Frequently Asked Questions - How is spectrum managed?

The two most popular means of granting access to licensed spectrum bands are through spectrum auctions and through so-called “beauty contests.”

The auction method is straightforward: interested parties bid for a given spectrum band; whoever commits the higher sum gets the right to use the frequencies. In theory this method guarantees that the adjudication will be transparent but in practice, transparency has often been circumvented. There have been instances where powerful commercial interests have acquired frequencies only to avoid their used by competition. As a result, highly valuable spectrum was not used. There is also temptation on the part of the government to use this method as a means of revenue generation as opposed to a mechanism for seeking the optimum value of a spectrum band. This is not necessarily a bad thing in itself but arguably counterproductive if the policy goal is increasing access and stimulating competition. As an example, in 2000 auctions in several European countries allocated 3G spectrum auction for mobile phones that resulted in income of 100 billion (100 000 000 000) euros to the government coffers. The massive price paid by operators for this spectrum resulted in reduced resources and increased delays in roll-out.

The “beauty contest” method requires interested parties to submit proposals on how they intend to use the spectrum. A committee of the spectrum regulating agency then decides which of the proposals better serves public goals. This method relies on the objectivity, independence, technical proficiency and honesty of the members of the deciding committee, which are not always guaranteed.
In many countries there are rules for spectrum adjudication that call for relinquishing spectrum bands that have been acquired but are not being used. Enforcement, however, is often lacking due to strong economic interests.

Figure 3: The “spectrum Police” at work in JakartaFigure 3: The “spectrum Police” at work in Jakarta

The importance of spectrum as a communications enabler cannot be overstated. Television and radio broadcasting have a strong influence in shaping public perceptions on any issue, and have been used overtly for political propaganda. It has been said, for example, that Kennedy’s election as president of the U.S. was due mainly to his television campaign. During the cold war, The Voice of America, Moscow Radio and Radio Havana Cuba were very effective ways to sway a global audience.

More recent examples include the influence of CNN and Al Jazeera in shaping public interpretation of current events.

At a national level, the role of radio and television in steering public opinion is often quite overt. Berlusconi’s ascent to power in Italy was made possible by his control of commercial television. It is therefore not surprising that governments everywhere exert a strong control of spectrum access and have shut down broadcasting stations that aired “inconvenient” viewpoints on allegedly technical or legal grounds.

Spectrum used for two-way communication, including mobile and internet technologies, has also been subject to government interventions, especially in cases of political unrest.

Economic interests also play a vital role in broadcasting. Concentration of broadcast media ownership has had demonstrable negative impact on freedom of expression and unbiased reporting whether that concentration was in government or private sector ownership. The increasing economic value of communication spectrum whether in broadcast or telecommunications increases the likelihood of influence.

We can conclude that the electromagnetic spectrum is a natural resource whose usefulness is heavily conditioned by technological, economic and political factors.

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