Slashdot Mirror
Study: Limiting Bidding On Spectrum Could Cost Billions
itwbennett writes "According to a study (PDF) by the Georgetown Center for Business and Public Policy, restricting the ability of Verizon Wireless and AT&T to bid in upcoming spectrum auctions would drive down the bidding during the auction, and could cost the U.S. treasury as much as $12 billion. Even a partial restriction of bids by Verizon and AT&T could have a significant impact on auction revenues, said Douglas Holtz-Eakin, a co-author of the Georgetown study. Matt Wood, policy director at digital rights group Free Press, fired back, saying 'No one is talking about completely barring AT&T and Verizon from the incentive auction. Sensible people are talking about making sure that more than two companies have a chance at obtaining spectrum. The fact that these duopolists hired economists to parrot the companies' own talking points isn't really that newsworthy.'"
For a bit of money, will soon have little of either.
Letting the cash-rich companies have their way is surely a bad idea.
What does it cost society?
Is it worth 12 billion dollars to keep AT&T and Verizon from controlling the airwaves?
If I have been able to see further than others, it is because I bought a pair of binoculars.
Every time the government doesn't get every penny and ounce of blood it can out of everyone doesn't mean it's "costing" the government anything.
Exactly - sky high spectrum auctions amount to a tax on the consumers that are forced to pay back the billions that the company spent to buy the spectrum. Encouraging more competition from smaller carriers by banning the big boys will likely save consumers many more billions than the government would have "earned".
From TFA:
But a policy to restrict the ability of Verizon Wireless and AT&T to bid on the spectrum would drive down the bidding during the auction and leave less money for a nationwide public safety network and the U.S. treasury
Why should spectrum auctions (i.e. my cell phone bill) pay for a public safety network?
The question to ask is: which way will build value?
If Verizon and AT&T will just sit on the spectrum doing nothing, then the government gets 12 billion extra and it will be wasted. The government doesn't do anything that's useful or valuable to the people any more - it only generates pointless bureaucracy and sweetheart deals. It's the aristocracy of "pull".
If players other than Verizon and AT&T will use the spectrum for new and innovative products, generate intellectual property (ugh! that word...) and add value to the economy, then the government gets 12 billion less which will go unnoticed (a minor drop in the bucket), but it will enrich America and perhaps generate tax revenue over time.
Let's give Verizon and AT&T a chance at the new spectrum. They kept the 200 billion we gave them to bring broadband to 86 million homes in America and did nothing, but that was a long time ago.
They wouldn't do that to us again, right?
Here is a simple way to make telecoms move on the spectrum they are sitting on: make the lease non-permanent.
If each lease lasted, say, 15 years, and had to be rebid, say, 5 years before the lease expires, the incentive to sit on spectrum would diminish greatly. The prices that companies are willing to pay for spectrum might diminish somewhat, but not utilizing spectrum would start costing real money, and new competition would have a chance to enter the market every now and then.
The problem with the current system is that obtaining a lease to spectrum gives companies a permanent monopoly on the spectrum forever, which decreases the incentive for competition. The spectrum is a sunk cost and delaying utilization of it is merely a loss of revenue, but not a direct cost.
m
It's not just wishful thinking, it's a gambit in an assault against our ideas. Anything that is done based on the idea that the free market is involved here is done on false premises and bound to fail. For which the nonexistent free market will be blamed.
The spectrum auction is a scam from beginning to end. The idea that anyone can own spectrum betrays a complete misunderstand of "own" and/or of "spectrum."
The best one could do is establish a customary right of occupation. By using the spectrum in question for something of value. If they dont use it they should lose it. If we ignore spectrum which is reserved but unused, there is suddenly a considerably greater supply.
The telecoms in this country are monopoly capitalists, not free marketeers, and this has been true longer than I have been alive. And I am a bit older than the average slashbot. This has only gotten worse over time. Their idea of competition is competing with other telecoms to see who can sway more congresscritters to their side. Just look at how many times the taxpayers (and ratepayers in monopolised/privileged districts, same thing) have paid for fibre coverage in the US. Enough to provide it border to border, sea to sea, several times over. What's the current percentage of us that have it? 10, 15%? And how many telecoms are still actively expanding coverage? Trick question, the answer appears to be 0.
=-=-=-=-=-=-=-=-=-=-=-=-=-=-
Friends don't let friends enable ecmascript.
could cost the U.S. treasury as much as $12 billion.
It's all in how you spin it, isn't it?
Flash: Duopolists willing to pay government $12 billion to extend duopoly. "Duopoly rents sure are nice!" says duopolist CEO, "We'd be happy to give the government a taste of the action." Film at eleven.
Stop-Prism.org: Opt Out of Surveillance