FCC Concludes 5G CBRS Auction, Seen as 'Success' by FCC, Industry
The FCC ended the citizens broadband radio service auction after the final bidding round Tuesday, with total bids of $4.585 billion, or just more than 21 cents MHz/POP. The auction offered the largest number of spectrum licenses ever in a single FCC auction and was the first FCC mid-band auction for 5G. Questions remain about who drove up the bids in the auction and the amount bid by wireless carriers, cable operators, Dish Network or companies planning to offer private networks. The next big mid-band auction of C-band spectrum starts Dec. 8.
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Industry officials said the most likely big players were Verizon, which needs mid-band spectrum, and the cable operators. FCC rules bar bidders from commenting until after the list of winners is released. “The robust and persistent demand that we saw in this auction was likely driven by carriers' desire to get immediate access to mid-band spectrum, cable companies looking to reduce reliance on [mobile virtual network operator] arrangements, and genuine interest from smaller and non-traditional bidders looking to provide mobile broadband services,” Sasha Javid, BitPath chief operating officer, told us. It appears that the FCC, after many years of deliberation, struck the right balance on license sizes and on operation restrictions resulting from sharing with federal incumbents.”
“All eyes naturally focus first on Verizon,” LightShed’s Walter Piecyk told investors Wednesday. “It owns the least amount of mid-band spectrum band, which it has already largely utilized to support the largest wireless customer base in the United States,” he said: “Verizon pivoted their network strategy to mmWave spectrum following the high-priced AWS-3 auction, but that has yet to deliver on its aspirations.” The growing demand for wireless data “remains persistent as Verizon continues to convert its base to unlimited rate plans,” Piecyk said: “We believe unlimited wireless subscribers use 2x as much data as metered customers, on average.”
“The conclusion of the CBRS auction is the culmination of the extraordinary work of so many in industry and government,” emailed Commissioner Mike O’Rielly, who oversaw rewriting the rules for the auction: “I take great pride in leading the significant effort that went into fixing our previous rules, resulting in a successful auction and new mid-band spectrum licenses for 5G and other innovative services. My hat’s off to the winners, and I look forward to closely reviewing the results.” FCC Chairman Ajit Pai tweeted the auction was “a resounding success.” Pai credited the work of O’Rielly and FCC staff.
The amount bid “is a lot of shekels and reflects a wholehearted confidence in the CBRS sharing model to find and better employ underutilized spectrum,” said Louis Peraertz, Wireless ISP Association vice president-policy. “Indications are emerging that the auction resulted in robust competition outside of the top 20 markets, far exceeding expectations,” he said: “We hope and trust that those of our members who bid were successful.”
“Operators and new entrants alike can enjoy licensed band operation with all the benefits of the CBRS ‘innovation band’ ecosystem,” emailed Paul Challoner, Ericsson North America vice president-network product solutions. “This will improve user experience for many applications and we will see wider deployment and extension of applications such as mobile network data offload, MVNO offload, Fixed Wireless Access, Enterprise and industrial IoT,” he said.
“Whether judged by traditional metrics, such as total auction proceeds and price, … or by non-traditional metrics such as the number and diversity of bidders, the demand for rural as well as metro licenses and the overall number of licenses awarded” the auction “far exceeded expectations,” CBRS Alliance President Dave Wright told us. "This is further confirmation of the value of this shared band and is the last component to be put into service, enabling the full realization and potential of the three-tier spectrum sharing model.”