Salivating over those wireless airwaves, the Bush administration says it now hopes to raise $25 billion between 2007 and 2009 from auctioning off 3G spectrum. The administration had originally predicted raising $17.2 billion. The FCC will auction off 90 MHz of Advanced Wireless Services spectrum in June and expects to raise as much as $15 billion in that auction. The auction of 700 MHz will come after TV broadcasters move out of the band in 2008.
However, the Yankee Group has thrown up some red flags when it comes to June's auction. The firm expects June's auction to net between $8.5 billion and $13.9 billion. Although this would constitute one of the FCC's highest grossing auctions, it's still below what an equivalent amount of PCS spectrum would sell for in today's market, notes analyst Marina Amoroso. The firm values this spectrum much cheaper than PCS because of the uncertainty and network buildout costs surrounding 3G wireless services.
For more about the Bush administration's optimism surrounding 3G auctions:
- check out this article from The Register