Administrative Creation of Property Rights to Radio Spectrum

Despite the 1934 Communication Act's ban on private ownership of radio spectrum, the law leaves open to the Federal Communications Commission a range of licensing regimes under which the Commission may, in its discretion, grant spectrum users relatively strong or weak property rights to allotted frequencies. This article examines numerous administrative decisions by the FCC to demonstrate how regulatory changes have affected the property interests conferred by spectrum licenses, focusing on licensees' rights to use, divide, and broker spectrum flexibly and to prevent unauthorized reception of their signals. The article discusses the economic and legal significance of those changes and identifies areas for further reform. The authors conclude that, although important changes remain to be made, the FCC has strengthened property interests on both the transmission and receiving ends of licensed frequencies and, through the administrative process, has eroded the importance of the statutory distinction between private ownership and public licensing. Copyright 1998 by the University of Chicago.