Three spectrum reforms to improve value obtained from wireless services: 1. Reduce the ambiguity over responsibilities for interference harm by introducing Harm Claim Thresholds 2. Overcome the drawbacks of excessive control fragmentation of spectrum bands by instituting Band Agents 3. Improve the reliability and efficacy of interference dispute resolution by moving to fact-based adjudication using judges with expertise in spectrum policy

1. Silicon Flatirons Center, UC Boulder
Breaking the spell of Command and Control:
Three spectrum reforms to maximize wireless value
Pierre de Vries
Co-Director of the Spectrum Policy Initiative & Senior Fellow
Silicon Flatirons Center, University of Colorado, Boulder
Johannesberg Summit, 12 May 2014
http://johannesbergsummit.com/program-2014/, https://www.youtube.com/user/JohannesbergSummit
Video: https://www.youtube.com/watch?v=TQz3I-TeIPA

2. Open
Wireless is wonderful! But current regulation is slowing us down
– Society – and all the businesses here – benefit from wireless services
– and we need more, better wireless services, and need them sooner
– But: current regulatory regime prevents that
Phil Weiser and I have three interlocking proposals to improve matters:
1. harm claim thresholds, that provide more clarity about entitlements
to protection from harmful interference
2. band agents, to address fragmentation of spectrum control that
prevents successful win-win negotiations at band boundaries
3. more effective adjudication of interference disputes to support more
efficient contracting between spectrum operators
Developed in US regulatory context; look forward to
comparing/contrasting with European context in the Q&A
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3. Acknowledgments
Honor and privilege to be at Johannesberg
Summit
Grateful to Jens Zander & program committee
for invitation to present; sponsors for making it
possible to attend; Jenny Minnema for help
with logistics
Thanks to everyone who helped us develop the
ideas
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4. “More better sooner”: Why and How
Value of wireless services keeps growing, and so demand does too
More demand for rights to operate radios means more services have
to be packed together
But there are technical limits on ability of radios to operate close to
each other in time, place and frequency
But not ultimately a technical problem:
– engineering means costs
– costs have to be borne by someone
– which means rights, responsibilities & entitlements
– which entails lawyers & economists
– which takes us to regulation – that is, the design of institutions → the
“Big G” (government)
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5. Is this actually a problem? Yes!
Could rehearse many examples of economic inefficiencies of
interference disputes that have not be resolved in a win-win way, in
a timely manner
Focus on GPS/LightSquared dispute – reveals all three frailties I’ll
discuss in a moment
– LSQ mobile satellite service licensee, got a waiver in 2001 to allow it to
operate terrestrial base stations (ancillary terrestrial component, ATC;
complementary ground component, CGC)
– Focus of GPS concerns was OOBE; nobody seems to have thought about
adjacent band blocking before 2010
– In 2010/2011, firestorm of objections because of harmful interference
to GPS due to adjacent band blocking, tens MHz away, due to poor
selectivity of GPS receiver filters
– FCC withdrew permission for CGC operations in 2012, LSQ filed for
bankruptcy in 2013
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6. Root causes of LSQ/GPS dispute
1. Totally incompatible understanding by LSQ and
GPS over the rights and responsibilities
regarding harmful interference
2. Inability of LSQ to close deals with all
fragmented GPS interests
3. The question of whether there was harmful
interference was “adjudicated” in a very political
process: intense lobbying of FCC, incl. invisible
back-channel communications from NTIA, and
Congressional hearings
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7. Causes of difficulties resolving interference
disputes
1. Unproductive uncertainty about spectrum operating entitlements
– i.e. what are rights & responsibilities to protect others from harmful
interference, and to protect oneself against reasonable interference
– means that parties hold wildly incompatible positions, very hard to
bridge gulf in negotiations and get to a win-win
2. Collective action problems – most bands are fragmented among many
licensees and many different services – too many players holding rights
blocking negotiations
3. Shortage of efficient and trusted adjudication slows down dispute
resolution and surely deters contracting – in US, disputes always end up
as a rulemaking before Commissioners, often with Congress in the loop –
not before a judge
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8. “This doesn’t scale”
Even if it works now, isn’t going to work in future as
cheek-to-cheek sharing among constantly evolving
services keeps growing
But it doesn’t work now – even uncontroversial
changes take FCC years, and gets involved in
minutiae
Need ways for regulators to delegate some powers
and facilitate the decentralizing of negotiations
There are 3 key tasks that our proposal addresses:
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9. Task 1: Reduce the ambiguity over
responsibilities for interference harm
Current spectrum policy focuses on transmitters and fails to address the
important role of receivers – one lesson of GPS/LightSquared
Rather than have the regulator mandate receiver performance standards, we
advocate harm claim thresholds that state the interference level that
receivers have to tolerate, but leaves it up to system operators to figure out
how to do deal with interference below threshold
Not one size fits all
– HCT will differ between bands, depending on kinds of service being protected,
needs of incumbents, plans for future uses for neighboring bands, etc.
Good progress on this idea:
– PCAST, then white paper by FCC Technological Advisory Council last year;
– generally positive response to Public Notice;
– FCC’s proposed rules for the 3.5 GHz sharing band include harm claim threshold-
like rules for interference between Priority Access services
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10. Task 2: Overcome the drawbacks of
excessive fragmentation
40% (1.3 GHz) of US spectrum 400-3700 MHz in bands that each contain four
or more services AND where either or both adjacent bands are similarly
fragmented; each service hundreds, often many thousands, of
licenses/assignments
Existing proposals insufficient
– Abolish fragmentation by “every band has exclusive licenses” – we’re not going
to get there overnight – if ever
– Sharing isn’t a panacea: even with sharing, still need to have way to renegotiate
operating rules at band boundaries, including making side payments
Introduce band agents: entities that could represent large groups of operators
(licensed or unlicensed) in negotiating changes in operating rights with
neighbors, especially across band boundaries
Band agents are “band managers or frequency coordinators on steroids”: not
only manage interference within a band, but can negotiate changes in
operating parameters across band boundaries
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11. 3 ways to implement band agents
Regulators build on existing institutions, such as frequency coordinators, band
managers, by extending their powers
– E.g. in US: 800/900 MHz frequency coordinators, federal band managers (NTIA,
or Dept of Defense and Federal Aviation Administration) become band agents
– negotiate deals, accept payments (assuming necessary changes in legislation are
made for DoD, FAA)
Re-use ideas from commercial law:
– Licensees appoint the band agent in the same way that shareholders appoint
managers to act on their behalf
– Majority of bond holders appoint someone to negotiate with bad borrowers
using collective action clauses
FCC explicitly allocates alteration rights
– e.g. in unlicensed, a spectrum sharing database could negotiate changes in
operating rights with neighbors on behalf of millions of unlicensed devices that
use that database
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12. Task 3: Improve the reliability and efficacy
of dispute resolution
We propose
1. moving to more fact-based adjudication process using judges
with expertise in spectrum policy
2. allowing parties to take action against each other directly,
without the regulator in the loop
In US, two complementary paths
1. FCC empowers ALJs to resolve disputes, rather than solve
problems by Commissioners rulemaking
2. Congress establishes a Court of Spectrum Claims
• Alternative venue to FCC, hedge against FCC failure to act
• Handling disputes where federal government is a party, e.g. resolve
fed/non-fed disputes – peculiarity of US spectrum, split governance with
no common venue
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13. Links between Proposal
Regulators can’t keep up – need to delegate, decentralize to
facilitate efficient contracting
– To delegate need clearer entitlements to interference protection
since can’t go back to regulator to check all the time → HCT
– But clear entitlements won’t lead to optimizing negotiations if
there are high transaction costs → band agents
– But even if initial negotiations succeed, still need
backstop/recourse for contracting → adjudication independent of
the political process
– But for court, even specialized, helps to have clarity on key
concepts to find facts → HCT
To learn more, go to http://bit.ly/unlockingspectrum
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14. Close
For all the fuss and bother about licensed vs. unlicensed polemic (most
recent incarnation, clearing vs. sharing), most spectrum is still under
command & control
Main challenge is to move away from command & control, and get to a
more decentralized and dynamic spectrum management regime
Three proposed changes regulatory regime would
– Accelerate this transition
– make it easier for parties to figure out among themselves how to reach
mutually beneficial outcomes for themselves, and society at large
In this way will can unlock more of the wonderful potential of wireless
for producers, consumers, and government users
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