Business Week says critics are pointing to the FCC’s unusual slicing of the spectrum, a new approach that had been pushed by Google. There’s a nationwide package that was seen as possibly leading to the creation of a new national provider and a wide variety of spectrum slots and availablity.
Despite the criticisms, the FCC chairman tells BusinessWeek.com that he’s been pleased with the auction’s set-up and outcome:
Would you say the auction is a success?
I think that the auction has already been a significant success. We’ve seen significant demand from a variety of players. We’ve adopted rules that require a more open platform to innovations and applications and handsets on a significant portion of the spectrum. And, to top it all off, we’ve raised significantly more than what was budgeted by the government originally and than what most analysts have predicted—and more than the government has ever raised in any previous auction.
A lot of people argue that the open-access requirements the FCC imposed in the auction are open to interpretation. How do you ensure application of the FCC’s interpretation?
We’ve got certain rules that we’ve put in place. We said carriers couldn’t discriminate among handsets and applications. And so I think the commission will obviously have to stay vigilant in making sure that we enforce these conditions, and the commission has every intention to do that.
How will these open-access requirements affect the wireless industry?
They’ve already had a transformative effect on the industry as a whole. Just look at things like Google’s open Android software platform for cell phones that T-Mobile supported; Verizon’s announcement of them moving to a more open platform and being open to any applications that they announced in December; and, indeed, AT&T emphasizing the more portable nature of their phones. So the industry is already going in the same direction as required in the auction.
According to RCR News, new bids in Auction 73 have dropped to double digits during the three opening rounds yesterday with new potential winning bids falling to just $3.7 million during round 66. Total potential winning bids stood at $19.383 billion yesterday.
Prices have gone up since the last 700 Mhz auction in 2002.
In 2002, Aloha Partners almost got the Portland metro region for $850,000, but in the end was out-bid by Paul Allen’s Vulcan Ventures who bought it for $2.3 million in Auction 44 (pdf).
That was for Channel 54 & channel 59. Aloha Partners also paid $6,216,000 for the West Coast license for Channel 55 — which Qualcomm later bought for MediaFlo.
In Auction 73, the price tag for 700MHz has gone up. The two Channels in “Block A” (Channels 52 & 57), serving Portland, Oregon, for example, are now north of $43 million, providing basically the same service that $2.3 million bought in 2002 for Channels 54 & 59.
Actually, performance might be more problematic. That’s because this month’s “Block A” bid, on channel 57, would likely adjoin a new 50,000 watt mobile television transmitter on channel 56.
Will AT&T convert their newly acquired Channels 54 and 59 (purchased from Aloha for $2.5 Billion last October) into mobile tv transmitters? Seems unlikely. They could get free money from the government to supply rural telephony on those frequencies.
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