FCC’s Reaction Is A Re-auction

By Michael Todd
00:34, April 27th 2008
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FCC’s Reaction Is A Re-auction

After a successful 700-megahertz auction in March, which managed to raise more than $19 billion, the Federal Communications Commission is preparing the re-auction of the public safety airwaves known as the D-block. At the time, this particular auction was the only failure of the event, as many other licenses were sold successfully to private wireless phone companies.

The safety airwaves available for emergency, police and fire services all across the country did not manage to attract sufficient bidders. Initially, there were two interested parties but, just a few days before the auction, the key potential bidder withdrew, leaving just one bid on the table, far less than the minimum asking price.

 The key bidder was the telecommunications startup Frontline Wireless company and its offcials gave no explanations for their decision.

 A federal investigation found no fault with the companies involved. Apparently, bidders were not satisfied with some of the rules, such as being unable to negociate financial terms, thus making the costs calculations much more difficult.

 "Rather, the many layers of uncertainty and risk, and the growing prospect of high network costs ... were responsible for potential bidders' decisions not to bid," FCC Inspector General Kent Nilsson stated in his report, according to Reuters.

 The FCC is expected to bring to the new auction some assurances for bidders and financiers in order to present a much more appealing offer.

 "The Commission should take a more active role in future auctions to make certain public safety receives the spectrum it deserves," Gigi B. Sohn, president of Public Knowledge, said according to the Washington Post.

 



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