Round-by-Round: Learnings from the First 35 Years of Spectrum Auctions

by Richard Marsden, Julien Martin (contributor), Hans Ihle (contributor)

Government awards of radio spectrum have provided an extraordinary laboratory for auction design over the last 35 years. Auctions of spectrum licenses have facilitated the development of mobile communication networks while generating billions of dollars in revenue for governments. The perceived effectiveness of these auctions has encouraged their adoption in other economic sectors, such as electricity generation, wind power, and corporate procurement. Richard Marsden’s Round-by-Round describes the many formats of these auctions (e.g., sealed bid, SMRA, clock, combinatorial) and identifies the circumstances in which specific designs have been more successful or controversial than others.

This insightful book charts the rise of spectrum auctions worldwide across five generations of mobile technology, examines their relationship with spectrum pricing and mobile broadband coverage, and anticipates their further evolution in the 6G era. Notably, it explores the role of mobile industry change and politics, alongside innovation in auction design, in driving regulator preferences for auction formats. Mr. Marsden presents detailed statistics on the global adoption of different auction formats and the evolution of prices paid for radio spectrum since the 1990s, as well as case studies of spectrum award “successes” and “failures” from around the world.

Round-by-Round is essential reading for practitioners engaged in implementing auctions or developing bid strategy for bidders. And for students of game theory and mechanism design, it provides real-world insights to complement the extensive scholarly literature on auction formats and rules.

Mr. Marsden is an expert on auctions and market design at NERA, the world’s longest-established economic consultancy, dedicated to methodically applying rigorous microeconomic thought to litigation and regulatory matters. The analysis in this book draws on his experience working on more than 100 auctions across the Americas, Asia Pacific, Europe, the Middle East, and Africa since 1999, advising regulators on format design and developing bid strategy for mobile network operators. NERA’s experience with spectrum auctions stretches back even further. In 1989, NERA advised on the design of the first spectrum auction in New Zealand. That award helped pave the way for the United States FCC’s adoption of spectrum auctions in 1994 and their eventual spread worldwide.

148 pages, Paperback

Published May 22, 2024

Reviews

[Philipp · Rating 5 out of 5]

Very readable overview of the development of spectrum auction design by one of the leading practitioners. Compared to more academic treatments, the great benefit of this volume is shedding more light on the behind the scenes practical issues driving the choice of auction format across the world.