FCC Reverse Auction Drops Clearing Price to $54.6B

[cdmagurus.com]

The FCC has wrapped up the initial phase of stage two of its incentive auction for 600 MHz airwaves, and drastically lowered the price for that spectrum. The initial clearing cost for all the 600 MHz spectrum was $86.4 billion, but bidders failed to come even close during the first round of bidding. Bidders offered up about $23 billion instead. The FCC was forced to go back to the spectrum license holders -- in this case, broadcast television stations -- and renegotiate a series of minimum prices for those licenses. The new clearing cost for stage two of the auction is $54.6 billion. Bidding will resume on Oct. 19. Most industry watchers assumed the reverse auction would need several rounds to reach completion. The 600 MHz airwaves are valuable due to their signal propagation characteristics. AT&T, T-Mobile, and Verizon Wireless are participating in the auction, but Sprint is not.


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