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Mises Economics Blog

The Spectrum Should Be Private Property: The Economics, History, and Future of Wireless Technology

October 28, 2004 10:46 PM by B.K. Marcus | Other posts by B.K. Marcus | Comments (15) | TrackBacks (1)

How much of the spectrum should be privatized? All of it. Even the vast "beachfront property" held by the military? Yes, all of it. Most government-held spectrum is currently unused, but remains off-limits to private appropriation. The result, in the United States, is an artificial scarcity well beyond that imposed by the FCC's protectionist practices. How do we privatize the airwaves? If the spectrum confiscation were a recent development, the answer would be obvious. In today's world, matters are more complicated. [Full Article]

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Un poco en línea con mi artículo reciente sobre la privatización del espacio radioeléctrico, esta semana Jorge Rodríguez discute con más detalles una posible forma de llevar a cabo tal privatización. Jorge y yo coincidimos en que hay un problema de e... Read More

Comments (15)

  • Mike
  • Another great production from BKM.

  • Published: October 29, 2004 8:23 AM

  • wu-ping
  • For what it's worth, the inception of the Soviet Union (the socialist experiment) and regulation of the radio spectrum at least in America and probably elsewhere, were contemporaneous. The Soviet Union ended in 1989, to be replaced by something not necessarily a lot better. And I hear there was a big deregulation of the FCC's ambit a few years ago. Long way to go - in both cases.

  • Published: October 29, 2004 9:30 AM

  • Curt Howland
  • Surprising to me, Slashdot has rejected a link to this article. Utilization of the radio spectrum for communications, be it analog or digital, is a serious bone of contention when ever the subject comes up.


    Maybe someone else would try submitting it?

  • Published: October 29, 2004 12:40 PM

  • alive69

  • You are correct in the tragedy of the commons flowing from central control of spectrum. You have outlined admirably a long sad history. But the tragedy stems not from lack of private property, as you suggest, but from bad paper law. You are wrong about the nature of spectrum. It is not a scarce resource. The scarce resource is technology. And technology is the private property of this issue. Spectrum is a natural commons which, through free association and human action, need not end in tragedy.

    I grant your reasoning is smart and ‘convenient’, but it is not correct. Private ownership cannot justly be claimed by either homesteading or any other grant from any individual or body. Spectrum is unlimited and free, and if anything, it should be protected by law as free. You may see this as ‘inconvenient’ to established markets and to the question of interference, but that does not change the nature of spectrum.

    It’s my belief that you have adapted principles to fit technology. When you comprehend the true nature of spectrum, you will then identify the correct principles and the outcome will be that human action and technology will adapt.

  • Published: October 29, 2004 3:16 PM

  • David J. Heinrich
  • alive69,

    You are wrong about the spectrum; it is a scarce resource, as the author of the article illustrates. Spectrum is not in any way unlimited and free, due to various interference problems. Furthermore, spectrum is something that our demand can grow and scale to meet the supply of. People have an enormous appetite for information.

    Curt Howland,

    I don't think it's surprising that Slashdot rejected the article. They claim not to be party to politics, but they are clearly socialists over there (at least the editors). They think that private property is evil. They have their defined solution to the problem of spectrum, which is to, in effect, socialize it. Of course, the brilliant ones determining how the socialized resources are distributed would be the radiowave nerds, with their perfect judgement.

  • Published: October 29, 2004 5:11 PM

  • Curt Howland
  • Privatizing the broadcast spectrum and enforcing what amounts to "homesteading" doesn't have to await any new technology. For example, the plethora of wireless phones and microwave ovens work well in the 2.4GHz band, and up in GHz "broadcast" becomes less efficient. A directional signal does not effect my wireless phone, nor does my microwave oven effect that other persons directional point-to-point signal for which microwaves are well suited. Satellites transmitting in that same general band are also uneffected, because directional receivers on the ground blank out "interference" from my wireless phone and microwave oven.

    So even the most "junk" band, with its overlapping signals, doesn't mean there is any interference or "tresspassing".

    I think of a traditional transmission not as a "homesteading" but as a "right of way". An established television/radio transmitter on a specific frequency maintains that right of way so long as they use it without then trespassing on anyone else. Easily done, easy to conceive of, and well covered by traditional common-law property rights.

    So-called spread spectrum can easily utilize the guard bands (gaps) between the established AM and FM channels. Cable TV interferes not a whit with broadcast signals even if they use the same frequencies. It is in variety that opportunity is found, and the FCC has styfled that variety with their regulations. Recall that ISDN (digital telephony) was architected in the early 1970's, but "never tarriffed".

    Yeah, I've been preaching this on Slashdot any time the subject comes up. I'm really glad that I can point people to this article now instead of having to reitterate it over and over. (department of redundancy department)

  • Published: October 30, 2004 2:58 PM

  • RottHund
  • When I read about the radio passing through someone's home, I suddenly thought of Marie Curie. One's radio transmittions doesn't affect another's disuse of the radio spectrum, therefore it's not tresspass. It is thought to do no harm. The Curie's work in radiation proved benefitial, but ignoriant of it's harm died from exposure to radiation. (Star Trek's episode of Data's amnesia and possession of radioactive material comes to mind, too.)


    Presently, there's controversy over the negative health effects of mobile phone transmittions. Effects of exposure to electromagnetice (EM) radiation from powerlines has been documented. There's also concerns over sitting in front of CRT screens. My dad has mentioned stories of people sensitive the common EM emmisions.


    Is restitution simply made after discovery, proof of harm and demonstration of damages?


    Technology would transform by the demands of health conscience and risk adverse customers, right?

  • Published: November 1, 2004 5:26 PM

  • rtr
  • The argument for the ownership of spectrum is based on the same fallacies as the arguments for ownership of copyrighted intellectual property. An essential characteristic of property is that it can clearly be delineated and circumscribed, such as an individual person or a piece of land. Spectrum does *not* meet these qualifications. Spectrum is not even a scare resource as it cannot be “used upâ€? the way mineral deposits in the ground can be totally extracted, or even the way air could be used up. If one claims that spectrum can be privately owned property then one should just as easily be able to show that the air containing oxygen or a patent on the process of breathing (and the logical enslavement of all of humanity proceeding from such claimed ownership) can be privately owned property. Obviously, that’s a logical impossibility which necessarily calls for the destruction of society. It’s as absurd as having property ownership of musical note frequencies.

    One pays nobody anything to breath air. Of course, a scuba diver can fill his privately owned oxygen tank with air, just as can anyone else. One can obtain ownership of a definite specific delineated and circumscribed amount of fresh lake water or rain water by collecting it in privately owned specific materially delineating and circumscribing collection devices, just as can anyone else. And one can broadcast on a specific radio frequency, just as can anyone else. The current difference is that currently in the third case men will come to either imprison or kill or steal from another individual for using it with their privately owned material broadcasting/transmission devices. Airplanes don’t avoid crashing into each other by owning air space but by voluntary agreeing with each other in advance to perform certain maneuvers if they see a potential collision, or agreeing to avoid certain space at a certain time. There’s no ownership of airspace. It’s the same with ships on the oceans.

    If one can own any spectrum whatsoever it would logically follow that the forceful aggression against everyday speech, whether amplified by/into “radio� or not, in a specific frequency could and would necessarily be attempted to be enforced. Thus, the “right� to verbally talk or whisper to anybody would be forcefully taken away. It’s an aggressive declaration of war to obtain non-voluntary forthcoming rent from the free market by force. Does one person originally talking give that person the right to forcefully prevent all other individuals from talking without the express consent of the original talker? Or does the first individual breathing air acquire the right to breathe all the air and not have “his� air tainted by the carbon dioxide of others?

    Property rights only apply to the material delineable dimension which is in totality land and person, and the material extensions of them such as buildings or airplanes or satellites. The free market has already found the solution to non-ownership of spectrum. Specific “broadcasted� content does not need to be sent through the air but can be supplied in possess-able tradable forms such as on compact discs and dvds. Direct line connections can be privately owned to transmit content through telephone lines and cable lines. Better filtering devices can be developed to lessen interference of specific signals between specific points just as recorded background “noise� can currently be filtered out.

    Just as someone’s overheard conversation at a restaurant is in a quasi-public domain so necessarily is all signals sent through the airwaves. No right to send any signal of any sort through specifically owned and clearly delineated property, such as houses, has ever been obtained from any or all of the specific owners of clearly delineated property. As the article argued, there is no rightfully regarded “harm� done by that just as there is no rightfully regarded “harm� done by exhaling oxygen. Those signals may be subjectively regarded as positive beneficial “external economies� or as negative “pollution� by individually subjective valuing actors just as the exhalation of carbon dioxide may be subjectively regarded as pollution by others or a positive “external economy� benefit for the plants in the actor’s garden.

    There would be innumerable absurdities of claimed violations, all arbitrarily claimed "resolutions" aside, of (non-existing) property right ownership in spectrum from the interference caused by an airplane, or even potentially mere motion of existence of human beings (as can sometimes be experienced by walking in certain areas near a tv antenna). Are all airlines now susceptible to claims of damage from interference causing loss of a specific signal (for even the slightest of time periods?) at a specific frequency for as far as the frequency can be said to extend (infinity?), or would some so-called arbitrary "right of first use" exception be arbitrarily granted to airlines? No, it’s clear that spectrum cannot be privately owned property. The unhindered use of any particular frequency can only be maintained by non-competitive way of voluntary choice “right of way *customs/tradition*� or by explicit contracting with every individual human being to not transmit signals in that specific frequency thus making attempted ownership of spectrum economically unfeasible.

    The free market solution is for companies or individuals wishing to sell or broadcast content to transmit it in location specific private property material specific forms such as specific cds, dvds, websites, cable channels, movie screens, or whatever tangible material forms may be possible, or else find privately established solutions to the necessarily eternal commons of spectrum. It is only these tangible material forms that can be owned as property and traded between individuals. Everyone can go on just as before using their specific materially owned *transmission equipment* and broadcast whatever they want to on any frequency whatsoever. And everyone else can also. Analogies of harm to the material dimension such as soot on crops do not apply as soot on crops is materially specific harm that can be stopped by requiring the polluter to cease polluting by shutting his factory down or developing a device to catch the pollutants and prevent them from being deposited on the neighbor’s crops.

    There is no artificial right to have one’s transmission received through the air from its source any distance whatsoever just as there is no artificial right to own sunshine or rain or patent the process of sunshine or rain. Attempted aggressive violent enforcement of such temporary instances of control of non-property existing as long as the necessary submission co-exists with it are anti-social action which results in the destruction of society. As such any ownership of spectrum, private or government cannot possibly be regarded as peaceful voluntary cooperative action. It’s absurd to regard as a “tragedy of the commons� the fact that all human beings breathe oxygen from the same air or transmit broadcasts from the same spectrum. It’s just a cheap attempt to avoid seeking free market solutions to the problem of a cacophony of voices through the age-old employment of violent coercion.

  • Published: November 2, 2004 5:00 PM

  • bill wald
  • Largest transmitter wins?

    I sue for unwanted transmissions passing through my house?

  • Published: November 3, 2004 6:37 PM

  • Alex
  • It seems as though Bill Wald has taken the place of the old Gary who used to frequent these boards and poke fun at our stupidity for trying something new, something that has to do with liberty and efficient resource allocation (also called the market).

    I keep telling people this, but we need not have a coda of law and legislation for privatizing things. The law - like the market - is constantly changing anyway, and what seems like 'common sense' now is proven out of touch with reality tomorrow.

    The biggest problem is that because we get law from a centralized source, a lot of people get a 'one size fits all' idea; we have to come up with the perfect application of theory, practicality, and economics. Such a perfect answer does not exist, and the nitpicking bitter people like Bill and Gary will always laugh at our attempts for perfection.

    (Bill thinks that our quest to find a more perfect solution to life's problems through liberty instead of the state, through the market instead of taxation, is idiotic. He doesn't understand the the quest for perfection is an enobling feature of the human race. Austrians are not promising utopia; they're trying to solve problems that have been lingering for a long time, and from which the likes of the more whiny and cowardly Bill types, continues because of their lack of character and constant depressed state of mind. These are the people who poke fun at other people's attempts to better themselves or society, while eating the fast food junk and candy bars and marveling at how smart they are, and how dumb everyone else is.)

    We do not need to know how laws would form in a free market society, for the same reason that a capitalist doesn't need to tell a communist how cars are going to be made in order to sell the idea of private enterprise in car manufacturing.

    A perfect body of law would require perfect knowledge and perfect wisdom. No man - or group of men - has existed or will exist with these abilities. Perfect law could not exist even with great wisdom and knowledge - because people by their nature are not perfect or all-wise. What good does it do to have a perfect system of law, if one could exist, if the people whom the law applied to were too base on some levels to obey it?

    The advantages that the market has over the State is it's ability to change very quickly. For this reason, profit loss is minimized as much as possible. Huge settlements over silly quibbles (like Bill's poverbial 'suing for unwanted transmitions through my house') become unpofitable, and signal to others that a more efficient means of doing business needs to be in order - through the means of profit incentive.

    Comparing this to a State legislation board is like comparing a dying man trying run a 100 yard dash to an Olympic sprinter in his prime. The State moves very slowly, as anyone who has observed any branch of it - military, law enforcement, public service - has observed.

    The second problem with this is that even if the State and politicians desire to have a truly just and wise law(s), they cannot go about doing it in the most efficient manner. Without access to prices, they are making arbitrary decisions based more on 'gut feelings' than resource allocation. To deny this is to make a claim for socialism and communism; there is no way around this statement. Like war, it is a great divider; either you agree, or you do not agree that the State cannot allocate resources as efficiently as the market. If you don't agree with that statement, you have made a claim for communism. It's that simple.

  • Published: November 6, 2004 1:16 PM

  • Rotthund
  • The scuba diver example clearly shows the ownability and containability of air. Air will be an important product and service in space travel/colonization, where air really is scarce.


    Tangile property can be withheld from the market. That's a valuable trait of collectibles.

    However, spectrum can't be withheld. Disuse would compare to abandonment. First to use specturm implies ownership, homesteading as the article mentions. New entries in the market might find is cheaper and favorable to circumvent the homesteaded spectrum.


    The advantage of market resource allocation is that more decision makers are nearer the resources and directly affected by those decisions.

  • Published: November 7, 2004 7:27 AM

  • rtr
  • The scuba diver example shows the ownability and containability of a specific definite circumscribed amount of air, not the ownability and containability of all of the existing air.

    Spectrum can never be contained and circumscribed in a limited definite quantity without necessarily tresspassing on the rightfully owned property of others. Therefore, spectrum cannot be owned in the slightest.

    Ownership of the mises.org website does not imply ownership of all of the internet or the process of transmitting information on the web. This website employs free market solutions to filtering its subjectively regarded spam on its area of the internet. That is exactly what broadcast companies must do as well with the property they own that can be owned -- their transmission equipment.

    Claiming the right to transmit at a certain frequency is no different than claiming the right to transmit in any spoken or written language. For that to be possible agressive violent action must be imposed on others preventing them from speaking and their voices echoing for as far as they naturally extend.

    Not everything can be homesteaded. One would be rightfully regarded as acting violently if they were to drape a sunblocking net in space around the planet earth and then attempting to seek rent to let the sun pass through their homsteaded space (by placement of the net) in location specific space. Claiming ownership of spectrum is very similar to this space net example.

  • Published: November 8, 2004 9:28 AM

  • R. Higgins
  • It appears to me that what Nature has provided belongs equally to everyone. Therefore, all reasonably desirable waterfront property should be publicly, not privately, owned. Consequently, there should be a strip of land of reasonable width along the water, available for public use.

  • Published: April 12, 2006 9:55 AM

  • BillG (not Gates)
  • R. Higgins wrote:

    "It appears to me that what Nature has provided belongs equally to everyone. Therefore, all reasonably desirable waterfront property should be publicly, not privately, owned. Consequently, there should be a strip of land of reasonable width along the water, available for public use."

    BillG responds:

    there already is...a beachfront property owner only owns the land to the high water mark.

    between high and low tide there is a very nice piece of the commons to walk along...

  • Published: April 12, 2006 12:00 PM

  • Roy W. Wright
  • rtr is exactly correct. "Owning" part of the spectrum makes as little sense as owning a piece of intellectual "property." And R. Higgins' comment strikes me as sarcasm, though I wouldn't be terribly surprised if it's not.

  • Published: April 12, 2006 12:17 PM

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