Wednesday, 9 March 2011

Government profiteering on somebody else’s airwaves

The Government appears to have agreed to a deal to help bail out media company MediaWorks, reports the Royal NZ Herald.

_Quote MediaWorks’ latest accounts [says the Herald] show it has essentially received a $43.3 million loan from the Crown to enable it to renew its radio broadcasting licences for the next 20 years.

Except Media Works hasn’t received a loan from the Government at all. What it has received is an agreement to defer payment for the use of the Government’s radio airwaves for the next twenty years—for which the Government is charging MediaWorks $43.3 million plus penalties of 11.3%.

It’s nonetheless objected by commentators that this is capitalism. Or even crony capitalism. Or just regular old corruption with a bailout of the government's mates.

Frankly, this sounds like children talking. Because not one of the commentators on any side of the aisle has bothered to challenge the most absurd part of this story: that the government owns the airwaves in New Zealand, and not the private broadcasters—and that it charges the broadcasters handsomely for the “privilege” it grants them for using this nationalised property.

Something that is frankly as absurd with airwaves as it is with foreshore and seabed.

As if that sort of setup was capitalism.

Or right.

Yet virtually every commentator takes it for granted that airwaves (and seabeds) are "public." But they shouldn't be. And curiously, none of them sees the connection with the foreshore and seabed debate. But they should.

Alex Epstein from the Ayn Rand Center makes the case that airwaves (and by extension all natural resources) should be private property.

Sure, while the airwaves themselves have always existed in nature, the broadcast technology that gives them value did not. It’s here that property status properly begins.

_QuoteWhen inventors and engineers first unlocked nature's potential to carry radio waves, and entrepreneurs began developing the commercial value of radio, the government had a responsibility to define property rights in this sphere--so that these innovators could own and utilize portions of the spectrum without interference by others.

But instead of defining property rights, the government usurped them.

_QuoteThere is an exact parallel here to property rights over [foreshore, seabed, and] newly available land. When the American frontier was opened in the 19th century, the government did not declare it public property. Rather, it parceled out the unowned land on a first-come, first-served basis, and then recognized a property right for those who made use of the land for five years. The same type of procedure—enabling pioneers to earn a property right to that which they render valuable--applies to any newly usable portion of spectrum.

Or should.

_QuoteAnd, like land rights, once a property right to the use of a given frequency band in a given region is earned, it belongs to the owner unconditionally...

Meaning, among other things, that it doesn’t need to go cap in hand to its master every year pleading for another license—something some governments have oft-times used to shut down stations that criticise them too harshly.

_QuoteUnfortunately, our government does not recognize airwaves as private property, and never has. In the 1920s, its response to the development of radio was not to define and protect property rights for the field's creators, but to nationalize them as "public property." Consider the injustice of this: the pioneers who envisioned the potential of radio technology, and took the risk of bringing it about, had no more right to their creation than we do, who created nothing.
    Under the "public" airwaves regime, businesses do not own but merely "license" portions of spectrum--which the government has total authority to control in the "public interest." The use of spectrum is determined, not by the business that has purchased and earned it, but by the [grey ones]--by whatever it feels is in the indefinable "public interest." In the realm of media, … bureaucrats can effectively censor viewpoints they dislike by revoking broadcast licenses or imposing huge fines. In the realm of wireless data, [bureaucrats and Government] can impose more onerous terms on a paying licensee anytime they wish--such as Google's proposal that licensees be forced to sell large portions of their bandwidth to competitors at FCC-dictated "reasonable" rates, no matter what it does to their business…
    [We] need to start recognizing airwaves as the private property they really are…

Yes. We do.


  1. Suppose I, as a property owner, erect an antenna to intercept radio waves and enjoy the decoded form of them on my TV (or radio or whatever).

    I didn't ask anyone to beam radio energy to me or across my property so I don't feel at all obligated to pay for the decrypted results of intercepting that energy.

    How can a person lay claim to owning this thing that has been carelessly propagated onto my property? Does not my right to enjoy the bounty of my property and what comes to it (rain, air, sunlight and many others forms of radiant energy) deny other claims to ownership of these things on my property?

    Suppose you accept that privately owned radio waves cease to be owned privately if carelessly used to irradiate other peoples property and decide that private ownership only applies to broadcasting.

    How then is it I'm allowed to have these radio waves on my property but not share them with my neighbour by pointing another antenna at their home and sending them a signal?

    Radio waves aren't a discrete thing that can be grasped, fenced or boxed and claiming property rights apply to them is problematic. It certainly is not an identical issue as any land or foreshore that can be staked out and measured in place.

  2. @ Pete: And yet you stubbornly defend patents and copyright, against which precisely the same argument can be raised.

    @Fentex: If you are interested in the libertarian (but not Randian) argument about this check out:


  3. @Bez: I'm arguing for property rights. You, on the patents & copyrights hand, have been arguing for theft.

    Your link is neither libertarian nor Misesian---despite being hosted at a site using Mises's name. It is frankly incoherent.

  4. @Femtex: Complete this sentence for me, if you would: "I erected this antenna in order to ... "

    And maybe this one: "The last time a private radio station forced me to pay for listening to their decrypted energy was ... "

  5. @Pete: I have not been arguing for theft at all, I have been arguing that you cannot produce any valid argument for IP as a property right other than rehashing the Randian approach, which is based on an utterly fuddled concept of "creation".

    In respect of the article, I'm disappointed you don't deal with is argument and assumptions, but attack it ad hominem.


  6. PC, should I take your comments here to mean that you're in favour of so-called "intellectual property"? Copyrights and patents aren't property rights, they breach property rights. If I, using my own money, manufacture and distribute (for example) CDs, Big Brother can step in at any time and declare that the configuration of bits on the CDs "belongs" to somebody else and I'm a criminal for trying to profit from my own labour. Or say I want to watch a film in my own home, copyright means that the government can decide that I have too many people in my living room, and am therefore a criminal.

    In the United States, copyright law makes it illegal for you to tell somebody how to play a DVD, that they purchased and that they own, on their own computer, for their own personal use. Because this somehow protects "property rights".

    I looked around the Mises Institute site, and given their views on the matter (and here, and here), I was wondering if you might want to reconsider their blog's placement in your "regular reads" list (relocate to "socialist lickspittles", perhaps?).

    This is all not to mention the fact that copyright is government-enforced censorship that hinders innovation.

    Is Libertarianz as a party officially in favour of government-enforced artificial monopolies, PC, or is that just your opinion?

    Also, I believe the word is "Misean". And Sky TV charges for the content that they freely broadcast to everyone.

  7. "I erected this antenna in order to ... " intercept whatever electromagnetic waves dipoles of the attached lengthy can.

    If you mean to argue that my, and your, property rights proceed from our intentions then I think you undermine many of your own arguments.

    Because the good socialists intentions are only ever the best.

    I don't think a radio spectrum lends itself to the same concepts of property as physical objects one can fence or carry.

    Like other problematic legal monopolies (such as copyright or patent) it's a legally delineated concept with boundaries chosen by legislation and with extents not immediately obvious to everyone.

    I personally think if someone is going to irradiate my property with electromagnetic waves it's entirely within my rights to decode it (if I can, for example, Sky's encrypted satellite transmissions) and manipulate it any way I please (i.e watch it on my TV) just as I might rainfall.

    If Sky doesn't like that they can always stop irradiating my property any time they please.

    Arguing that their ability to do so gives them a right to trespass on my electromagnetic exposure doesn't seem very libertarian to me.



    I started to read it, but when it started referring to Conspiracy Theories early on it didn't seem worth the effort given conspiracies don't have a lot to with the topic of the nature of radio spectrums.

    P.S Could this commenting code be modified to allow blockquotes?

  9. "I erected this antenna in order to ... " intercept whatever electro- magnetic energy it's dipoles are the correct length to intercept.

    Are you arguing my or your property rights proceed from our intentions?

    That would seem to undermine many of your arguments as the good socialists attitude to property rights proceeds from the very best of intentions.

    "The last time a private radio station forced me to pay for listening to their decrypted energy was ... " (would be) when I start decrypting Sky's satellite transmissions without renting one of their decoders were they to find out.

  10. Suppose I, as a property owner, erect an antenna to intercept radio waves and enjoy the decoded form of them on my TV (or radio or whatever).

    I didn't ask anyone to beam radio energy to me or across my property so I don't feel at all obligated to pay for the decrypted results of intercepting that energy.

    How can a person lay claim to owning this thing that has been carelessly propagated onto my property? Does not my right to enjoy the bounty of my property and what comes to it (rain, air, sunlight and many others forms of radiant energy) deny other claims to ownership of these things on my property?

    I think that someone's right to use a band of radio frequency does not impose a restriction on others to not intercept it but it does restrict others from interfering with that use e.g. jamming and copyrights on whatever is broadcast would obviously prohibit retransmission

    Suppose you accept that privately owned radio waves cease to be owned privately if carelessly used to irradiate other peoples property and decide that private ownership only applies to broadcasting. How then is it I'm allowed to have these radio waves on my property but not share them with my neighbour by pointing another antenna at their home and sending them a signal?

    If your usage would not interfere with the senior owner, I suppose it would be permissible. If you mean forwarding the same traffic I believe that would run into the intellectual property laws on copyright

  11. @ Fentex: perhaps you should allow yourself to dig a bit deeper rather than being distracted by the first word that triggers some primeval response.
    I'd agree with your response to Pete's first half-phrase, as this indeed clearly defines your property rights, namely to do exactly what you wish, erecting an antenna on your own land, using your own property, in this case some wire and some electronic circuitry to tune into the required signal, which is being trans ponded across your property anyway. Pete would argue that the property right to the transmission, and even your use of your own circuitry are somehow restricted by rights of the person from who the transmission is emanating, or even from the individual that was the first to obtain from the grey ones a "patent" to the electronic circuitry, but alas, that's his misunderstanding.

    Your second example is not correct though, why would you have to pay Sky, because you receive and decode their message, which is broad casted all over your property (including your body)without them ever asking for your consent to do so in the first place? If anybody in that example is invading property it is Sky, not you, and the only way they can get away with it is by either presuming an implicit easement over your property, or the approval of the grey ones, who have conveniently assumed that sort of property right and right to aggression for, and on behalf of, all of us.


  12. In fact there ARE property right in radio spectrum in New Zealand in many cases, in the form of management rights. This was started in 1990 with UHF analogue television spectrum auctioned off, which is what got Sky TV started. However, the last government started undermining this further by granting encumbency rights and returning to licencing.

    Management rights are effectively leases on spectrum, and worked rather well, until two issues came up that government was incapable of responding to on principle.

    1. Renewals: Broadcasters lobbied that when management rights came close to expiration, that they could gain "encumbency" rights to extend their right to use the spectrum. A transparent process would simply open it up to tender again, but broadcasters complained that it would be unfair if they didn't win, unfair if they had to pay "over the odds" (market value) for this property right. Labour capitulated.

  13. 2. Pre-auction encumbents: This covers those broadcasters which had grandfathered rights to spectrum from gaining licences before auctions began in 1990. The key ones here being TVNZ and TV3. Both lobbied heavily that if they had to bid for their spectrum at a certain point, then it would cost in "New Zealand content", and TVNZ simply said it would pay less dividends. On top of that TVNZ scaremongered Ministers into thinking that maybe "TV2 could go off air", if TVNZ couldn't compete with foreign bidders for spectrum.

    The spectre of "Murdoch buying up spectrum and "forcing" TVNZ to pay him to broadcast "Kayyway" content" was presented by the Ministry of Culture and Heritage. You see broadcasting policy previously had resided in the former Ministry of Commerce (along with policy for most utilities like electricity, telecoms and gas), where radio frequency management also resided, and a rather economic rationalist approach was promoted. Labour shifted it to Culture and Heritage, which has a very different culture, full of nationalist protectionist types who believe in the state protecting "culture and identity".

    So the big TV encumbents (this is only those on VHF, the UHF ones are all with management rights, like Prime) stayed on a licencing approach, but with licences set to be a proxy for radio frequency auctions.

    It has all moved on since then with the arrival of digital terrestrial television, as the state has wanted to ensure it control the spectrum so it can reallocate it and ensure its preferred broadcasters have guaranteed space on the airwaves.

    It is basically a story of how the ground for a free-market and property rights in radio spectrum were laid by the tail end of the 4th Labour government and the Bolger government, and how it has been progressively compromised by the Clark administration.

    The problem is the Ministry of Culture and Heritage, it is a strong supporter of NaZis On Air et al. Wind it up, put what is now the Ministry of Economic Development back in charge and get it to auction spectrum once more - and be completely neutral about who wins what.

    What's particularly sad is that the government includes Steven Joyce - a man who built much of his business on spectrum sold through this process.

  14. As for the others:
    - Radio waves are discreet and defined, just in ways you don't understand. Frequencies, bandwidths, modulation, encoding, compression, encryption are all applied to spectrum to make it usable. Rights to use spectrum have all these defined, as effective as fences define land. Indeed, those with such rights are given rights to broadcast up to certain power levels over certain geographies in particular directions. You have no more right over that than you have a right to complain that the light reflecting from your ugly neighbour disturbs the use of your property when you look over at him - because that is another form of EMR reaching you.

    Your peaceful use of property is not disturbed by radio emissions, until you have equipment to receive them (or it is at such an intensity to present a health risk, which is exceedingly rare).

    The idea that broadcasting signals are aggression is so absurd as to be ridiculous. They do nothing, unless they interfere with your own property rights to emit spectrum, which are limited to remote controls and handheld phones. You can, of course, use radio spectrum on your own property confined to your property - good luck using SHF spectrum that Sky uses for satellite TV without it leaking.

    You may as well say everyone around you is being aggressive because light reflecting off them (or indeed at night when they emit lights) crosses into your property, or even heat (infra red).

    As has been demonstrated with air rights, you do not have perpetual property rights that extend to all conceivable dimensions on your property. You can't charge airlines for flying over your property, as you cannot effectively control it.

  15. @Libertyscott: who was saying that radio waves are aggression? (exept for extreme doses). The word I used was invading property and that's exactly what they do, hence the reference to an implied easement.
    I used aggression in the context of government, the ultimate usurper of violence and power.
    As for property rights in spectrum, yes I can see that, but have some problems with accepting that because you can define these the government should be involved with doling these out, and charging for it. Your example just goes to show that giving that power and function to government immediately corrupts the whole thing.
    In respect of reflecting light and such, if you do a little bit of research you'll find that in common law there already was quite an advanced way of dealing with this, again until government decided to get involved with such beautiful solutions of planning regulations and RMA, hence the quagmire that we now have for anything even closely relating to development.

    As for your comment that I just don't understand how "property rights" over spectrum can be defined, what makes you think that? Or are you just attacking the man, not the ball?

    I'd like to hear your argument why government should be involved in all of this, let alone why they should make inordinate profits from it?

  16. @Anonymous: "@ Pete: And yet you stubbornly defend patents and copyright, against which precisely the same argument can be raised."

    Rubbish. It's completely different. I certainly don't defend patents or copyrights, but I'm in almost complete agreement with PC on ownership of radio frequencies. (As is the article in the link you posted, for that matter)

    Fentex: the right to transmit on that frequency (in a particular area) is what is subject of ownership, not the signal...if you can receive the broadcast, you can do what you want with it; what you can't do is transmit your own signal on the same frequency, interfering with the original broadcast.

  17. In what way does EMR emitted from a radio transmitter invade property any differently from EMR reflected from people's bodies that you can detect with your eyes?

    "Invading property" implies a conscious disregard for your ability to control your property. I think you'll find you didn't buy radio frequency control rights over your property, anymore than you bought air rights. So actually it isn't your property, you neither bought it, nor discovered it on your property as the rights were already held by the state.

    You're entitled to claim against the tort of nuisance or trespass, but I doubt any court even under common law would say you experienced harm or inability to reasonably use your property as a result.

    One can argue that radio spectrum rights should have been owned by a matter of discovery by the first users, but that horse has bolted. Sky and other broadcasters acquired the property rights quite legally, so you have no leg to stand on.

    I know property rights over spectrum can be defined because it has been done. If you read the specifications for the management rights (effectively leases) for auctioned spectrum in New Zealand, you will see this. Most of it will be understandable only to a radio engineer, but it effectively is the right to use a frequency (which is not just a Hz rating), from a particular site to particular power ratings in particular directions.

    Government's role should simply be to define the property rights and allocate them once, either by sale or simple encumbency for short range comms. That's it. It then becomes the referee and enforcement body for infringements of those property rights.

  18. "Invading property" does not imply a conscious disregard at all, it simply means the objective fact, which in the case of radio waves can only be established by technical means.
    A trespass does not require intention if you want to put it in legal terms.
    What is included in the "bundle of rights" that come with a property I buy is the crux of the debate, and if you have a legal background you'll be aware of how that concept has changed (some would say eroded) over time. You'll also be aware of how that definition is used for political aims, I only mention Maori claims over fish species that weren't in NZ until after colonization, or indeed radio spectrum.
    As you say, the horse has bolted, we have come to accept that governments can appropriate any property rights they deem to exist and seek to define, the RMA and again the radio spectrum are fine examples.
    That doesn't change anything in the fundamental debate though, and that is what I thought we were heading to, namely what exactly are property rights (and do they include creative rights such as IP and intangible rights such as radio spectrum), how do they come about, and why should the government have any role in them at all.

  19. It's been raised by some above. How do you shield your property from radio-waves that you didn't approve to pass thru? Remember, there are radio-waves (any form) paranoia people out there.

    I remembered PC arguing about common law for nuisances' cases. If one person's pigs, caused damage at his/her neighbors properties, then the pig's owners is responsible.

    Ok, pigs wandered to the neighbors properties (whether they cause damage or not is irrelevant). The fact that the pigs trespassed without permission is a violation of the neighbors properties.

    Now, replace wandering pigs, with radio-waves? What's the difference here folks?

    Owning privately a radio-frequency wouldn't alter the fact that the radio-waves would still trespass properties of others, whether they choose to tune to that specific frequency or not?

  20. LibertyScott said...
    In what way does EMR emitted from a radio transmitter invade property any differently from EMR reflected from people's bodies that you can detect with your eyes?

    I remembered a lawyer who told me a case in Mt Eden in the late 1990s, where a couple were having sex in their own house (I think it was their living room) and a member of the public who saw the couple on the action in full view, when she walked past that house (on public road). They didn't attempt to hide what they were doing by pulling the curtain so to hide themselves from people walking by on their street. The woman who witnessed the couple who were having sex in their own house, contacted the police and the cops arrived & arrested the couple for exposing themselves to the public.

    The question to ask, if the reflected live images (light-waves) of the couple who were having sex, intruded the eyes of the woman who happened to walk past that house on a public road? Or can it be said, that the woman who witnessed the action was only guilty, when she decided to look? Who owned all the light-waves that coming out (reflected) of the bodies of the naughty couple? Can this be called nuisance in common law? If not, then why not?

  21. There's no real difference FF. But lets dig a bit deeper: first off, you can't shield your property for everything (or this is prohibitively expensive, for pigs its relatively easy, for radio waves it is very difficult).
    There are a number of ways to get around the problem at a more fundamental level. One is the implied easement approach, which itself can be roughly divided in two schools, one the "coming to a nuisance" theory, i.e. accepting whatever is passing through or over at the moment of acquisition, whether that is by Lockean homesteading or contract, and the other the minor nuisance theory, i.e. we all have to accept infringements that result from living in society, and that are de minimis.
    Another main approach is the use of something Rothbard called the "relevant technological unit" which is akin in its effect to what we call "bundle of rights" in legal parlance. This holds that one doesn't hold absolutely unrestricted title to property, but that this is can be subject to boundaries and restrictions that follow from the nature of the use. Some infringements ought to be accepted as they do not affect the actual use of the property, for instance overflying aircraft, crown mineral rights etc. This approach has been smartly (some would say fraudulently) apprehended by the grey ones, and effectively turned on its head to the extent that we in NZ never own any right to our own property unless it is explicitly provided. I.e. any exercise of discretion over one's own property is always subject to the state's rights, and this even extends to one's own body.
    This fraud has such a magnitude that it has even been applied retrospectively, the best example being the 1990 RMA.

    Then there is a third approach which has its origins in the "Lockean Proviso", basically that one can only homestead any property to the extent that enough remains of equal quality for the next taker. When this is applied together with the relevant technological unit approach you end up with something similar to the de-minimis rule.

    As you'll see, all these theories provide for a basis whereby property rights of one (in this case the emitter of radio waves) can impinge on those of another, without explicit consent, i.e. contract, which of course would provide another means of solving the puzzle, albeit a very complicated and unpractical one.

    Some of the grey ones would argue (and Peter C would agree) that by dint of the fact that you are a member of this "sovereign" society, you have impliedly given the grey ones the right to regulate this on your behalf, because they have after all a preemptive right over your property, or to negotiate it on your behalf (assumedly out of their role of slave master), and to charge you and the emitter for that pleasure.

    Hope this covers your question.



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