THE QUESTION OF SPECTRUM: TECHNOLOGY, MANAGEMENT AND REGIME CHANGE and a little Public Safety

1
THE QUESTION OF SPECTRUM TECHNOLOGY, MANAGEMENT
AND REGIME CHANGE(and a little Public Safety)

• Gerald R. Faulhaber
• Wireless Broadband Is the US Lagging?
• USC Center for Communication Law and Policy
• October 25, 2005

2
Review of the Spectrum Debate

• Commons vs. Property
• Round 1Adam Smith vs. John Perry Barlow Hurray
  for our side!
• Round 2 Is there common ground? More than you
  might think
• Round 3 Roll up our sleeves and do the hard
  work define the problem carefully, assess
  transaction costs, dispute resolution, etc. of
  each regime. Which regime delivers the goods?
• This paper plus Goodman, Werbach, Speta,
  Hatfield/Weiser

3
Parsing the Problem

• Property Rights vs. Commons mis-specifies its
  all just different forms of property rights.
• Four parts
• New Technology agile radio, UWB, mesh networks
• But these work under either regime.
• Spectrum Use what is it being used for? High
  power, low power, two way, directional, .
• Some uses call for exclusive use, some for
  commons
• Spectrum Management Are bands managed for
  exclusive use or commons (Part 15)?
• We all agreeWe need both!

4
The Core Issue

• Overarching Legal Regime
• Traditional Regulated Command and Control We all
  agreeYech!
• Fully Commons Cannot accommodate any exclusive
  use that we all agree we need)
• Fully Property Rights (including public private
  commons)
• Mixed Commons/Property Rights, overseen by
  regulator
• Only feasible candidates c) and d)
• Evaluate costs and benefits of each
• Assume the end state for each (transition for a
  later paper)
• Assume technology evolves as forecast.
• Assume regulation and the courts behave as they
  always have.
• Transaction costs, dispute resolution, incentives
  to economize, incentives to adapt new
  technologies.

5
New Results - 1

• Property rights moves dispute resolution to the
  courts (away from regulators)
• Property rights accommodates open access
  provision
• Central Park is owned by NYC, maintained as
  regulated open access facility
• But defining property rights well is difficult
• Commons is really govt ownership and govt
  control of all spectrum still regulation!
• And its regulation thats the problem, not
  licenses
• Well solve interference with hardware..not in
  this universe!
• Like bootleg CB radio? Bootleg cordless phones?
  WiFi/cordless?

6
New Results - 2

• Commons advocates point to new technology and
  imply we need a commons to deploy it.
• This is false all the new technologies can be
  deployed in either a property rights or a commons
  model technology is regime-neutral.
• But the new technologies are necessary (but not
  sufficient) for a commons regime to be
  functional.
• Greatest deployment of new technology in spectrum
  in last 10 years has been cellular, not WiFi

7
New Results - 3

• Exclusive use does not lead to tragedy of the
  anticommons (i.e., holdout problem)
• Commons advocates claim aggregation of individual
  properties for one big property (e.g., commons)
  victim of the holdout problem (e.g., mall and
  park developers)
• But this assumes contiguity to anchored property
  new technologies largely eliminate this problem.
  SDR means we can stitch together non-contiguous
  bands for a single application
• and didnt the PCS firms solve this problem in
  the 1990s when they created national
  networksusing the market?

8
New Results - 4

• Tragedy of the commons is not in congestion, its
  in enforcement.
• If everyone has a stake in radio commons peace,
  then who has incentive to punish offenders? No
  one.
• With lots of excess capacity today, no need for
  concern about congestionbut tomorrow?
• When its free everyone will use it, and use it
  up
• And how come commons advocates tell us they need
  more, more, more now, when new technologies
  should mean we can conserve on bandwidth and use
  less, less, less!
• FCC has created huge swathes of Part 15, yet we
  hear calls for more!

9
New Results - 5

• Power mix even with high-powered agile radios,
  cant mix high and low powered devices in the
  same commons
• Low power works well in commons UWB the poster
  child for spectrum underlays but we already have
  this
• High power agile radios downright dangerous
  their agility means interfering radios cannot be
  identified and prosecuted
• Should be called hit and run radios without
  stringent controls agile radios will be the
  AK-47s of the wireless world, under any regime!
• Today, interfering radios generally easy to
  identify and hold accountable. This may not be
  true in the future.

10
New Results - 6

• But regulation is the key difference between the
  two overarching regimes, and the performance of
  regulation has been disastrous WHY?
• as long as there is a regulator to complain to,
  market participants will complain and the
  regulator will be forced to respond. The scope
  and intensity of regulation inevitably expands to
  meet the demands of market participants.

11
Old Results Redux

• Faulhaber-Farber proposed non-interfering
  easement for all propertied licenses
• Anyone can use any spectrum provided they do not
  interfere with licensee.
• Definition of interference, detection issue, etc.
• NIE give commons advocates all the functionality
  they claim they want. So why is there still an
  argument?
• But is non-interference really feasible,
  especially with agile radio? I now have deep
  reservations about this.
• Defining, detecting and enforcing true
  non-interference may be quite costly

12
Conclusions

• Transactions costs less with property rights
• Actual transaction fees higher, but regulatory
  costs much lower holdup problems not an issue
  with new technology
• Dispute resolution costs less with property
  rights
• Judicial resolution costs lowered using
  injunctive relief (rather than nuisance)
  regulatory resolution has proved itself a
  nightmare
• Social norms? Literature shows that social norms
  work only in exceptional circumstances.
• Property rights encourages economizing, deploying
  new technology commons accepts new technology
  but little incentive to deploy.
• And if non-interfering easements really work,
  then what is left for commons advocates to
  advocate, except property rights with NIE?

13
A Word about Public Safety

• much on our minds in the wake of Katrina
• But always a concern
• Calls for the FCC/Feds to do something about
  public safety spectrum
• Interoperability police/fire/EMT. How come we
  still dont have it after 9/11?
• We need more spectrum wheres the 700 Mhz
  stuff?
• We dont have the money
• Maybe the Feds should be deploying zowie new
  technologies, like mesh WiFi, WiMax, blah, blah.

14
Some Interesting Facts

• Interoperability among police/fire/EMT is a local
  issue can be decided and implemented at
  municipal/county level
• Handsets and systems for full integration are
  easily within reach, and have been for 20 yrs.
• Municipalities/counties dont need anyones
  permission to do this
• Can be accomplished by moving toward modern
  digital systems with multiband handsets/systems,
  protocols
• Political issues of control dominate the debate
  at local level

15
Spectrum and Money

• Moving from analog to digital systems could
  increase channel capacity 2-5 times
• Move to digital now underway but incomplete
• There is always money what matters is what you
  spend it on
• Sussex County, DE first responders
• Lots of money (contributions), well-supplied with
  fire houses, engines, life-saving stuff but
  analog radios, no interoperability and no plans
  for either

16
Zowie Technologies

• Zowie technology advocates are using Katrina as
  the poster child of Zowie for disaster relief
• But post-Katrina Zowie was custom tailored system
  which would not meet public safety needs
• Katrina was a special case, in which
  infrastructure was destroyed the answer is easy
  (and non-Zowie) satellite phones.
• Solutions to public safety issues
• Analog ? Digital increase channel capacity,
  reduce handset weight.
• Local adoption of interoperable systems
  multichannel
• These are local political decisions what is
  lacking is leadership and will, not technology or
  spectrum