700 MHz auction: Focus remains on a decreasing number of licenses

The grind is on. After topping the $19 billion mark yesterday — prodded by some arm-twisting from the Federal Communications Commission — the 700 MHz auction resumed this morning with a trio of rounds, each slower than the previous one. Round 41 was good for $18.6 million in potential winning bids spread across 197 bids; round 42 for $19.6 million across 188 bids; and round 43 for $4.9 million across 173 new bids.
Overall the three rounds added $44 million to the government’s coffers, with total potential winning bids sitting at $19.062 billion after round 43.
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Interestingly, the most action in today’s bidding revolved around the E-Block license covering Traverse City, Mich. The license received 3 bids during each of the three rounds today, ending round 43 with a potential winning bid of $220,000, or 13 cents per megahertz/potential customer covered, according to Optimal Markets Inc. The significance of that license might not be known until the auction is finished and the FCC releases the identities of winning bidders.
E Block nears reserve
The activity did continue to push the E Block closer to its $903.7 million reserve price, as potential winning bids after round 43 totaled $897.8 million, or just over 99% of its reserve. The A-, B- and C-Block licenses have already reached their reserve prices.
However, the D Block continues to languish far below its reserve price.
The auction will continue as long as a new bid is placed during a round. The FCC recently initiated new rules that require active bidders to keep at least 95% of their eligibility in play during each round, a move that during last year’s advanced wireless services auction was followed by 130 more rounds of bidding.
End in sight?
Analysts think Auction 73 could end as soon as next week, but battles over a handful of licenses could extend the proceedings. Today, the most action — beyond the frenzy around the E Block covering Traverse City — centered on a handful of licenses that each received at least two bids per round, indicating interest from at least two participants. Those licenses included the A-Block licenses for Greenville and Ashville, N.C.; and Fort Smith, Ark.; and E-Block licenses for Northern Michigan; Columbia, Mo.; Lafayette and Lake Charles, La.; Pueblo, Colo.; Casper, Wyo.; and Aberdeen, S.D.
After a handful of new bids yesterday, the regional C-Block license covering Alaska did not receive any additional interest during the opening three rounds today.
The FCC also noted that beginning Friday it would increase the bidding rounds from five per day to six per day. Each round would also be cut from the current 30 minutes each to 25 minutes each.