Trade organizations claim $33B spectrum auction windfall awaits government

The federal government could reap more than $33 billion in net proceeds if it moves ahead with plans to auction off 120 megahertz of wireless spectrum currently under the control of television broadcasters, according to a white paper submitted to the Federal Communications Commission by wireless industry trade association CTIA and the Consumer Electronics Association.
The paper claims that the spectrum could fetch approximately 97.8 cents per megahertz/per potential customer covered, resulting in the $33 billion total.
In 2008 the FCC raised nearly $19.6 billion through the auction of 52 megahertz of spectrum in the 700 MHz band. The value of those licenses ranged from 74 cents to $2.68 per MHz/pop. That followed the 2006 auction of 90 megahertz of so-called AWS spectrum in the 1.7/2.1 GHz band that raised nearly $13.9 billion.
The white paper also claims that only a small percentage of broadcast stations would need to participate in the auction in order to address the spectrum shortage faced by the mobile industry. “Indeed in the vast majority of broadcast markets, an incentive auction will still be successful even if no broadcast stations participate,” the paper states, adding that in a limited number of markets the number of licensed broadcasters will exceed the channels that will remain available for TV use following a reallocation.
The paper also states that the value of licenses voluntarily surrendered by broadcasters could be as high as $2.3 billion. This surrendering would assume those broadcasters would rather give up those licenses then accept lower-cost option like channel sharing or cellularization.
President Obama recently announced plans to provide up to 500 megahertz of new spectrum for the wireless industry in an attempt to further the availability of broadband services to 98% of the country’s population. The plan claims $27.8 billion could be raised from auctioning off that spectrum.
“With support from the United Nations and thanks to the efforts of President Obama, the FCC, the NTIA and numerous policymakers, it’s clear there’s a recognition that our industry needs more spectrum so we can remain the world’s wireless leader,” said CTIA President and CEO Steve Largent.” Our members are willing to spend billions to purchase unused or underutilized broadcast spectrum to fuel the ‘virtuous cycle’ of innovation and competition. That’s why this proposal is an all around win for the federal government, the wireless industry, broadcasters and most importantly, consumers who demand the best products and services.”