Coopetive Spectrum Trading – Creating Endogenous Spectrum Holes

Dynamic spectrum access has been proposed to address the spectrum scarcity. Based on this access mode, secondary users are allowed to opportunistically operate when primary users are absent. Secondary Users are, however, required to relinquish the spectrum upon return of the incumbent spectrum holder. Although it improves spectrum utility, opportunistic spectrum access limits secondary users’ access to exogenous spectrum holes vacated by primary users. We argue that spectrum holes should be endogenous, enabled by incentives to incumbent users to increase spectrum availability, while mitigating risk. To this end, we take a different perspective on dynamic spectrum sharing and propose a coopetive framework, whereby primary and secondary users engage in a cooperative, yet competitive, auction-driven spectrum sharing to enhance spectrum usage. In this framework, the primary users’spectrum is organized in three bands, namely exclusive usage, usage right and management right bands. Based on this structure, spectrum is traded as financial options to increase trading flexibility and capture the value primary and secondary users attach to spectrum access and usage. Spectrum trading between primary and secondary users is formalized as a utility maximization problem. Approximate solutions to this problem are derived and their performance is analyzed. The results show that spectrum trading, which combines revocable and exclusive leasing, provides higher utilities for both primary and secondary users.