Thursday, March 14, 2002

Spectrum I was flipping through an old Release 1.0 and read Kevin Warbach arguing that spectrum should be an open common. He claims that you no longer need to worry about interference because new technology means node devices are much better at sifting out signal from noise, so why not let people broadcast at any frequency?

Currently, spectrums is licensed through government auctions. In the bad old days, it was allocated through a beauty contest, so graft and waste was rampant. Auctions have been spectacularly successful except for NextWave, but that's an anomaly because the rules were changed for that bidding round (so anyone who points to NextWave to critique auctions is being lazy). Telcos moaning about high auctions prices are just upset they had to pay the fair market price, and should be ignored.

Moreover, spectrum owners should be free to resell spectrum to whomever they choose for whichever purpose, which would result in inefficient spectrum use being sold to efficient spectrum users. In the US, broadcasters have their spectrum allocated for their use and their use only, so they can't get rid of it even if they could do so profitably. Satellite providers bribed Congress to write into law that their spectrum would only be allocated through beauty contests (so bring on the pork!) The most productive and efficient user of spectrum will be willing to pay the most for it, and so inefficient owners have economic incentive to sell it to them. Beauty contents and pre-allocated use destroys this efficiency.

But back to Warbach. It's true that more power (and money) in the nodes lets you get more juice out of spectrum, but that's not the same thing as saying there is no interference. Also, he argues the rules to stop cheating should be coded into the hardware, but this is easy to crack and break. Spectrum allocation started because some religious radio station in Montanna was drowning out everyone else around--nothing but software stops this happening in Warbach's world. More auctions, an aftermarket for spectrum, and non-prescriptive property rights would improve spectrum utilization more than hippie WiFi networks. But hippie WiFi networks are probably better than much spectrum use now.

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