Structure of a Spectrum Revolution

At a European Workshop on Spectrum Trading, I took the somewhat controversial postion (frankly, very controversial considering the audience) that leasing or trading spectrum is about as crazy as the state selling or leasing the color red. (Of course, I credited Eli Noam for this insight).

This position may be wrong; after all I am only a student and therefore a bit of an idealist. But the intellectual battle is heating up. For example, recently Gregory Staple and Kevin Werbach have declared The End of Spectrum Scarcity:

“Incumbent mobile operators and broadcasters will almost certainly face greater competitive pressures from both licensed and unlicensed alternatives. The spectrum portfolios of incumbent operators, especially the large cellular phone companies, may be the first to be devalued. Manufacturers, on the other hand, may see an enormous stimulus from the new spectrum environment. If nothing else, lower entry barriers mean that more service providers will want their equipment. Greater demand, in turn, may stimulate price reductions for devices and other equipment.”

My view continues to be that it is a good idea to explore spectrum trading. It may work. Or, it may just be much ado about nothing. Perhaps we are in the middle of a fundamental paradigm shift, along the lines of Thomas Kuhn, who told us in his famous work The Structure of Scientific Revolutions that “[t]he decision to reject one paradigm is always simultaneously the decision to accept another, and the judgment leading to that decision involves the comparison of both paradigms with nature and with each other” (p. 77). If spectrum scarcity and the notion that spectrum is not scarce are two fundamentally different paradigms, then trading is not likely to be the answer. Are we struggling between two different paradigms, having difficulty letting go of the old and instead attempting to embrace something in the middle?

I think so — at least as far as the mid to long term is concerned. But in the meantime, there is little to be lost in spectrum trading, so full speed ahead!