FCC Raising Big Bucks, Now North Of $34 Billion In Spectrum Auction With Major Carriers

The Federal Communications Commission is in the process of auctioning off 65 megahertz of the electromagnetic spectrum and it is going very well. As of Friday, bidding for six blocks of airwaves has reached an unprecedented amount sailing north of $34 billion.

This particular auction, which started November 13, is now three times the reserve price of $10.5 billion that the FCC put on the sale. One of the factors that has contributed to the high bidding war is the fact that this is the first such auction in six years.

“Years of hard effort paved the way for the AWS-3 auction, in which 70 applicants qualified to bid, and ongoing bidding appears to signal considerable commercial interest in this spectrum, “ said FCC chairman Tom Wheeler and assistant secretary of Commerce for Communications and Information Lawrence E. Strikling in a joint statement. “NTIA and the FCC continue to work collaboratively to make additional spectrum available for wireless broadband services and devices while protecting critical federal government missions.”

Cell Tower
Image Source: Flickr (Carl Lender)

Of the 70 companies approved for bidding, it is assumed that Verizon Wireless and AT&T are among the high bidders at the auction. In the case of AT&T, it is interesting to note that they are bidding for airwaves despite the company’s recent announcement of halting construction of fiber networks following President Obama’s public stance on net neutrality.

During the past six years, the mobile market has exploded which is why bidding has been so high. 2008 was the last time an auction was held in which the iPhone was only a year old and the mobile market was still growing. Fast forward six years and the market has grown in leaps and bounds with bandwidth usage increasing due to streaming services, such as Netflix, and consumers wishing to share photographs and videos on their phones, tablets, and other devices.

As for when the auction will end, there is no definitive date. The auction could last for days or even weeks and, by then, who knows how high the bidding will reach.