Sudden Interest in C Block of 700MHz Auction

By Alice Turner
12:58, February 1st 2008
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Sudden Interest in C Block of 700MHz Auction

A high buyer has broken the $4.6 billion minimum price for the C block of the 700MHz spectrum auctioned by the Federal Communications Commission. The $4.71 billion bid represents a 2.3 percent premium over the minimum price. The bids added up to $15.64 billion for the five blocks on sale.

The C block comes with open access rules adopted under pressure from Google and others.

"Open access means different things to different people," says Harold Furchtgott-Roth, a former FCC commissioner and founder of consultancy Furchtgott-Roth Economic Enterprises, as quoted by BusinessWeek. "I think the more likely scenario here [if Verizon is the winner] is open hardware, not open software."

Most people think that Verizon and Google are battling it out for the C block.

Prominent wireless startup company Frontline Wireless LLC has bailed out of the FCC auction for the 700MHz spectrum earlier this month. Frontline was supposed to come up with an upfront payment for the wireless chunk it wanted, a special section of the 700MHz spectrum, the Block D, which was set aside for an emergency communications network. Frontline was the main planner behind the concept of a nationwide communications system which would include the newly freed up frequencies.

For now, there appear to be no takers for the D block, and another auction will probably have to be organized with different rules. The stringent requirements imposed by the group spearheaded by Frontline will probably have to go. So far, only one company bid $472 million, well short of the minimum $1.3 billion required to snatch it.

The auction will actually cover the 698-806 MHz part of the wireless spectrum. The public safety network was supposed to run on a total of 10 megahertz (763-768 and 793-798 MHz), making up the so-called Block D of the auctioned spectrum.

The FCC three months ago rejected again heavy pressure from those "wireless cartels" (as described by former chairman of the Federal Communications Commission Reed Hundt) and said it won't budge on the rules it announced for the 700 MHz spectrum. Specifically, the FCC requires winning bidders for a certain portion of the 700 MHz spectrum called the "C-block" open up their services to their customers' choice of equipment.



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Tags: FCC, 700MHz
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