The Federal Communications Commission chairman, Tom Wheeler, has decided to delay the upcoming wireless spectrum auction until the middle of 2015. The auction had an original deadline set for 2014 by the former FCC chairman, Julius Genachowski. The auction is going to be used to sell the wireless spectrum that TV broadcasters voluntarily gave up earlier this year. The auction will be held in reverse, with TV broadcasters giving up swaths of spectrum and the FCC paying them for what is sold.
There are questions about limiting the bidding power of the nation's two largest wireless carriers, Verizon and AT&T. The Department of Justice, T-Mobile, and Sprint would like the FCC to put limits in place. As the number 3 and 4 wireless carriers in the US, Sprint and T-Mobile want a chance at some of the available spectrum. Verizon and AT&T are large enough that they could easily outbid their smaller competitors. Current law states that the FCC cannot restrict bidders, and the House GOP is standing on that point.
In a meeting with the press, Rep. Greg Walden, chairman of the communications and technology subcommittee, said: "I expect them to follow the letter and the intent of the law. It's not fair to take the biggest bidders out of the process. Closing the auction to certain carriers would reduce competitive pressures and likely suppress the final bid amount, leaving crucial revenue on the table."
With wireless spectrum at a premium and carriers looking for more space, delaying the auction doesn't make everyone happy. Still, most of the people involved as well as the political and tech sectors see the delay as a necessary one. There are a lot of moving pieces, and Wheeler wants to make sure that the FCC gets it right. Most analysts considered former chairman Genachowski's 2014 date for the auction to be much too aggressive.
Wheeler wrote a blog post today in which he said: "As any responsible manager knows, managing a complex undertaking such as this also requires an ongoing commitment to continuously and honestly assess its readiness and its project plan. I believe we can conduct a successful auction in the middle of 2015."
About 70 TV broadcasters have signed on to give up their spectrum right now. This is short of the FCC's goal. Revenues are also expected to be lower than initially projected. Delaying the auciton until 2015 would give more broadcasters time to join in. The FCC has a meeting on January 30 where Wheeler says more details would be discussed.