Spectrum Sharing: The Opportunity is Now
Spectrum Sharing: The Opportunity is Now
Spectrum Sharing: The Opportunity is Now

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    We’re reaching a critical period in spectrum policy.  Finding more wireless capacity has never been more important, and efforts on two major fronts are aiming toward that goal. If we truly hope to maximize the potential of the airwaves, and do so in a way that promotes innovation and competition, we must flip our baseline assumptions.  Sharing spectrum should be the default, exclusivity the exception.  Yet it’s quite possible that current efforts to free up spectrum will move in the opposite direction, even undermining already-authorized spectrum sharing opportunities.

    I’ve been writing about spectrum policy for over a dozen years. Recently, I’ve noticed an important development.  As clearing and re-auctioning spectrum has become increasingly difficult, mechanisms for sharing spectrum have become more diverse and sophisticated.  Sharing is no longer just an alternative to exclusive rights in spectrum; it’s a vital component of any well-designed spectrum reallocation regime. 

    The International Journal of Communication just published my peer-reviewed paper, The Spectrum Opportunity, co-authored with Aalok Mehta, a graduate student at the University of Southern California’s Annenberg School.  In the paper, and a follow-on dialogue with my former colleague Gerry Faulhaber, we discuss how, at some level, all spectrum use involves sharing, and technology has dramatically increased the power and variety of spectrum sharing mechanisms.  As we explain, we are living through a wireless data boom, thanks to the proliferation of smartphones, tablets, and connected devices, which is creating a massive wireless crunch as usage outstrips capacity.  Sharing should be a core part of the solution.   

    Let me take a step back.  For roughly fifteen years, there has been a debate between those who think the best approach for wireless spectrum allocation is to sell more licenses to companies with stronger private property rights, and those who argue that shared access to spectrum actually produces more capacity while promoting important societal values.  I’ve been an active voice in the latter camp, as has Public Knowledge.  Our most familiar examples of the power of sharing have been WiFi and Bluetooth, which take advantage of unlicensed spectrum bands devoted to shared access.  So the debate has focused on the relative merits of exclusive licenses and unlicensed allocations.

    Fifteen years is a long time in technology-driven industries.  The debate is still raging, but three very significant things have happened.

    First, wireless got big.  Not just big: massively, stupendously big.  And still growing. So the issues we’re fighting about mean a great deal.  They are important because wireless is so important to the future of the Internet, especially to the growth areas like the Internet of Things, digital commerce, and social media.  And they are important because all that growth means finding the wireless capacity we need is harder than ever.

    Second, the market has spoken.  There was an open question in the mid-90s whether licensed or unlicensed bands would promote growth and innovation.  The answer is pretty clear: unlicensed.   Some 3.5 billion WiFi and Bluetooth devices were shipped worldwide in 2012, and if you look at any of the explosive growth areas such as the Internet of Things or wearable devices, they’re all building on unlicensed technologies.

    To be sure, the licensed cellular market has grown as well, and has evolved from a primarily voice-based service to today’s data-rich 4G systems.  It’s important to note, however, that virtually all smartphones, beginning with Apple’s iPhone, also include a WiFi radio.  Reports suggest that half of all data traffic on such devices, or more, passes over WiFi access points rather than the cellular network.  It’s unlikely the smartphone marketplace as we know it would have taken off without the availability of unlicensed networks. This is even more true for tablets.

    Third, we don’t really have to choose between licensed and unlicensed.  A frequency can be licensed and still shared, for example, if licenses are limited in the scope of the rights they grant. Similarly, unlicensed allocations can be designed to occupy an entire band, as with WiFi, or structured to coexist with other systems.  And where before companies lined up in the licensed camp unthinkingly, today some of the biggest investments in WiFi and spectrum sharing come from companies like Comcast, Time Warner Cable, Cisco, and Qualcomm. Sharing is no longer a crazy idea at the fringes.

    That’s especially important to consider in light of the two major spectrum reallocation efforts now underway: the broadcast TV incentive auction, and attempts to move spectrum from federal users, such as the military, to the private sector.  In both cases, the most efficient approach is to combine exclusivity and sharing.  The alternative – insisting on full clearing of spectrum bands and re-auctioning to the highest bidder – would slow the process, distort the market, and close off opportunities to maximize capacity.

    It’s comforting to think that all the government needs to do is yell loudly at the Pentagon and the broadcasters, and new spectrum will appear.  The reality is not so simple.  If we want to get as much capacity into production as quickly as possible, we need to leverage sharing arrangements that allow, for example, commercial services to co-exist with government systems that maintain override rights, and unlicensed systems that can only transmit without if they don’t interfere.  That’s what PCAST – the President’s science and technology advisory board – proposed last year in a visionary report.

    While the path forward seems clear, support for spectrum sharing is far from universal. The advocates of spectrum exclusivity heaped scorn on the PCAST proposal, calling it an unrealistic fantasy.  Meanwhile, as the FCC moves forward in the complicated incentive auction process, it and Congressed are being pushed to quash one of the truly innovative ideas to come out of the FCC during the early 2000: TV white spaces systems that operate in the margins around broadcast channels.  White spaces devices have particular potential to enhance wireless data connectivity in rural areas, but only if the development of the technology and business arrangements is allowed to continue.

    As my paper explains, this is not the right time to leave potential wireless capacity on the table. Nor is it the time to foster a wireless environment that is centralized and dominated by a few large players.  One of the reasons the wireless market has seen so much innovation is that, thanks the unlicensed systems, it is a far more diverse playground for innovation than the wired broadband world.

    Spectrum policy is a long game.  The WiFi explosion of the 2000s   grew out of FCC unlicensed allocations in the 1980s. White spaces devices have gone through a decade-long gestation, and are finally starting to show commercial potential.  The combination of technology development patterns and capital investment cycles mean that the decisions we make today will define the shape of the spectrum environment for decades to come.  That’s why it’s so important to recognize the importance of sharing today. 

    Those of us who first started promoting unlicensed wireless in last millennium didn’t know exactly how things would develop. We had a sense that, just as with the Internet, open and decentralized networks would eventually win, given a fair fight. Now, as the wireless crunch is upon us, it’s time to realize that vision.

    Kevin Werbach is an Associate Professor of Legal Studies and Business Ethics at the Wharton School, University of Pennsylvania, served as Counsel for New Technology Policy at the FCC during the Clinton Administration, and co-led the FCC review for the Obama-Biden Transition Project.  He is also a board member and treasurer of Public Knowledge.