Wired, Engadget Mobile and The Register have posted their updates on the FCC’s 700 mHz auction. Bidding started last Thursday for the right to use these frequencies, which include the UHF band that is used by US broadcast television channels 14 and higher. US television stations will stop using these frequencies in January 2009 as part of a long-planned conversion from analog to digital television that will support high-definition television.
In other words, this kind of auction is a rarity. It’s like finding new beachfront property in Waikiki. Of course, no one owns the airwaves. By international agreement, the radio-frequency spectrum is tightly regulated. This helps manufacturers and governements prevent radio-frequency interference (RFI), so that devices don’t overwhelm each other with static and overlapping signals. Specific portions of the spectrum are allocated to certain uses, and countries control how some frequencies are used within their borders.
This FCC auction will decide which companies rent the 700 mHz or C block for the next few decades in the USA.
These frequencies would provide better mobile phone reception than the current bands of 800 mHz to 1900 mHz. Users might get better reception inside a building, for example. As part of the deal, the FCC has mandated that the winners must allow open access to the new networks. That’s not the same as free or inexpensive access, but that requirement does mean the winner won’t have a monopoly. Someone has to design, build and sell the new hardware to use these frequencies.
AT&T, Apple, Google and Verizon have each been rumored as bidders. Current mobile telcos covet the additional bandwidth and coverage. Apple and Google could develop their own mobile data services together or independently.
Google executives have stated the company will match the US$4.6 billion reserve price of the auction, if the FCC agreed to certain conditions. The FCC said no, but there’s no good estimate on how high the auction might go. Perhaps Google was signaling that it was willing to meet the reserve price, but is the company or any other bidder willing the exceed it? Whoever wins the auction has to build out the network and earn enough money from their new services to satisfy stockholders and the market.
