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Too many goals: Problems with the 700Â MHz auction

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  • Bazelon, Coleman

Abstract

In early 2008, the Federal Communications Commission (FCC) conducted its largest auction of radio spectrum licenses. The auctioned 700Â MHz spectrum bands represented a large part of the US's digital dividend, which was created by transitioning to more efficient digital television broadcasts. The FCC set out to accomplish many laudable goals with the 700Â MHz auction such as promoting new entry and rural deployments in wireless broadband, creating a band of commercial spectrum with requirements for open access, and creating a nationwide interoperable public safety network. Unfortunately, poor 700Â MHz band license configurations and auction rules for their assignment prevented the FCC from meeting most of its goals. The two largest national wireless incumbents won most of the licensed frequencies so there will be no new national entrants, rural build-out is unlikely to be promoted, and the spectrum band set aside to aid the development of a public-private partnership for public safety is still unassigned. Furthermore, the large variation in prices within the auction does not support the notion that the auction assigned licenses efficiently.

Suggested Citation

  • Bazelon, Coleman, 2009. "Too many goals: Problems with the 700Â MHz auction," Information Economics and Policy, Elsevier, vol. 21(2), pages 115-127, June.
    • Handle: RePEc:eee:iepoli:v:21:y:2009:i:2:p:115-127
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    References listed on IDEAS

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    1. Jeremy Bulow & Jonathan Levin & Paul Milgrom, 2009. "Winning Play in Spectrum Auctions," NBER Working Papers 14765, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Anker, Peter, 2017. "From spectrum management to spectrum governance," Telecommunications Policy, Elsevier, vol. 41(5), pages 486-497.
    2. Saint, Martin & Brown, Timothy X, 2019. "A dynamic policy license for flexible spectrum management," Telecommunications Policy, Elsevier, vol. 43(1), pages 23-37.
    3. Gregory Rosston, 2014. "Increasing the Efficiency of Spectrum Allocation," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 45(3), pages 221-243, November.
    4. Thomas W. Hazlett & David Porter & Vernon Smith, 2011. "Radio Spectrum and the Disruptive Clarity of Ronald Coase," Journal of Law and Economics, University of Chicago Press, vol. 54(S4), pages 125-165.
    5. Peter Cramton & Evan Kwerel & Gregory Rosston & Andrzej Skrzypacz, 2011. "Using Spectrum Auctions to Enhance Competition in Wireless Services," Journal of Law and Economics, University of Chicago Press, vol. 54(S4), pages 167-188.
    6. Bazelon, Coleman & McHenry, Giulia, 2013. "Spectrum value," Telecommunications Policy, Elsevier, vol. 37(9), pages 737-747.
    7. Thomas W. Hazlett & Joshua D. Wright, 2017. "The Effect of Regulation on Broadband Markets: Evaluating the Empirical Evidence in the FCC’s 2015 “Open Internet” Order," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 50(4), pages 487-507, June.
    8. Gary Madden & Hiroaki Suenaga, 2017. "The determinants of price in 3G spectrum auctions," Applied Economics, Taylor & Francis Journals, vol. 49(32), pages 3129-3140, July.
    9. Gary Madden & Erik Bohlin & Paitoon Kraipornsak & Thien Tran, 2014. "The determinants of prices in the FCC's 700 MHz spectrum auction," Applied Economics, Taylor & Francis Journals, vol. 46(17), pages 1953-1960, June.

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    Keywords

    Spectrum Auctions;

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