FCC Delays 2 Spectrum Auctions But C-Band Auction Still Set for December
The FCC Wednesday postponed the first mid-band auction of citizens broadband radio service licenses for about a month because of COVID-19. The FCC postponed indefinitely an auction of FM construction permits. Analysts disagreed Wednesday whether the C-band auction could get pushed to next year.
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The C-band auction “will proceed apace,” an FCC spokesperson emailed. Other officials said the expectation remains the auction will begin Dec. 8.
Analysts said the pandemic raises other questions. A delay is possible, said Roger Entner of Recon Analytics. “We have to watch the liquidity of the financial market and the willingness of investors to provide funding to smaller companies to make that call."
“The bigger and more substantive issues are around the real disruption,” said MoffettNathanson’s Craig Moffett. “If social distancing drives a deep recession and a wave of business bankruptcies, then we might need [to] think about longer delays, and not only for CBRS but potentially also for C band. If the potential bidders aren’t in a position to bid, then it’s the wrong time to hold an auction.”
“My staff & I talked with Chairman” Ajit Pai “& his team and agreed this was most appropriate action given COVID-19 pandemic,” tweeted Commissioner Mike O’Rielly: “Intention is to not delay the important CBRS auction any further than this, unless circumstances absolutely warrant it," he tweeted.
The auction of priority access licenses (PALs) will now start July 23 (see 2003250022), postponed from June 25. Short-form applications are due May 7 instead of April 9, said the Office of Economics and Analytics and Wireless Bureau in docket 19-244. The FCC delayed the start to “protect the health and safety of Commission staff during the auction and so that parties have additional time to prepare to participate in Auction 105 given the COVID-19 pandemic.”
New Street’s Blair Levin said the added time was apparently to help potential bidders focused on COVID-19 response “rather than the inability of the FCC to get the auction up and running.” Levin expects the FCC to be able to hold the C-band auction as expected. “Based on my experience, most of the work for preparing the auction can be done by remote teams,” he said. “Potential bidders will not want to delay.” But “there is uncertainty in everything that far out,” he said. Some timetables and payment schedules “may have to change, as a material amount of the transition work cannot be done remotely.”
“We expect the FCC to do everything they can to start the C-Band auction in 2020,” emailed LightShed’s Walter Piecyk.
“This delay still allows the C-band auction to go ahead as planned, assuming that there are no further delays,” said consultant Tim Farrar. “It will obviously require working through what would normally be summer holidays in August, but because CBRS has no allocation stage … the CBRS auction should be completed in three-five weeks,” he predicted: “There is still a risk of further delays but the FCC will do everything it can to start the C-band auction under this administration, because there was no unanimity among the commissioners in approving the order.” If there are further extensions, the 2.5 GHz auction is likely to be put off until next year, he said.
The Wireless ISP Association would prefer that the CBRS auction ends before the C-band one starts, said Louis Peraertz, vice president-policy. “It is particularly important to WISPA members that the FCC conclude the CBRS auction before the short-form application filing deadline" for the Rural Digital Opportunity Fund auction.
A revised schedule will be announced “in a future public notice,” said the OEA and Media Bureau PN. That auction wasn’t expected by broadcast attorneys to generate a large amount of interest or proceeds. This wasn’t going to be a high-yield auction, said Rini O’Neil's David O’Neil. The PAL auction is much more likely to generate more money, and is likely a bigger priority for the FCC, he said. “I didn’t see a lot of excitement about this auction,” said Womble Bond's John Garziglia.
The FM CP postponement didn’t come as a shock to participants, lawyers with clients in the auction said. “I’m surprised they waited as long as they did,” said Fletcher Heald's Frank Montero. NAB and the FCC had been discussing the auction’s possible postponement for at least a week, and the trade group polled broadcast attorneys about whether they would support the delay, an attorney said.
Montero said the postponement could have been announced before upfront payments were due March 20, which would have allowed broadcasters to hold on to their cash. Since participants already submitted those payments, they now need to write in to request a refund, the PN said.