Blog Post

8 Things to Know About the 700MHz Auction

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

The 700MHz auction kicks off today, and like kids waiting for Santa Claus, the technology and business publications are tense with anticipation. But FCC chairman Kevin Martin is keeping a lid on this auction, rather than post periodic updates as was done in the AWS auction in 2006.

While you wait to learn who gets the goods who gets a lump of coal, here’s a quick list of everything you need to know about the upcoming auction and why it matters. Check out all the links, because the bidding doesn’t conclude until March 24 and down payments aren’t due until April 11. You’ve got time.

  • Setting the rules for this auction took a lot of time — and lobbying.
  • There are a lot of bidders: Out of the 214 of them, the big ones to watch are AT&T, Verizon and Google. Interesting no shows are Sprint Nextel and Time Warner.
  • It costs a lot to bid: Reserves are set high at $10 billion, but several people think that the current economic crisis might make it hard for those reserves to be met. Heck even Google has seen $16.15 billion lopped of its market cap so far this week.
  • Already some have failed. Both Frontline Wireless and Cyren Call, both of which were going after the “D” block of spectrum and its heavy load of public safety requirements, have already bailed.
  • Google is bidding, but may not be playing to win against the carriers.
  • The winners have to create an open network. The dream of having a network that would allow any device onto it is still alive.
  • Or maybe not. Om would like to see the spectrum become unlicensed and treated much like Wi-Fi is today for it to be truly open.

And like childhood obesity, short attention spans and the general decline of Western Civilization, you can blame all of this controversy on television — the shift from analog to digital TV signals, to be exact.

15 Responses to “8 Things to Know About the 700MHz Auction”

  1. RF Guru

    hank, do u know RF? lower frequency carries less data? What an idiot? Data rate has nothing to do with frequency. It is directly related to bandwidth. Who told you tower can not be close to each other at dense city? your mama?

  2. The draft white space rules for DTV would allow unlicensed use provided that beacons are supported (see the work of 802.22 as a protocol overlay fit for an OFDM application in DTV white space). Overall this should get through — although it is opposed by spectrum owners represented by NAB and the like.

  3. Jesse Kopelman

    The issue Hank is raising is that of frequency reuse. You only get so many bits per Hz, so in areas with very high user density, it is can be better to have more spectrum that doesn’t propagate as well than less better propagating spectrum. For example, in a major metro, I’d rather have Sprint’s 100MHz of 2.6GHz spectrum than the 22MHz of 700MHz spectrum one would get by winning the C block in this auction (what Google is bidding on). Given that the major metros are where carriers earn the majority of their revenue and spend the majority of their network build/maintenance costs, one could argue that the 700MHz spectrum is being a little overhyped. I would argue the situation is more that Sprint’s vast 2.6GHz spectrum holdings are underappreciated, however. One great thing about 700MHz is its ability to penetrate buildings. So, even if you need just as many 700MHz sites in your city to handle all the capacity as you would using PCS or AWS, you get the added benefit of your stuff working in a higher percentage of indoor situations. Meanwhile, you do save a great deal of money on sites out in the boonies, where user density is not a big worry. The bottom line is that 700MHz is not the greatest thing since sliced bread, but it is pretty great. The problem is that if AT&T and Verizon gobble it all up, good luck seeing it put to use in currently underserved areas any time soon!

  4. Hank Williams:

    By “urban areas” do you mean “in cities” in general, or in the areas of cities with densely packed buildings? I ask because some cities have only relatively small pockets of structure density, such as my city of Austin, and large expanses of low structure density. I’m also thinking of the growing municipal provision of wifi in city parks and other public spaces. I know that Portland is doing that and Austin has one or two parks wired.

  5. One additional think I would add to your analysis. A I blogged today at The 700mhz spectrum is not terribly good for internet signals in urban areas because the frequency is low, so the signal carries less data, but the signal is really strong so you cant have too many towers close to each other which is the standard cellular strategy.

    The article link is here