Wireless Spectrum Auctions

Google, NCTA and 20 others urged leaders of the House and Senate Commerce committees Wednesday to address “current estimated costs to clear the 3.45 GHz band of federal users,” which “could jeopardize” FCC “ability to conduct a successful auction and meet its obligation to ensure that a wide variety of applicants have access to spectrum.” Commissioners vote March 17 on beginning an auction for early October (see 2102230065). NTIA in January estimated relocation costs “at more than $13.4 billion, meaning that the auction reserve price that bidders would have to meet in order for a successful auction would be nearly $15 billion, likely putting licenses out of reach for all but the three largest nationwide wireless operators,” stakeholders also including Comcast, Hewlett Packard Enterprise, Public Knowledge, the Rural Wireless Association and Wireless ISP Association said in a letter to Senate Commerce Chair Maria Cantwell, D-Wash.; ranking member Roger Wicker, R-Miss.; House Commerce Chairman Frank Pallone, D-N.J.; and ranking member Cathy McMorris Rodgers, R-Wash. “Wireless providers’ large financial commitments in the recent C-band auction and related build-out obligations make it all the more appropriate to encourage other sources of capital in a second mid-band spectrum auction in the same year.” Congress “should encourage the FCC to consider licensing policies akin to those adopted in the [citizens broadband radio service] CBRS band that could increase competition, lower costs for prospective new entrants, and better ensure that the benefits of 5G are enjoyed by all consumers,” the entities said. They want lawmakers to “work closely with NTIA, affected federal spectrum users, and the FCC to consider ways to refine and reduce the federal government’s relocation cost estimate.”

The FCC appears unlikely to hold a 2.5 GHz auction before mid-December, based on the deadlines in a notice in Tuesday's Federal Register, industry experts said. With the 3.45-3.55 GHz auction expected to start Oct. 5, the 2.5 GHz auction would likely follow.

"Incredible" proceeds of the C-band auction "changed the game somewhat" in federal spectrum management, greasing the path for more federal agency participation in sharing or relocation, FCC Commissioner Nathan Simington said Thursday in a Lincoln Network talk. The $81.2 billion in auction proceeds (see 2102180041) show how valuable some spectrum is to commercial operators, making it clear there will be ample funds available for spectrum relocation fund (SRF) uses and "mitigating somewhat" the pain of federal relocation from those bands, he said.

In an apparent win for carriers, acting FCC Chairwoman Jessica Rosenworcel is proposing a standard auction for the 3.45-3.55 GHz band, offering the big license sizes favored by national providers. The auction would start Oct. 5 and use an ascending clock format. The FCC also released its open radio access network notice of inquiry and public safety items for the March 17 commissioners’ meeting.

Verizon dominated the record-setting C-band auction with $45.4 billion in bids, almost twice the $23.4 billion bid by AT&T, the FCC announced. T-Mobile was third at $9.3 billion, as it further buttressed its midband holdings. UScellular bid $1.3 billion. The auction started Dec. 8 and closed Feb. 17 at $81.2 billion after the assignment phase. That doesn’t include roughly $13 billion in accelerated clearing payments. The FCC sold all 5,684 spectrum blocks up for bid.

FCC acting Chairwoman Jessica Rosenworcel said 5G issues will be a focus at the March 17 commissioners’ meeting, circulating a draft order to start an auction of the 3.45-3.55 GHz band in early October (see 2102230046). She plans a notice of inquiry opening a “formal discussion” on open radio access networks, the FCC said Tuesday. Rosenworcel announced Monday commissioners will vote on rules for the $3.2 billion emergency broadband benefit program (see 2102220065).

NTIA sent a letter to the FCC Monday providing “more refined geographic parameters” for proposed cooperative planning areas (CPAs) and periodic use areas (PUAs) provided by DOD, tied to an eventual 3.45-3.55 GHz auction. NTIA urged the FCC to release rules and auction the band “as expeditiously as practical.” It's seen as a top priority under acting Chairwoman Jessica Rosenworcel (see 2102190046). The areas aren’t exclusion zones, but “military systems require protection from harmful interference from new non-federal operations, either indefinitely (in CPAs) or episodically (in PUAs), in support of national security missions and to meet readiness requirements,” NTIA wrote. More information will be released as the auction approaches, the letter said: “NTIA and DoD will provide supplemental information to potential bidders similar to the DOD AWS-3 Workbook and NTIA recommends issuing a joint Public Notice, like with AWS-3, with more details on federal notification and coordination.” NTIA reported Monday incumbent informing capability (IIC) time-based sharing holds promise for making more federal spectrum available for commercial use. The sharing system will likely be federalized, “run and administered by NTIA,” the paper said. “NTIA expects that IIC will be deployed over the next few years to support mid-band spectrum sharing predominately between federal systems and broadband wireless carriers using 4G and 5G technology,” it said: “IIC is expected to be a long-term project with iterations that will ultimately allow federal agencies to populate and update in realtime a database with frequency, location, and time-of-use information for systems they deploy.” First steps for testing in the citizens broadband radio service band in this effort are updating the previously developed CBRS portal to a DOD scheduler 11 participating test ranges “and identifying the data collection and security requirements and considerations,” NTIA said. “If successful, NTIA will next evaluate expanding IIC functionality to other 5G mid-band spectrum and ultimately transition the capability to an NTIA operation, allowing us to potentially apply IIC to all federal operations in other bands.” The letter to the FCC said IIC will play a role in 3.45 GHz.

UScellular may have spent $1.46 billion in the C-band auction, suggested a footnote in its Friday investor presentation accompanying Q4 results. Executives on a quarterly call declined to comment, saying the footnote was intended only to provide “context.” After Dec. 31, “UScellular committed to purchase wireless spectrum licenses for approximately $1,460 million inclusive of associated costs, subject to regulatory approval,” the footnote said. Companies are barred from commenting on auction results until 10 business days after they're announced by the FCC. Winners must make 20% deposits. A UScellular spokesperson didn’t comment.

An order establishing rules for a 3.45-3.55 GHz auction appears to be one spectrum item moving under acting FCC Chairwoman Jessica Rosenworcel. She's reluctant to plow into other bands while acting chief, but 3.5 GHz is teed up, and timing is an issue, with an auction having to take place this year, said FCC and industry officials. The big question is whether the FCC will approve a model based on the adjacent citizens broadband radio service or a more traditional licensed model.

The FCC approved 4-0 an NPRM proposing revised rules for a program to pay for the replacement of equipment from Huawei and ZTE in U.S. networks, as expected (see 2102110053), at the commissioners' meeting Wednesday. Acting Chairwoman Jessica Rosenworcel stressed that even more than the previous administration, she's emphasizing coordination with other parts of the federal government in her approach to supply chain risks. Commissioner Brendan Carr said the U.S. must stay tough on China.