The FCC’s ongoing 600 MHz incentive auction surged past $18.5B in total ‘winning’ bids through round 18, with larger markets still oversubscribed
Having recently passed its “first component” milestone, the Federal Communications Commission’s 600 MHz incentive auction continues to rake in the dough, with bids set to see a significant minimum bump beginning next week.
Through 18 rounds of the forward auction process, total “winning” bids exceeded $18.5 billion, with net proceeds nearing $17.9 billion. The auction late Wednesday flew past the “first component” milestone of nearly $15.9 billion, which is one of three needed for the auction to end successfully.
Despite the milestone and growing pot, it remains unlikely this first auction stage will end successfully in terms of wireless carriers actually getting their hands on these exact licenses or that television broadcasters will get paid from the growing bids. Few expect the first stage to reach the $88 billion in total proceeds as part of the second component and needed to meet the financial demand of broadcasters for the 126 megahertz of total spectrum – which includes 100 megahertz of licensed spectrum for commercial wireless services.
Larger markets continue to dominate total bids, with the 10 available licenses centered on New York City generating more than $3 billion in total bids, and those licenses being oversubscribed with 23 offers at more than $309 million per license at the end of round 18. Five licenses up for bid centered on Los Angeles are even more oversubscribed, with 19 bids for $229 million per license on the board at the end of round 18.
The FCC said beginning next week, per-round bidding increments would jump from the current 5% to 10%, which could support a surge in overall auction revenue as bidders seriously interested in licenses will need to get more strategic in their plans. Similar to recent spectrum auctions, the FCC is only releasing bidding information on markets and not on which bidders have placed those bids. The current auction has 62 qualified bidders, including the likes of Verizon Wireless, AT&T Mobility, T-Mobile US, U.S. Cellular and C Spire.
Current auction proceeds are still less than half of the more than $40 billion raised in the AWS-3 auction, which included 65 megahertz of spectrum focused in the 1.7/2.1 GHz bands, but is creeping up on the more than $19 billion generated during the 700 MHz spectrum auction that included 84 megahertz of spectrum.
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