The U.S. Federal Communications Commission (FCC)’s first spectrum auction in six years has received more than $34 billion bids- which is over three times more than its own expectations. It has been flooded by offers by telecom companies keen to get a slice of the mid-range frequency spectrum auctioned off by the FCC- a clear indicator that providers of wireless internet are expecting to rake in huge profits in the coming years.

The FCC, which expected to raise nearly $10.5 billion for the sale, was skeptical about that as well. Companies bid for six blocks of airwaves for 65 megahertz spectrum in the AWS- 3 band which kicked off on Nov.13. the sate for the end of the auction is noit yet known but whenever it does end, “will set the pace of the auction based upon monitoring of the bidding and assessment of the auction’s progress,” says the Wireless Telecommunications Bureau of the FCC.

“It’s stunning,” said Preston Padden, executive director of the Expanding Opportunities for Broadcasters Coalition, to the New York Times. The coalition consists of a group of TV stations planning to sell their airwaves through a FCC auction for 2016.

“Consumer demand for wireless broadband is on a growth curve that looks like a hockey stick, and carriers are desperate to keep up with that demand,” he added.

The progress on the auction has been heartening so far. It marks what the Times called “a significant victory” for the FCC and the National Telecommunications and Information Administration (NTIA), the Commerce Department agency that oversees the nation’s communications systems.

“Years of hard effort paved the way for the AWS-3 auction, in which 70 applicants qualified to bid, and ongoing bidding appears to signal considerable commercial interest in this spectrum,” FCC Chairman Tom Wheeler and NTIA Administrator Lawrence Strickling said in a joint statement.

What makes the bids and the money put at stake all the more noteworthy is the fact that the spectrum which has been offered for auction is not the most desirable one. It is not capable of moving through buildings and other solid object easily ( is high on the electromagnetic spectrum) which can pose a difficulty.

Some of the best known names in the current round of bidding are Verizon, AT &T, Dish Network and T-Mobile US. They are all looking for expansion opportunities and would not mind owning half the spectrum. The FCC will reveal the final bidders after the end of the auction.

Leave a Reply

Your email address will not be published.