WASHINGTON-The Federal Communications Commission already could be headed for a local multipoint distribution services reauction, now that the bidding has reached Stage 3. Overall bidder eligibility has dropped below the total amount of available spectrum and the commission appears to be balking at lowering the minimum opening bids on 129 A-block markets in which there has been no interest.
“Despite quite a bit of competition persisting for the top markets, the overall eligibility finally dropped March 4 below the total spectrum available,” said Taylor Simmons of Washington, D.C.-based Simmons Associates. “Therefore, it is impossible for all of the as-yet-unclaimed spectrum to find an owner. There must be a reauction. The FCC probably will not drop the minimums on the unbid stuff-fearing cries of foul now that all of the extra eligibility is gone-but you never know.” Commission staffers assigned to the LMDS auction could not be reached for comment at press time.
As of Round 41, WNP Communications Inc. and Nextband Communications were neck-and-neck when it came to the number of pops covered: 103.9 million vs. 102.7 million, but there is a substantial gap in the monies pledged for them: $185 million vs. $131 million. Total net revenues garnered as of that round, which concluded late Thursday, were $551 million, with 127 new bids and 117 new high bids.
Simmons told RCR he doesn’t expect much substantial change in the bidder rankings during the next two to three weeks, although there could be some play in the B blocks, which first were discovered by Baker Creek Communications; others, including McCaw/Nextel-backed Nextband subsequently have found out this bidding methodology was a cheaper way to gain coverage. Baker Creek has racked up the largest number of high bids in the auction-209-but Alta Wireless Inc. and CoServ L.L.C. both have broken into the Top 10 bidders with just four high bids each.
In a surprise, but heartening move last week, the commission reversed its original decision and granted a petition put forth by bidder Virginia Tech Foundation Inc., a nonprofit part of the Virginia Institute of Technology, giving that entity a 45-percent bidding credit. The commission had ruled that the bidder was ineligible for the small-business discount because of its revenues from the foundation. Virginia Tech has been the sole bidder for four licenses it its southern Virginia area.
