Airwaves Amount for Sale in U.S. Auction Called Extravaganza

  • U.S. Federal Communications Commission sets target for sale
  • Auction to free TV-station airwaves for use by smartphones

Regulators running a U.S. airwaves auction said the amount of frequencies to be offered was on the high end of what they had projected, auguring for brisk action during the sale that could fetch $40 billion.

The Federal Communications Commission in an e-mailed order Friday set an initial clearing target of 126 megahertz in the two-stage sale.

The figure ensures that “bidders have their chance to compete for the maximum amount of low-band ‘beachfront’ spectrum," or airwaves particularly suited to use by wireless devices, FCC Chairman Tom Wheeler said in an e-mailed statement. “The broadcasters have stepped up and done their part."

Broadcasters had until last month to tell the FCC if they wanted to sell airwaves, and the level of interest drove calculations for the amount of spectrum to be offered. Identity of participating broadcasters has been kept confidential.

“That is indeed a ‘spectrum extravaganza,’" Preston Padden, former executive director of the Expanding Opportunities for Broadcasters Coalition that represented broadcasters considering taking part in the auction, said in an e-mailed statement. The amount “far exceeds early estimates of likely broadcaster participation.”

Broadcaster Proceeds

The sale is designed to help meet growing demand from smartphone users by employing airwaves now occupied by TV stations, which will receive payment in return for voluntarily giving up frequencies. Broadcasters in many cases can stay in business by sharing airwaves with other stations, or moving to new frequencies.

Three of the four major wireless companies -- AT&T Inc., Verizon Communications Inc. and T-Mobile US Inc. -- have filed to bid for airwaves, as has Dish Network Corp. Top U.S. cable provider Comcast Corp. may buy airwaves and plans to offer for sale frequencies from NBC stations it owns. Other TV companies that may sell frequencies include CBS Corp. and Rupert Murdoch’s 21st Century Fox Inc.’s station group.

CTIA, a wireless trade group, is “encouraged to see so much interest,” Meredith Attwell Baker, the organization’s president, said in an e-mailed statement.

Mobile Boom

FCC officials have called the auction a “once in a lifetime” opportunity for TV companies to take in a payout and in many cases stay on the air.

The large wireless-service providers are seeking airwaves to meet growing demand from users of mobile phones, tablet computers and other portable Internet-capable devices. Sprint Corp. has said it won’t be a bidder.

An airwaves sale that ended last year drew $44.9 billion in bids and attracted applications from 80 companies at a similar stage of preparation. The Congressional Budget Office has estimated that this year’s auction will bring in between $10 billion and $40 billion, with an expected value of $25 billion, after TV station owners have been paid. Money left goes mainly to pay down the U.S. debt.

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