FCC Puts 4.6 Billion Minimum Bid on Spectrum Auction 165
ChainedFei writes "Wired News notes that the Spectrum auction is moving forward, with the FCC placing a minimum bid for the C-block spectrum being offered at $4.6 billion. That, coincidentally, was the amount that Google fronted as a minimum bid to endorse certain open standards for the spectrum being sold. This is essentially a move to shut out smaller possible competitors while also maximizing the money the auction will generate for the grade-A areas of the spectrum. In addition, any single bidder wishing to purchase the entirety of the spectrum must front a minimum of $10 billion. 'According to the FCC, nearly all of that C block aggregate reserve price will go toward a package of U.S. national licenses. This portion of the spectrum also happens to be the one with two open access conditions attached to its sale mandating that all devices be allowed to access the band and that all applications can be able to run across the network. If the reserve price isn't met, the auction will be rerun without these two conditions in place, according to the FCC.'"
Not really shutting out smaller competitors (Score:4, Insightful)
Although, to be fair, it might force the bidding war to be shorter -- but knocking out the competition right from the start because they can't afford it doesn't really affect the final outcome. It just forces the bids to be realistic from the start.
So much political agenda on
Re: (Score:3, Insightful)
The jist is that a physics fundamental isn't something we can buy and sell.
Do correct me if I'm wrong
Re: (Score:3, Insightful)
The jist is that a physics fundamental isn't something we can buy and sell.
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
It depends on where it is. But for the sake of this example lets say it pops up in international waters. If that is the case then no, according to treaties nations can no longer plant a flag and claim international territory. That said, even in the old days those claims were only worth the weapons used to defend them
Re: (Score:2, Troll)
(Note: a method which does not involve a central regulatory body is, in fact, a method based upon "he with the most broadcast power owns the spectrum")
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
yo you asshole.
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
And I'm not saying you could have 100 broadcasters on the exact same band, but you could easily have 10 with a trivial amount of collision detection. Moving everything to digital packets you could vastly compress the data, then just spam packets UPD style at irregular intervals, with the usual collision/resend timing, same as with any streaming media. Sure,
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
Funny, my FM radio only goes from about 88 MHz to 108 MHz, a total of 20 MHz of spectrum. Did I get gypped out of 230 MHz somewhere in there, or are you blowing smoke?
The "HD" Digital Radio folks keep running ads telling me that there other stations hidden in there somewhere too, but I'm happy enough with the three or four stations I listen to already, so why s
Re: (Score:2)
The math don't work. Check you figures. If satellite has 50Mhz and 150 channels and FM radio has "about 5 times the spectrum" then, FM must have 250Mhz of spectrum. I think not. My dial goes from about 86Mhz to about 107Mhz or roughly about 20Mhz But you are right the channels are wider. The reason is because FM uses many in
Re: (Score:2)
FM Broadcast band is 87.8 to 108.0 - thats 20 mhz of bandwidth - channels are spaced at
Also I should point out XM is 2332.5 to 2345.0 - thats 13.5 mhz, not 50. 150/100 is 50 more channels for 6.5 mhz less bandwidth.
So digital radio is more effic
Need to take them to court. Airwave freedom (Score:2)
Spectrum shouldn't be held hostage for filling government coffers.
We could have very cheap phones for everyone. Not with ATT guy running the FCC.
Re:Need to take them to court. Airwave freedom (Score:5, Insightful)
The public never lost its property rights to those airwaves, we simply elected to rent them out to the highest bidder so that the proceeds of that auction could be used to fund the purchase other goods and services that we the public wish to conusme rather than attempting to operate them directly ourselves with all of the risks and costs that that entails. The government, acting on behalf of and in the interest of the people, is our agent in that sale. Now, you might argue that the government is squandering the proceeds or not getting the best possible price, but really we never lost control of the airwaves.
Spectrum shouldn't be held hostage for filling government coffers.
The government coffers are really *our* coffers in that the government uses this money to provide us with public goods that we like to consume. If the government did not receive this money from the auctions then it would have to raise the cash necessary to provide these public goods in other less desirable ways, such as raising taxes.
We could have very cheap phones for everyone. Not with ATT guy running the FCC.
Selling the right to use the spectrum at auction and then allowing the market with competition to decide the outcome yields the best and most fair result for everyone. You will have your cheap phone for everyone much faster, and at a much better price, from the market than you would from government control and central planning. Remember here that wireless spectrum is not entangled in "natural monopoly" scenarios with last mile physical infrastructure problems so the market is much more able to reach the optimal result more quickly than might be the case in fiber optic or cables and other utilities.
Re:Need to take them to court. Airwave freedom (Score:5, Insightful)
The government coffers are really *our* coffers in that the government uses this money to provide us with public goods that we like to consume. If the government did not receive this money from the auctions then it would have to raise the cash necessary to provide these public goods in other less desirable ways, such as raising taxes.
You may find it shocking but maybe our government spends money excessively just to buy votes. Some political experts do suggest this as happening. And if the government is so good with our money then lets give them 'all' of our money. That would surely solve all of our problems.
Selling the right to use the spectrum at auction and then allowing the market with competition to decide the outcome yields the best and most fair result for everyone. You will have your cheap phone for everyone much faster, and at a much better price, from the market than you would from government control and central planning. Remember here that wireless spectrum is not entangled in "natural monopoly" scenarios with last mile physical infrastructure problems so the market is much more able to reach the optimal result more quickly than might be the case in fiber optic or cables and other utilities.
Creating a monopoly for just 'ONE COMPANY' to horde spectrum does not equal the free market. The gov makes makes a buck and that doesn't always filter down to average Joe citizen
A better idea is to free and democrotize our spectrum much like the internet or even better than the internet.
Re: (Score:2)
Re: (Score:2)
It is *rented* by corporate America with certain rights and privileges, including exclusivity of their right to transmit on the selected frequencies, it is not *owned* by corporate America. I don't care that I cannot personally afford the cost of exclusive access to a desirable band of public frequencies. I for one would rather have the money than be able to p
Re: (Score:2)
Re: (Score:2)
If you don't like the price then do not purchase the product. High end wireless services are not a necessity of life. The auction ensures that only the serious bidders, who in theory are best able to implement and roll out the new technologies, are given serious consideration for purchasing the spectrum. Would you want to entrust the spectrum to some low rent mom and pop shop in Peoria or one of the big corporations like Google? How woul
Re: (Score:2)
Nope, I just have a side interest in economics. I really don't care who buys the rights to the spectrum so long as the government, and by extension the people, gets the best possible price and the best way to ensure that is with an auction.
Re: (Score:2)
You are confusing the EM spectrum with a Public Good [wikipedia.org]. It is *not* the case, for example, that your unfettered use of the EM spectrum does not interfere with my unfettered ability to use that same EM spectrum. Thus the EM spectrum, particularly within a specific geographic region, is more correctly understood to be a Private Good [wikipedia.org]. I didn't elect anyone to sell it.
You agreed to be bo
Re:Not really shutting out smaller competitors (Score:5, Funny)
Some things are a bit different. Like they don't display the % of positive/negative feedback, or they'd never manage to sell anything
Re: (Score:2)
i'm pretty sure it acts like a regular auction, where the bidding keeps going unless everyone but one bidder gives up.
Re:Not really shutting out smaller competitors (Score:5, Informative)
Re: (Score:3, Funny)
Great (Score:2, Insightful)
Great. So if AT&T outbids everyone, and comes in under the reserve, then we can all kiss the open spectrum goodbye. I wonder how much the FCC charged AT
Re: (Score:2, Insightful)
Re: (Score:2)
That is,
Does "starting price" == "reserve" here? (Score:3, Insightful)
Is the FCC using "reserve" and "starting price" interchangeably? Or are they two separate things (similar to an eBay auction), where there's a starting price for the bidding, and a much higher, secret reserve price?
It sounds like the FCC did what Google wanted, and are running the auction with the interoperability and open-access mandates in place. And they're starting the price out at a level ($4.6B) that Google said they would pay, given those conditions. So that se
Re: (Score:2)
The FCC did half of what google wanted (and not really the important half).
Re: (Score:2)
So yea 4.6+ is the exact reserve and I assume starting bid.
Its not a secret reserve, that is rarely done in the real world, just ebay.
Re: (Score:2, Interesting)
Re: (Score:2)
Cash and Short Term Investments: 11,935.92 million as of 2007-03-31. Source. [google.com]
Take one for the team Google!
Re: (Score:2, Informative)
http://arstechnica.com/news.ars/post/20070815-700m hz-auction-whats-really-up-for-grabs-and-why-it-wo nt-be-monopolized.html/ [arstechnica.com]
Simple Question (Score:3, Informative)
What they are selling (Score:2)
Of course, people who do less knee jerking and make an effort to use there heads all ready knew this.
Re: (Score:2)
Evidentally that would not include you.
What I am asking, if you would please remove your knee, is what is the company getting out of this either way the spectrum will be free to use for any application and anyone to use, why dont they just open it up?
This portion of the spectrum also happens to be the one with two open access conditions attached to its sale mandating that all devices be allowed to access the band and tha
Re: (Score:2)
Re:What they are selling (Score:5, Insightful)
What you have to understand is that the purpose of the FCC is to take complete and absolute control as possible of the natural resource of the EM spectrum, and make that resource available to corporations to resell to the citizens at a profit, as well as carve off a few chunks for the government to use any way they like.
The citizens are only allowed the tiniest possible token portions of the resource, with usage of those portions additionally limited in many critical ways. They do all this under the guise of "protecting" the resource.
Once you wrap your head around this, everything the FCC does makes sense.
The FCC probably qualifies as one of the most corrupt agencies of the US government in the sense that what it does is extremely disjoint from the actual interests and needs of the public, and intentionally so. The US government is supposed to serve the interests of the people, not the corporations.
Re:What they are selling (Score:5, Informative)
Regurgitating, eh? I'm an extra class amateur radio operator and I hold an FCC commercial radio operator's license (used to be a first class license, guess it still is, sort of, though they don't give them out any longer.) My name is found in more than one edition of the radio amateur's handbook as an innovator, I received technical achievement of the year from a television group at the Dayton hamvention, and some of well known ham radio manufacturer AEA's commercial products were of my design, as well as my responsibility to get tested for FCC approval. My designs have been on the front cover of 73 and reviewed extensively in 73, CQ, and QST magazines - and elsewhere. I've been the engineer at several 10kw through 100kw radio stations, I've been a DJ (progressive rock), and I've even had my fingers in pirate radio a couple of times. Also related to all this, I'm a musician and a recording engineer.
So it could just possibly be that I might have my own informed opinion on these matters, rather than just parroting what you appear to think is mindless slashdot groupthink. Now, for your edification, Here's a short (and woefully incomplete) list of things I can't do for the "common good" by specific FCC edict:
And of course, the amateur radio bands that I am allowed to transmit upon are only available to me because I have passed several technical tests according to the requirements of the FCC; your average citizen has no access to the amateur bands as you should know, and so you cannot hold up the amateur bands as a resource for Joe or Jane blow to do anything in particular with. Not that they are very useful what with all the restrictions on what we can do with them, anyway.
I think that you and I fundamentally disagree on what the phrase "common good" actually means.
Re: (Score:2)
Re: (Score:2)
Here's an idea; auction the spectrum, but make the bids service promises rather than money. The bidder who will offer the greatest coverage, lowest cost (to end users) and greatest amount of choice in terms of connecting devices gets the spectrum. If they don't deliver on their promises, they lose it, and it goes to the next bidder.
We tried auctioning bandwidth for 3G mobile phones in the UK, and it was a disaster. The operators had to keep bidding, or they would become uncompetitive when everyone else
Re: (Score:2)
Th
n00bs (Score:5, Funny)
Why are they setting a minimum bid? They should just start it at $0.01 and keep saying "reserve not met" until it passes the $4,600,000,000.00 point.
Re: (Score:2)
They are not setting a minimum bid. TFA says reserve bid. The submitter misquoted the article.
Re: (Score:2)
Bad Move (Score:5, Interesting)
People in favour of these auctions seem to forget that companies are not in it for charity, and investors like to see a reasonable return on the money they put in. The cash for these licenses have to come from someone, and that someone is you, the dumbass consumer.
Translation (Score:3, Insightful)
Re:Bad Move (Score:5, Interesting)
The same also happened in the UK.
In European countries where they held a 'beauty contest' (operators bid less money but also had to promise to roll out services and coverage) the result was decent services from the start at cheap price for the end consumer. E.g. Norway.
Re: (Score:2)
Re: (Score:2)
People in favour of these auctions seem to forget that companies are not in it for charity, and investors like to see a reasonable return on the money they put in. The cash for these licenses have to come from someone, and that someone is you, the dumbass consumer.
WTF? Oh the poor, poor telecoms companies...
They didn't have to bid that high, the only compulsion was their own. They could all have bid £0.01, but they didn't, they chose instead to add many many zeros.
Re: (Score:2)
On the contrary, we are keenly aware of this fact. It does not matter that some companies overpaid, their licenses will be liquidated along with the rest of their assets in bankruptcy and resold to the highest bidders. This process will contin
Re: (Score:2, Informative)
We had two of these fiascoes. One was Nextwave, which overbid and promptly filed for bankruptcy back in 1996, trying up spectrum for ten years, at which point they started selling their licenses to incumbents such as Verizon. Here's a summary [internetnews.com] from 2005:
Use of this frequency (Score:2)
Re:Use of this frequency (Score:5, Insightful)
To me, the company that is really missing the boat on this is M$. Their cash holdings trump anything Google can come up with and could easily buy the entire frequency map. The uses for this are endless... Iridium v2 I think are the best idea from a longtimer standpoint. They could sell low cost packages where you put a small dish on your house and get basic services for free. Then have an access point built directly into the unit... Instant national WiFi coverage!!
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
Re: (Score:2, Informative)
att and verizon are big but not that big. I guess we'll see during the bid...
actually: ignore me, from forbes 500, I see that verizon is 13th with 93b revenue and att is 27th with 63b. The closest techie is M$ with 44b (all 2006 numbers)
So, it's not a streach to see this happen...
Ben
Re: (Score:2)
I've actually had to use Iridium modems in the recent past and I can tell you that the service is worse than you remember it but just as expensive.
Re: (Score:2)
In my opinion, the first company that could have a la
Re: (Score:2)
Re: (Score:2, Insightful)
Effective range:
Out with the old UHF, in with the new:
And, cost:
The reserve bid is old news (Score:4, Informative)
An article [arstechnica.com] from July.
Show me the Money (Score:2)
What is a 'package of U.S. national licenses?' Does anyone know where the money from this auction goes?
Re: (Score:2)
Re: (Score:2)
The money goes the the US Treasury, and has to be paid by June 30th, 2008, because it's already been included in the budget by the Congress. In other words, it's already been spent.
Backwards (Score:4, Insightful)
It should be the other way around... if they can't get 4.6B for the spectrum, then they'll ADD the two open-access restrictions that they didn't include. Then at least, they know Google would bid 4.6B and maximize their profits while also having a more open network.
Re: (Score:2)
Re: (Score:2)
I think a lot of people have missed the meaning of the restrictions Google requested...
The restrictions apply to the buyer. They force whoever wins this block of spectrum to "play well with others", more or less.
Personally, I think the FCC should just open the spectrum as with the 2.4GHz, perhaps with just a few more minor restrictions on (such as limiting it to ultra-low po
Re:Backwards (Score:5, Insightful)
The problem with the current systems are that only the existing cell companies can get into the business. There is no real way for a competitor to enter the market. Further, in general only approved devices can be used on the network (although the GSM networks are the exception). The companies can dictate what the network can be used for. As a result, Cellular internet prices are outrageous, and unfair.
So what Google would do is but the spectrum. They would standardize on a protocol. They would let companies provide services (most likely internet services) on that band. The companies offering services on that band would be required to let any devices that support the protocol to be used (likely a SIM-card like system would be used). The companies could not restrict the applications or services used on the network. Smaller companies would have a much better chance to get in on the action, as the major requirements would be an antenna on a cell tower, and a large internet connection. They would only need to provide the end users with a SIM, as the modems could be gotten anywhere. The total overhead of providing 700 MHz internet access would be far less than the traditional cell system, and thus there would be significant competition, and low prices.
The key here is that the spectrum owner has no interest in providing the service themselves, and has no reason to sell out to the large companies. So they would have no problem allowing multiple companies to provide the service in the same area. That is not heard of for most utilities. Also, unlike cell phones, the companies competing in the local area would not conspire to fix prices, as the cost of entrance would be low enough that a new player could easily join in.
If I am correct about that, that would be the sort of thing the government should do. That sort of regulation would level the playing field, and thus allow capitalism to work well both for businesses and for consumers. That would be the sort of regulation that is ideal. Unfortunately all too often, government regulation works to make the playing field less even, in the favor of the entrenched large companies that are already working in that sector.
Re: (Score:3, Interesting)
Re: (Score:2)
Re: (Score:2, Interesting)
I agree, WTF - but not for the same reason:
I think the bigger problem is the money vs. principles problem on display. With only two of the four rest
FCC Puts 4.6 Billion Minimum Bid on Spectrum... (Score:2)
I'll take two of them!
Can they afford it? (Score:2)
This spectrum will probably go for 20 - 30 billion. How much cash does Google have?
Not cash... (Score:2)
The question is, how much liquidity does Google have, and how does it help their bottom line.
All by itself, I don't see how it helps Google, but it would be nice to have that spectrum opened up to all devices so that we can finally have decent coverage without draconian device restrictions. Just a complete guess is that Google wants to "sublet" the space to smaller device makers.
Other way around. (Score:3, Insightful)
Google's requirements just made sure that Google can step into the game in this juicy section of spectrum even when they don't win the bidding (I don't think that they're going to try very hard).
Either way, I highly doubt that we'll see a completely free wireless mesh that only costs the initial investment of the device crop up any time soon. Your tax dollars hard at
Re: (Score:2)
Jeez (Score:3, Funny)
Google's ploy to get M$ to cough up... (Score:2)
I mean get real, if Google really did want the spectrum, it would seem to be a big mistake to telegraph their interest the way they have, especially knowing that M$ has a big interest in anything that would hamstring Google...
Re: (Score:2)
If MS dropped $30 billion for this as a knee-jerk reaction to keep it away from Google, well...they might get a third of that, total, back in revenue. That's after a few more billion to develop uses for it.
Ehh (Score:2)
Re: (Score:2)
Smaller players (Score:2)
So much for supporting the market (Score:2)
I could see capping the amount a single entity could take, thus encouraging competition and opening it up to smaller players, and then the smaller players could either take it and run, consolidate amongst each other, or dangle it in front of the bigger players.
Or I could see no limits at all and let them go for th
Re:Listing Fees (Score:5, Funny)
Purchase price: $0.01
Shipping: $4,899,999,999.99
Re: (Score:3, Funny)
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
The spectrum belongs to me and everyone else in america.
Not just the ATT FCC lobbyist.
De-Facto Pioneers! (Score:2)