Defining success for the 700 MHz auction

 

Defining success for the 700 MHz auction

After 54 days and 261 rounds of bidding the usual pomp and circumstance that surrounds spectrum auctions understandably dies down, but now that the bidding is over in the 700 MHz auction the industry will once again turn its attention to what could be a watershed moment for the wireless industry.

Could be, but, probably won't be. Analysts seemed to have reached a consensus that either Verizon Wireless or AT&T has won the coveted C Block of spectrum, which is laden with open access provisions that Google lobbied the FCC to implement. Bloggers on-site at the Verizon Wireless Open Development Conference today claim that the carriers' onstage presenters hinted that it had won the C Block through well-timed smirks and subtle chit-chat. The speculation, of course, is more fodder for the rumor mill, but the time for speculation is almost over. The FCC is expected to announce the winners of the auction within the next couple weeks.

The FCC, the incumbent carriers and Congress will certainly see the 700 MHz auction as a smashing success for all parties. The FCC managed to raise more money than expected--doubling reserve prices in some cases--even though it implemented special rules on some of the spectrum blocks. The incumbent carriers are largely rumored and favored to have won the critical spectrum blocks. Congress, of course, is happy that the FCC raised close to $20 billion to fill its coffers.

But if the 700 MHz auction did not attract a new entrant--like a Google--was it really a success? Perhaps even more concerning, the FCC's auction failed to raise the $1.3 billion reserve price for the D Block of spectrum, which was set aside for a public-private network that would solve public safety interoperability problems nationwide.

Twice the money but two key goals may not have been accomplished. So will the 700 MHz auction be remembered as a smashing success or an epic failure? Chances are: a little from column A and a little from column B. What do you think? -Brian [1]