VI. Summary and Conclusions

Because of the multitude of forces influencing frequency management, several countries have been investigating, experimenting with, and implementing alternative policies and processes for managing the radio spectrum resource. This paper has reviewed and critiqued many of the U.S. attempts over the past 20 years to improve and reform the traditional administrative approach to spectrum management. The most recent legislative and regulatory steps toward reform, namely, clarification and restriction of the use of auctions for issuing licenses, were also discussed.

Although it is far too soon to reach any final judgment as to the actual real-world advantages and disadvantages of auctions in assigning spectrum, the review does suggest these conclusions:

• The U.S. experience with the Chicago experiment implies that trying to micro-manage the resource creates significant problems, even in a decentralized context.

• The experience with private frequency coordinators, which has generally been positive, suggests that similar cooperative efforts between governments and the private sector may be productive.

• The experience with the use of quasi-property rights in spectrum management (which includes giving the licensee sufficient flexibility to change the nature of services offered, the customers served, and the technology employed) strongly suggests that creating such rights can lead to more efficient allocations, assignments, and usage of the resource.

• The experience with lotteries suggests that this approach to assigning licenses is fraught with problems, especially with high-value licenses.

• The experience with pioneer's preference is mixed and its future utility--with spectrum auctions in place--is uncertain.

• The experience with negotiated rulemakings (which include major allocation matters) suggests that this approach may well be advantageous, at least in selected circumstances. It deserves greater visibility.

• Although auctioning may prove to be a superior way of assigning licenses, by itself it does nothing to improve the way that spectrum is allocated among services. Indeed some observers note that auctions may exacerbate the problems associated with spectrum allocations.