The battle for the major regional licenses in the AWS auction appears close to its end, with bidding at a halt for those licenses in recent rounds - including the most valuable licenses of all, the 6 regional 20 MHz F block licenses. In the most recent bidding rounds, action has shifted from the 18 regional licenses to the smaller A, B and C blocks.
Wireless Spectrum Auctions
The FCC manages and licenses the electromagnetic spectrum used by wireless, broadcast, satellite and other telecommunications services for government and commercial users. This activity includes organizing specific telecommunications modes to only use specific frequencies and maintaining the licensing systems for each frequency such that communications services and devices using different bands receive as little interference as possible.
What are spectrum auctions?
The FCC will periodically hold auctions of unused or newly available spectrum frequencies, in which potential licensees can bid to acquire the rights to use a specific frequency for a specific purpose. As an example, over the last few years the U.S. government has conducted periodic auctions of different GHz bands to support the growth of 5G services.
SpectrumCo’s aggressive bidding in the AWS auction may signal the cable operator group has bigger wireless plans than it let on, said analysts and investors. High bids Wed. from the Comcast-led partnership came on spectrum in areas where that company and other allies, including Time Warner, own cable systems. SpectrumCo members could go as far as selling full-service wireless instead of relying on a Sprint MVNO if the group wins licenses in those markets, Citigroup analysts said. That would give cable another leg up on DBS, which quit the auction (CD Aug 16 p1), said analysts and investors.
Wireless DBS, the deep-pocketed partnership between DirecTV and Echostar, has effectively dropped out of the bidding in the advanced wireless services (AWS), as the auction has progressed more quickly than many had expected. Bids top more than $8 billion total. The DBS partnership has used all its waivers and stopped bidding.
Three days into the bidding in the FCC’s advanced wireless services auction, action appears strong so far, with all the major players maintaining their eligibility to bid. After Round 7 late Fri., bidding stood at almost $2 billion and was poised to surpass that amount in the next round. The big spectrum blocks -- D, E, and F -- were attracting significant attention. Many smaller licenses have yet to attract a single bid. The auction could take a month or more, and winners and losers won’t be known for several weeks.
In a de facto endorsement, the Assn. of Public Safety Communications Officials (APCO) backed the Cyren Call wireless broadband proposal. APCO said it favors reallocating 30 MHz of spectrum from the 700 MHz band otherwise set to be sold at auction -- the gist of the Cyren Cell proposal (CD Aug 9 p 4). The Cyren Call idea offers a “viable framework” for getting more 700 MHz spectrum for public safety, APCO said. An APCO endorsement has been a priority for Cyren Call, launched by Nextel co-founder Morgan O'Brien. Wireless carriers want the spectrum auctioned as planned and are lobbying against the Cyren Call plan. APCO said the 24 MHz of spectrum designated for public safety in the DTV transition “is insufficient to meet public safety’s future requirements… Therefore, APCO International supports reallocating 30 MHz of spectrum from the 700 MHz band that is currently slated for auction.” The 30 MHz should be assigned to a govt.-created entity using public/private partnerships to build and run a nationwide broadband network addressing public safety communications requirements, APCO said. An auction would “forever place control of the spectrum in the hands of commercial enterprises that do not have public safety as their principal, overriding objective,” it said. O'Brien met with public safety officials on the topic at this week’s APCO conference, he said in a statement. “APCO has long advocated for additional spectrum that will enable effective public safety communications including advanced broadband applications,” O'Brien said: “Such capabilities are widely available to commercial sectors and private citizens in the U.S. but not to the vast majority of our first responders.” - HB
CenturyTel’s new Vail, Colo. wireless network (CD Aug 10 p10) could be starting a “a more comprehensive out-of-region edge-out strategy,” said UBS Thurs. As a bidder in the AWS auctions, CenturyTel could couple new spectrum with VoIP services outside its current CLEC footprint, UBS said. Though Wi-Fi runs on unlicensed spectrum, UBS said CenturyTel could easily consider a move to WiMAX.
ORLANDO -- Cyren Call founder Morgan O'Brien and M2Z CEO John Muleta agreed Wed. that their proposals to build wireless broadband networks don’t cancel each other out, especially since they would operate in different spectrum. But the 2 conceded they both face time pressures to get their plans up and running. O'Brien, co-founder of Nextel and Muleta, a former FCC Wireless Bureau chief, made a rare joint appearance at the Assn. of Public Safety Communications Officials annual meeting.
Companies bid $897.8 million in the FCC’s 2nd round AWS spectrum auction late Wed., an 18% increase from the first batch earlier in the day. Wireless DBS, a DirecTV and EchoStar joint venture, emerged as one of the largest participants, boosting its high bids to $282.4 million, from about $31 million in the first round. The satellite firms probably want spectrum to build a nationwide wireless broadband network to compete with cable and telcos (CD Aug 7 p 2). T-Mobile, the largest participant in the first round, saw its high bids decrease by about 2/3 to $121.7 million in the 2nd round. T-Mobile is expected to be active because it’s bandwidth starved. With bidding far from complete, 2 analysts told us it’s too soon to predict the outcome. “As the auction continues to progress, we expect the rounds to progress in frequency and become more competitive in the price,” said Medley Global Advisors’ Jessica Zufolo: “These early rounds don’t really provide much guidance… other than all those who were expected to be aggressive bidders are indeed showing up and actively participating.” Cablevision’s controlling family bid $88.9 million for Long Island, N.Y., and other Northeast U.S. spectrum. Dolan Family Holdings, which is separate from the cable operator, is expected to use any spectrum it acquires to offer wireless services over home IP networks. Cingular $44.6 million in high bids. Auction 66 bidding is scheduled to reopen around 10 a.m. Eastern time today (Wed.).
Sprint Nextel will run WiMAX for its 4G wireless network, launching a broadband initiative in partnership with Intel, Motorola and Samsung. The network will use WiMAX technology because it’s a young, growing technology inexpensive to deploy relative to competitors like Qualcomm’s EVDO, Spring said. The company long as weighed its 4G options, at one time even seeming to favor Flarion technology in the 1.9 GHz spectrum (CD June 29 p12).
ORLANDO -- An endorsement of a proposal to have the FCC dedicate 30 MHz of 700 MHz spectrum for use by public safety to create a broadband network -- rather than sell it at auction -- is getting strong consideration by the Assn. of Public Safety Communications Officials, sources said Tues. The idea came from Nextel co-founder Morgan O'Brien, who met Mon. with the APCO board to outline it. O'Brien has been meeting with others at the conference here on the plan. The APCO board could act as early as this week.