The Federal Communications Commission’s decision to delay the auction of spectrum licenses it the 1.7 GHz and 2.1 GHz bands until Aug. 9 isn’t expected to have a big impact on equipment vendors as most have been working with carriers for many months to determine what type of and how much gear they will be asked to provide.
“They still have to wait and see, like the rest of us, who the auction winners will be,” explained Ranjan Mishra, director in the communications, information and entertainment practice at Mercer Management Consulting. “It’s then left to the winners to decide when and with which vendor to proceed with, based on their spectrum strategy.”
Adding that the spectrum auction’s postponement isn’t of major concern to vendors, Mishra said: “Vendors are in a very good position to learn from this process, but their focus is definitely more on deciding which technologies to develop.”
WiMAX vendors, including several of the big infrastructure players, are particularly likely to benefit from the auction since spectrum has been an impediment for those seeking to deploy any sort of WiMAX offering, said Mishra.
“The big players will do well regardless of who wins spectrum since they all have pretty diverse technology offerings,” said Mishra.
However, once auction winners are announced, Mishra expects them to quickly put their new spectrum winnings to use, calling on vendors and tower companies to move fast.
Tower companies are likely to see a boon to their business, as whoever wins spectrum will need tower space in order to launch any kind of new wireless service, Mishra said.
“We have to expect that data along with services from non-traditional players, like maybe a cable operator setting up a true quadruple- play of services, will figure heavily into the post-auction scenario. New players looking to offer services will have more powerful implications for wireless equipment vendors than carriers adding to their spectrum portfolios.”
The question for vendors, according to Mishra, is, “What’s their competitive strategy to win the business of auction winners? It’s a crowded marketplace, and vendors have to strategize to determine how they plant to compete.”
