28 GHz auction moves past $500M mark, advances to Stage 2

spectrum
Bidding will halt Wednesday in observance of the national day of mourning for President George H.W. Bush. (Pixabay)

After 39 rounds of bidding, the 28 GHz auction has reached $536,040,320, with the FCC planning to transition bidding to Stage 2 on Thursday.

Bidding continues through today but will halt Wednesday in observance of the national day of mourning for President George H.W. Bush. The bidding on Thursday will continue with the four-round bidding schedule until the FCC deems otherwise.

In Stage 1, bidders are required to be active on licenses representing at least 80% of their current bidding eligibility. In Stage 2, a bidder must be active on at least 95% of its current bidding eligibility in each round.

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RELATED: Action slows in 28 GHz spectrum auction, but bids pass $85M mark

Bidding in the auction, also known as Auction 101, will continue until there are no more bids, and it’s not clear when that will happen. Expectations for the 28 GHz auction in terms of revenues for the U.S. Treasury were not high to begin with, mainly because it involves a hodgepodge of smaller markets scattered around the country.

In a research note distributed yesterday, Morgan Stanley Research analysts said they expect bidding intensity to pick up in Stage 2. They also observed a disconnect between the most expensive counties on a total cost basis and those on a $/MHz-POP basis. “From a total cost perspective, the most expensive counties have remained fairly stable week over week, whereas on the $/MHz-Pop side, we have seen a shift to less populated geographies,” they stated. “One of the most expensive counties from a $/MHz-Pop perspective is now Storey, NV at just over 5¢ although the population covered is only 4K people and has a total license cost of $86K. On the other hand, Honolulu, HI licenses are currently priced at ~$10m covering 953K people each but have pricing at ~$0.025 / MHz-Pop.”

RELATED: 28, 24 GHz auction primer: What to expect before the bidding starts

The 24 GHz auction, or Auction 102, will follow directly after Auction 101 and is expected to generate far more interest because the FCC is offering licenses across most of the country, including in big cities. In the 28 GHz band, Verizon held most of the licenses across the country even before bidding started, whereas the whole 24 GHz band is pretty much up for grabs.