March 20th, 2008
FCC: Verizon Wireless a big 700 Mhz auction winner; Now what?
Updated: Verizon Wireless was the biggest winner in the Federal Communication Commission’s 700 Mhz auction.
FCC Chairman Kevin Martin revealed Verizon Wireless as the biggest winner of spectrum. Martin made the comments at a press conference at FCC headquarters.
Here’s Martin’s statement (also see Techmeme):
A bidder other than a nationwide incumbent won a license in every market. As a result of the 700 MHz Auction, there is the potential for an additional wireless ‘third-pipe” in every market across the nation. Additionally, 99 bidders, other than the nationwide wireless incumbents, won 754 licenses – representing approximately 69 percent of the 1090 licenses sold in the 700 MHz auction.
The 700 Mhz auction was critical for future wireless services. Analog TV broadcasters currently use most of the spectrum to deliver programming. However, these TV stations are required to go all digital in 2009. That opens a lot of signal for wireless companies.
Verizon Wireless–a joint venture between Verizon and Vodafone–won a bevy of large, medium and small licenses to essentially get enough spectrum to build a national next-generation wireless network.
In a statement, Verizon Wireless said:
“We are very pleased with our auction results. Specifically, we were successful in achieving the spectrum depth we need to continue to grow our business and data revenues, to preserve our reputation as the nation’s most reliable wireless network, and to continue to lead in data services and help us satisfy the next wave of services and consumer electronics devices. The bids we won include a nationwide spectrum footprint covering 298M Pops, plus 102 licenses for individual markets covering 171M Pops. In compliance with the FCC’s anti-collusion quiet period rules, Verizon Wireless cannot comment further until that period ends.”
Analysts such as Citigroup’s Michael Rollins expected Verizon Wireless to spend about $8 billion to $10 billion on the FCC auction. The total auction value was $19.59 billion.
Echostar was another company that won licenses, according to the Journal. Google didn’t win any licenses. Surprisingly, AT&T won many small licenses, but didn’t get the big spectrum blocks. Other spectrum winners include (warning the link takes forever to download):
- CenturyTel
- Frontier Wireless (tied to Echostar)
- Qualcomm
- Vulcan Spectrum
- Cavalier Wireless
Separately, the FCC said in a statement it was de-linking its D-block spectrum.
The big question now: What will Verizon Wireless do with that spectrum? It has made strides to open its network to developers and should have the bandwidth to unleash a bunch of new services should it choose to.
Update: AT&T has issued a statement on the auction. Here’s the gist from Ralph de la Vega, president and CEO of AT&T’s wireless unit:
AT&T’s strong spectrum holdings position the company to further enhance the quality and reliability of existing wireless broadband and voice services, and to set the foundation for new-generation wireless broadband technologies and services. Upon final award of this spectrum, the company’s 700 MHz spectrum will cover 100 percent of the top 200 markets. Combined with the spectrum previously purchased in the AWS auction, AT&T will have quality spectrum available for new services covering 95 percent of the U.S. population. With this spectrum we can continue to deliver the latest technology and best-in-class services to our customers as the wireless industry grows and evolves.
Larry Dignan is Editor in Chief of ZDNet and Editorial Director of ZDNet sister site TechRepublic. See his full profile and disclosure of his industry affiliations.
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