Economics at the FCC, 2011-2012: Spectrum Incentive Auctions, Universal Service and Intercarrier Compensation Reform, and Mergers

44 Pages Posted: 2 Jan 2013 Last revised: 5 Jan 2014

See all articles by Evan Kwerel

Evan Kwerel

Federal Communications Commission (FCC)

Paul LaFontaine

Federal Communications Commission (FCC)

Marius Schwartz

Georgetown University

Date Written: October 15, 2012

Abstract

The past year in economics at the Federal Communications Commission covered a broad range of topics in telecommunications policy. This paper highlights the economic issues that are addressed in the following key areas: spectrum management, universal service and intercarrier compensation reform, and merger review. In spectrum management, the FCC received congressional authority to implement an “incentive auction” to repurpose television broadcasting spectrum into flexible-use licenses that will be suitable for mobile wireless service providers. We discuss some important issues in designing the auction. We next address some aspects of the FCC’s comprehensive reforms of intercarrier compensation, which mainly involves call termination rates, and of universal service. Finally, we discuss the economic analysis of two major mergers: AT&T-T-Mobile, which the FCC staff recommended should be referred to an administrative hearing, and Level 3/Global Crossing, which was cleared with no conditions.

Keywords: FCC, spectrum auctions, mergers, universal service, termination rates

JEL Classification: L96, L51, L40, L41, L4, L5

Suggested Citation

Kwerel, Evan and LaFontaine, Paul and Schwartz, Marius, Economics at the FCC, 2011-2012: Spectrum Incentive Auctions, Universal Service and Intercarrier Compensation Reform, and Mergers (October 15, 2012). Review of Industrial Organization, Vol. 41, No. 4, 2012. Available at SSRN: https://ssrn.com/abstract=2195386

Evan Kwerel

Federal Communications Commission (FCC) ( email )

Rm. TW-B204

Paul LaFontaine

Federal Communications Commission (FCC) ( email )

445 12th Street SW
Rm. TW-B204
Washington, DC 20554
United States

Marius Schwartz (Contact Author)

Georgetown University ( email )

Washington, DC 20057
United States
202-678-6112 (Phone)

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