The Federal Communications Commissions re-auction of 422 personal communications services licenses returned from its winter break by closing in on the $13-billion barrier, and seeing its total bidder pool dwindle from its original 82 members to 51 bidders after 29 rounds.
Verizon Wireless, through its CellCo Partnership, continued to hold the top spot, doling out net high bids of $5.2 billion on 29 licenses covering more than 110 million potential customers. Verizon’s total includes more than $2 billion on two licenses in New York.
Designated-entity Alaska Native Wireless and partner AT&T Corp. remain a distant second with net high bids on 64 markets totaling $2.7 billion and covering more than 84 million pops. Cingular Wireless’ DE bidding partner Salmon PCS L.L.C., had its hands in the most markets with high net bids on 76 licenses totaling $1.7 billion and covering more than 64 million pops.
While the auction continues to build on its record performance for a U.S. auction, the pace of that climb has slowed dramatically. Increases in net high bids per round have fallen from 30 percent before the winter break to less than 1 percent in the latest round.
“On the whole, the tempo of the auctions appears to be slowing, with some high-level withdrawals and few new high bids in major markets,” said John Bensche, a wireless analyst at Lehman Brothers. “Activity is now focused on smaller markets, and the auction could be over in a few weeks.”
Some analysts expect the FCC to accelerate the auction from four rounds of bidding per day to six rounds per day to help speed the process, with some of the licenses for major markets expected to be wrapped up by the end of this week.
Sprint PCS, which was not expected to be very aggressive before the auction due to its wealth of spectrum, added to the list of high profile withdrawals from the auction heading home shortly after the bidding resumed last week. Sprint’s bidding partners, SprintCom Inc. and affiliate Horizon PCS Inc., also dropped out of the auction.
As expected, the big markets continue to see the highest bids, led by New York, Los Angeles and Chicago. Total bids for New York’s three licenses, including one set aside for DEs, has reached nearly $3 billion, almost a quarter of all bids with CellCo (Verizon), Salmon (Cingular) and Alaska Native (AT&T) the most active.
Other large carriers still aggressive in the auction include DE Dobson Communications, with net high bids on 29 licenses totaling $835 million, VoiceStream Wireless, with net high bids on 21 licenses totaling $684 million, and DE Leap Wireless International, with net high bids on 20 licenses totaling $385 million.
