Round 17: FCC's Spectrum Auction Bids Approach $18 Billion - Broadcasting & Cable

Round 17: FCC's Spectrum Auction Bids Approach $18 Billion

Up almost $800 million from previous round
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Seventeen rounds down and the forward part of the FCC's spectrum incentive auction has raised $17,932,219,000.

But that is before bidding credits and discounts for rural bidders and small businesses. The key figure is the $17.70 billion net in round 17 after those credits and discounts are factored in. That is the figure that will have to be at least $88,379,558,704 to cover broadcasters payments and moving expenses and auction expenses if the auction is to close after stage 1, in which 126 MHz is being auctioned in 416 geographic license parcels to 62 qualified bidders.

That total $17,932,219,000 is up from a total $17,149,091,000 and a net $16.490 in round 16. That total figure is almost $800 million more than round 16, but it makes sense for the number to increase since the FCC is increasing the price each round.

If those bidders don't bid at least that much, the FCC will go to stage 2, lowering the spectrum clearing target to 114 MHz, reducing what it has to pay broadcasters, and then hold a second forward auction.

The FCC announced Aug. 25 that it is increasing its asking price on those 416 geographic licenses by 10% each round starting Aug. 29, double the 5% increase in each of the previous rounds.

The forward auction is a "clock" auction, in which the FCC raises the price each round by between 1% and 15%. In addition, each bidder has to bid at least 95% of the bidding units it has committed to, though not in any particular spectrum license or market, which means bids can be shifted strategically.

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