As a revenue source, spectrum auctions are a particularly pernicious tax on wireless innovation. They pick the wrong technology for wireless infrastructure by regulatory fiat, and strengthen the market dominance of already-dominant players. The costs of this policy to innovation and growth greatly outweigh its revenue benefits.
These auctions may lock in an outdated regulatory paradigm, strengthen the dominant mobile broadband carriers, and block the path for some of the most innovative wireless technologies that could improve mobile broadband speed and reduce its price over the next decade
The proposed spectrum auctions are being promoted under the false premise that boosting mobile broadband, smart grid communications, inventory management systems, mobile payments, and health monitoring requires auctioning exclusive pieces of licensed spectrum. In reality, these markets are fast developing through unlicensed wireless applications, like WiFi.
These dynamic markets are telling us something new: The future of wireless will likely be mostly unlicensed, with an important, but residual role of auctioned, licensed services. And yet the drive to auctions simply ignores the evidence from actual markets in favor of an outmoded regulatory ideal that is the opposite of what cutting edge radio engineering and dynamic markets show.
To me it sounds very like the dominant incumbent exclusivity regime being chosen over the developing innovative, chaotic, anarchic, and successful models. That sounds like the copyright struggle to me.
If you haven’t, read this. He puts it so much better.