Markets for military spectrum in the United Kingdom

The UK Government is really leaning forward on introducing markets to spectrum.  The goal of a current initiative is “releasing the maximum amount of spectrum to the market and to increase the opportunities for the development of innovative new services”  In particular, the Ministry of Defense (MOD), which currently manages a third of the UK radio frequency (RF) spectrum, now must pay for the use of that resource.  The Treasury has set the initial prices administratively — the costs will rise from £55 million this year to £500M in 2011.  Thereafter, MOD would have to procure spectrum on the market if it required more for its new systems. 

 

I am in favor of the approach.  It’s good public policy, forcing the political system to realize the opportunity cost of the Government’s actions.  Many military analysts in the US are against market reforms, including auctions.  Why wouldn’t they be – they are losing something they previously had for free.  I have no doubt it will constrain military capability in the medium term.  Yet if bandwidth intensive spectrum-dependent systems are critical to fighting future wars, the political system needs to face that head on and make hard choices. 

 

I expect that one outcome of the high cost of spectrum in rich, densely populated areas will be to shift military training to poorer, less populated areas.  Think third world deserts and jungles. 

 

Any other opinions out there?