FCC delays H Block auction following government shutdown

The FCC on Monday delayed by eight days the start of the auction of 1900 MHz PCS H Block following the 16-day government shutdown this month, which disrupted the agency's operations.

The auction was supposed to start Jan. 14, 2014, but will now begin Jan. 22, the FCC said. "These schedule changes are necessary to give potential bidders and commission staff additional time for planning and preparation" for the auction, the FCC said in a public notice. Analysts had warned that the shutdown could imperil the auction date. The H Block auction is the FCC's first major spectrum auction since 2008.

The FCC has said the H Block auction, dubbed Auction 96, will have a reserve price of $1.56 billion, based on a minimum spectrum value of $0.50/MHz-pop, as suggested by Dish Network (NASDAQ: DISH). Sprint (NYSE:S) has been bandied about as the potential lead bidder for the airwaves. The proceeds of the auction will be used to build a nationwide public safety broadband network, though the H Block auction will only cover a small portion of the full cost of building that network.

The spectrum will be auctioned in 176 individual Economic Areas across the country. The public notice sets out minimum opening bids and other auction procedures. The H Block is a 10 MHz block of paired airwaves that runs from 1915-1920 MHz (for the uplink) and from 1995-2000 MHz (for the downlink). The H Block is part of 65 MHz of spectrum Congress mandated the FCC to auction by February 2015.

In addition to delaying the auction, the government shutdown pushed back the Senate confirmation votes for Tom Wheeler to be the next FCC chairman and Michael O'Rielly to be the fifth commissioner and second Republican on the panel. Sen. Ted Cruz (R.-Texas) has formally placed a hold on Wheeler's nomination. Cruz, who led the unsuccessful charge in the Senate to defund President Obama's healthcare law ahead of the government shutdown, is unsatisfied with answers Wheeler has given on whether the FCC will require more disclosures from the sponsors of political advertisements.

As a result of the shutdown, as Politico notes, the FCC halted its review of AT&T's (NYSE:T) proposed acquisition of Leap Wireless (NASDAQ:LEAP) as well as Verizon Communications' (NYSE:VZ) purchase of Vodafone's 45 percent stake in Verizon Wireless.

On the agenda for the FCC's Oct. 28 open meeting is the approval of an industry agreement on interoperability in the Lower 700 MHz band, as well as technical rules for the separate 700 MHz airwaves licensed to the First Responder Network Authority, which is overseeing the construction of and will operate of the nationwide public safety network.

For more:
- see this FCC notice (PDF)
- see this Bloomberg article
- see this PhoneScoop article
- see this Politico article

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