I have received some interesting feedback – on and off the record – that is worth sharing.
A comment on my Monday post points out a good reason for people to comment anonymously – lack of corporate support for their involvement in blog commentary. The comment said:
If you say something that even hints at being confidential, proprietary, libelous, discriminatory, etc. and it’s found out, you’ll get a rather large chunk of your hide taken out by HR, not to mention your boss of the moment. So a lot of people use prudence, rather than their real identity.
I had a chance to have a brief conversation at The 2007 Canadian Telecom Summit with John Roese about the challenges for an officer of a public company to speak freely on his blog. I fully understand that concern.
So, let me provide a screen for a couple good contrary viewpoints that have been sent into me privately.
Here is one on the spectrum auction:
For some strange reason I am of the view that the government should set aside spectrum from a policy perspective. What analogies miss, such as Bangor Lodge, is that in wireless, the government owns all the available real estate and has it awarded it to just three innkeepers. I believe that anyone in cottage country who can get the zoning permission can start an inn.
The other issue I take with the incumbents is that they have all benefited in some way shape or form from spectrum grants, with the understanding that the licenses were for a limited amount of spectrum for a defined time period. I didn’t think they came with a caveat that all future spectrum grants would allow them equal access. Isn’t it a case of ‘buyer beware’?
A number of people point to the fact that the current incumbents received their initial spectrum without large upfront payments. Many of these folks tend to forget that there was no certainty to the success of cellular as a service. Indeed, a celebrated study conducted in 1980 forecast a total market of less than a million subscribers in the US in the year 2000 – off by more than 2 orders of magnitude. The spectrum had no proven value at the time that Rogers and the ILECs got started.
So what would have been the right market price in 1984 for the spectrum? In hindsight, our vision is crystal clear. Isn’t it possible that the risk sharing model – carriers paying as demand grew, was the appropriate model in a high risk period of time for the industry?
“Bruce,” commenting on Sunday’s posting, noted:
As I said in my original comment, the goal should be to ensure there is spectrum available to a new entrant, but not at a discount for the new entrant. (Yes, this will reduce the total government take because it removes the incentive for incumbents to pay more in order to hoard the spectrum.)
Brian accurately gets at the broader policy issue — should the government go beyond steps that enable a new entrant to ones that specifically benefit a new entrant.
This is a more complicated issue.
Michael Geist writes:
Viewed through the lens of planned spectrum use, the choice boils down to the chance for increased Canadian competition through a set-aside or an open auction that offers little in the way of change. For a Minister who has made his mark reshaping the Canadian telecommunications landscape, the decision may not be so difficult after all.
Contrary to the viewpoint expressed in Michael’s piece this week, I tend to agree with Bruce. I think the Minister has some very difficult decisions to make. The auction policy is very much a complicated issue, with serious implications for the carriers, potential new entrants and all of us consumers.
We’ll be watching the reply comments that are due on June 27. More input, more guidance and likely even more twists in the road.