEEE article is introduced here

From: Steven Cherry <s.cherry () ieee org>
Subject: The End of Spectrum Scarcity
X-Sender: steven () pop panix com
To: "David J. Farber" <dave () farber net>

Dave,

I think IPers will be interested in an article in our March issue, "The End 
of Spectrum Scarcity," by Kevin Werbach and Greg Staple.

http://www.spectrum.ieee.org/WEBONLY/publicfeature/mar04/0304scar.html

End of IEEE note]

******Beginning of Faulhaber /Farber Comment ******

The following is a comment on the article referenced above from Gerry 
Faulhaber and Dave Farber. ( I distributed to IP the paper we wrote last 
year on this subject but in case you forgot, it  is at:

http://rider.wharton.upenn.edu/~faulhabe/SPECTRUM_MANAGEMENTv51.pdf )

Comment:


The Werbach-Staples article is a very nice intro to what we all hope
will be an age of spectrum abundance, replacing the old regulatory order
of spectrum scarcity.  The authors mention both new technology (mesh
networks, agile radio, UWB) and loosening licensing restrictions
(leasing,etc.) as means to achieve this abundance.  The old world of the
FCC handing out restrictive licenses is about to go, the authors believe
(perhaps hope).  In its place, the hardware will ensure that
interference is a thing of the past.

Well, I hope too.  But the hard work is ahead.  The problem has never
been spectrum licenses (even though exclusive use); the problem has
always been regulation and the huge inefficiencies it generates.
Spectrum licenses can easily co-exist with the new technologies,
including open-access-type use ("Part 15" in FCC-speak).  Licenses can
easily co-exist within a market, in which licensees can not only lease
but buy, sell and subdivide their spectrum licenses, subject only to
frequency, power and other restrictions.  It is regulation, not
licenses, that has led to a false spectrum shortage.

It is not that regulators are venal or slow-witted.  The FCC has some of
the brightest engineers and economists in this field.  It is the
regulatory process itself, which leads to lobbying, rent-seeking,
obfuscation, blocking rivals and legal manuevering to achieve
competitive advantage within this regulatory/legal process.  Success
comes from manipulating the regulatory/legal process, not building
better equipment nor pleasing customers.

As the authors point out, economists have argued for making spectrum
licenses marketable; not because economists love exclusive-use licenses
but because they believe, with overwhelming evidence, that markets are
orders of magnitude more efficient that regulation.  Engineers would
like to replace the arbitrariness of the assignment of licenses and use
an open-access approach to spectrum (the "spectrum commons"), as we now
do in Part 15 spectrum, claiming we can let the hardware take care of
interference and allocate spectrum in real time.  Unfortunately, the
history of Part 15 (and the UWB proceeding) demonstrates that we are not
out of the regulatory woods -- not even close!  Tho users need have no
license to broadcast, manufacturers and service providers still struggle
mightily at the FCC, holding up innovation for years, to gain advantage
for their favorite use.  "Open access" means everyone can use it; it
doesn't mean there aren't rules.  And there must be rules which are
enforced.  Who makes up the rules?  Who enforces them?  Well, it looks
like it will end up being...the FCC, the regulator that brought us the
present mess.

We need both exclusive use licenses (FM radio, airport radars, etc.) and
open access spectrum (Part 15, agile radio, etc.).  What we need to get
rid of is regulation!  We need to undertake spectrum reform that takes
the politics and bureaucrats out of the allocation and rulemaking
process and let the private markets deal with it.

Spectrum abundance?  Bring it on.  New advanced technologies?  Bring 'em
on.  Regulation?  High time we lost it, and let's make sure we don't let
regulators in the back door on our way to abundance, or it may never
happen.

Professor Gerald R. Faulhaber
Business and Public Policy Department
Wharton School, University of Pennsylvania
Philadelphia, PA 19104

David J. Farber
Distinguished Career Professor of Computer Science and Public Policy
Carnegie Mellon University
School of Computer Science

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