osewalrus (osewalrus) wrote,
osewalrus
osewalrus

Link Harvest: Spectrum Stuff I Gotta Respond To

I will hopefully get around to blogging on spectrum again. Especially as I need to respond to one of the most ridiculous articles I've ever read from ann economist and former FCC Commissioner.

In this piece: http://www.hudson.org/index.cfm?fuseaction=publication_details&id=8840 Harold Furchgott-Roth argues that since it is axiomatic that shortages do not occur in functioning markets, and we are increasingly facing a spectrum shortage, the only explanation possible is that it is government regulation is preventing the market from responding to price signals.

Among the many problems with this explanation is that it does not take into account that spectrum is not subject to additional production -- at least not in the conventional sense. You cannot mine spectrum, or weave it, or drill for more of it. Worse, the efficiency of its use is dependent on a host of complex factors. There is also the minor problem that spectrum is not moving to the most spectrum constrained, but to the two largest companies. To the extent there is a shortage it is not for want of price signaling.

And, apparently, we accept a monopoly or cartel arrangement as a functioning market. Presumaably, it is antitrust that is the unnecessary government regulation. As it happens, that view was expressed recently by Rick Rule, a former colleague of mine at Covington, now at Cadwalader. http://www.itworld.com/it-managementstrategy/258830/antitrust-experts-us-govt-should-avoid-enforcement-tech-industry
This is rather funny since it used to be the position of people that antitrust replaced the need for regulation. Of course, now that antitrust is the only remaining regulation, we should get rid of it.

Meanwhile, over here, James Crowe of Level 3 argues that there is no spectrum shortage and we should rely more on wires which, conveniently enough, his company sells. http://www.forbes.com/sites/ciocentral/2012/03/23/the-solution-to-the-wireless-spectrum-shortage-more-wires/

Meanwhile, Verizon, which used to sell wires, says this is popycock. http://policyblog.verizon.com/BlogPost/857/CroweSaysNoSpectrumShortageReally.aspx
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