Wireless Auction Stalls Again

Bidding stalled on Tuesday in the closely watched auction of a piece of wireless airwaves that the U.S. government is selling, according to data released by the Federal Communications Commission.

There were no new offers for the nationwide "C" block slice of wireless spectrum to top previous high bids totaling $4.74 billion.

Tuesday’s pause prompted speculation that bidding for the C block spectrum may have run its course, and that the most likely possible winner could be either Verizon Wireless or Internet search leader Google.

Bidders’ identities are kept secret until the entire auction ends, under FCC rules. The end won’t come until bidding has stopped on all five blocks of spectrum up for sale in the auction, which will probably take at least another week or two.

The $4.74 billion in bids for eight regional pieces of the C block airwaves on Monday surpassed a $4.71 billion offer made last Thursday for a nationwide package of the spectrum.

Stifel Nicolaus analyst Rebecca Arbogast said there were several possible scenarios as to what companies had bid on the C block airwaves.

The most likely of those, she said, is that Verizon Wireless pushed the C block bids up to $4.74 billion on Monday in order to top an earlier bid by Google.

It was also possible that the earlier, $4.71 billion offer was made by Verizon Wireless, and that another competitor is aiming to force Verizon to up its bid, Arbogast said.

Bidding on the C block had temporarily stalled on Friday after Thursday’s $4.71 billion offer. That bid exceeded a $4.64 billion minimum price set by the FCC and triggered a condition sought by Google that would require the winner to make the spectrum accessible to any device or software application.

Analysts have said Google may drop out of the bidding after hitting the minimum price, content to let Verizon acquire the C block spectrum as long as the open-access conditions are guaranteed.

The C block is one of five groups of 700-megahertz spectrum being offered. The top bids on Tuesday totaled almost $18.94 billion for all five blocks, raising more money than any previous FCC auction.

The 700-megahertz signals are valuable because they can go long distances and penetrate thick walls. The airwaves are being returned by television broadcasters as they move to digital from analog signals in early 2009.

Other potential bidders in the auction that began January 24 range from entrenched carriers AT&T and Verizon Wireless, to possible new competitors like Google,
and Cablevision.

Verizon Wireless is a joint venture of Verizon Communications and Vodafone.  

CIO Insight Staff
CIO Insight Staff
CIO Insight offers thought leadership and best practices in the IT security and management industry while providing expert recommendations on software solutions for IT leaders. It is the trusted resource for security professionals who need network monitoring technology and solutions to maintain regulatory compliance for their teams and organizations.

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