Innovation in the Wireless Ecosystem: A Customer-Centric Framework
Gerald R. Faulhaber
Wharton School, University of Pennsylvania and Penn Law School
David J. Farber
Carnegie Mellon University
School of Computer Science and Engineering Public Policy

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Faulhaber and Farber answer the FCC’s Notice of Inquiry into fostering innovation and investment.  They argue that these are two sides of the same coin, and enter into an analysis of three areas of the industries previous performance:

1. The rate of innovation
2. How Competitive the industry is.
3. How competitive the wireless innovation is.

To examine these areas the record of the 3 key areas of the industry’s vertical chain are taken into account.  These areas are:

1. Software applications
2. Devices (handhelds)
3. Core wireless distribution networks

Based on these things, Faulbaher and Farber address several issues in the NOI, including whether the FCC should:

• mandate spectrum sharing of licensed spectrum, with the view of encouraging “non-interfering” uses such as cognitive radio;
• adopt network infrastructure policies that foster the deployment of 4G and future technologies for wireless broadband, as well as explore alternatives to traditional network architectures, such as mesh networks.
• consider how difference business platforms and different business models affect innovation.

The two scholars indicate that based on their research the FCC “should put the customer in the driver’s seat,” and provide two specific policy recommendations:

1. Make more spectrum available for licensed use; and,
2. Ensure that customers have the information they need to make informed decisions.

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