The Federal Communications Commission’s multi-billion-dollar auction of valuable wireless spectrum has been underway for only about seven business days [1] – and could go on for some time more - but there’s already encouraging news for those who believe that business and democracy are best served by a wireless future with greater choice for all.
Bidding on the key nationwide 50-state “C Block” of spectrum has now reached $4.71 billion, surpassing the auction’s “reserve price” and triggering “open access” provisions which would prevent the winning licensee from limiting customers’ ability to use “devices and applications of their choice” on the spectrum.
Triggering of the open access provisions is great news: it theoretically means that a wireless provider must provide a mobile Internet where consumers connect with phones and digital assistants of their choice, employing applications they consider important– not just the hardware and controlled service offerings of cell phone providers.
But open access advocates can’t declare victory just yet: the auction provisions are only a first step in a very long-term process. The spectrum in question won’t become available to wireless consumers until least 2010, after TV broadcasters switch to digital from analog transmission. And, as many analysts are noting [2], what’s “open” may depend in large measure on how a wireless carrier defines it – “the devil is in the details”.
Investment banker Blair Levin (formerly a senior staffer at the FCC) has been tracking the auction results on a daily basis along with his colleagues at Stifel Nicolaus. He speculates that there are two remaining bidders for the C Block - probably Verizon Wireless and Google - but one can’t entirely rule out AT&T or others. The auction for the C Block is not yet over, and even when it is, the identity of the winning bidder won’t be revealed until the bidding for all blocks of spectrum has been completed.
Meanwhile, the FCC seems to be having considerably less luck with the auction for the so-called D Block, a nationwide piece of spectrum which a carrier must share with public safety agencies, according to the rules of the auction. Bidding for the D Block is far below the reserve price, and analysts say there’s been little bidding activity in recent days. That might mean D Block would need to be re-auctioned.
Overall, bidding for entire spectrum package now totals $18.55 billion. That’s well beyond both expectations for this auction and the $13.8 billion raised in a 2006 auction.
Open MIC will be addressing these issues on March 11 at a breakfast forum - “Wireless America: Closed or Open?” [3] – that we’re co-hosting with the Paley Center for Media in New York City. It’s likely to be a provocative session. If you’re interested in attending, send us an email or register here via the website.