US Spectrum auction raises $44.9bn, with Dish amongst the big winners
Spectrum for all, even Elmo... © Flickr/CC-licence/Ed Yourdon
At times it appeared that it would never end, but after 45 days and 341 rounds of bidding, the US AWS-3 spectrum auction finally came to a close at the end of last week, having raised a record $44.899bn in licence fees. This total was far in excess of previous FCC spectrum auctions (and made light of the regulator’s $10bn reserve price), and more than double the prediction of even the most optimistic analyst firm.
Up for grabs was 50MHz of paired spectrum and 15MHz of unpaired, though it was the paired spectrum that attracted the largest bids.
The highest overall bidder was AT&T, which bid a total of $18.2bn. AT&T said that its new licenses amounted to a “near nationwide contiguous 10x10 MHz block”, and that it now covers 96 per cent of the US.
“Growth in our customers’ mobile data usage continues to explode, driven by mobile video traffic,” said John Stankey, chief strategy officer with AT&T. “This spectrum investment will be critical to AT&T staying ahead of customer demand and facilitate the next generation of mobile video entertainment.” He added AT&T would work with network and handset suppliers to deploy the spectrum from 2017.
Surprisingly, it was satellite firm Dish Network that came in second with $13.3bn, although this was acquired via its bidding partners SNR Wireless License and Northstar Wireless. What Dish intends to do with this spectrum still remains unclear – there was speculation that it may try and sell it on to another telco, but that’s no longer looking likely. Whatever it intends, it had better make an announcement soon, as worried investors pushed its share price down on the news.
“As part of the auction process, we publicly filed an application to participate as a potential bidder, and Dish invested in two entities that also publicly applied to participate in the auction as designated entities,” said the company in a statement on Friday. “Because of the FCC’s anti-collusion rules, however, we are not able to discuss further at this time.”
Verizon ranked third with $10.4bn, followed by T-Mobile in a distant fourth place with $1.8bn. “Verizon Communications has won a total of 181 licenses with an aggregate bid price of $10.4bn,” said the company. “These licenses are in markets covering 192 million POPs, or 61 per cent of the United States. In compliance with the FCC’s anti-collusion quiet period rules, Verizon cannot comment further until that period ends on February 13, 2015.”
T-Mobile obviously thought its low bid was not worth taking about, and so its usually loquacious CEO John Legere didn’t (at least, not until the quiet period is over…)
Sprint had decided prior to the auction not to participate.
The AWS-3 advanced wireless service bands comprise spectrum in the 1695-1710MHz (unpaired) and 1755-1780MHz and 2155-2180MHz (paired) bands. In total, there were 70 bidders, of whom 31 acquired 1,611 separate licences between them. Only three licences went unsold. Plenty more information and data on the FCC’s auction page.
Meanwhile, in the world of fixed broadband, FCC Commissioner Michael O'Rielly isn’t making many friends within the municipal broadband movement. On a blog post last Friday, O’Rielly questioned the extent of state restrictions on municipal broadband and also the ability of the FCC to pre-empt these laws.
“A closer inspection of the specific state laws being criticised offers a much different picture regarding the scope and particulars of the specific state limitations,” he wrote. “If the Commission were to pre-empt state laws (assuming it has requisite authority), what “barriers” would it be pre-empting?”
He cites an FCC filing by the Coalition for Local Internet Choice (CLIC), an advocate of municipal broadband networks, which groups individual states based on common limitations or restrictions.
“It is clear that many of the limitations or restrictions appear to be justified practices by state governments and should be excluded from any pre-emption discussion,” wrote O’Rielly. “Beyond the extensive rhetoric and absent Congressional direction, nullifying state-enacted taxpayer protections to further a political goal sends the Commission down an extremely troubling path.”