Airwave auction off to flying start

An auction of some government airwaves is off to a flying start, already surpassing expectations.

Wireless companies have shelled out more than $28 billion in the Federal Communications Commission’s (FCC) auction of government airwaves as of late Thursday afternoon, as a signal of the high demand for the valuable spectrum licenses. 

{mosads}Money from the auction of “AWS-3” airwaves will go to build a national communications network for fire fighters, police and other first responders.

Bidders easily blew past the $10 billion reserve price quickly after the auction opened last week, and the profits are only likely to continue going up. Money not pegged to fund the FirstNet system will go to pay down the nation’s deficit.

Rep. Doris Matsui (D-Calif.), a co-chairwoman of the Congressional Spectrum Caucus, called the auction a “remarkable success” that will only continue to raise money for the government.

“In addition to generating needed revenue, this spectrum auction provides an opportunity for wireless carriers to build out and enhance their networks, providing better coverage and faster speeds to their customers,” she said in a statement on Thursday. “This auction is clearly proving to be a major win for consumers, innovation, and public safety.” 

The auction is the best opportunity for major wireless companies to get access to more of the nation’s airwaves in years. Companies say that they are struggling to keep up with consumers’ demand for more bandwidth to download videos, surf the Web and play games on their phones and tablets.

The trade group CTIA-The Wireless Association this week called the auction “a critical down payment in allowing the mobile broadband ecosystem to invest and innovate to the benefit of American consumers.”

The companies bidding for spectrum rights are anonymous until the auction closes, but major wireless companies such as Verizon and AT&T are expected to be key players.

The success of the auction so far should be a positive signal to the FCC ahead of a separate, much more intensive airwave auction set for 2016. That auction will involve the FCC buying spectrum rights from TV broadcasters, repackaging them and then auctioning them off to wireless companies.