Spectrum Sharing in the Shadow of Uncertainty: Risk, Incentives and Investment

The National Broadband Plan has identified efficient allocation and management of spectrum assets as a major component for providing universal broadband access. At the same time numerous media outlets have warned of an impending “spectrum crunch”: predictions that the growth in wireless data traffic will outstrip the capacity of wireless networks that carry this traffic. Much of the wireless spectrum that could be used to meet these demands is used only sporadically and often in only isolated geographic regions. However, the high cost of relocating many of these services, in particular those used by federal agencies, has created much interest in facilitating secondary sharing of spectrum with incumbent users. Indeed, sharing is a central theme of the 2012 Presidential Council of Advisors on Science and Technology (PCAST) report, which recommended that up to 1000MHz of federal spectrum be shared with commercial users. The FCC has been developing rules to promote sharing including the 2010 rules for the TV white spaces as well as the proposed rules for small cells in the 3.5Ghz band.