Tuesday, May 06, 2008

Spectrum isn't a resource

I’m still struggling to understand what spectrum really is – and to articulate why the question matters. I hope I’m not becoming that whacko who keeps pestering physics professors with his “proof” that general relativity is wrong... Any feedback would be appreciated.

It seems to me that “spectrum” is conceived of in two distinct ways. First, a spectrum allocation is seen as a right to operate radio equipment in a given way, for example centered on a certain frequency band. In this case, “spectrum” isn’t problematic, because the term doesn’t carry any real meaning. It simply connotes electromagnetic radiation. A spectrum allocation confers a bundle of in personam rights, and all that matters is system operation. As Coase said in the 1959 FCC paper, “what is being allocated by the Federal Communications Commission ... is the right to use a piece of equipment to transmit signals in a particular way. Once the question is looked at in this way, it is unnecessary to think in terms of ownership of frequencies or the ether.”

Alternatively, one can think of spectrum as a series of abutting frequency bands, and a spectrum allocation as the right to use of a frequency band. The band is treated as a thing which a person obtains an in rem right to, just as they obtain in rem property rights via things like inventions, apples, and land. Tom Hazlett is a leading proponent of this approach, though the notion of wave lengths, frequencies and spectrum being resources (and thus “things”) is entrenched in US legislative language.

Tom has been persuading me, via Merrill & Smith’s 2001 paper in the Yale L J, that in rem rights are some sense better than in personam rights for thinking about property. However, I’ve struggled to put my finger on what the “thing” is in wireless policy.

To rehearse a metaphor: An owner rents a piece of farm land. (The hunting license analogy is more fun, but the fact that game moves around complicates matters more than this case merits.) The renter obtains permission to perform various behaviors with a bunch of constraints, like boundary lines, planting crops vs. running cattle, providing so much fertilizer, etc. So far, this sounds just like the in personam description of spectrum allocation: the a contract between the owner and the renter is like a license granted by a regulator to a licensee. A wireless transmission is like a renter using the land. The frequency band edges are like land boundaries; they indicate a constraint (underspecified, but I’ll ignore that here) on transmission, ie, system behavior.

Now let’s imagine that the rental contract ends, and no other renter shows up. Nobody performs any actions; no in personam rights are exercised. However, the land is still there – the thing which anchors the owner’s in rem rights persists. This is where the analogy to spectrum breaks down for me. When a system ceases transmission (the renter goes away), nothing remains. The frequencies that indicated band edges are parameters. They parameterize an output (a transmission) not an input (“spectrum”).

Since frequency parameterizes outputs not inputs, what it measures – spectrum – isn’t a resource. Therefore the whole question of ownership of spectrum is moot. As for what the input(s) might be: I’d have to say it’s ingenuity in system design, capital to build infrastructure, and the labor of running the resulting operation.

This by no means precludes an in rem analysis. One simply needs to define another kind of “thing”. This leads me from land to trademark as the guiding metaphor. Intellectual property is intangible, just as wireless operation is, but one can still identify a productive resource. In the case of trademark, it’s a signifier coupled to an interpretative context. The signifier is analogized to transmission, and the context to victims of interference. Trademark infringement is largely in the mind of the customer: are they confused or not by an allegedly infringing mark? Similarly, radio interference is largely in the receiver. Patents work in the same way: the productive resource is an invention coupled to a context of what constitutes novelty, obviousness, and utility.

Ultimately, this leads to a restatement of wireless policy in terms of system operation rather than spectrum (easy), and a reformulation of the rights that are issued along the lines of trademark rather than real estate law (hard).


Coase, R H (1959) "The Federal Communications Commission," Journal of Law and Economics, Vol. 2. (Oct., 1959), pp. 1-40.

Merrill, Thomas W and Henry E Smith (2001) “What Happened to Property in Law and Economics?” The Yale Law Journal, Vol. 111, p. 357

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