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Wireless Bidders Stand Their Ground - Broadcasting & Cable

Wireless Bidders Stand Their Ground

The longer the auction goes, the less spectrum the FCC is freeing up
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It took broadcasters a couple of weeks and 53 rounds to offer up the latest price tag for their spectrum: $54.6 billion.

It took wireless companies and forward auction bidders only two hours to respond, and the answer was a big, fat no.

Stage two of the forward auction began at 10 a.m. Oct. 19 and was over by noon, closing at a total bid price of $21.5 billion, or $33.1 billion short.

The way the forward auction works is that a stage closes when demand no longer exceeds supply in the top 40 markets.

The FCC had reduced the number of available spectrum blocks from a maximum of 10 paired blocks per market to nine. The bidders were still on the hook for their closing prices in stage one and they stuck to them, declining to meet the FCC’s new price, which effectively closed the stage whether or not there continued to be bidding in the smaller markets.

The bidders’ signal was clear. The broadcasters’ asking price was still too high, and they were willing to have the pot of available spectrum reduced before they bid any more, if they do.

The FCC has always said the auction could go multiple rounds and started off with high pricesto attract broadcasters. Butthe longer the auction goes, the less spectrum the FCC is freeing up for what it and wireless carriers had said was to address a spectrum shortage verging on a crisis. 

It took broadcasters a couple of weeks and 53 rounds to offer up the latest price tag for their spectrum: $54.6 billion.

It took wireless companies and forward auction bidders only two hours to respond, and the answer was a big, fat no.

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