Understanding the Success and Meeting the Challenges of Unlicensed Spectrum as a Focal Core Resources System of the Digital Economy

Posted: 1 Apr 2013

See all articles by Mark Cooper

Mark Cooper

affiliation not provided to SSRN

Date Written: March 30, 2013

Abstract

Unlicensed spectrum is one of the most compelling examples of the emergence of a new mode of communications production (the Internet being the other). However, dramatic growth creates unintended consequences that can restrict or even undermine the continued expansion. Treating unlicensed spectrum as a focal core resource system, this paper this paper analyzes the success of unlicensed spectrum to identify principles that will allow it to adapt, while preserving its core competence.

Wireless communications is overwhelmingly nomadic, rather than mobile. People move from place-to-place, but are stationary when they communicate. Unlicensed spectrum embodies a coherent set of rules that provide a “brutally simple and amazingly efficient” approach to nomadic communications based on a combination of “soft law” and “strong norms.”

A continuous sequence of transmitters occupying the spectrum is an extremely efficient way to utilize a renewable resource. (border and provision rules).

Simple standards (information rules) for sharing the spectrum allowed free entry and did not require detailed management by the regulator. (position and appropriation rules).

Voluntary adoption (collective choice rules) of an open protocol (monitoring and enforcement rules) was uniquely friendly to innovation and entrepreneurship (payoff rules).

Although implemented in a small slice of “junk” spectrum with relatively unattractive propagation characteristics, the amount of traffic reaching end user devices through unlicensed spectrum today equals the amount of traffic reaching devices that are wired or utilize licensed spectrum.

Cellular carriers find it more efficient to offload their traffic into unlicensed spectrum (rather than terminate it utilizing their licensed spectrum); Users find it extremely convenient to extend wireline communications to their wireless devices; Commercial and noncommercial establishments find hotspots to be an attractive way to serve the nomadic needs of their patrons.

The importance of unlicensed spectrum is likely to increase with the proliferation of communications enabled end user devices and the evolution of hot spots into hot zones. Massive amounts of machine-to-machine communications created by the Internet of Things involve have intermittent, low volume communications that is well-suited to sharing spectrum. This will increase the amount and add a great deal of diversity to the type of traffic.

The challenge will be to preserve the core principles of simplicity and open entry to the greatest extent possible in the face of congestion and complexity. Making more spectrum available is only a small part of the solution and making better spectrum available may even increase the challenge because it invites more users and usage and more diverse uses.

A precautionary principle should govern change, with the burden of proof leaning against “infringement” on the foundational rules. Appropriation and pay-off rules are not the “cause” of the problem. Enforcement and collective choice rule should continue to rely on soft law and strong norms. Hierarchy of change, stopping when the problem is “solved.” Monitoring/Information. Technology-based reporting and look up obligations.

Position: Identifiable uses that demonstrate they “require” preferred access; Utilize all previously dedicated spectrum resources first; Impose smallest possible restriction on shared resources.

Boundary: Open access within categories; Transparency between categories.

Keywords: Unlicensed Spectrum, New Institutional Analysis, Telecommunication Policy

Suggested Citation

Cooper, Mark, Understanding the Success and Meeting the Challenges of Unlicensed Spectrum as a Focal Core Resources System of the Digital Economy (March 30, 2013). Available at SSRN: https://ssrn.com/abstract=2241995

Mark Cooper (Contact Author)

affiliation not provided to SSRN

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