Forbes “Dead Air”
While this decades-old mess finally may hit a breaking point, a solution has been around since 1959. Economist Ronald Coase, who would go on to win the Nobel Prize, studied the matter and proposed a simple idea to Congress: Let free markets, not bureaucratic dictates, govern spectrum. Treat spectrum licenses like patents or other intangible private property, he argued, and markets can take care of the rest. “Is this all a big joke?” FCC Commissioner Philip Cross famously asked Coase at one hearing back then.
Coase’s heresy is now economic orthodoxy: He won the 1991 Nobel Prize in economics largely for his idea that well-defined property rights will lead to an efficient allocation of any resource, including spectrum, so long as the cost of negotiating deals is reasonable. Last year a group of 37 economists, including six former FCCchief economists and Coase himself, urged the commission to remove sclerotic regulations and create spectrum markets. They decried a torpid system ruled by licensees and pliant regulators: “Unnecessary restrictions prevent beneficial uses of spectrum. Over time these regulatory rigidities can discourage innovation altogether.”
Great article by Scott Wooley on open spectrum.