Competition in Secondary Spectrum Markets: Price War or Market Sharing?
Source: Boston University
Recent initiatives allow cellular providers to offer spot service of their licensed spectrum, paving the way to dynamic secondary spectrum markets. This paper characterizes market outcomes when multiple providers are drawn into competition for secondary demand. The authors study a game-theoretic model in which each provider aims to enhance its revenue by opportunistically serving secondary demand, while also serving dedicated primary demand. The secondary demand is a function of the price being charged. They consider two philosophies for sharing spectrum between primary and secondary demand: in coordinated access, spectrum providers have the option to decline a secondary access request if that helps enhance their revenue.