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April 04, 2014

AWS-3 Auction Will Feature "Shared Spectrum" for First Time

The Federal Communications Commission has announced its intention to hold an auction for 65 MHz of new mobile spectrum in the 1695-1710 MHz, 1755-1780 MHz, and 2155-2180 MHz bands.

There are some novel implications, both in terms of how the spectrum will be licensed, and in terms of whether all the four largest mobile firms actually will bid, and how intensely they might bid. There are risks for the FCC and the carriers.

The novelty is that part of the AWS-3 band (2155-2180 MHz) already is licensed for use by Federal users, and will be available on a shared basis with the new commercial users. That is a first for formerly-exclusive license issuance.

In this case, the new licensees will neither have exclusive rights, nor will the spectrum be offered “unlicensed,” at least in half of the spectrum awarded.

There are risks for the FCC as well. If the auction reserve prices (minimum bids) are too high, not all the carriers might want to bid. In a worst case scenario, nobody would bid.

If the reserve prices are set too low, the FCC might not raise enough money, something that is important because the proceeds will fund a national first responder network that has proven to be a problem.

Some argue that getting the first responder network funded now, by the AWS-3 auction, means it will be easier to provide incentives for TV broadcasters to vacate their spectrum when the two-stage 600-MHz auction is held, BTIG Research notes.

There also are other issues that could affect actual bidding rules. Sprint and T-Mobile US have argued for set asides of spectrum for contestants other than AT&T and Verizon when the 600-MHz spectrum is auctioned.

But in the case of AWS-3, there are indications that Sprint is not too interested in bidding, in any case, given the spectrum it gained when it acquired all of Clearwire. Dish Network, on the other hand, is viewed as a key bidder for unpaired spectrum Dish can pair with its existing AWS-4 spectrum.

The Advanced Wireless Services 3 spectrum is expected to be used to support additional Long Term Evolution mobile services.

The FCC will pair the 2155-2180 MHz band for downlink/base station operations with the 1755-1780 MHz band for uplink/mobile operations.

The 2155-2180 MHz band is already currently allocated for non-Federal, commercial use. The 1755-1780 MHz band is being made available on a shared basis with a limited number of Federal incumbents. 




Edited by Cassandra Tucker


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