University of Southern California

Wireless Telecommunications: Spectrum as a Critical Resource

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Article by Gerald R. Faulhaber
From Volume 79, Number 3 (March, 2006)

Telecommunications services have always been a mix of wireline services, such as wireline telephone, cable television, and Internet access, and wireless services, such as AM/FM radio, broadcast television, and microwave-satellite transmission of electronic signals. Each mode of service has certain properties, both beneficial and detrimental. Wireline has the potential for almost unlimited capacity, such as the use of multigigabit fiber optics, but requires that the service be delivered to a particular location. Wireless frees the customer from being tied to a specific location, allowing service to be rendered wherever the customer is, but suffers from fading or nonexistent connections and possible privacy concerns. The mix between wireline mode and wireless mode is in constant flux; recently, however, the focus of the market has been shifting toward wireless. Cellular telephony has exploded worldwide, and after a slow start, the market penetration has increased dramatically. Meanwhile, the number of wired access lines in the United States has been declining, for the first time since the Great Depression.

The ability of engineers and innovative firms to bring new and compelling wireless telecommunications applications to an ever-communicating market is very impressive, and bodes well for even greater applications in the future. But even the cleverest of engineers cannot escape the one critical resource absolutely required for wireless services to be deployed: electromagnetic spectrum. Wireless services and devices are all radios, emitting electromagnetic radiation into free space and receiving such radiation. If other nearby transmitters are emitting radiation at the same frequency, the intended receivers will be unable to disentangle the signal they wish to receive from the spurious “interfering” signal. Fundamental to wireless technology is the need to solve this potential interference problem. Since the birth of radio in the 1920s, the interference problem has been solved by government licensing of transmission rights; each licensee is permitted to transmit from a particular place at a particular frequency at a maximum power for a particular application (for example, broadcast radio or police dispatch). Licensing has traditionally been a highly bureaucratic and political process. The outcome, all agree, has been a hugely inefficient use of spectrum resulting from this “command and control” regulatory allocation of a scarce resource.

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