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Tuesday, March 14, 2006

'Propertization' of Spectrum on the Hill
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"Think real estate." That was the message NYU Professor Lawrence White kept using this morning when explaining the DACA Spectrum Working Group conclusions to the Senate Commerce Committee. White explained how a spectrum property owner, if she didn't trespass outside of her geographic territory or band, and if she didn't cross antitrust boundaries, could do with her property what she wished -- deploy any technology in it, lease some of it, sell other parts of it. It appeared White's message was heard, and appreciated, by senators on both sides of the aisle. Chairman Ted Stevens (R-AK) early in the hearing said the committee would soon be introducing communications reform legislation. To White, he apologized that the DACA proposal couldn't be part of that legislation because it was sweeping -- "it's like going from one 'ism' to another" -- but twice said he'd like to have a hearing dedicated to the DACA proposal.

All told, the hearing was an example of thoughtful, intelligent discourse on a complicated yet critically important topic. There were calls for more unlicensed spectrum, calls for limits on spectrum ownership, and calls for assistance to rural providers. White brought the market perspective to the hearing.

Senator Frank Lautenberg (D-NJ) told White that he had "an interesting, semi-scathing review of our current system," which Lautenberg assured White was "constructively received." Lautenberg in his questioning seemed concerned that if spectrum truly were blocked off by property barriers, it might be more difficult for multiple providers and technologies to serve various markets. Later, in talking with Senator Conrad Burns (R-MT), White cycled back to Lautenberg's concern that a holdout spectrum squatter could obstruct another service by seizing an argument by commons advocates. Those advocates, White said, cite cognitive radio technology as a way to operate in unlicensed spectrum without interference. Well, White said, the same technology can help a licensed operator go around obstructors.

Burns thought White was advocating "privatization," but White made clear he was not, as the government could certainly hold spectrum under the DACA model. The model instead called for "propertization." Asked by Burns if spectrum users now don't have property rights, White said that generally you can't sell your spectrum and you can't change its designated use. Burns then called spectrum a "natural resource." "So is three million square miles of land," White replied, "yet we rely primarily on private ownership" in the US, enforced with the law of trespass and the law of nuisance.

Stevens is right when he says the DACA proposal would require some work to get from here to there, and that it does appear to be a change of "isms." I won't fill in what I think those two "isms" are, but readers can use their own judgment. What is clear is that once again, DACA is helping members of Congress think about markets and how the tools of the market can maximize both economic output and consumer welfare.

posted by Patrick Ross @ 2:48 PM | DACA , Spectrum , Wireless

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