WiMax Spectrum Fight With School Districts Highlights Market Distorting Effects Of Gov't Monopolies
from the worthless-spectrum...-oh-you-want-it? dept
We've tried to point out how government granted monopolies can distort a market, whether it's in the intellectual property space or within wireless spectrum. For example, take a look at what's happening in the 2.5 gigahertz spectrum space. A bunch of 2.5 gigahertz spectrum was handed over to schools and non-profits, supposedly for use in education. The rules on those licenses were that it couldn't be owned by for-profit businesses... but could be licensed to them. Of course, for many schools, the idea that they owned any spectrum rights at all was a complete mystery. Many valued the spectrum at absolutely nothing (which was its real value to them) and let the licenses expire. However, with Sprint's latest focus on WiMax, it could make use of more 2.5 GHz spectrum. It already owns a bunch, but not enough. So, of course, now that this spectrum is suddenly valuable to Sprint, schools are scrambling to renew expired licenses to the spectrum they valued at absolutely nothing, in order to turn around and license it to Sprint for quite a bit of money. In other words, you have a natural resource given to schools absolutely free. They didn't value it and didn't have any use for it at all. Then, a company comes along that actually can do something useful with that spectrum, and the schools are suddenly setting roadblocks in their way. That doesn't seem like a particularly useful thing -- but thanks to another set of gov't granted monopolies, combined with a complete lack of a comprehensive spectrum allocation policy from the FCC, it's what we're left with.Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
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Whoever came up with that licensing scheme needed to first tell the schools they had it, then shown them how to use it, and give them the resources to use it to make it valuable to them.
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Unclear Intentions
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Re: Unclear Intentions
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As if schools are just another business.
The common good? What a quaint idea!
I guess we don't live in a country - it's really just a collection of businesses.
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Re:
if you're the same anonymous coward that's been getting his ass handed to him over on the verizon post, i suggest you spend some time offline, reading economics texts irl and learning how to construct an argument.
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Missing information
Shouldn't we have some sort of wireless electronics industry black-list? That way we can ensure that people who make these mistakes are never heard of again, as they damage the consumer, developers, network providers, and school funding (couldn't that spectrum have been sold originally to sprint, and instead be turned into a boatload of cash for schools, instead of forcing schools to compete in spectrum space auctioning?).
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Already did the deed
Now dats a lot of objects!
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Get the corperations to help.
For that matter you could stipulate that wireless equipment be furnished to the schools as part of the licensing deal.
This would create better developers and thus spurring new innovation. It's a strech I know, but any additional revenue going into our education system is a good thing.
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Re: Get the corperations to help.
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Re: Get the corperations to help.
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Huh?
I am sure you had a purpose, but you never got around to making it since you were so busy raging against the machine.
Whats wrong with trying to sqeeze a few bucks from a big buisness that has more than done its share to screw over its customers on many levels so that little Billy and Suzie can learn to balance a check book? Nothing at all.
Get to the point.
"It's fun to obey the machine!"
~Ralphie Wiggum
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Re: Huh?
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Spectrum Warehouse
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Can't believe some of these comments
What's curious to me is why the FCC granted schools the spectrum in the first place. They didn't ask for it, so the FCC must have had some other motive that we just don't understand. To steal from A. Coward, kinda like hoarding dog food in your child's toy chest. The kid didn't ask for it, has no use for it, but the dog WILL find it..eventually. Sounds like the FCC is trying to keep other members of the family from getting to the good stuff.
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Inefficient funding
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2.5 GHz spectrum for education
Unfortunately, many educational institutions found that the cost of building a network was excessive, even with free spectrum licenses. Thus, a lot of the spectrum sat vacant.
Realizing that vacant spectrum did no one any good, the FCC allowed license holders to lease a significant amount of their spectrum for commercial use.
I doubt that it was "a complete mystery" to many institutions that they held spectrum licenses - they had to file for the licenses in the first place; they weren't just "handed out" by the FCC. I suppose in the ten years or so since the licenses were granted an institution could have lost track of them, just like they could lose track of any other assets - but the notion that the FCC gave out licenses that institutions didn't even know about isn't correct.
Values of assets change all the time, and organizations will behave differently based on the current perceived value of the asset - not what it was worth five years ago, or what they think it might be worth five years from now. Let's say that a farmer bequeaths 100 acres of land to the local school district, with the condition that it be used to build a new high school within 10 years; if no school is built, the land will be given to the county for open space. But the old high school has plenty of room, it's perfectly adequate for the needs of the community, and the school district can't justify the need for a new high school sufficiently to get a bond issue passed. The land is basically worthless to the school district - all it can be used for is a high school or open space, and the school district doesn't need a high school - so it's willing to let the land revert to the county.
Suddenly, Sprint builds a tremendous customer support center in the town, bringing a huge influx of families, so the high school isn't big enough any more - and Sprint offers to contribute half the cost of building a new high school. All of a sudden, that land that the school district valued at absolutely nothing is now worth something, and the school district won't want to let the county have it any more. It's the same land, with the same restrictions, but the value to the school district is completely different.
Like others, I'm really not sure what your point is. Is it that these evil greedy educational institutions are throwing up roadblocks to Sprint's noble effort to build a new wireless network? Is it that the foolish FCC knows so little about what technology will be like 10 years in the future that it doesn't allocate spectrum appropriately?
You could have made a couple of very interesting points. One is a point of regulatory philosophy - that application-specific spectrum licensing, while perhaps valid in the early days of the FCC when there was a tight coupling between the use of spectrum (e.g., radio/TV broadcast, point-to-point fixed communications, land mobile communications) and the frequency band assignments, is increasingly becoming an obstacle to innovative use of the spectrum, and that a more application- and technology-neutral licensing philosophy, allowing any application to use the spectrum within prescribed technical parameters, better serves the current environment of fairly rapid change in radio technology and applications.
A second is an economic point related to the law of unintended consequences - that the original purpose of the ITFS spectrum licensing was to enable educational institutions to broaden their reach through video learning and to tie together geographically separated "campuses", but changes in technology, new use patterns and applications (i.e. mobile internet connectivity), and a failure of the business case for investment in the originally planned application has led ITFS spectrum licensing to largely become a land grant available for lease and a means for educational institutions to earn income from commercial mobile operators.
I expected better from you guys.
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Who
Since the people are considered to be the original "owners" of the radio spectrum, why is it in the public interest for the agent of the people (i.e. the Government, in the guise of the FCC) to sell that spectrum in perpetuity? Why doesn't it make more sense for the government to lease the radio spectrum, to the highest bidder in most cases, but at bargain rates in some cases, such as to schools?
It shouldn't stifle business to lease rather than sell, since those leases could be negotiated for reasonably long terms, such as 25-30 years. But in all cases the spectrum should revert to the people at the end of the lease term instead of becoming permanent property of billion-dollar corporations. The big corporations might find it to their advantage to squat on spectrum rather than let an innovative newcomer have access to it.
Am I the only one who thinks this way?
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Spectrum ownership.
Um, no! No it's not, it's managed by the Government, but it's the people's/public's spectrum.
See, the corrupt FCC, is actually suppose to ensure the citizens of this country are getting something out of granting companies exclusive access to public resources, like spectrum and right-of-way. Unfortunately, they have lost sight of that, and only make token gestures, much like the one that is the subject of the original article.
What benefits has the FCC obtained, other then auction, tax revenue. I see no public benefit, although they do make a show out of whimsical and pointless "obscenity" issues.
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Re:
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So here it is June, 2008...
The market and economy has changed drastically since these lease deals were snow balling and it is time for these EBS licensees to start fighting to get out of the leases and get their spectrum back.
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newest jordan shoes
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