Verizon, AT&T big winners in 700MHz auction
25 March 2008
Verizon, AT&T big winners in 700MHz auction
As expected, Verizon Wireless and AT&T were the big winners, and the big spenders, in the FCC's 700MHz spectrum auction.
According to information released by the US communications regulator, Verizon Wireless bid around $9.4bn in the auction and AT&T bid $6.6bn, together accounting for around $16bn of the $19.6bn total.
The dominance of two of the nation's biggest wireless carriers in the auction have led to concerns over a lack of competition. However, FCC chairman Kevin Martin was quick to issue a statement clarifying that a bidder other than a nationwide incumbent won a license in every market.
"As a result of the 700MHz Auction, there is the potential for an additional wireless 'third-pipe" in every market across the nation," Martin said. "Additionally, 99 bidders, other than the nationwide wireless incumbents, won 754 licenses - representing approximately 69 per cent of the 1090 licenses sold in the 700MHz auction.For example, Frontier Wireless LLC (EchoStar), which is widely viewed as a new entrant, won 168 licenses in the E block to establish a near nationwide footprint for its services for consumers."
Eight licences remain unsold, including the D block of spectrum which was reserved for the creation of a public/private partnership to create a nationwide public safety and commercial network. Unfortunately this block only attracted one bid, which fell well short of the reserve. Unsold licences will be re-auctioned at a later date.
The C block however, did win enough interest, $4.75bn worth to be exact, to trigger the open access provisions. It is believed that Google committed to spending $4.6bn on the auction, in order to guarantee the open access rules, which came into play when bidding reached this figure. Once that number was [just] beaten, Google left Verizon to step into the breach.
In a blog posting over the weekend, Google said: "While the Commission's anti-collusion rules prevent us from saying much at this point, one thing is clear: although Google didn't pick up any spectrum licenses, the auction produced a major victory for American consumers. As a result of the auction, consumers whose devices use the C-block of spectrum soon will be able to use any wireless device they wish, and download to their devices any applications and content they wish. Consumers soon should begin enjoying new, Internet-like freedom to get the most out of their mobile phones and other wireless devices."
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