The FCC’s UHF auction is on. Winners get 12 MHz on a pair on 6 MHz channels at 710-716 MHz (on UHF channel 54) and 740-746 MHz (on UHF channel 59). These dual (duplex) channels can be used for “3G” cell phones and are called the “C” block by the FCC. Another option is to buy a single 6 MHz channel (the “D” block). But you better have a fat wallet…you have to buy an entire time zone. Only six (“D”) channels are available in the entire United States. They’re at 716 MHz-722 MHz (on UHF channel 55).
So far the FCC has raised about $85 million. No big cellular bidders are participating. Why? Nobody is really sure if broadcasters will be vacating these frequencies by 2007. Plus nobody has any money. 3G bombed in Europe. It bombed in Asia.
While 12 MHz doesn’t seem like much compared to the 85 MHz available over 802.11b (at 2.4GHz), the UHF band CAN penetrate walls and leap tall buildings. Flarion and other “4G” providers say they can deliver 2-way voice using VoIP. But the FCC is only selling single 6 MHz channels in “bulk”. You have to buy an entire time zone if you only want a simplex channel. Nobody’s buying.
By population, my hometown of Portland, Oregon is 30th on the list of cities. Portland’s “C” block channel is WZ-CMA030-C. So far the new owner of channel 54 & channel 59 is Aloha Partners, L.P. who has bid $843,000 for it (so far). Other Oregon UHF bids include Clatsop County (VCOM U.S. Inc. – $47,000); Hood River (Eastern Oregon Telecom, LLC – $19,000); Umatilla (Banks Broadcasting, Inc. – $84,000); Lincoln County (no bidders yet) and Coos County (no bidders yet).
These UHF channels could be bargains (even waiting until 2007). A 5000 watt AM radio station in Portland costs about $1.5 million, considerably less than the $845,000 Aloha Partners paid for their 12MHz of UHF spectrum. A Flarion “4G” system on the KGON Tower could deliver mobile broadband (256Kbps and up) for 5-7 miles in a 100-square-mile area. With 12 MHz you might serve 5,000-20,000 subs. Hot spot backbone service might cost $20/mo, mobile 256kbps might cost $40/mo. PocketPCs with Flarion cards deliver interoperable voice and video. Do the math (5K X $30/mo = $150K/month). Portland’s CommNet is about 5 years behind user needs so the year 2007 looks like a practical target.
“D” channels cover an entire time zone. Aloha Partners paid $6,216,000 for the West Coast. Nobody else has bid on other regional “D” licenses covering the Northeast, Mid-Atlantic, Southeast, Great Lakes and Central / Mountain. Why? Perhaps “4G” operators (who could provide voice and data on a single 6 MHZ channel, are really angling for Worldcom and Sprint MMDS frequencies. MMDS has 200 Mhz available in the 2.5-2.7 GHz band.
Sprint halted MMDS deployment, and AT&T shut down its service entirely, cutting off 47,000 customers in January 2002. Sprint’s service is still going, but hasn’t been taking new orders since November 2001. About 200 MHz of spectrum (between 2.5 GHz and 2.7 GHz) is allocated for MMDS use. That’s lots more than 12MHz. Somebody’s going to pick up Worldcom’s licenses for a song. Who needs to spend big bucks on the auction? Both Sprint and Worldcom owned about 2/3rds the MMDS licenses in the US.
It appears the low UHF band does not matter much for “3G” telephony. The real action may be the 200 MHZ of sleeper MMDS band at 2.5 GHz. Besides, licensed MMDS might make a great feeder for hot spots. Variations of COFDM modulation such as ArrayComm, BeamReach, Flarion, IPWireless, and Navini are said to deliver “3G” services for about 1/10th the cost. Soon, 802.16a could coalese these different approaches into a Wide Area Networking standard, delivering economical and reliable “backbone” service to laptops, PDAs and hot spots. Many industry observers now believe that 802.16a “4G” IP telephony is a better bet than circuit-switched “3G”.
So far the high bidders on the low UHF band are:
- Aloha Partners, L.P. 29 $31,839,000
- Cavalier Group, LLC 5 $9,911,000
- Vulcan Spectrum LLC 3 $5,733,000
- Harbor Wireless, LLC 4 $3,442,000
- DataCom Wireless, L. 3 $3,252,000