FCC's Spectrum Auction Approaches $20 Billion in Bids
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Since its 700-MHz auction began on Jan. 24, the FCC has raised more than $18.8 billion. That well surpasses the agency's own early estimates of attracting between $10-15 billion.
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If the FCC's auction of former UHF bandwidth were to end here, it might raise over $19 billion. But with bidding activity slowing to a crawl, the Commission has one more tool in its arsenal to squeeze out some more value.
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Several wireless firms are challenging different parts of the spectrum auction rules.
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Carnegie Mellon professor and telecommunications expert David Farber explains what's at stake in the January 2008 FCC auction of spectrum in the 700-MHz band -- spectrum that Google has expressed interest in.
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A nationwide block of&#160;spectrum in the 700MHz band being auctioned&#160;by the U.S. Federal Communications Commission received a high bid exceeding the &quot;reserve,&quot; or minimum, price of $4.6 billion on Thursday morning.A block of eight licenses covering the 22MHz C block of spectrum being sold by the FCC received a high bid of $4.7 billion in the 17th round of the 700MHz auctions, completed early Thursday. The C block is the portion of the 700MHz band on which the FCC will require open-access rules, meaning the winning bidder must allow outside devices such as mobile handsets from other carriers and must allow users to run outside applications on the network.Some critics have complained that the&#160;open-access rules&#160;would suppress bidding on the C block, but&#160;Google has pledged to bid&#160;at least $4.6 billion on the C block. Bidding is anonymous during the 700MHz auctions, so it&#39;s impossible to tell which company has the high bid.Through the 17th bidding round, high bids on the entire 62MHz of spectrum being auctioned totalled nearly $12.8 billion. The FCC and U.S. Congress had budgeted the auctions to raise at least $10 billion, but many observers had expected the auctions would raise much more than that.One block of spectrum unlikely to reach the FCC&#39;s reserve price is the D block, a 10MHz band of spectrum that would be paired with another 10MHz assigned to public safety agencies. The FCC required that the winning bidder build a nationwide voice and data network to be shared between commercial users and public safety agencies such as police and fire departments.After 17 auction rounds, the high bid for the D block stood at $472 million, far short of the $1.33 billion reserve price set by the FCC. That bid happened in the auction&#39;s first round on Jan. 24, and there&#39;s been no higher bids since then. If the reserve price is not met, the FCC would have to re-auction the D block.Many members of the U.S. Congress pushed for a public safety network, after emergency responders couldn&#39;t communicate with each other during the 9/11 terrorists attacks and more recent disasters. Police and fire departments in neighboring cities often use different devices on different blocks of spectrum.Critics have pointed to an FCC rule for the D block saying the winning bidder would have to give up millions of dollars in a deposit if it couldn&#39;t come to an agreement on network design with the Public Safety Spectrum Trust (PSST), which controls the public safety spectrum. Scott Cleland, founder of telecom analyst firm The Precursor Group, called that provision &quot;onerous.&quot;&quot;That is not a negotiation,&quot; said Cleland, speaking at a 700MHz forum Wednesday. &quot;Auctions are free markets, and people don&#39;t have to show up.&quot;The FCC may have to re-auction the spectrum without the reserve price and perhaps without public safety obligations, said Michael Calabrese, director of the Spectrum Policy Program at think tank the New America Foundation. The PSST could use its block of spectrum to negotiate service with the auction winner if no build-out rules are in place, he said.A PSST spokesman wasn&#39;t immediately available for comment on the bidding.
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At the close of the first full day of&#160;bidding for 700MHz wireless spectrum&#160;Thursday, the Federal Communications Commission reported nearly $2.8 billion in provisional winning bids.
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(InfoWorld) - Several companies have challengedÂ spectrum auction rulesÂ recently set by the U.S. Federal Communications Commission, with Frontline Wireless protesting that the auction of the 700MHz band to be auctioned in January could shut out small bidders. In addition, AT&T has asked the FCC to reconsider requirements for the winning bidder of a block of spectrum to be used to build a nationwide broadband network for public safety agencies. The rules require bidders to reach a service agreement with public safety officials before the auction, and the FCC's decision to deny bidders the spectrum if an agreement is not reached is "an extreme penalty," AT&T said in its petition. AT&T and Frontline, a startup made up of government and wireless industry veterans, filed petitions for reconsideration of the auction rules with the FCC Monday. They were among 10 companies that filed petitions in the last week asking the FCC to reconsider the auction rules it set in July for the 700MHz band of spectrum being vacated by U.S. television stations. The FCC is scheduled to auction 62MHz of spectrum in the 700MHz band beginning Jan. 16. The FCC set a reserve price of $10 billion for the entire 62MHz, but many observers believe the auctions will raise much more than that. The spectrum is currently controlled by U.S. television stations using channels 52 to 69. The U.S. Congress in late 2005 passed legislation that requires the stations to move to digital broadcasts and abandon this spectrum by February 2009. Frontline raised several objections about the auction rules. The company and someÂ consumer groupsÂ had called for the FCC to require that the winning bidder of a portion of the spectrum resell the spectrum at wholesale rates, but the FCC declined to do so. FCC members talked about including small businesses in the auction, Frontline noted. But the FCC denied bidding discounts, called credits, for small business wholesalers, Frontline said. Small businesses can't compete against large wireless carriers unless they adopt a wholesale model, the company said. "Wholesaling is also the only model a new nationwide wireless network operator could realistically afford to adopt, given the massive costs associated with providing retail service -- consider Verizon's 2,300 retail outlets and its $1.9 billion annual advertising budget," Frontline said in its petition. Frontline also suggested the reserve, or minimum prices, for two blocks of spectrum are too high. Frontline objected to a reserve price of about $1.3 billion for a 10MHz portion of spectrum to be paired with 12MHz set aside for emergency response communications. Frontline said the $4.6 billion reserve is also too high for another 22MHz of spectrum, for which the FCC adopted so-called open access rules. If the reserve price is met, the FCC will require the winning bidder to allow customers to bring wireless devices from other carriers and prohibit the winner from blocking or slowing competing Web content. Under the FCC rules, both blocks of spectrum would be re-auctioned under new rules if the reserve prices aren't met. "The unlawfully high reserve prices will nullify or disrupt and damage the Commission's carefully considered decisions as to the highest and best use of this spectrum, encourage bidding strategies that defeat these sound allocations decisions and seriously reduce auction revenues," Frontline's lawyers wrote. Earlier this month, Verizon Wireless asked the U.S. Court of Appeals for the District of Columbia Circuit to review the FCC's decision to require open-access rules supported by Frontline and some consumer groups. Those rules are "arbitrary, capricious, unsupported by substantial evidence and otherwise contrary to law," Verizon Wireless said in a brief filed with the court.
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Bids on the opening day of a much-anticipated auction of public airwaves totaled $2.8 billion Thursday, according to the Federal Communications Commission.
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InfoWorld - The U.S. government has given away between $140 billion and $480 billion worth of radio spectrum to wireless providers and broadcasters since 1993, according to a study released Tuesday.
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Wireless carriers planning to offer next-generation wireless services have bid $13.9 billion in a spectrum license auction that ended Monday, the U.S. Federal Communications Commission (FCC) said.
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New offer is 20% above earlier approach.
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The U.S. government raised $2.25  billion in an auction of wireless airwaves that ended on  Tuesday, with Verizon Wireless and a partner collectively  winning 63 licenses with almost $697.4 million in bids.
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AT&amp;T and Verizon Wireless want to go up against other current mobile operators and some possible future competitors, including Google, in next month&#39;s&#160;auction for 700MHz wireless spectrum&#160;around the U.S.The U.S. Federal Communications Commission on Tuesday released lists of accepted and incomplete applications for the auction, in which it will sell licenses to frequencies that are set to be vacated by analog TV stations. It has accepted 96 applications and reported 170 as incomplete. The latter need to be completed by Jan. 4.AT&amp;T and Verizon are not surprise entrants but are the country&#39;s biggest mobile operators. If either carrier won a portion of the spectrum that has been designated for use by any device and any service, it would have to open up its network more than any big U.S. operator ever has. Verizon has already unveiled part of a plan to further open its network.They were on the list of incomplete applications, along with smaller mobile operators Alltel and MetroPCS. Cable operator Cox Communications, an archrival of the telecommunications giants, is also preparing an application. And cellular technology giant Qualcomm, which is already building a mobile entertainment network on vacated TV channels, is also gearing up to bid. Would-be bidders with incomplete applications have until Jan. 4 to complete their paperwork.Google earlier this year&#160;offered to participate in the auction&#160;in return for the FCC imposing open-network requirements. The booming Internet company&#39;s involvement could drive up bids all around, helping the government reap its hoped-for $10 billion payday for the spectrum.&#160;Google&#39;s application&#160;has already been accepted, the FCC said Tuesday. So has that of Towerstream, a wireless broadband provider to businesses.One surprise applicant yet to complete its papers is oil giant Chevron.Participation by Chevron in the auction comes &#8220;out of the blue,&#8221; said analyst Jack Gold of J. Gold Associates. However, oil companies and utilities are big wireless users, so he can see why Chevron might be interested.Chevron, like Google, is unlikely to actually build a network, though, he said. &#8220;I can see them potentially winning but then becoming landlords, renting it out,&#8221; he said. For both companies, that decision wouldn&#8217;t be based on the cost of building a network but on the experience required: Neither company has any history of constructing and operating a wireless network, a complicated undertaking.Also Tuesday, the agency extended the Dec. 28 deadline for upfront payments in the auction to Jan. 4 and pushed back a mock auction until Jan. 22. The auction itself is set to begin Jan. 24.Nancy Gohring, in Seattle, contributed to this report.
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(InfoWorld) - Several lawmakers protested a spectrum auction proposal from the chairman of the U.S. Federal Communications Commission (FCC), saying his plan could limit the number of bidders and raise costs to consumers. FCC Chairman Kevin Martin's plan would require winners of part of theÂ 700MHz band of spectrum, to be auctioned by early next year, to accept any wireless devices, including phone handsets, allowing customers to transfer devices between mobile providers. Martin's plan would also include net neutrality-like rules, prohibiting auction winners from blocking or slowing Web content from other providers. But several members of the House of Representatives Subcommittee on Telecommunications and the Internet, many of them Republicans, questioned Martin's proposed rules, which have support of the majority of the FCC. Representative Joe Barton, a Texas Republican, said he was "very disappointed" that fellow Republican Martin was proposing regulations for part of the 60MHz of spectrum to be auctioned. Some proposals byÂ consumer groups and Frontline WirelessÂ would also require auction winners to provide wholesale access to competitors, and Barton praised Martin for not including that provision. "It's not quite as bad as the Frontline plan, but I don't think it's as good as absolute no-condition auction," Barton said. Many Republicans suggested that auction conditions would decrease the value of the spectrum. Congress has budgeted the auction to raise $10 billion with about half of that going toward reducing the U.S. government budget deficit. "Congress has already spent that money," said Representative Charles Gonzalez, a Texas Democrat. Questions about Martin's proposal came from a handful of Democrats. Representative John Dingell, a Michigan Democrat and chairman of the full House Energy and Commerce Committee, asked FCC commissioners whether the device-portability rules would increase the cost of wireless phone plans. Customers want to be able to take their mobile phones with them when they switch carriers, but carriers generally haven't offered that option, Martin said. "I think the benefits outweigh the costs and concerns," he said. Barton suggested that winning bidders could implement the device-portability and net neutrality proposals without FCC mandate. Google has indicatedÂ it could bid billions of dollars, Barton noted. "Why shouldn't we just let Google bid?" Barton said. "If they've got a better idea, why don't they go into the marketplace and bid their four or five billion dollars?" There's customer demand for device portability, but carriers haven't acted on it, Martin said. Wireless carriers didn't offer phone number portability until the FCC forced them to in late 2003, then millions of U.S. residents took advantage of it, he said. Asked whether they supported Martin's proposals, the FCC's two Democrats said they did, while the two other Republicans said they hadn't made their minds up yet. "Please let me keep my phone and let me take it wherever I want," said subcommittee chairman Ed Markey, a Massachusetts Democrat. The so-called open-access rules are necessary for new broadband competition to challenge cable and telecom providers, said FCC commissioner Michael Copps, a Democrat. The 700MHz auction is the last major spectrum auction on the horizon, many participants said. "This is one proceeding where we cannot fail," Copps said. Some lawmakers suggested Martin's proposal doesn't go far enough. Representative Charles "Chip" Pickering, a Mississippi Republican, called on the FCC to require wholesale access rules as well. Wholesale access would allow new and innovative services to flourish on the networks using the spectrum, he said. Martin's plan would "enhance markets and competition," he added.
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The bidding topped $3.7 billion on  the second day of the Federal Communications Commission's  auction of government-owned airwaves, but there were no new  suitors Friday for a closely watched block of spectrum to be  shared with public safety agencies.
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The U.S. government raised &#36;2.25 billion in an auction of wireless airwaves that ended on Tuesday, with Verizon Wireless and a partner collectively winning 63 licenses with almost &#36;697.4 million in bids.
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A $1.3 billion reserve price for a piece of wireless spectrum to be auctioned by the FCC in January is too high, according to one company.