Martin Says D-Block Auction Could Still Be a Success

Martin called a press conference to herald the C-block results and overall success of the auction, but questions immediately turned to the D-block. No bidder has come forward to take the place for Frontline Wireless after it folded shortly before the auction was to begin. “I am still optimistic that the auction isn’t over,” Martin told reporters. “I know you all want to, but I'm not ready to give up yet on the D-block… This auction has only been going on for a week. There have been less than 20 rounds.” Martin noted that the advanced wireless services auction in 2006 lasted 160 rounds.

Martin said it’s up to his fellow commissioners whether the D-block, if it is reauctioned, will be offered with a lower reserve price or other changes that might make it more attractive to a buyer. He stopped short of making a commitment that the spectrum would be set aside for public safety. Sources said Martin has started a round of discussions with members of Congress about what’s next if the D-block auction falters, but those discussions have not made their way to the eighth floor at the FCC.

“On the D-block the commission just said that we would reevaluate the rules,” Martin said. “I can’t give you an answer because the commission would have to consider it.” He said the commission is “committed in general” to trying to address public safety’s need for an interoperable broadband network. The proposed public safety-private partnership to build an interoperable broadband network was a “creative” approach that had the support of the commission and Congress, he said.

Commissioners and their staff were asked by the General Counsel’s Office to sign a non-disclosure agreement before the auction began if they wanted to review bidder information. Several commissioners decided not to sign, sources said. Martin said he had done so that he does have access to bidder information. “I haven’t been monitoring in the sense that I haven’t actually gone down to the war room and checked out who is bidding on everything,” he said.

Several sources noted the press conference comes against the backdrop of the wireless competition report, expected to be released sometime this week, which reportedly contends that the 700 MHz auction has been critical in promoting open wireless networks.

“It’s critical that we recognize that the conditions that the commission is imposing on the C-block were not a deterrent to people coming in and being willing to participate in the auction and build it out with a more open environment,” Martin said.

“The fact that bidders met the $4.6 billion threshold is a welcome development for consumers,” public interest groups said in a joint statement. “The winner of the auction will be required to offer consumers more options for devices and more choice among wireless applications than wireless companies do now. We hope that the freedom that will develop as the new spectrum opens up will carry over into the existing cellular network.”

“The auction is clearly a success from Kevin Martin’s perspective (again, with the exception of D-block, which is a special case),” said Harold Feld, senior vice president of the Media Access Project, on his blog. “While those like Commissioner [Robert] McDowell can argue that C-block might have fetched more without conditions, $4.7 billion is nothing to sneeze at. And it is clear that the aggressive build out conditions did not scare bidders away from A and B block.”

“It’s interesting to reflect that, just a few months ago, critics were saying that open access would be bad for consumers and carriers, possibly even leading to network service disruptions,” Commissioner Michael Copps said in a statement on the auction. “Since then, most of the major carriers have voluntarily adopted some form or another of open access. Today’s auction news continues this progress by writing openness principles into law for 22 MHz of particularly valuable commercial wireless spectrum.”