The FCC wrapped up the first round of the 3.5 GHz spectrum auction on Thursday, with 271 qualified bidders and strong demand.
Gross proceeds to round 1 at Auction 105 totaled $ 357,344,200. Many more bidding rounds are expected in the coming weeks.
The large number of bidders had indicated that there could be strong auction activity for the mid-band spectrum in the shared 3.55-3.65 GHz band of the Citizens Broadband Radio Service (CBRS).
Participants compete for priority access licenses (PAL) in the county areas. In total, there are 22,631 PALs, with seven available in each county licensing area. Each PAL consists of an unpaired 10 MHz block, and licensees can add up to four PAL channels within any area of the county at any given time.
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AT&T, T-Mobile, Verizon and Dish are participating. However, unlike previous 5G auctions for the millimeter wave spectrum, there are numerous smaller entities and non-traditional players involved in the action. That includes cable companies Cox and Charter, but also companies like Chevron, Deere & Company, and Duke University and Health System, among others.
Sasha Javid, COO of BitPath, tracks and closely analyzes the auction results, and in one post noted the significant demand that Auction 105 is seeing after the first round. Although strong, she noted that demand is comparable to previous auctions.
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“Strong demand after the first round … is a very promising sign,” said Javid, who was chief data officer and legal advisor to the FCC Incentive Auction Task Force in 2016. “I have to assume that the FCC is happy with the way the auction started. “
Much of the initial demand is in large markets, including Los Angeles, Dallas, and New York. Javid told Fierce via email that it’s not surprising, because as seen in previous auctions, it’s where high bidders “can safely park bids in the early rounds.” Once the price of those areas increases as the auction continues, bidders will move to the markets they really want, he explained.
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Still, Auction 105 offers licenses in many less populated markets, and the market with the highest excess demand was Calhoun, Iowa. However, it does not necessarily mean that bidders have a strong interest in the area.
“Calhoun, IA and other cheap markets in the middle of the country are probably being used by some small bidders (of which there are many) to ensure they meet the requirements of the activity rule,” Javid said. “But I hope that in at least some of these smaller markets there is a genuine interest in using CBRS band to provide wireless broadband.”
The national price per MHz-POP at the end of the first round was $ 0.020031.
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The CBRS band configuration is unique, with a coordinated tiered exchange between three levels of users, including established federal protected operations. PALs come after federal users, followed by General Authorized Access (GAA). The GAA tier is more similar to unlicensed access and they are already being implemented.
Operators have been waiting for a new opportunity for 5G-licensed mid-band spectrum, but CBRS is also using applications such as private and fixed wireless LTE, among others.
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