Licensed shared access for 5G: Which auction mechanism to choose?

Abstract

Licensed Shared Access (LSA) is a complementary solution allowing Mobile Network Operators (MNOs) to use another incumbents frequency spectrum after obtaining a proper license from the regulator.Using auctions to allocate those LSA-type licenses is a natural approach toward an efficient use of spectrum, by controlling the incentives for MNOs to declare their true valuation for the spectrum and allocating it to those who value it the most. A specificity of LSA licenses lies in the interactions among buyers, due to possibly overlapping coverage areas, this allows for allocating the same spectrum to several MNOs.In this paper, we review the existing mechanisms taking into account such radio interference constraints, propose new ones, and compare their performance. We show how to increase the revenue, while maintaining truthful-telling, of all-or-nothing auction mechanisms by introducing a reserve price per bidder. We also investigate extensions of those mechanisms, namely when the management of interference among base stations is more subtle than partitioning base stations into groups of non-interfering base stations. For each mechanism, we show how to optimize a trade-off between expected fairness, expected revenue and expected efficiency by carefully working with groups and reserve prices. Simulations suggests that the extension of those mechanisms may lead to increase an indicator combining allocation fairness, social welfare and seller’s revenue by more than 20% compared to the ones without the extension.