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Enjeux numériques -N° 9 - Mars 2020 - Les fréquences, gestion d’une ressource-clé

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N° 9 - Mars 2020 -  Les fréquences, gestion d’une ressource-clé

Spectrum economics: serving public policies

Gérard POGOREL

 

Since the 1990s, economic approaches and assessments have played an increasing role in policies for managing the radio-frequency spectrum. Along with stiffer competition in telecommunications, they have generated considerable benefits for citizens, consumers, industry and governments in Europe and the world. More recently, as concerns have grown  about  the  relatively  slow  speed  of  the  deployment  of  4G  networks  and  fears arisen about a repetition of these delays during the deployment of 5G, the ability of these economic and financial approaches to provide the guiding principles for a spectrum policy has come under question. This “spectrum economics” is examined, specifically the policies for assigning bandwidths. Examples of policy decisions with an impact on market developments along with evidence drawn from recent in-depth studies lead us to reconsider the principle that auctions are the most effective means for promoting competition and driving investment. We are also led to question another principle, namely: that the amount of revenue raised through an auction of bandwidths is overriding proof of the auction’s success. After reviewing analyses of the causal relations and trade-offs between various methods for assigning bandwidths and setting fee structures, guidelines are suggested for a more effective, balanced approach to bandwidth assignments that would better align the award process with broader, economic and societal, objectives.

 

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N° 9 - March 2020 - The radio-frequency spectrum! Management of a key resource

 

Spectrum economics: Serving public policies

 

Gérard Pogorel.

 

Since the 1990s, economic approaches and assessments have played an increasing role in policies for managing the radio-frequency spectrum. Along with stiffer competition in telecommunications, they have generated considerable benefits for citizens, consumers, industry and governments in Europe and the world. More recently, as concerns have grown about the relatively slow speed of the deployment of 4G networks and fears arisen about a repetition of these delays during the deployment of 5G, the ability of these economic and financial approaches to provide the guiding principles for a spectrum policy has come under question. This “spectrum economics” is examined, specifically the policies for assigning bandwidths. Examples of policy decisions with an impact on market developments along with evidence drawn from recent in-depth studies lead us to reconsider the principle that auctions are the most effective means for promoting competition and driving investment. We are also led to question another principle, namely: that the amount of revenue raised through an auction of bandwidths is overriding proof of the auction’s success. After reviewing analyses of the causal relations and trade-offs between various methods for assigning bandwidths and setting fee structures, guidelines are suggested for a more effective, balanced approach to bandwidth assignments that would better align the award process with broader, economic and societal, objectives.

 

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