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3.2. How regulation favors commercial players and creates hurdles for WCN

Despite their potential in fostering public interest goals in telecom policy, regulators have so far failed to support the efforts of community networks. More often than not, public policy actually puts important hurdles in their way.

The most striking example is that several community networks have been precluded from using public broadband networks funded with taxpayers money. In France for instance, many local governments have invested in rolling-out fiber networks in both urban and rural areas. These public networks are built and managed by a private contractor, which then leases access to Internet access providers that, in turn, sell Internet access offers to subscribers. Yet, the fee charged by the contractor to access the public network is designed for large commercial ISPs, and is often much too prohibitive for nonprofit community networks.

Another other major problem of current telecom policies for WCNs is the issue of spectrum management. Here, again, regulatory capture by commercial interests leads to regulatory choices that systematically overlook the potential of more flexible and citizen-centric policies. The recent allocations of the so-called ‘digital dividend’ (i.e. the frequencies left vacant by the switch from analog to digital television) is a textbook case. In France for instance, it was proposed to use part of the spectrum dividend to create new digital TV channels and develop mobile television as well as digital radio (neither of these two technologies has taken off thus far). The remaining half of these ‘golden frequencies’ of the lower UHF bands (sought-after for their long-range propagation) was then auctioned off to telecom operators for their 4G mobile Internet access offers (the lucrative license auctioning took place between October 2011 and January 2012 and brought €3.5bn to the French state). Similar policies have been devised in other European countries.

In the process, one option has, however, never been considered: extending ‘unlicensed’ access to some of these frequencies—that is, effectively turning them into a commons open for all to use. Long thought to be unreasonable because of the risk of radio interferences, opening up the spectrum to multiple, non-coordinated radio users has actually been experimented on a worldwide basis more than a decade ago for Wi-Fi frequencies. Needless to say, it has proved to be a very wise policy choice. At the time, those frequencies were referred to as ‘junk bands’, because few actually thought they could have valuable applications. Now, experts predict that Wi-Fi will power 55 per cent of Internet traffic by 2017 (Cisco 2013). It is widely recognized as a flexible and efficient technology, enabling large-scale innovation, allowing laptops, mobile phones, tablets, game consoles, cameras, e-book readers and countless other devices to connect seamlessly to the Internet. As our case-studies have shown, it also plays a key role in fostering the development of citizen-centric last-mile networks. Even exclusive licensees in the telecom sector providing Internet access over 3G and 4G increasingly resort to Wi-Fi’s open spectrum to offload their Internet traffic (Juniper Research 2013).

The success of Wi-Fi has proven the defense of a market-based approach as the sole alternative to exclusive licensing to be overly simplistic. Against the backdrop of traditional economic theory, open spectrum policies have shown that commons-based approach to many-to-many communication infrastructure can actually work in practice. Through packet switching, best-effort delivery, as well as innovative radio transmission and bandwidth managements techniques, Wi-Fi has successfully verified Ostrom’s (1990, p. 88) claim that users themselves and ad hoc technical standards can create and enforce rules that mitigate the over-exploitation of the commons, confirming the point that orthodox economists usually overlook the practical failures of privatization and government regulation. In many regards, though property-based allocations of spectrum and exclusive licensing still have the upper hand, they have often come short of fostering public interest goals, for instance by causing a very significant underutilization of this public resource (Forge et al., 2012). Moreover, not only does the regulatory focus on exclusive licensing create an enormous opportunity cost by favoring established players over innovative new-entrants (such as community networks), it has even been argued by human rights NGOs that it may actually breach the international law on freedom of expression (Article 19 2005).

Meanwhile, despite the successes of Wi-Fi, unlicensed access to spectrum remains marginal, and WCN’s spectrum needs are largely ignored by regulators—which is all the more worrying considering that these are increasingly victims of the rapid growth of Wi-Fi traffic. and Freifunk, for instance, report having a hard time maintaining the quality of their network because of the saturation of the 5GHz frequency bands. Another issue for WCNs is linked to the topography of their environment: Wi-Fi bands have some important technical limitations, in particular in terms of propagation, and signals are easily blocked by buildings or trees. WCNs are thus faced with the choice of either refraining from creating a new radio link in a given location, or pushing the emission power levels beyond the legal limits to overcome these obstacles.