Saturday, May 27, 2006

The real tragedy of the spectrum commons

Advocates of licensed spectrum warn darkly that unlicensed spectrum suffers from the Tragedy of the Commons – that is, the over-exploitation of a shared resource because individuals get the benefit of anti-social over-consumption, while everyone suffers the cost.

The true tragedy of the spectrum commons arises from the collective action dilemma. When all benefit from the existence of a good, and every individual’s contribution to creating it is small, everyone will wait for someone else to do the work of production. Less of the good – unlicensed spectrum, in this case – will be produced than would be optimal.

Many companies (not to mention the citizenry at large) would benefit from generous unlicensed spectrum allocations. However, the impact that any single entity can have in making the case is relatively small. Further, since no-one would have exclusive access to this spectrum, any successful lobbying to get such spectrum would benefit the world at large, particularly those who sat on their hands and did nothing.

Licensed operation, in contrast, is the preserve of relatively few players. Any lobbying they do to increase the amount of flexible-use spectrum is to the advantage of a relative small group of spectrum owners.

One would predict that there would be much less unlicensed than licensed spectrum; and that unlicensed would lose out from licensed in a lobbying fight. Jim Snider provides this data in a paper making the case for unlicensed allocations in the TV bands:

  • There is more than six times as much spectrum allocated to flexible licensed use as to unlicensed below 3 GHz (683.5 MHz vs. 109.5 MHz)
  • Reallocations of spectrum since 2002 have been biased against unlicensed: licensed gained 489.5 MHz, and unlicensed lost 20 MHz.

A regulator like the FCC should therefore allocate more to unlicensed than the lobbying record might justify, to make up for the under-provision that’s inherent in such collective goods.