Wireless spectrum auction winding down
By Michal Lev-Ram
The federal government’s high-profile wireless spectrum auction will likely end in the next few days. That means we could soon find out who won the last major chunks of spectrum available in the United States, which have attracted nearly $20 billion in bids.
Analysts say it will likely take about a week after the auction concludes for the Federal Communications Commission to compile and release the list of winners for five “blocks” of the 700MHz spectrum that are particularly suited for mobile broadband services. But the announcement could be delayed because the “D Block” of spectrum — a portion set aside for a nationwide public safety network — has failed to raise the minimum amount set by the FCC. According to the auction rules, the identity of the winning bidders won’t be released until bidding is completed on all blocks of spectrum. But it’s possible the government will set aside the D Block so that it can finish (and collect money) on the rest of the auction.
The 700 MHz auction has garnered attention for the number of non-traditional companies that registered to bid, including Google (GOOG).
But many in the industry believe the search giant was bidding just to ensure the $4.6 billion reserve price on the coveted C Block was met and thus the requirement that it remain open to any mobile device assured. Analysts say the likely winner will be a traditional mobile operator like AT&T (T) or Verizon Wireless (VZ).
Bidding has already dragged on for about seven weeks but auction activity slowed last week and the FCC upped the number of daily rounds in an attempt to accelerate the process. The rules of the auction state that it will end only when no new bids are placed. Only seven bids were placed in the latest round early Monday.
The spectrum up for grabs was originally allocated for analog television, which go off the air in January 2009. Analysts are calling this the last big chunk of “beachfront property” in the wireless spectrum.
“Everyone knows there’s nothing else of great significance coming down the pipe,” says Stifel Nicolaus analyst Rebecca Arbogas. “There’s a finite amount of spectrum that’s considered desirable, and there’s no way to squeeze more out.”
But Arbogas adds that the wireless industry has all the spectrum it needs for quite a while. For nontraditional or smaller players, though, getting their foot in the door will be a challenge.
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We will still have more auctions for satellite spectrums… LImitless! We will be popping off thousands of Sputnik class satellitles to beam down our yapping smartphones and laptops…