For $86 Billion Dollars, you can get TV stations to go off-the-air

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July 15, 2016 by Paul Dughi

On air sign

Phase 1 of the Spectrum Auction has been completed.  The Federal Communications Commission (FCC) is trying to clear 126 MHz of broadcast spectrum for use by the wireless industry.  The spectrum would come from TV stations currently broadcasting in that spectrum.  They’d give it up in exchange for a one-time cash payment to go off the air.

In the “Reverse Auction” part of the bidding, TV stations said they would be willing to give up that spectrum for a certain dollar amount.  The bids started high and then came down until the point where the FCC could get the amount of spectrum they wanted at the lowest price point stations said they would accept.

To buy it all at the clearing target would take $86 Billion Dollars.  Who’s in, who’s out, and what prices it will take are all under lock-and-key.

clearing target

SOURCE: FCC

Phase 2 about to begin

Phase 2 of the Spectrum Auction is about to begin.  This is where it gets serious.  It’s called the “Forward Auction,” where the wireless companies will bid against each other and the “reserve price” each TV owner has set.  If someone hits the magic number, a sale can occur.  If it doesn’t, then no deal.  If the Auction doesn’t come up with enough transactions to meet the targets, or the bidders don’t come up with the amount of money it will take, the whole thing may start over.

biddersAT&T, T-Mobile, US Cellular, and Verizon (Cellco Partnership) were among the big names you’d recognize.

In total, 62 companies – many of them smaller or regional companies – have applied to bid and done the paperwork and deposits necessary.  Another 42 put in applications, but were deemed unqualified.

Here’s the complete list of Qualified Bidders.

Here’s the list of Unqualified Bidders.

And, finally, here’s the Public Notice that lays out the timetable.

Most Desirable Spectrum

The 600 megahertz TV band is some of the most desirable spectrum for the wireless companies. Congress authorized the FCC to hold an auction to see how much it could get and re-purpose, feeding the need, and also putting some money in the government’s pockets.

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