Round 19: FCC Raises Maximum Minimum Ante in AWS-3

Sets maximum for minimum price increases for future rounds
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With $24,168,801,900 in bids after 19 rounds of the FCC's AWS-3 auction of 65 MHz of wireless spectrum, the commission announced that starting Thursday, the minimum new bids will set at no more than $50 million over the previous round's high bid. It has been set by a percentage of the previous bid, which in cases of larger markets like New York or Chicago, could mean the next bid would have to be hundreds of millions of dollars higher.

The goal is to goose the auction, though it has been flying pretty high to date after only five days.

The latest tale of the auction tape is that all licenses have been bid on, with only one bid withdrawn. There were a total of 1,605 new bids in round 19 for the 1,614 licenses up for auction. That was an additional $1,339,732,700 in bids over round 18. There are 70 qualified bidders.

The more money raised in the AWS-3 (advanced wireless services) auction, the less pressure there is on the broadcast incentive auction. For example, the $7 billion FirstNet interoperable emergency communications network appears to have been paid for, with plenty of money left over.

Also, the more money raised in AWS-3, the more money from the broadcast incentive auction that can go to paying broadcasters and paying down the debt.

AWS-3 is the second of three spectrum auctions mandated by Congress to fund FirstNet, as well as local first responders, advanced 911, R&D, and deficit reduction. The first auction, of H block spectrum, collected $1.564 billion toward that goal. The incentive auction, slated for early 2016, is the third auction.

The FCC has to pay auction expenses out of that total, and moving and relocation costs for the government agencies who are giving up or sharing spectrum. In its AWS-3 transition plan, the National Telecommunications & Information Administration estimated total relocation and sharing costs for the 1695-1710 MHz band at $527.1 million and for the 1755-1780 MHz band at $4.576 billion. The spectrum at 2155-2180 MHz is in FCC hands and ready for auction.

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