Spectrum Licensing, Policy Instruments and Market Entry

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may AbstractCompetition policy attempts to address the potential for market failure by encouraging competition in service markets. Often, in wireless communication service markets, national regulatory authorities seek to encourage entry via the spectrum assignment process. Instruments used include the assignment mode (auction or beauty contest), setting aside licenses and providing bidding (price and quantity) credits for potential entrants, and making more licenses (spectrum blocks) available than incumbent firms (excess licenses). The empirical analysis assesses the effectiveness of these policy instruments on encouraging entry. The econometric results show that the probability of entry is enhanced by using auction assignments and excess licenses. Furthermore, quantity, but not price, concessions encourage entry.JEL Classification: D82, L51, L96

Spectrum Concentration and Performance of the U.S. Wireless Industry

“…One exception is Madden et al (2014), who attempt to connect empirically the choice of spectrum auction format (and other spectrum allocation mechanisms) and the extent of new entry into mobile wireless markets.…”

Spectrum licensing, policy instruments and market entry. A comment

“…Some more detailed information about these cases can be seen in Table I. Source: Curwen (2002a) The problem also arises in Asian countries covered in Madden et al (2014). For example:…”

“…In May 2014, Madden, Bohlin, Tran and Morey published a study concerned with the mobile communications industry. The study concluded, as stated in the abstract, that "the probability of entry is enhanced by using auction assignments and excess licences[1]" (Madden et al, 2014). They obtained the national 3G (third-generation) [2] spectrum data, which underpinned their study by recourse to the DotEcon Spectrum Awards database supplemented by further data searches to establish the number of 2G licences [3] held prior to the award of 3G Universal Mobile Telecommunications System (UMTS) licences.…”

“…The problem also arises in Asian countries covered in Madden et al (2014). For example: Singapore: There were three incumbents and four licences.…”

Regulation for dynamic spectrum management.

“…However, it is argued that no empirical evidence exists supporting that auctions are distortionary (Morris, 2005). In addition, auctions have facilitated new entrants (Madden, Bohlin, Tran & Morey, 2014).…”