The United States’ third millimeter wave spectrum auction is set to resume Monday, having already garnered over $5.7 billion ahead of the holidays.
After 26 rounds, gross proceeds at the FCC’s Auction 103 hit $5,757,682,316 as of Dec. 20. Licenses for spectrum in the upper 37 GHz, 39 GHz and 47 GHz bands are up for grabs, and 35 qualified bidders are participating in the clock phase.
The FCC is offering a total of 3,400 megahertz of spectrum for 5G, licensed as 100-megahertz blocks covering partial economic areas (PEAs). Top markets like New York City and Los Angeles have brought in the largest cumulative proceeds, at about $947 million and $740 million, respectively.
After Round 23, Sasha Javid, current COO at the Spectrum Consortium and former chief data officer and legal advisor for the FCC’s Incentive Auction Task Force in 2016, predicted that total gross proceeds from Auction 103 could climb close to the $7 billion mark.
“If we use Auction 102's progress (including competition between bidders) as any guide, Auction 103 could end up in the $6.8 billion range,” wrote Javid in a December blog post, while noting forecasts based on past auctions have limitations.
At the end of Round 26, the nationwide price per MHz-PoP was $0.006126, according to Javid’s website that tracks the current spectrum auction.
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Following Round 23, Javid noted that on a nationwide price per MHz-PoP basis, Auction 103 was then roughly at 59% of the final price per MHz-PoP during the clock round of Auction 102.
“This is certainly better than I expected after the first few rounds of this auction, and should make the FCC feel better about its decision to put so much mmW spectrum (3400 MHz) up for sale so quickly after two prior mmW auctions,” wrote Javid.
The FCC already offered high-band spectrum in Auction 101 (28 GHz band) and Auction 102 (24 GHz band) in 2019 and some had been concerned about the interest level in yet another millimeter wave spectrum auction. It also comes as carriers look for mid-band spectrum opportunities, which have been scarce in the U.S.
RELATED: Will carriers bet big at the third mmWave 5G auction?
Javid noted that while gross proceeds were on track to surpass $5 billion after Round 23, competition had decreased significantly, particularly in rounds 19 and 20, where excess demand (in dollars) dropped sharply.
“This means that the opportunity to see excess demand jump significantly in big markets has largely diminished,” Javid wrote.
After Round 26, there were 427 products with greater supply than demand, including 345 with no demand. Meanwhile, 267 still had greater demand than supply, which includes excess demand in only two of the top 10 markets (Boston and Dallas).
Licensed blocks covering the 37 and 39 GHz bands appear to be garnering more interest than those in the 47 GHz band, with Javid noting only 70 PEAs had any demand for the 47 GHz blocks (categorized as “P” blocks) after Round 23.
The nationwide price per MHz-PoP for category P was $0.001412 at the end of Round 26, compared to $0.007371 for category MN (which consists of 37.6-38.6 GHz and 38.6-40 GHz).
Notably, there are incumbents in the 39 GHz band, which is being reconfigured as part of Auction 103.
The FCC's third millimeter wave auction has been on hold since Dec. 20 but will start back up again next week, with three rounds scheduled for Monday.
Separately, Verizon has requested FCC permission to conduct tests using a portion of the 37.6-40 GHz band in northwest Arkansas, which the carrier said won’t impact any rights regarding the spectrum licenses currently being auctioned.