FCC finishes first stage of 600MHz auction with $86.4 billion spectrum cost

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It’s been a while since we’ve heard anything about the 600MHz spectrum auction, but today a major milestone was hit.

The FCC has confirmed that the reverse auction is complete, and that the bidding for the 126MHz of spectrum that was cleared finished at $86.4 billion. With a “B.” Now the FCC will shift to the forward auction that’ll see carriers, including T-Mobile, bid for that spectrum. In addition to T-Mo, AT&T and Verizon are participating in the auction along with Comcast and other smaller players.

Here’s what Gary Epstein, Chairman of the FCC’s Incentive Auction Task Force, had to say about today’s news:

“Today, bidding concluded in the reverse auction, establishing the cost for clearing 126 MHz in the TV band for wireless use. Strong participation from broadcast stations made this initial clearing target possible. Now the action shifts to the forward auction, which will give wireless bidders the opportunity to compete for this beachfront spectrum to meet America’s growing mobile data needs.”

It’s worth noting that while the FCC has completed its reverse auction with the TV broadcasters that currently hold the 600MHz spectrum, it’s possible that the FCC will have to resume that auction if the carriers bidding on the airwaves don’t meet the $86.4 billion cost. If that’s the case, the FCC will reduce the amount of spectrum it acquires and the price it’ll pay the TV broadcasters until it reaches an amount that the carriers will pay. If carriers do pay the full $86.4 billion, the forward auction could end in the coming months. If they don’t, though, the auction could continue into 2017.

T-Mo has previously said that it believes that it’ll start 600MHz deployment at the end of 2017 and that it expects to have 600MHz-compatible phones ready to go with that deployment.

Via: WSJ
Source: FCC

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  • pda96

    Way too much money. It’s doubtful that the FCC will get $86 billions from the wireless carriers.

    • riverhorse

      It will be extremely valuable to anyone who’s not Verizon…the big 4’s to catch up to Verizon, and Comcast plus all other non Big 4’s to catch up to the big 4…plus some foreigner wanting a foothold here can still step in to give cash to one of our players.
      So yes, fcc gets the dough.

      • pda96

        I don’t care about the rest. I just hope TMO will get what it needs for the price it’s willing to pay.

        • riverhorse

          You got that right. The less participate the better for us.
          Although I’m hoping not to the point where it all gets killed from not enough proceeds.

    • maximus1901

      Fcc is not getting the money. Broadcasters are.

  • Willie D

    So basically Verizon and AT&T will win big blocks and leave TMobile with smaller non national licenses

    • Prode

      T-Mobile is only buying in the areas that 700mhz is not at or where they want to make better.

      • SirStephenH

        That’s their focus but don’t be surprised if they go beyond that if the price is right.

    • riverhorse

      And besides what Prode stated, Comcast will be buying, plus various regionals & non Big 4’s, AT&T to complement Dish…
      don’t think Sprint or Verizon will be getting much…

      • SirStephenH

        Sprint has said that they’re not going to participate and Verizon and AT&T aren’t too interested. A lot of the spectrum will probably go to spectrum trolls like the last auction.

        • riverhorse

          AT&T needs it to complement Dish spectrum.
          So good, better for us on pricing if they and others pass.
          Sprint, I don’t know what their line of thinking is by passing… they keep falling behind.
          Verizon doesn’t seemingly need it, BUT they’re giving the competition a chance to close the gap… where there wasn’t any before. AND they could actually combine to increase speeds.

  • Raiterio Patterson

    These ads…does the FCC really expect one or more carriers to pay $86 billion for this spectrum?? Explain like I’m 5

    • MastarPete

      yes that is what the total of all carrier bids needs to reach in order for the carriers to get the full 126mhz of spectrum. if not the fcc will lower the amount of spectrum until the broadcasters agree to what the total amount of carrier bids equals.

      • Raiterio Patterson

        So this bidding could possibly go through 2017? There’s no way T-Mobile has enough cash laying around to buy all 126MHz

        • J-Hop2o6

          T-Mobile will most likely buy 20MHz minimum around the US.

        • MastarPete

          the spectrum is broken up into smaller blocks, no single carrier could buy the entire block if they wanted to.

          if the total of all carrier bids on blocks does not meet $86bn then the blocks of spectrum will be made smaller.

    • Roger Sales

      Yeah, its like 2x more than anyone wants to pay.

    • maximus1901

      Fcc didn’t set th prices. The broadcasters did.

  • Guest

    Can an entity buy spectrum and use it for whatever they want or does it have to be used only for telecommunication and internet?

  • Irfan

    Price is too much , and 600 spectrum is good for long range but USA is moving towards 5G where they need High frequencies , hight frequency high data transfer , might possible if Cellular industry use ATSC data transmitting in cell phone which might provide them high speed data transfer in future , but at the moment its not a good idea to buy lower frequency on this much price .

    • 9to5Slavery

      Disagree. It can be useful with CA

    • GuestBob8

      Totally disagree. High frequencies have basically no range (~100-feet, think WiFi). 600Mhz range is measured in miles, with excellent building penetration.

      • VN

        That’s not true honeypot

    • kev2684

      You might be in one of the markets where T-Mo gets amazing coverage everywhere, but for most people in this country, this is essential to T-Mobile. Their coverage is nowhere near as reliable as AT&T or VZW. Nailing the basics first (get coverage on every nook and crannies of every cities) is the right choice before investing towards an even more localized coverage 5G will offer. Why would people switch to an inferior network for speeds if they can’t get coverage in some parts of their house or at work?

    • riverhorse

      I think you got it bass ackwards.
      The main reason Verizon outdistanced the competition on coverage / signal… and maintained their lead gap is because they had the 700 low bandwidth TO COMPLEMENT THEIR HIGH BANDWIDTH from the get go, while others are just now able to get some…and even worse, there’s now not enough-especially contiguous- to go around.
      BOTH high and low are needed, to avoid gaps & low signals.
      This is the very last chance Any/ALL other carrier(s) have of catching up; they would fall even further behind passing up on this while waiting on 5.8.
      This is the main reason I think the reverse auction pricing gets met.

    • Guest

      It’s good for rural, the roads and building penetration as a backup frequency, but not good for speeds and 5G. When they deploy 5G they should start with the high frequency bands and leave 600mhz and 700mhz with 4G until the end.

  • Richard Darrington

    How long before we know the outcome? Come on t mobile, get er done