700 MHz auction concluded recently and the major winners
and AT&T. While this may seem like bad news to those who would have preferred more competition as a result of this auction, FCC Chairman Martin explains that a number of smaller competitive companies did indeed win a large chunk of spectrum.
For example, 99 bidders who were not AT&T or Verizon won 754 licenses representing 69 percent of the 1,090 licenses sold. For example, Frontier Wireless, won 168 licenses in the E block to establish a near nationwide footprint for its services.
In a press release, FCC Chairman Kevin Martin had this to say:
Even in a difficult economic climate, revenues raised in this auction exceeded congressional estimates of $10.182 billion by approximately 187 percent – nearly twice the amount Congress had anticipated would be raised to support public safety initiatives, the digital television transition and $7 billion in budget deficit reduction.
I suppose from the FCC's perspective this is great news and moreover it is a nice shot in the arm for the US government at a time when we could use the revenue.
The problem here is that this money and much more will now be extracted by the winning companies who the last time I checked were not non-profit organizations.
In other words, the government has just ensured the price of broadband will be substantially more than it could have been.
If you want to understand the power of free wireless spectrum, just think about life before WiFi. Think about how much it has improved and how much more productive the world economy is as a result of WiFi using unlicensed spectrum which was blessed by the FCC.
How many WiFi devices have been sold in the US these past years? Tens of millions?