As the use of radio waves resources has been increased along with a rapid radiocommunications growth and technology, effective utilization of radio waves resources has been an important task. Radio waves resources is finite resources and because of the scarcity, it has been a main task to distribute it effectively. In many countries including Korea, radio waves resources had been controled by command and control of government. Due to the limitation of Frequency Management System controled by command and control which the government leaded, Market-Based Frequency Management System was adopted.
New Zeland, Austrailia, America, England and many other countries adopted and has enforced Frequency Actions System. There are some merits of Frequency Actions System. Frist, privilege quarrel could be minimized as objective standard guarantees. Second, recompense for national resources could be earmarked relatively high. Third, radio waves resources as a scarcity resource could be fairly distributed. Fourth, when a provider is selected, effectiveness and flexibility could be considered.
On the other side, there are demerits of Frequency Actions System. First, high liabilities means high expenses to providers. Setting up costs by marginal cost could be possible temporarily but if it maintains, businesses are hard to survive in the long term. Second, auctions can promote oligopoly. Third, the system can effect as an entrance obstacle to small businesses. It would decrease the number of providers and promote oligopoly after all. Fourth, if the contract price is too high, the rest of the providers could put in a rigged bid warring the winner's curse.
Amendment of Radio Waves Act to adopt Frequency Actions System is a pending problem at National Assembly in January 2009. The revision however had some problems so they were reviewed and examined. The examinations resulted satisfactory Frequency Actions System. To adopt successful Frequency Actions System, followings have to be considered. First, a plan to prevent bidders putting in a rigged bid needs to be considered. Second, a plan to promote providers to participate so that way a poor action doesn't occur due to the lack of participants. Third, it needs to be considered that because of a highly competitive bid, if the contract price goes up too high, there could cause many problems. Fourth, when the Actions System is adopted, promoting fair competitive environment of market and possibility of competition revitalization needs to be considered. At last, we should analyze cases of Frequency Actions Systems of main foreign countries and study appropriate Frequency Actions Method for Korea.