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Hootenannies are mostly peaceful affairs, so it’s a bit awkward to invoke a violent metaphor here.

In “Raiders of the Lost Ark,” Indiana Jones runs down a Cairo sidestreet only to be confronted by a swordsman. The swordsman makes a big show of tossing his weapon from hand-to-hand and swirling it around. But Indy has no time for such nonsense—he pulls out his gun and shoots the would-be assassin.

U.S. spectrum policy is much like the swordsman. While the telecom regulators swirl around studies of how to allocate spectrum, the rest of the world is pulling the trigger.

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Abstract

Policy approaches to the enforcement and licensing of standard-essential patents (SEPs) in wireless communications markets reflect the competing interests of entities that specialize in the innovation or implementation segments of the technology supply chain. This same principle can anticipate the policy preferences of national jurisdictions that specialize in the chip-design or device-production segments of the global technology supply chain. Consistent with this principle, the legal treatment of SEP licensing and enforcement by regulators and courts in the People’s Republic of China reflects a strategic effort to deploy competition and patent law to reduce input costs for domestic device producers that rely on wireless communications technology held by foreign chip suppliers. This mercantilist use of antitrust law has derived its intellectual foundation from patent holdup and royalty stacking models of market failure developed principally by U.S. scholars and has borrowed excessive pricing, essential facility, and other doctrines from E.U. competition and U.S. antitrust law, which have then been applied expansively by Chinese regulators and courts in service of geopolitical objectives. While this strategy promotes the short-term interests of a national economy that specializes in the implementation segments of the technology supply chain, it is unlikely to promote the global economy’s longer-term interest in preserving the funding and transactional structures that have supported innovation and commercialization in the wireless technology ecosystem.

Amazon on Friday launched its first two prototype satellites for its planned Project Kuiper internet-satellite network. It was the latest milestone in the rapid evolution of the low-Earth-orbit (LEO) satellite industry, with companies like SpaceX and OneWeb joining Project Kuiper in launching thousands of satellites to provide broadband internet access globally.

As this nascent industry takes shape, it is important that U.S. policymakers understand its competitive dynamics. With the number of LEO satellites set to increase in the coming years, establishing a regulatory framework that spurs innovation and investment while fostering a competitive marketplace will be essential to ensure the industry’s growth benefits consumers. In this post, we will examine some of the most urgent public-policy issues that directly impact competitiveness in the LEO industry.

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Abstract

This paper builds on previous work addressing the problem of “hold-out” in the licensing of standards essential patents (SEPs) in mobile cellular communications technology. Given the pervasiveness of mobile technology, and the need to maintain continued innovation in such technology, the robustness of the licensing marketplace for patents is an economically important issue. We show how the ease with which implementers of such technology such as smartphone makers can use the technology without having agreed to licenses is a major structural factor that shifts bargaining power in licence negotiations towards the implementers. Together with frictions in the enforcement process, and the increasing propensity to resist licensing by new groups of implementers (i.e., “hold out”) we explain why there is an elevated risk that the licensing marketplace may produce outcomes that are inconsistent with the “balance” that Standards Development Organizations (“SDOs”) such as ETSI have sought out. The ability of the licensing marketplace to strike this balance is critical to the continued robustness of the wireless ecosystem. We explain that there is a risk that the SEP holders’ obligation to be prepared to make licences available on Fair, Reasonable and Non-Discriminatory (FRAND) terms can be used to “bound” the worst case scenario for an implementer– i.e., that it can never do worse than receiving the “FRAND” royalty. We discuss how courts and policymakers should sensibly interpret the bounds and limits of the FRAND commitment, in order to respect the overarching goals of “balance” and robust innovation in the ecosystem.

School’s back in session and the Telecom Hootenanny is heating up. We’ve got a hot-off-the-presses issue brief on the ACP, more BEAD agonistes, and the latest on spectrum auctions.

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The U.S. Senate moved yesterday in a 55-43 vote to confirm Anna Gomez to the Federal Communications Commission. Her confirmation breaks a partisan deadlock at the agency that has been in place since the beginning of the Biden administration, when Commissioner Jessica Rosenworcel vacated her seat to become FCC chair.

The commission now has a 3-2 Democratic majority. With the new majority, many speculate that the FCC will push to bring back net neutrality, which President Joe Biden supports. The president’s July 9, 2021 executive order specifically “encouraged” the FCC to “[r]estore Net Neutrality rules undone by the prior administration.” Deadline reminds us that Gomez served as counselor to Obama-era FCC Chairman Tom Wheeler, when the commission voted to reclassify broadband service under the banner of net neutrality.

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Coming out of Labor Day weekend, there’s not a lot of earth-shaking happenings at the Telecom Hootenanny. But like a visit to the state fair, there’s always something to see.

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While the dog days of August have sent many people to the pool to cool off, the Telecom Hootenanny dance floor is heating up. We’ve got hiccups in BEAD deployment, a former Federal Communications Commission (FCC) member urging the agency to free-up 12 GHz spectrum for fixed wireless, and another former FCC commissioner urging a rewrite of the rules governing low-earth orbit (LEO) satellites.

It’s been less than two months since the National Telecommunications and Information Administration (NTIA) announced state funding under the Broadband Equity Access and Deployment (BEAD) program. Already, states are grumbling about implementation headaches.

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Abstract

In 2015, the FCC established the Citizens Broadband Radio Service (CBRS) for sharing the 3.5 GHz Band (3550-3700 MHz) among federal and non-federal users in the United States. This rulemaking created an experiment in a novel three-tier rights structure: strong protections for incumbents, including government radar systems; Priority Access Licenses (PALs) granting exclusive rights to high bidders in an FCC auction, in part of the band and subject to avoiding interference with incumbents; and Generalized Authorized Access (GAA) for unlicensed users, subject to avoiding interference with both PALs and incumbents. The first commercial deployments in this band were approved in 2019 for GAA devices, and an auction of PALs completed in 2020 generated $4.5 billion in revenues.

It is now timely to evaluate this experiment and glean lessons for applications to other spectrum bands, such as the neighboring 3.1-3.45 GHz band or portions of the upper mid-band spectrum 7-24 GHz. In fact, a number of perspectives on CBRS have been recently published. In this paper we review these developments and suggest related policy questions that should be considered when evaluating the use of CBRS-style allocation rules in future bands.

The CBRS policy involves several different innovations, seeking to accomplish multiple objectives. One can evaluate this approach from a technical point of view, as an experiment to show that dynamic sharing can provide multiple tiers of commercial access to a band of spectrum while protecting incumbent users. The approach involves coordinated access via a cloud-based Spectrum Access System (SAS) and an Environmental Sensing Capability (ESC) to monitor incumbent users of the band, with requirements standardized through the Wireless Innovation Forum (WInnForum) and implementations certified by the FCC. From an economic and policy point of view, this type of dynamic sharing is asserted to reduce the costs and delays involved in making additional spectrum available for commercial use, as it seeks to avoid relocating incumbents. Of course, costs and benefits should be observed, not simply assumed, and the process undertaken should be compared to those associated with the relevant policy alternatives.

CBRS adopted the PAL and GAA tiers for commercial access in an attempt to provide spectrum that could not only support deployments by traditional wireless providers, but also enable new uses of the spectrum by non-traditional entities. How well the spectrum can support these uses, and whether this type of approach leads to an economically efficient mix of uses, provides another economic and policy lens through which this system can be evaluated. This paper explores the technical implementation of the CBRS spectrum sharing approach, and then attempts to appraise the economic welfare results of the novel allocation policy.