A total of 62 bidders will take part in the forward auction portion of the FCC’s spectrum incentive auction, the commission announced.
According to the FCC, only 62 of the 99 bidders with approved applications submitted qualifying upfront payments by the July 1 deadline. Those bidders will move on to participate in the forward auction starting on August 16, the FCC said.
Among those who have been deemed “qualified” through the successful submission of a complete application and advance payment are telecommunication industry titans AT&T, Verizon, T-Mobile, U.S. Cellular and Comcast. Dish Network also appears to be participating under the name ParkerB.com Wireless, which shares a Colorado address with Dish. The company did not previously respond to a request for comment on its participation.
It appears, however, that former Facebook executive Chamath Palihapitiya won’t be executing his plan to participate in the auction after all. Though the name of the dark horse player’s firm, Social Capital, was among bidders with initially approved applications, it appears the firm failed to submit an upfront payment in time to qualify for participation.
Twenty of the final bidders have qualified for small business bidding credits and 28 bidders have qualified for rural service provider bidding credits.
A clock phase practice auction for qualified bidders will be held July 25 through July 29, the FCC said. A final clock phase mock auction will be held just before the start of the auction, on August 11 and 12.
At the start of the auction, the FCC said bids must be sufficient to cover the minimum opening bid amounts set by the commission previously. Clock prices for subsequent bidding rounds will be set by adding a fixed percentage of between one and 15 percent to the previous round’s price, with the initial increment set at five percent, the FCC said. The increments may be changed during the auction on a PEA-by-PEA or category-by-category basis as stages and rounds continue, but any changes will be announced in advance, the commission said.
Results from each round will be available 15 minutes after the close of each round, the FCC said.
Bidders in the forward auction will be up against a towering $86.4 billion clearing target price for 126 MHz of broadcaster spectrum – a figure analysts have been skeptical bidders will reach.
“Tthe bar has been set high for the wireless industry,” Dan Hays, principal of PwC’s Strategy&, said after the target was announced. “Given the current financial profile of the industry, this number may have to move significantly lower. A second stage of the reverse auction later this year is likely. Indeed, we could well see the proceedings drag on into early 2017 before coming to a final conclusion.”
In comments before the House subcommittee on Communications and Technology last week, FCC Chairman Tom Wheeler agreed the auction could well extend beyond one round.
“The auction is a market-based mechanism for matching supply with demand,” Wheeler said. “Until the forward bidding concludes, we will not know whether the demand meets the large supply offered by broadcasters.”
“Depending upon that response, it’s possible that we would need to move to additional stages to find the level where demand meets supply,” he continued. “The Commission intentionally designed the auction to account for the possibility that supply and demand might not match at the initial clearing target. It’s something we planned for, and we’re fully prepared to implement if the need arises.”
Filed Under: Telecommunications (Spectrum)