Abstract

Spectrum access conditions in terms of available bandwidth, occupancy, propagation characteristics, and sharing restrictions are one of the major issues with a significant impact on capital and operational expenditures for any radiocommunication project. The growing spectrum demand is putting strong pressure on the conventional management system, which is ill-adapted to technological evolution, resulting in a spectrum bottleneck for new radio technologies. This paper draws on the lessons learned from the application of economic measures, such as auctioning, that have recently been introduced in spectrum management systems worldwide. A consideration of the auction experience, based on the proposed spectrum efficiency criterion, reveals a substantial shortcoming, which generates a significant additional project cost and devastating consequences for telecommunications markets, industry, users, and whole national economies. This paper argues that spectrum auctions are not always a valuable method for achieving an optimum economic return and proposes economic options to improve spectrum management practices.