Abstract

http://ssrn.com/abstract=2321264
 


 



The FCC's Incentive Auction: Getting Spectrum Policy Right


David A. Balto


Federal Trade Commission

Hal J. Singer


Economists Incorporated

September 2013

Progressive Policy Institute, Backgrounder, Sept. 2013

Abstract:     
As the Federal Communications Commission (FCC) considers how to allocate the broadcasters' spectrum in the upcoming "incentive auction," it should be guided by economic principles designed to maximize social benefits. To date, the spectrum policy debate largely has been driven by considerations of the private benefits of carriers such as Sprint, T-Mobile/MetroPCS, U.S. Cellular, and other small carriers (collectively, the "smaller carriers."). In April, the Department of Justice (DOJ) weighed into this debate by advocating "rules that ensure the smaller nationwide networks, which currently lack substantial low-frequency spectrum, have an opportunity to acquire such spectrum. Although it is natural instinct to root for the little guy, ensuring the livelihood of smaller carriers is not an appropriate policy objective, as that would counsel a range of subsidies and tax credits for handpicked competitors. Indeed maximizing the number of wireless competitors is not the appropriate objective either; using spectrum allocation as a tool for reducing wireless concentration would require divvying up the spectrum in such thin slices as to render the resulting allocation virtually useless. The problem with these narrow objectives is that, if pursued to their logical extreme, the resulting policies would sacrifice massive (and growing) economies of scales associated with providing the capacity needed to support mobile video, tele-medicine, distance learning, and a host of other band-width-intensive applications that consumers and small businesses are demanding from their mobile devices.

Number of Pages in PDF File: 12

Keywords: incentive auction, spectrum policy, tradeoffs, wireless networks

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Date posted: September 6, 2013  

Suggested Citation

Balto, David A. and Singer, Hal J., The FCC's Incentive Auction: Getting Spectrum Policy Right (September 2013). Progressive Policy Institute, Backgrounder, Sept. 2013 . Available at SSRN: http://ssrn.com/abstract=2321264

Contact Information

David A. Balto
Federal Trade Commission ( email )
600 Pennsylvania Avenue, NW
Washington, DC 20580
United States
(202) 326-2884 (Phone)
(202) 326-2881 (Fax)
Hal J. Singer (Contact Author)
Economists Incorporated ( email )
2121 K Street N.W.
Suite 1100
Washington, DC 20037
United States
202-747-3520 (Phone)
HOME PAGE: http://www.ei.com/viewprofessional.php?id=71
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