2008 Year in Review: The 700 MHz auction

The news: The FCC's auction of the 700 MHz spectrum occurred in early 2008 and initially it was thought that non-traditional bidders such as Google would compete with incumbent telecom players for some of the precious spectrum.

On Jan. 15, the FCC released a final list of 214 qualified bidders for the auction and established specific reserve prices for the five blocks of 700 MHz spectrum:  Block A, $1.8 billion; Block B, $1.4 billion; Block C, $4.6 billion; Block D, $1.3 billion; Block E, $0.9 billion. On Jan. 24, the first round of bidding started, with no set number of rounds--rounds would continue until there were no more bids. The first round netted the FCC $2.4 billion in provisionally winning bids after 1,849 bids were placed. The FCC did not disclose which bidders placed bids or who was in the lead in an effort to discourage collusion between potential bidders.

After 261 rounds there was $19.59 billion worth of provisionally winning bids. The only spectrum block that did not meet its reserve price was the D-Block, which was set aside for a public-private partnership to develop an interoperable network for public safety and emergency response radios. The fate of the D-Block still remains uncertain.

As it turned out, Verizon Wireless and AT&T Mobility made out like bandits in the auction, and Google did not win a single bid, which is what some had suspected all along.   

Why it was significant: The 700 MHz spectrum auction was not only the largest spectrum auction ever, but it managed to raise more money than every other spectrum auction the FCC had ever done combined. And while Frontier, a subsidiary of the satellite television company EchoStar, won a significant amount of licenses in the E-Block, most of the major winning bidders were the the usual suspects. The Tier 1 carriers cleaned up and Verizon, above all, cemented its market position. 
(See FierceWireless' dedicated auction coverage here)

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