WASHINGTON-At the close of business today, 203 wireless communications veterans and hopefuls could be accepted to participate in the D-, E- and F-block broadband personal communications services auction set to begin Aug. 26; 1,479 licenses are at stake.
Of the initial applications filed earlier this month, 44 were not complete when submitted. Those applicants have through today to correct the errors. One application was thrown out altogether. Once accepted, applicants have until today to submit upfront payments to the Mellon Bank in Pittsburgh, Pa. No delays will be accepted.
As expected, following massive rule changes recently adopted by the Federal Communications Commission, the bidder roster includes regional holding company interests; major cellular, PCS and paging carriers; rural telcos; and utility companies. Smaller businesses are back again to acquire-or to acquire more-markets in the entrepreneurs’ block, and there are numerous new players. Because the commission again chose not to change front-end rules regarding disclosure of all financial backers, it is not known at this time which bidders are bankrolled by whom.
The Aug. 1 filing deadline precludes applicants from communicating with each other, even if they have applied for participation in only the D- and E- blocks or only in the F-block set aside for entrepreneurs. According to FCC rules, however, companies that formulated bidding agreements prior to the filing date and that included such information on their Form 175 are exempt from the rule.
No one is willing to predict how much money will be garnered for the U.S. Treasury from these 10-megahertz pieces of spectrum, although Jerry Vaughan, deputy chief of the Wireless Telecommunications Bureau, has predicted that they will bring in more money than the C-block PCS licenses did. In a last-minute, pre-vacation press conference called by FCC Chairman Reed Hundt, a 1996-97 schedule of this and upcoming auctions was distributed. Hundt referred to the commission’s monetary luck with past bidding processes as “having a perpetual money machine going,” even though detractors have focused on the small number of defaults that have occurred because of monumental prices.
The commission still has not released any official information regarding a possible default in the recent C-block re-auction by CH PCS Inc., which won the Phoenix license, including how the license and its winner would be treated. Sources close to the auction told RCR the company missed its $9.4 million down-payment deadline July 24, saying that an investor had dropped out prior to the re-auction’s end. Confirming the default but brushing aside any negative aspects, Hundt said, “We keep raising more money every time we re-auction a license,” confirming that the license would be auctioned again instead of being awarded to the next-highest bidder.
One applicant-Gold Horse Group Ltd.-was denied entry into the auction because its Form 175 lacked the following information: city, state, zip code, fax number, mailing address, phone number, contact person, authorized name, certifying name, applicant status, certifying title, signature, attachments, applicant classification, payment and assets. The company also missed the Aug. 1 filing date. Gold Horse will have no further opportunity to resubmit a valid application.
