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August 20, 2007

Spectrum auction date set

Posted by Tricia Duryee at 1:54 PM

The FCC has set a date for the upcoming airwave auction that has generated quite a bit of debate over the past few months as Google and others push to change the way wireless networks operate.

The spectrum, considered valuable for providing wireless broadband Internet access, will be auctioned off startng Jan. 16, 2008. The FCC is also seeking opinions on how it has chosen to sell off the spectrum.

I wrote a story last week explaining what's going on, here's an excerpt:

Q: What is at issue?

A: For any company or organization to operate a wireless service, it needs access to a sliver of airwaves, or so-called "spectrum," much of which is controlled by the federal government. The FCC will conduct an auction in January to sell rights to a swath of the spectrum that's ideal for providing wireless broadband services. Technically, that swath is the 700 megahertz band.

The spectrum will become available after television companies vacate airwaves they don't need as they convert to digital or high-definition television. That deadline is Feb. 17, 2009.

Q: What is Google asking for?

A: Google and other companies, including Frontline Wireless of Greensboro, N.C., proposed to the FCC that a portion of the spectrum being sold in January should be set aside for an "open access" network, one that would allow consumers to choose the device and applications they want regardless of whether a network operator has approved them.

This auction is quite significant. The FCC is estimating that the spectrum is worth $10.1 billion.

The FCC came up with that number by taking into account another recent auction, called Advanced Wireless Services (or AWS-1). The agency said in a document released today that comparing that sale with the upcoming one is fair, but that the 700 MHz band is better:

For instance, spectrum in the 700 MHz Band possesses superior propagation characteristics to AWS-1 spectrum. In addition, as of February 18, 2009, the 700 MHz Band spectrum will be unencumbered, while full access to AWS-1 spectrum requires the relocation of both Government and commercial incumbent users. Thus, other factors aside, 700 MHz Band licenses with comparable geographic service areas and bandwidth should have a higher market value than AWS-1 licenses.

If you remember, Bellevue-based T-Mobile USA was big participant in the AWS auction. It spent more than $4 billion, doubling its spectrum holdings in the top 100 markets.

In a news conference last October, T-Mobile detailed plans to start building out a 3G network on its new spectrum. It said at the time that it intended to provide the service commercially in mid-2007, and that most markets will have 3G by 2008.

Rumors have circulated that T-Mobile is getting ready to turn a few markets on soon.

CrunchGear is reporting that T-Mobile's first 3G device, also called a UMTS phone, will go on sale starting Sept. 10. At that time, it will be interesting to see what products T-Mobile will be selling to justify the higher-speed network.

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Tricia Duryee
Tricia Duryee
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