Spectrum licences assigned in the 4G era are nearing expiry and many regulators are opting to renew the expiring licences rather than to offer new ones via auction. Licence renewal prices need to be set at reasonable estimates of market value to encourage the efficient use of spectrum and compensate the public for use of this scarce resource.

In Australia, the Australian Communications and Media Authority (ACMA) has developed a benchmarking approach to set licence renewal prices, through an extensive public consultation process. DotEcon supported the ACMA with two peer reviews of its benchmarking methodology. We addressed many common benchmarking issues, including selecting statistics that are suitably conservative, demonstrating that prices are robust to small numbers of extreme values and explaining that spectrum price movements cannot always be characterised as trends.

Our first and second reports for the ACMA are available here and here.