The question of scarcity is important for the choice of regulatory approaches to frequency management. The radio spectrum represents a very valuable resource and the 3G auctions proved that scarcity could lead to a situation where operators were willing to pay substantial amounts to ensure the right resources.
Technological development has led to an ever increasing number of applications for the spectrum and it is foreseen that demand for spectrum resources will increase in the future. However there are also trends going in the opposite direction:
More effective use through better modulation, compression techniques and smart antennas
More flexible allocation mechanisms
Usage of high frequency radio waves.
In addition to this, it should be noted that scarcity will not be the same in different parts of the spectrum and in different regions. Scarcity will be a much more important issue in the most favorable frequencies for supplying the most profitable products and services in densely populated regions.
If these developments will remove scarcity in most frequency bands, this will imply that the traditional ‘first come first served’ principle can be used. However, this principle may be used in quite a different way than today, as it will become possible to apply a much more dynamic approach to spectrum management, where several users share a common frequency band, but have assigned parts of this for exclusive use on a temporarily basis.
Many new applications e.g. Wi-Fi are using unlicensed spectrum bands. It is therefore important to make such bands available in order to facilitate development of new applications, but about half of the countries have already allocated parts of the 2.5 GHz spectrum band to other purposes – e.g. military purposes. Mexico provides a prominent example on how use of Wi-Fi can be facilitated. Here, the regulatory authority COFETEL has allowed use of several new frequency bands for developing WiMAX Internet access for remote regions.
Development of new wireless service applications may create a need for freeing new spectrum resources in a particular band in order to be able to comply with international market standards and enable use of mass produced wireless equipment. Regulators may therefore need to refarm current use of spectrum resources.