A report from the FCC inspector general concluded that the requirement for lease payments of about $500 million contributed to the failure of the D-block auction. No serious bidders emerged for the spectrum, which was reserved for a public-private partnership that would give first responders a national wireless broadband network.
The inspector general's report was based on interviews with FCC staffers, public safety and companies such as Frontline Wireless--which had planned on bidding for the spectrum but couldn't raise enough money. The report concluded that demand from public safety, via Cyren Call, which was appointed to manage negotiations, discouraged bidding. The report also called into question the commercial viability of such a public-private partnership given the way the FCC constructed the rules for the band.
According to the report, "Cyren Call's statements regarding a $50 million-per-year payment was not the deciding factor in Frontline's decision not to bid on the D-Block, but was merely one of many concerns it had regarding the auction."
For more about the inspector general's report:
- check out this article from Dow Jones