مقاله سال ۲۰۱۶

The startling growth of mobile communications throughout the world has significantly increased the rivalry between sectors and users over access to spectrum. This has placed increasing pressure on spectrum regulators to justify their allocation and assignment decisions. This is one (but not the only) factor behind the increasing use of auctions in spectrum assignment, since auctions introduce a greater element of objectivity into the process. However, when firms bidding in auctions are calculating their willingness to pay, they will take account of the revenues which they receive from their customers, but neglect benefits which accrue to others with whom neither the firms nor their customers have a market relationship.

Thus whereas administrative implementation of spectrum policies can in principle take into account (and in some cases expressly has taken into account2 ) externalities associated with spectrum-using services, the increasing scarcity of spectrum and the widespread use of auctions make it necessary to give thought about how to prevent or correct misallocations arising from failure adequately to incorporate them in the analysis.

The most prominent example of rivalry in the use of spectrum is the ‘battle for the UHF band’, which has convulsed spectrum management for the past decade, and led to the progressive refarming of several bands from terrestrial broadcasting to mobile communications. In practice, the re-allocation has largely been accomplished by administrative means, preceded in some countries by the analysis of its broader social effects, which are an important component of the externalities considered in this article. Auctions are generally used only to assign the released spectrum among competing mobile firms. In principle a ‘two-sided’ auction could determine the division of spectrum between broadcasting and mobile communications, and simultaneously decide which broadcasting firms give up and which mobile communications acquire spectrum. A variant of such an auction (the ‘incentive auction’) is planned in the United States (FCC, 2014). However, the issue of external benefits is by no means confined to processes implemented by auction. Where rivalry for spectrum arises between two uses where the product is non-marketed, and perhaps also a public good – for example defence or basic science, the allocation decision will generally rest on the scale of benefits which accrue wholly to nonpaying or external beneficiaries