Aloha Eying More Spectrum Rights Ahead of 700 MHz Auction
Aloha Partners still is gunning for more lower 700 MHz licenses and hopes to announce more spectrum acquisitions in coming months, but sellers might prefer waiting it out until after the upcoming spectrum auction, President Charlie Townsend told us. Aloha agreed to buy 31 licenses in the lower C-block from LIN TV for $32.5 million Monday (CD Sept 18 p5). “LIN is the first of hopefully a number of acquisitions in the next couple of months that we're planning on making,” Townsend said. “Our objective is to fill in the remaining top 100 markets that we don’t own and we're either going to do it through the acquisition or go into the auction.”
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LIN’s licenses were particularly attractive because they cover four of the top 50 markets where Aloha doesn’t already have spectrum rights, Townsend said. That’s why it was willing to spend so much for them he said. Aloha and LIN both rent space in the same Providence, R.I., office building. “It made closing [the deal] a matter of just walking down two flights of stairs,” Townsend said.
More spectrum holders may sell out as the auction approaches, Townsend said. “They'll recognize that if they don’t sell before the auction… other people who might be potential buyers might go into the auction and purchase the markets those need, and not need them any more.”
The build out requirements that will come with 700 MHz licenses won in the upcoming spectrum auction don’t make those licenses much less attractive than those bought in auctions 44 and 49, Townsend said. “Certainly, the existing licenses are attractive in that they don’t have as stringent build out requirements as the new licenses do,” he said. “But if you're planning on deploying in the next four or five years, it probably doesn’t make too much of a difference.”
Other lower 700 MHz licensees are probably waiting to see what Aloha does with its spectrum before deploying mobile TV or wireless Internet services, Townsend said. Aloha is testing both and has had positive results from both trials, he said. It expects to pick between the two after the auction, he said. “We're seeing both options as really quite viable at this point,” he said. “It’s really just a questions of which one looks the best.
Aloha’s Hiwire subsidiary is seeing better mobile DTV results than it expected using the DVB-H standard, said Hiwire President Scott Wills. The signal from Hiwire’s transmitters penetrates walls better than expected and the company was able to put 24 linear channels on the air, he said. Hiwire has had talks with its partner in the test, SES Americom, about the possibility of offering hybrid satellite-terrestrial mobile video system using DVB-SH technology but hasn’t decided whether to proceed down that path, Wills said. Such a system could improve coverage in less densely populated areas such as those along highways. But more work needs to be done on the technology, he said. “It’s an interesting emerging technology, and it’s something that we could do. But we've made no decisions about it. The standards are not even fully baked yet.”