introduction to spectrum management reformthe “electromagnetic spectrum” introduction • what...

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ITU/BDT Regulatory Reform UnitG-REX Virtual Conference

Introduction to Spectrum Management Reform

Dale N. HatfieldAdjunct Professor, University of Colorado at Boulder

February 28, 2005

Agenda

• Introduction• Institutions for Spectrum Management• Definitions• Traditional Administrative Approaches to

Spectrum Management• Techniques for Awarding Licenses

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Agenda (Continued)

• Finding Spectrum for New Services and for Growth in Established Services

• Constraints and Criticisms of the Traditional Approach

• Approaches to Spectrum Management Reform

• Summary and Conclusions

Introduction

• Purpose:– To provide an introduction to the topic of

spectrum management from a policyperspective

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Introduction

• What Is Spectrum?– “Spectrum” is a conceptual tool used to

organize and map a set of physical phenomena

– Electric and magnetic fields produce (electromagnetic) waves that move through space at different frequencies

– The set of all possible frequencies is called the “electromagnetic spectrum”

Introduction• What Is Spectrum?

– The subset of frequencies between 3,000 Hz and 300 GHz is known as the “radio spectrum”

– Note that radio waves do not require a medium per se, that is, radio waves can travel through a vacuum (e.g., outer space)

Electromagnetic Spectrum

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Introduction

• Basic Radio Communication System

Transmitter Receiver

Antenna Antenna

Transmission Line Transmission Line

Radio Waves

Introduction• Basic Radio Communications System

Relationship Between Frequency, Wavelength and Velocity

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Introduction

• Nature of the Spectrum Resource– A Unique Natural Resource– A National and International Resource– Infinitely Renewable– Like Air or Water It Can Be Polluted– Scarcity of the Resource – Economic Value

• Interference Management – Key Element of Spectrum Management

15 GHz -

1 GHz -

800 MHz -

400 MHz -

150 MHz -

108 MHz -

54 MHz -27 MHz -

1600 KHz -

70 KHz -

SatelliteCommon Carrier Microwave

Cellular Phones

UHF-TV

Land MobileCoast Guard/Harbor

VHF-TV ch 7-13Police

VHF MarineCivil Air Patrol

Aviation

VHF-TV ch 2-6

CBAmateur (Ham)

Search & Rescue (SAR)

AM BroadcastMarine

FM Broadcast (88-108 MHz)

88 108

Introduction• Spectrum Diagram

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Introduction

• Definition of Spectrum Management– All activities associated with regulating the

use of the radio spectrum; it includes the structure and processes for allocating, allotting, assigning, and licensing the scarce resource as well as establishing and enforcing the associated rules and regulations

• Importance of Spectrum Management in the Face of Increasing Demand

Introduction

• Goals of Spectrum Management: Efficiency v. Equity– Economic efficiency considerations

• Allocative efficiency (i.e., assuring prices paid for spectrum reflect the costs to society of spectrum use)

• Distributive efficiency (i.e., assuring that the spectrum is allocated/assigned to the entities that can put it to the highest value use)

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Introduction

• Goals of Spectrum Management: Efficiency v. Equity– Economic efficiency considerations

(Continued)• Technical efficiency (i.e., assuring that total costs

are minimized for a given level of production or output)

• Administrative efficiency (i.e., assuring efficiency in the process of allocating/assigning spectrum --including both speed and cost)

Introduction

• Goals of Spectrum Management: Efficiency v. Equity– Equity considerations (e.g., participation by

woman, small businesses, and minority groups; impact on existing licenses)

• Other Goals (e.g., Ensuring Adequate Spectrum for National Defense)

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Introduction

• Major Functions in Spectrum Management– Allocation– Service Rules/Band Plans– Assignments/Licensing– Compliance/Enforcement– International Coordination

Introduction

• Interference Concerns– Improper design (e.g., spurious signals)– Proximity (in frequency, place or time)– Improper operation

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Introduction

• Historically, Above Concerns Led to Licensing of:– Technical characteristics of radio equipment

itself– Licensing of individual stations (frequency,

place, characteristics)– Licensing of individuals who

operated/maintained the equipment

Institutions for Spectrum Management

• The International Dimension of Spectrum Management– International Telecommunications Union

• Member states• Sectors: ITU-T, ITU-R, ITU-D

– World Radio Conferences• ITU Table of Allocations• ITU Radio Regulations• Treaty status

– Other agreements (e.g., bilateral)

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• The International Dimension of Spectrum Management– Note that national allocation decisions must

take into account these international agreements and that they guide and sometimes constrain domestic policies

– Regional organizations (e.g., CEPT, CITEL, APT)


• Domestic Spectrum Management Organization (Generic)

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COORDINATION

Figure 1. National Spectrum Management

THE PRESIDENT

COMMUNICATIONS ACT OF 1934

Non-Federal Users

FCC

INTERDEPARTMENT RADIO ADVISORY COMMITTEEChaired by NTIA

20 Federal Agencies Represented

ADVISORY LIAISON

THE CONGRESS

Federal Users

NTIA

National DefenseLaw Enforce. & SecurityTransportationResource Mgmt. & ControlEmergenciesOther Services

BusinessState & Local GovernmentEntertainmentCommercialPrivate

Source: President’s Spectrum Policy Initiative – Report 2

• Domestic Spectrum Management Organization (U.S.)


• National Spectrum Management Organization (U.S.)– Federal Communications Commission

• Independent regulatory agency• Among other responsibilities, manages all non-

federal government use of the radio spectrum• Allocations and allotments are made in formal

rule-making proceedings and the results are incorporated into the agency’s rules and regulations

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• National Spectrum Management Organization– Canada– UK– Australia– Other

Definitions/Terminology

• Allocations– The entire range of usable spectrum is

divided (in the frequency dimension) into blocks or bands of frequencies called allocations; these frequency allocations determine the type of use allowed in the block or band of frequencies -- examples

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Definitions/Terminology– Allocations: U.S. Frequency Allocations

Available at: http://www.ntia.doc.gov/osmhome/allochrt.html


941-1429 MHz (UHF) Page 41

International Table United States Table FCC Rule Part(s)

Region 1 Region 2 Region 3 Federal Government Non-Federal Government

See previous page for890-942 MHz



941-944FIXED

941-944FIXED

942-960FIXEDMOBILE except aeronautical mobileBROADCASTING S5.322

942-960FIXEDMOBILE

942-960FIXEDMOBILEBROADCASTING

US268 US301 US302 G2US268 US301 US302 NG120

Public Mobile (22)Fixed Microwave (101)

S5.323 S5.320

944-960 944-960FIXED

NG120

Public Mobile (22)International Fixed (23)Auxiliary Broadcast. (74)Fixed Microwave (101)

960-1215AERONAUTICAL RADIONAVIGATION

S5.328

960-1215AERONAUTICAL RADIONAVIGATION

S5.328 US224

Aviation (87)

Complete Table Available at: http://www.fcc.gov/oet/spectrum/

• FCC’s Table of Frequency Allocations47 C.F.R. §2.106 (Sample)

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Definitions/Terminology• Allotment (International)

– Entry of a designated frequency channel in an agreed upon plan for a particular service for use in certain identified countries or geographical areas and under specified conditions

• Allotment (National – US)– In general, refers to a subdivision of particular

service band (allocation) for a specific user and/or provider group within the service

– In broadcasting , an allotment is the association of a specific frequency or channel with a particular geographic area -- examples

Definitions/Terminology• Assignments

– An assignment is a grant of authority -- a license -- for a specific party/individual to operate a transmitter on a specific channel at a specific location under specified conditions

– In recent years and in certain services (e.g., cellular), the grant of authority has been expanded to include multiple channels covering a large geographic area employing multiple transmitter sites (area licensing)

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• Miscellaneous Other– Identification– Designation– “Grey spectrum”

Source: Manner


• Services– International (examples)

• AMS = Aeronautical Mobile Service• AMSS = Aeronautical Mobile Satellite Service• ARNS = Aeronautical Radio Navigation Service• BS = Broadcast Service• BSS = Broadcast Satellite Service• EES = Earth Exploration Satellite Service• RAS = Radio Astronomy Service• RDS = Radio Determination Service• RLS = Radio Location Service

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• Services– National (US examples)

• PLMRS = Private Land Mobile Radio Service• CMRS = Commercial Mobile Radio Service• LMDS = Local Multipoint Distribution Service• MMDS = Multipoint Multichannel Distribution

Service• ABS = Auxiliary Broadcast Service• Fixed Microwave Service• Cable TV Relay Service


• Status of an Allocation– Primary and Co-Primary Allocation– Secondary Allocation

• Terminology Associated with Assignments– Exclusive– Non-exclusive– Mutually exclusive

• A Brief Note on Unlicensed Spectrum

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Traditional Administrative Approachto Spectrum Allocations

• Considerations in Allocations– Public need and benefits for the service– Amount of spectrum required considering:

• Technical limitations on spectrum efficiency• Impact on economic viability of service

– Controlling interference with other services

Traditional Administrative Approach to Spectrum Allocations

• Considerations in Allocations (Continued)– Other technical considerations:

• Ability to control interference• Propagation characteristics• Apparatus limitations

– International allocation considerations• WRC Results• Use in neighboring countries• Need for international harmonization of the service

Source: FCC/Hatfield/Knapp

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Techniques for Awarding Mutually Exclusive Licenses

• Definition of mutually exclusive– If, because of interference limitations, a

specific channel can only be granted to one party, the channel is deemed to be exclusive

– If more than one party applies for a license to operate on that channel, then the applications are said to be mutually exclusive

Techniques for Awarding Licenses

• “First-Come, First Served”– Description -- agency accepts applications

for a limited number of assignments for a short time (filing window)

• If applications exceed number of licenses to be awarded, use a lottery, comparative evaluation or auction;

• If fewer, award the licenses• Later applications go onto a waiting list for any

licenses returned

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Techniques for Awarding Licenses• “First-Come, First Served” (Continued)

– Advantages• Speed -- licenses issued quickly• Inexpensive (to the agency and the applicant)

– Disadvantages• License may not end up in the hands of the entity

that values it most highly• In the modern world, with licenses valued highly, it

does not really solve the problem


• Comparative Evaluation or “Beauty Contest”– Description -- agency selects the winning

applicant in a competitive process using comparative criteria established by precedent or by rule in a rulemaking proceeding --examples

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Techniques for Awarding Licenses• Comparative Evaluation (Continued)

– Advantages• In theory, awards the license to the contending

entity that would make best use of it from society’s point of view -- i.e., the contender who would best serve the “public interest;” can include equity considerations

• Keeps the cost of spectrum to providers low thus promoting lower prices to consumers

Techniques for Awarding Licenses• Comparative Evaluation (Continued)

– Disadvantages• Time consuming• Expensive -- because of economic value of

resulting license, applicants often expend huge sums in attempting to succeed in the competitive hearing

• Because of the above, the license often end up in the hands of the entity that value it most highly in economic terms in any event

• Subjective nature of the process can lead to arbitrariness, unfairness, and corruption

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• Comparative Evaluation (Continued)– Disadvantages (Continued)

• Ultimately provides no way of choosing among two or more licenses that are substantially equal --examples, including perverse results; invites litigation and adds further delay

• Promises made during the application process may be hard to enforce

Techniques for Awarding Licenses• Lotteries

– Description -- agency selects from among qualified applicants by random selection

– Advantages• Speed -- licenses issued quickly• Inexpensive (to the agency but not necessarily

to the society as a whole)• Provides a mechanism for selecting from

among substantially equal applications -- “tie breaker”

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Techniques for Awarding Licenses• Lotteries (Continued)

– Disadvantages• License may end up in the hands of an entity

that is not qualified to build and operate the system and remedies (pre-lottery qualifications) may produce other problems

• In the U.S., once the value of spectrum/licenses became apparent, speculators, “license mills,” and scam artists were drawn in

• In some instances, lottery winners reaped huge windfall profits of 10s of millions of dollars in “secondary auction” -- make a killing on the public’s airwaves


• Auctions– Description -- agency awards license on

the basis of willingness to pay– Advantages

• Speed -- licenses issued quickly• Probably less expensive to both the

government and the private sector (compared to comparative hearings and perhaps lotteries)

• Licenses go to the entity that values them most highly -- promotes economic efficiency

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• Auctions (Continued)– Advantages (Continued)

• Windfall profits are, in effect, taxed away and go to the government

• Process is more objective and transparent lessening opportunities for favoritism and corruption

• Provides information on value of the spectrum which is useful in allocation proceedings


• Auctions (Continued)– Disadvantages

• May lead to increased concentration in the telecommunications industry (“the rich get richer); but antitrust laws and other rules and regulations can combat

• May ignore non-financial objectives in terms of equity and the public interest; but certain of these can be designed in -- e.g., set-asides and “installment payment” plans

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Techniques for Awarding Licenses• Auctions (Continued)

– Disadvantages (Continued)• Some argue that auctions lead to less infrastructure

development and higher prices to consumers• May lead to government managing spectrum in

such a way as to maximize revenue to the national treasury rather than in assuring its efficient use; i.e., the monopolist’s propensity to create scarcity and raise prices


• Hybrid Approaches– Combination of comparative hearing and

lottery (to break ties)– Combination of auctions and comparative

hearings– Advantages and disadvantages of hybrid

approaches

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• Comments– Note that all of the above techniques are

designed to solve the assignment problem; they do not:

• Solve the problem of finding spectrum for new services or growth in existing services

• Address ways of improving the allocation process (e.g., by reducing rigidities in the traditional methods of allocating theresource)

Finding Spectrum for New Services

• Increased Sharing• Increased Technical Efficiency• “Band Clearing”/Reallocation• Extend the Upper Limit of the Useful

Range

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Finding Spectrum for New Services• Increased Sharing

– Different services can use or “share” the same spectrum

• Risk of interference is minimal• Uses are compatible or can be coordinated

– Increased sharing usually comes at the expense of increased complexity and cost

Finding Spectrum for New Services• Example of Sharing

Ships and Railroads Share Marine VHF Frequencies

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Finding Spectrum for New Services• Example of Sharing

Earth Stations (Uplinks)and Fixed MicrowaveLinks Can Use the Same Frequencies Through Antenna Discrimination

Finding Spectrum for New Services• Techniques for Increasing Efficiency

– Increasing the amount of information that can be transmitted in a given amount of spectrum (e.g., through improved modulation techniques)

– Reducing the amount of information that has to be transmitted (e.g., through compression techniques)

– Exploiting frequency reuse (e.g., by utilizing smaller cells in a cellular mobile radio system and/or by taking advantage of antenna directivity)

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Finding Spectrum for New Services• Example of Improved Spectral Efficiency

Reduction in Voice Channel Bandwidths in the Mobile Services

50 kHz

25 kHz 25 kHz

12.5 kHz 12.5 kHz 12.5 kHz 12.5 kHz

6.25kHz

6.25kHz

6.25kHz

6.25kHz

6.25kHz

6.25kHz

6.25kHz

6.25kHz

Finding Spectrum for New Services• “Band Clearing”/Reallocation

– Lightly used spectrum can be reallocated for other purposes

– Existing operations required to move to other bands (or other modes of communications)

– Various techniques can be and have been adopted to facilitate band clearing (e.g., voluntary negotiations between incumbents and new entrants)

– Growing demand/congestion makes band clearing increasingly difficult and contentious

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Finding Spectrum for New Services

• Extend the Upper Limit of the Useful Frequency Range– The usefulness of extremely high

frequencies is constrained by • The state-of-the-art in microwave component

technology• Propagation limitations

– The highest frequency with service rules has steadily increased -- today the upper limit approaches 100 GHz

Constraints and Criticisms of the Traditional Approach

• Nature of the Traditional Approach– Still primarily an engineering oriented,

centralized, “command and control” system exercised through network licensing requirements focused on eliminating or minimizing interference

– Facing tremendous pressures on the resource due to growth in number of users, number of uses and amount of capacity required per user

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Constraints and Criticisms of the Traditional Approach

• Criticisms of the Command And Control System of Spectrum Management– Excessive rigidity – administrative scarcity– Stifles technical and service innovation– Lacks incentives for efficient use of the

resource– Creates barriers to voluntary and involuntary

sharing– Erects barriers to other beneficial transactions

Proposals for Reforming the Traditional System

• Move More Toward the Use Market-place Forces in the Management and Licensing of the Resource– Property-like, exclusive rights– Flexibility of use/unified licensing– Spectrum trading/secondary markets– Examples – Australia, Guatemala, and New

Zealand and, partially, the U.S.

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Proposals for Reforming the Traditional Systems

• Move Towards an Unlicensed, Spectrum Commons Approach– No exclusive rights – anyone can use certain

blocks of spectrum subject only to certain basic rules (e.g., maximum power) and for any lawful purpose using any technology

– Examples of commons approach• Definition (e.g., communal grazing of cattle or use

of a national park)• Early examples from radio (e.g., amateur radio

service)

Proposals for Reforming the Traditional System

• Move towards an unlicensed, spectrum commons approach (Continued)– Immense success of unlicensed

equipment/service market (e.g., Wi-Fi)• Internal WLANs• Hot-spots• Wireless Internet Service Providers (WISPs) –

including development of “carrier class” equipment

• Improve the Command and Control System

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Reform ProposalsLicensed Spectrum Option

• Advantages– Promotes investment by

providing more certainty for investors

– Provides more certainty regarding interference environment for design engineer

– May provide greater revenue collection opportunities to government (e.g., through auctions

• Disadvantages– Licensing step creates

entry barrier– Stifles innovation in

products and services unless accompanied by greater regulatory flexibility (including spectrum trading)

– Creates opportunities for spectrum “hoarding”

– Diminishes opportunities for local initiatives and microfinance

Reform ProposalsUnlicensed Spectrum Option

• Advantages– Promotes rapid innovation

in services/devices because of minimal regulatory restrictions

– Reduces barriers to entry and opportunities for corruption by eliminating the licensing step

– Eliminates opportunities for spectrum “hoarding”

– Creates opportunities for local initiatives and microfinancing

• Disadvantages– Creates conditions than

may lead to the tragedy of the commons

– May reduce investment incentives due to lack of exclusivity

– Reduces opportunities for government to collect revenues

– Creates issues of fairness related to spectrum users who have paid for spectrum

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Summary and Conclusions

Contact Information

Dale N. HatfieldAdjunct ProfessorInterdisciplinary Telecommunications ProgramUniversity of Colorado at BoulderEngineering Center - ECOT-317Campus Box 530Boulder, CO 80309-0530Main Tel: +1-303-492-8916Direct Dial: +1-303-492-6648Fax: +1-303-492-1112Cell Phone: +1-303-589-4546Email: [email protected] [email protected]

introduction to spectrum management reformthe “electromagnetic spectrum” introduction • what...

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