| How to Evaluate Spectrum |
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Many factors affect the value of wireless spectrum. Some of these factors include geographic area, total bandwidth, frequency band, current FCC regulations, proposed FCC rule changes, speculation, available/current technology and possible incumbent rights. Because spectrum attributes may vary significantly between spectrum types each attribute must be considered carefully when performing a valuation. Calculations on total cost of ownership (TCO) and return on investment (ROI) should also be considered.
$/MHz-POP
The wireless industry commonly uses a dollar per megahertz per person covered, or $/MHz-POP metric to value spectrum. This method may place a high value on densely populated areas, which for consumer-based wireless telephone carriers may correlate well with their business model. However, an electric utility may want to wirelessly monitor many transmission lines with little to no population around them. These transmission lines may contribute valuable service to the utility and the immediate response to an outage may translate to substantial savings or revenue. However, a $/MHz-POP valuation methodology would not have demonstrated a meaningful return on investment for the utility.
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