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story category Spectrum, Unchained
Has the FCC got it all wrong?
(old news - 02:58PM Thursday Jan 13 2005)
tags: fcc · wireless
"Misguided regulations of the airwaves are thwarting precious opportunities to innovate and create so-far undreamed of services," opines this piece over at Business Week. Largely spewing venom at the way the FCC licenses out spectrum, the article argues that by moving away from the FCC's model of restrictive licensing, you could "expand current spectrum usage by 100 times and add 100 times more entrepreneurial ideas."

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TK Junk Mail
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edit:
January 13th, @03:05PM

Business Week article prescribing chaos

The Business Week article is basically prescribing chaos as the antidote to FCC incompetence. Sure the FCC is doing a pretty poor job, but this article is prescribing a solution where no one decides what radio spectrum can be used and what that use may mean for massive interference across the country.

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calvoiper

join:2003-03-31
Belvedere Tiburon, CA

Re: Business Week article prescribing chaos

said by TK Junk Mail See Profile:

The Business Week article is basically prescribing chaos as the antidote to FCC incompetence.

No, the writer proposes a marketplace as an antidote to central planning.

An analogy would be land use. The US has developed with a relatively free market in land ownership and some restrictions on use--with retained government ownership for things like roads and parks.

A similar approach would put the FCC more in the position of a zoning administrator and title registry--worrying less about the perceived "public benefit" of the specific ownership and use of a particular slice of property/spectrum than about whether the use fits into broad guidelines established (possibly commercial/personal/government/unregulated--or some other category-based approach.)

There are pluses and minuses to this approach--I don't feel strongly one way or the other, but I agree the result of present practices is far less than optimal.

calvoiper
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Miah1

join:2004-10-15
Belton, TX

Maybe I am reading this wrong but essentially I get the same vibe, and while normally I would say hell yeah turn em loose and let the fittest survive - in this case I have to agree with you, solving major disorganization with total chaos is a stupid concept in itself.

Guspaz
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Massive RF interference. Ultra Wideband solutions would thrive in this situation, as it is not generally affected by RF interference.

That would be a good thing by the way, as Ultra Wideband will enable us to get several orders of magnitude more bandwidth out of the current RF spectrum without interfering with existing RF devices. But sadly the FCC is paranoid and restricted UWB's power output to one thousand times lower than expected. Still enough for WiFi-like ranges (See Pulse-Link), but not for longer range devices.
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RadioDoc
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edit:
January 13th, @03:27PM

Bullshit

The "solution" proposed is exactly how we ended up with the FCC regulating spectrum use in the first place.

Given that it is Business Week it is also a testament to why you don't let corporate America run public resource allotment.

And I am as much of an FCC hater as you'll find, having to deal with them on the licensee end (i.e. the crap end) of things.

As for the rest of his brilliant analysis, he needs to get out of the penny stock boiler-room and into the sunlight a little more often.

sabersaw
Premium
join:2001-08-21
Dayton, OH

Re: Bullshit

said by RadioDoc See Profile:

Given that it is Business Week it is also a testament to why you don't let corporate America run public resource allotment.
The recent FCC actions lead to to believe the FCC already is being run by corporate America. But that is only second to the FCC taking making their money first. Between BPL, HDTV, and Nextel; it is pretty clear that they are too incompetent to hide their incompetence. Either that, or they just have become way too bold, cause as long as Fellatio Island 5 comes on at 8, the public could care less. Unfortunately though... there must be a governing body to oversee the RF spectrum. However that governing body should not be a pimp or cheerleader for certain industries.

LegoPower77
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Arlington, VA

said by RadioDoc See Profile:

The "solution" proposed is exactly how we ended up with the FCC regulating spectrum use in the first place.
No, FCC started regulating things because people took a dubious "public goods" view of the airwaves since in the 20s and 30s the property rights of the airwaves were not properly enforced.

Having the free market take care of it would work absolutely but it requires property rights to be enforced. But big government sheep will prevent this from happening while talking out of both sides of their mouths, "the fcc sucks but eeevil businesses suck, too" blah blah blah.
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sabersaw
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edit:
January 13th, @04:17PM

Re: Bullshit

said by LegoPower77:





said by RadioDoc See Profile:"the fcc sucks but eeevil businesses suck, too" blah blah blah.
much like when the local police officer writes you a seatbelt violation ticket. its the American way.
audiog

join:2004-08-09
Detroit, MI

You are both right. The FCC(radio board) was formed because of finical and safety issues in service of the public good.

We need someone to control what the usage of the spectrum is. Because we had two stations trying to out broadcast each other like two people standing on the corner with bullhorns with different messages. Also, we had music broadcasts on the same frequency as the old steamship signaling core.

The problem is the FCC has moved away from the service of the public good to a service of the corporate good. If it is good for Big business than it must be good for the people. Competition is 5 or more very large companies controlling the market and if they want to merge then let them do it.

The recent telecom mergers would have not happened in the EU or they tried and the EU said " No way!!!!" ATT + Deutsche Telecom( T-mobile) and Verizon + Deutsche Telecom.

We will see the reformed new and improved ATT back together under some name.

And yes they both SUCK!!!

LegoPower77
Abecedarian
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Arlington, VA

Re: Bullshit

Yes of course, we want to do things the way Europe does it with their .2% growth and double-digit unemployment numbers . The fact is, market concentration (so-called monopoly) is not a bad thing. Sometimes it is the case that only huge eeevil companies can spend the $ for research and development.

Standard Oil is one often cited as being a "monopoly" (though at their apogee they still only had 70% market share) but look what they did, N.B.: they lowered the price of crude from some 40$ a barrel to mere pennies. In fact, when "monopolies" do occur, they end up lowering the price for consumers (heck, Microsoft got in trouble for giving their product away for free)!

So I say all this to try to point out that market concentration is not the bogeyman that so many in here make it out to be. As Friedrich Hayek points out in his essay The Meaning of Competition, “Enthusiasm for perfect competition in theory and the support of monopoly in practice are indeed surprisingly often found to live together.” The reason for this is that people get so caught-up in trying to make everything “competitive” that they end up distorting the market by excessive regulation. We just need free markets, and that's what Mr. Blonder's article is about.

Now to the point about the FEC taking control of the radio spectrum:

Government succeeded in gaining control of radio by promulgating the public property view of radio. This idea is mistaken because radio only meets half of the requirements for public goods; indeed, radio fails the first and most important: it is scarce. The four requirements for public goods are:

    •Not scarce.
    •Joint consumption—people use it at the same time.
    •Consumers do not pay producers.
    •Non excludability—it costs too much to police free riders.

Radio fails the public goods test on the first count because it cannot be said that radio is scarce. Once something is being broadcast, another transmission on the same frequency will either block or override the first. The radio stations that we listen to only come into existence after human action converts sound into radio waves and broadcasts it. Also, the number of radio stations is limited by scarcity of resources needed to build, administer, etc.

Radio fails the public goods test on the third count as well. While not glaringly obvious, the consumers actually do pay producers in the radio market if we think of the advertisers as consumers of radio. While there is no direct link from the listening public to the purchasers of radio broadcasts, i.e., advertisers, the programming reflects what the general public wants.

Regardless of these objections, the idea was accepted that radio is a public good and should be controlled by the state. The effect of this was to destroy the property rights attached to broadcasting and ipso facto get rid of the incentives to organize radio. This caused radio to become chaotic and stagnate as an industry, so it then fell to government to bring order. (It only follows, if government artificially makes the medium public, then they should also organize it as well.) The state of affairs in radio was used to justify government control, but notice how government distorted the market and then the blame was cast on the free market pariah. (Currently, the health care system in America has faced the same mechanism of command and conquer.)
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"Those who want to take our money and gain power over us have discovered the magic formula: Get us envious or angry at others and we will surrender, in installments, not only our money but our freedom"—Thomas Sowell.

DaveNJ
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Unplanned Growth

The FCC isnt perfect by when there is a problem they try to address it ie/ nextell problems. I think a good reorgination of the airwaves is needed. But what this guy is proposing sounds chaotic, which is just as bad.
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dardin

join:2002-11-19
Tucson, AZ

edit:
January 13th, @04:00PM

It's all about the green..........

Companies paid the FCC Billions for the spectrum they have. FCC has become a business like any other in America and they care only about money, not what is right.

This is America people.
footballdude

join:2002-08-13
Imperial, MO

Re: It's all about the green..........

said by dardin See Profile:

Companies paid the FCC Billions for the spectrum they have. FCC has become a business like any other in America and they care only about money, not what is right.

This is America people.
There may be a number of people in America who can be described or defined by that, but that's not America.
joemaloy

join:2004-12-21
Tonopah, AZ
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The Problem

The main problem is that the government "the politicians in it" has basically become a major corporation and wants to make all the money it can instead of looking out for the peoples best interests for which it was created. I think there should be a major overhaul of the government to reflect the current times that we live in. ALL OF IT.
rchawley
Premium
join:2004-04-03
Los Angeles, CA


edit:
January 16th, @02:52AM

the real problem

the fcc is to regulatory. the first thing they need to get rid of is their regulation on telephone companies. Prices would be more competitive if you could choose between SBC, Verizon, Bell South, etc. Before any broadband growth can happen the root problem needs to be solved. Money is the underlying factor as to why this hasen't happened
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