Auction Watch

The 700 MHz auction – spectrum the wireless industry has coveted for more than 10 years – is set to start this month.
At times it didn’t seem like the wireless industry was ever going to get its hands on this valuable resource because the powerful broadcast lobby fought to keep it for so long. In fact, browsing old RCR Wireless News articles on the subject led me to a 2001 story with this quote: “Protecting reruns of ‘Bonanza’ on UHF television pales in comparison to using the spectrum for 911 calls and better communications for police, fire and rescue,” said Tom Wheeler, CTIA president at that time. The irony, of course, is that CTIA was OK with public-safety getting some spectrum, but not too much. The lobbying group did not envision an auction with such a significant public-safety component.
Now that the auction is within reach, it’s going to be even more interesting to see which established wireless players – and even more so, which new ones – will end up with the spectrum, and how much they’re willing to pay to get it. There is Google, yes, and its wireless strategy deserves scrutiny. But I want to know if Paul Allen’s Vulcan Ventures plans to be a serious bidder or if it’s just sniffing around to see if there are any good deals to be had. And what should we make of Chevron, which has thrown its hat in the bidding ring. With oil pushing $100 a barrel, why does it want a wireless pipe? Does Qualcomm’s MediaFLO subsidiary want more spectrum to offer more TV channels? If so, that must bode well for the carriers using the service.
Can this auction live up to the hyperbole associated with it? (For example: Frontline CEO Haynes Griffin said the FCC has a “once-in-a-generation opportunity” with this auction to fix public-safety communications; Consumer groups are hoping the auction will create a formidable competitor to telephone and cable companies.)
In the past, some of the most interesting auction items slipped under the radar at the time: Cellular pioneer Craig McCaw picked up 42 LMDS licenses as part of a Nextel consortium called NextBand. Later, McCaw’s company bought out Nextel’s portion of those assets. Nextel, meanwhile, started securing MMDS licenses. Today both companies are planning to use those frequencies for wireless broadband, much like the consumer groups want deployed at 700 MHz.
You see, the start of the auction is just the beginning of the twists and turns in of the wireless evolution. Just follow the spectrum.