Location Dependent Spectrum Pricing of Private LTE and 5G Networks in Europe

Abstract Emerging private LTE and 5G services and applications have created need for local radio spectrum licensing. The existing pricing models for licenses do not work well in this context. This paper introduces three new location dependent pricing methods that aim to produce more accurate pricing for local licenses. We use Traficom Frequency Fee as our base-case general spectrum pricing model, and we replace the population density based location coefficient with proxies such as employee density, value added per employee, and rent prices. By comparing the differences in the prices yielded by the models, we show that the new models can in some cases identify high demand areas like hospitals and industrial districts better than the original population density based model. Additionally, we conclude that the original population density based model and the new employee density based model could be used together to capture both the consumer and the industrial spectrum demand simultaneously.