Spectrum value

This paper presents the theoretical underpinnings of spectrum value, and describes how these principles of spectrum value manifest in various empirical applications. Similar to most scarce resources, the value of spectrum is determined by the value generated by its deployment. This concept is typically understood as economic rent. In the case of radio spectrum, economic rent can be thought of as having two components: a sea level spectrum value driven by the general profitability of spectrum based services, and band or license specific adjustments to spectrum value due to band or license specific characteristics. Clarity about these different sources of value can inform how to apply traditional valuation techniques in a hybrid approach to spectrum valuation. The key is to capture the useful information from disparate and incomplete valuation methodologies and then combine them in a meaningful and structured manner. We then demonstrate these proposed valuation techniques empirically.