A Proposal for a Rapid Transition to Market Allocation of Spectrum

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A Proposal for a Rapid Transition to Market Allocation of Spectrum Presently only about 7 percent of the most valuable spectrum is available for market allocation. To facilitate the rapid transition from administrative allocation of spectrum to market allocation, this paper proposes that the FCC (1) reallocate restricted spectrum to flexible use; (2) conduct large-scale, two-sided auctions of spectrum voluntarily offered by incumbents together with any unassigned spectrum held by the FCC, and (3) provide incumbents with incentives to participate in such “band restructuring” auctions by immediately granting participants flexibility and allowing them to keep the proceeds from the sale of their spectrum. Incumbents choosing not to participate would be allowed to continue current operations and would receive full flexibility in 5 years.

By Evan Kwerel and John Williams. Published November 2002.

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