Bidders as a whole seemed to get a good deal from PCS Auction 58,...
Bidders as a whole seemed to get a good deal from PCS Auction 58, which wrapped up last week with prices significantly lower than the rash of sales leading up to the auction, Fitch said in a report. “When…
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compared to the average per megahertz person of population (MHz POP) price of approximately $1.70 for large block transactions during the past year, the spectrum purchased during this auction ($0.99 per MHz POP) represents a good value to wireless service providers and closely compares to Verizon Wireless’ acquisition of Qwest spectrum (estimated at $1.00--$1.20 per MHz POP) in 2004,” Fitch said. To calculate the Qwest spectrum, the firm subtracted the value of the $50 million-$100 million in network assets Verizon also got under the agreement. Fitch observed that Auction 58 prices also were lower than the per-MHz POP paid by Verizon last year for NextWave’s licenses in 23 markets, at $2.85, or $1.76, assuming a high price for the 20 MHz N.Y. license. The prices are also lower than the $1.68 per MHz POP deal cut between Cingular and NextWave for spectrum in 34 markets in Aug. 2003. The report seems to raise questions about whether Nextel is overpaying for the nationwide 1.9 GHz license it will get as part of the FCC’s 800 MHz rebanding order. Nextel will pay $1.70 MHz POP, the same amount it will get back for the 800 MHz spectrum it will surrender under the plan.