A 2016 decision by the US Federal Communications Commission to enhance the availability of spectrum across the nation for wireless broadband services designated the 3.5 GHz band (3550 to 3700 MHz) as the Citizens Broadband Radio Service (CBRS). The reshaped band, the established and new players, and the services expected to use it are now known as “the 3.5 GHz ecosystem”. The 3.5 GHz ecosystem is a three-tiered spectrum sharing space with incumbent users in the upper tier, mainly federal aeronautical uses and non-federal fixed satellite services and terrestrial wireless operations. The second tier, called Priority Access, allows Priority Access Licensees (PALs) to use up to 70 MHz in aggregate. The bottom tier is the General Authorised Access (GAA); it allows for opportunistic use of the band by radio devices. A new agent, the Spectrum Access System (SAS), coordinates access to the band and provides protection from interference.
With technological advances in the way spectrum is accessed and used the concept of value of spectrum demands a new approach. The goal of efficient spectrum management is to maximize the social and economic value of spectrum subject to conditions and constraints set by policy makers. Value is affected by revenues, costs and uncertainty. Sources of uncertainty such as innovation in technology, changes in market conditions and regulatory decisions render the value of spectrum less predictable.
In this research proposal I present and discuss a descriptive model that unveils the effects of spectrum sharing on the value of spectrum perceived by the players sharing the 3.5 GHz ecosystem. One expected application of this work is to help inform a spectrum authority’s allocation and assignment procedures, traditionally unable to sort out the role of externalities.
The US 3.5 GHz ecosystem provides a rich structure that allows for an assessment of how value is interlinked between the tiers. It is also possible to conjecture on the directions of change in the value of spectrum to existing users when a new user starts operating on a tier that was previously empty.
In other words, the impact that a new user may have on the existing distribution of value, which includes the direction and size of value change, may be better understood when an incremental model of value change is considered. So, at first the model considers a baseline scenario when no new uses have yet been allowed in the 3.5 GHz band. Next, assuming a new PAL starts operating on the band, drivers of spectrum value change are identified so that the direction of value change is found. Finally, given the uncertainty inherent to determining what type of agents will seek to operate tier 3, the incremental value analysis proposed here will need to investigate further rearrangement of value among players when GAA devices are allowed to use the band.
The significance of the research proposed here lies on the need to provide a bridge to the gap detected in the relevant literature, which falls short of providing a value framework that helps stakeholders understand the drivers of value.