To be sure, the FCC has modernized its management of spectrum some in recent times. New spectrum is auctioned off to bidders, rather than handed out for free to companies deemed worthy enough by the government. For 3G wireless, FCC promises to give companies a fair amount of flexibility on its use. But at its core, spectrum is managed just as it was back in the 1930s. Auctions are encumbered by a host of rules, caps on how much any company can own, and on and on.
Companies don t have any real property rights on the spectrum they use.
So anybody who wants spectrum for a new product or service has to go to the FCC and, essentially, beg. Everybody who has spectrum lobbies to keep it. Nobody can easily change what he or she uses it for. This centralized system continues to create artificial scarcity . Right now there are huge chunks of spectrum sitting idle simply because they cannot be easily redirected to more pressing uses.