Pai, Rosenworcel at Odds on Timing of H-Block Auction
The FCC appears divided, as does industry, on when an H-block auction should occur and whether it should take place in January or be pushed into the fall. Commissioner Jessica Rosenworcel is counseling the commission to wait until later in 2014, while Commissioner Ajit Pai urges a January auction, FCC sources said Friday.
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The H-block auction has been designated Auction 96 by the commission and is to take place “by or as early as” Jan. 14, according to a July Wireless Bureau public notice (http://bit.ly/18iYcWo). In June, the FCC approved by a 3-0 vote a report and order moving the FCC toward an auction of H-block spectrum, 10 MHz of already cleared paired spectrum at 1915-1920 MHz and 1995-2000 MHz (CD June 28 p1). The H block is located adjacent to the PCS band and the auction is widely expected to produce lots of carrier interest. FCC sources note that all of the funds from the H-block auction will pay for FirstNet, further raising the stakes for the auction. In the incentive auction broadcasters will have to first be paid for their spectrum before money can flow to FirstNet.
Reply comments were due at the FCC Friday on the H-block auction rules. Sprint is expected to urge a January auction, while Dish Network and T-Mobile, two of the bigger players on the H block, are expected to urge a delay, agency and industry officials said. Analyst firm BTIG said in an Aug. 7 report the FCC should “put the brakes on” and not hold a January auction. “A premature auction threatens to restrict the efficient use of spectrum, reduce the money payable to the government and hamper the ability to attract broadcasters to the subsequent incentive auction,” BTIG said. “This is a lose-lose situation for everyone involved other than Sprint but the FCC should not be engineering an auction for the benefit of one company. Meanwhile, [Dish Chairman] Charlie Ergen could play a critical role in helping the FCC achieve its goals and at the same time substantially improve his spectrum position.” A delay “just makes sense” and could potentially double the value of the H block if it’s paired with the AWS 3 M block, BTIG said.
Dish Network still supports Rosenworcel’s preferred timing, said Jeff Blum, Dish senior vice president. In an ex parte filing, the DBS company previously urged serious consideration of Rosenworcel’s proposal to auction off the H block with the other bands identified in the Spectrum Act (http://bit.ly/129wMfg). There is merit “to waiting for more certainty before auctioning the H block,” it said.
The Competitive Carriers Association said in a news release it’s urging the FCC to forego the use of package and anonymous bidding procedures and offer licenses in small geographic sizes, like cellular market area licenses. “Auction 96 is an important auction,” said CCA President Steve Berry. “It is the first in a series of upcoming auctions directed under the Spectrum Act, and it will set the bar for auctions that follow. CCA supports the Commission’s goal to conduct the H Block auction in January of next year, but it is absolutely critical for the FCC to get this one right. The ‘rules of the road’ regarding spectrum aggregation limits must be addressed prior to the auction, and the FCC must ensure that all carriers have meaningful opportunities to bid on and win additional usable spectrum.”,