Pai chooses public auction of C-band spectrum

Ajit Pai
The FCC has dramatically accelerated the speed at which it can conduct auctions under Chairman Pai's regime. (FCC)

That time-to-market advantage that the C-Band Alliance (CBA) claimed to have with its market-based proposal for getting C-band spectrum allocated for 5G faster? That appears to have flown out the window, with the Federal Communications Commission (FCC) staff confirming to media on Monday that they’re set to commence an auction of C-band spectrum before the end of 2020.

FCC Chairman Ajit Pai announced his intent for the FCC to conduct a public auction of 280 megahertz of the C-band in letters like this (PDF) to lawmakers on Monday following a weekend of speculation about how the CBA’s latest proposal would be received. On Friday, the CBA announced that if it were allowed to lead an auction and transition, it would commit to pay a portion of net proceeds to the U.S. Treasury using a progressive formula that ranges from 30% to 75% of proceeds depending on the outcome of the auction.  

For much of the past year or so, the CBA has argued that its proposal was the best way to get mid-band spectrum allocated for 5G. It is, after all, comprised of the satellite companies (minus one) that use the C-band for customers to distribute radio and video programming across the country. Opponents argued that a CBA-led auction would prompt litigation that would extend such a plan and ultimately delay that spectrum getting into the 5G market. Alternatively, CBA also argued that an alternative plan to its own could prompt litigation.

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The FCC, however, is confident that it can conduct an auction of the spectrum, repacking incumbents to the upper 200 megahertz portion of the band, which totals 500 megahertz, and then auctioning off 280 megahertz for 5G, with a 20 megahertz guard band to protect existing users. The 280 megahertz is in the 3.7-3.98 portion, and the other 20 megahertz is for a guard band, so 300 megahertz in total. (The CBA had indicated it could clear 300 megahertz and still serve existing customers.)

Earlier assumptions had the FCC taking up to three years to get an auction done. During a hearing called by Sen. John Kennedy (R-Louisiana) last month, Pai was asked and said he didn’t have a firm estimate on how long it would take the government to conduct an auction. Kennedy, a staunch opponent to the CBA plan, suggested convening all of the people involved in the FCC’s auctions process and instructing them to get an auction done in, say, two to three years.  

RELATED: C-Band Alliance taken to task in FCC oversight hearing

The FCC is actually going one better than that. They didn’t say exactly how they're able to get an auction teed up and commenced in the current timeframe. However, under Chairman Pai, the FCC has dramatically accelerated the speed at which it can move forward to auction, which is something that wasn’t done under prior chairs. Clearly, a lot of individuals are involved and according to the FCC, having a dedicated division in the Office of Economics and Analysis helps facilitate multiple auctions in the pipeline simultaneously.

The FCC is expected to move directly to an order early next year, with a public comment period occurring at some point on how the actual auction should be conducted.  

The Wireless Internet Service Providers Association (WISPA), which is comprised of many small WISPs that serve hard-to-reach areas throughout the country, took the chairman’s statement today as good news for the fixed wireless industry. “WISPA believes it leaves open the possibility that with a few technical rule amendments/changes, the FCC could permit P2MP by an automated frequency coordinator to protect delivery of programming and quickly bridge digital divides in rural areas,” the association said in a statement.

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