WASHINGTON-After reaching an exhausting seven rounds per day, the 900 MHz specialized mobile radio auctions finally ended last week, with the predicted big spenders-Paging Network of America, Geotek Communications Inc., FCI 900 Inc., Motorola SMR Inc. and Fleet Talk Inc.-leading the pack. Of the 128 bidders who qualified for this event, 60 small-business players survived 168 rounds to win 26 percent of the licenses.
Twenty-two auctions have been scheduled by the Federal Communications Commission, 10 of them taking place this year.
Net revenues, exclusive of withdrawal payments, topped out at $204,267,144.00-a drop in the bucket when compared with the more than $10 billion currently being wagered by C-block personal communications services bidders, but much more on target as far as the true worth of individual markets is concerned. One FCC staffer told RCR that the commission is reconsidering its plan to auction 800 MHz channels because of these lower revenues-that it may be more trouble than it’s worth.
Winners are scrambling to submit by April 22 down-payment checks that make their total funds on hold by the government equal 20 percent of their winning bids to Pittsburgh’s Mellon Bank. Small-business qualifiers must have funds equal to 5 percent of their winning bids in the bank by that date. In addition, winners now must submit the more in-depth Form 600 to reveal ownership, relationships, type of interests and percentages held, gross revenue information, joint ventures, intervening interests and divestiture plans by April 29.
According to Wireless Telecommunications Bureau acting chief Michelle Farquhar, 86 percent of the bids were placed electronically, and winners can provide all subsequent information via computer as well.
Within 60 days and barring any petitions to deny, the 1,020 major trading area licenses will be processed by the Federal Communications Commission’s Gettysburg, Pa., licensing facility. Winners then will begin the task of building out one third of their system within three years, growing to two thirds within five years.
A few players, including Atlanta Trucking Associates, are waiting to hear if they will be assessed any penalty for what Farquhar referred to as “fat-finger” mistakes-submitting the wrong electronic bid for a given market. A decision regarding their fate could be made within two weeks. Although the commission has been clear in its expectation that bidders must make good on their bets, “We’ve signaled that we were willing to make allowances for fat-finger honest mistakes, rather than for strategic withdrawals,” Farquhar said.
To avoid bidding errors during the remaining auction cycles, FCC software gurus have developed additional safeguards-including pop-up windows that note a previous bid and the percentage over currently being considered, and audible warnings.
