The Federal Communications Commission on Wednesday established procedures, dates and the bidding and pricing guidelines for its much-anticipated auction of spectrum licenses for so-called Advanced Wireless Services (AWS).

 

The FCC (News - Alert)’s upcoming auction for 1,122 AWS-1 licenses in the 1710-1755 MHz and 2110-2155 MHz bands – previously used by the Federal government – is scheduled to begin June 29, the agency said in a press statement. In addition, the FCC said it will cancel the auction if the net winning bids at the close of the auction do not exceed approximately $2.059 billion but analysts predict the spectrum licenses could actually fetch a price tag in the $10 billion range.

 

More than ever, the auction comes at a critical time. Not only does it represent one of the largest blocks of frequencies that have been auctioned in a long time but it also comes at a key inflection point for the telecom and entertainment industries, which have been increasingly encroaching on each other’s turf. With new standards like the Session Initiation Protocol (News - Alert) (SIP) and the IP Multimedia Subsystems (IMS) architecture serving as prevailing guidelines for both industries, convergence has sparked (and in some cases, re-sparked) bitter rivalries in delivering voice, video, data and wireless services.

 

As such, the FCC is taking unprecedented steps to ensure the auction will be conducted fairly and equitably, without the slightest signs of improprieties. The FCC has decided it will not release the identities of bidders unless there is a certain level of competition among bidders prior to the bidding. In addition, all of the AWS-1 licenses will be auctioned in a single auction using the simultaneous multiple-round auction format. Package bidding will not be used in this auction.

 

The new rules come amid allegations that bidders have colluded in previous auctions. Investigators have examined, for example, if a bidder previously agreed to resell spectrum licenses to an incumbent carrier following an auction, even though the bidder won its license on the basis that it was a rural, independent.

 

“Despite various attempts to address these concerns, the commission’s auction processes continue to provide opportunities for various types of collusion and other anti-competitive bidding behavior. Unfortunately, the ongoing susceptibility of our auctions to these practices is no secret,” said FCC Chairman Kevin Martin. “In light of this evidence, I believe it is essential that we make an effort to foreclose anti-competitive bidding behavior in this auction.”

 

----

 

Robert Liu is Executive Editor at TMCnet. Previously, he was Executive Editor at Jupitermedia and has also written for CNN, A&E, Dow Jones and Bloomberg. For more articles, please visit Robert Liu's columnist page.

Mobile Telephony