New report cites need for balance of unlicensed, licensed spectrum
Nov 7, 2011 2:35 PM, By Michael Grotticelli
Assaf Eilat, one of the authors of the study, noted that Apple's iPad has generated about $16 billion dollars. Yet, he questioned the tablet's value at all without Wi-Fi connectivity.
A new study, "The Case for Unlicensed Spectrum," argues that the government allocation of spectrum for unlicensed use may actually increase total auction revenues associated with the sale of spectrum. For that reason, the study urges a balanced approach to making both unlicensed and licensed spectrum available in the American marketplace.
In the study (commissioned by Google, a "white space" proponent)), authors Paul Milgrom, Jonathan Levin and Assaf Eilat found that proposals to auction spectrum designated for unlicensed use threaten to undermine its utility and potential. They said unlicensed applications have served as an important complement to licensed use.
"Unlicensed spectrum is an enabling resource," said Eliat, a senior economist at Compass Lexecon, at a news conference held on the report by Wireless Innovation Alliance in Washington, D.C. "Licensed spectrum concentrates use to the hands of very few players."
He said unlicensed spectrum both competes and compliments licensed spectrum. It competes by restricting the market power of licensed spectrum, while it also complements the value of that spectrum. A complementary example, Eliat said, are the "apps" that run on the unlicensed spectrum of tablets and smart phones that extend and enhance the audience of television broadcasters, who use licensed spectrum.
"Why have the unlicensed portions of the spectrum been such an effective catalyst for innovation?" the authors ask in the study. "Our answer is that unlicensed spectrum is an enabling resource that, like other enabling resources and technologies, encourages innovation by many parties. Licensing or ownership that limits access to such resources discourages innovation by giving too much power to the licensee or owner."
| Want to use this article? Click here for options! |  |
