T-Mobile, Dish lead bids in USD 20 bln spectrum sale

News Wireless United States 14 APR 2017
T-Mobile, Dish lead bids in USD 20 bln spectrum sale

The FCC has closed its 600 MHz broadcast incentive auction, raising USD 19.76 billion in gross revenue, or USD 19.3 billion net, for 70MHz of spectrum. The auction, the second highest grossing ever conducted by the FCC, saw 175 TV stations sell spectrum to 50 telecom companies, creating more space for mobile broadband. A total of around 2,776 licenses were awarded. A 39-month transition period will now start, to move broadcast stations to new channel assignments. The end of the auction is expected to start a wave of deal-making. This had been up to now restrained by a quiet period, but this will end after 27 April, when down payments are due from auction winners.

T-Mobile US bid USD 8 billion, saying the investment will quadruple its low-band holdings, Reuters reported. Its bid, together with the USD 6.2 billion from Dish Network, accounted for the lion’s share of the total raised by the FCC. Comcast agreed to acquire USD 1.7 billion worth of spectrum, AT&T USD 910 million and investment house Columbia Capital USD 1 billion. Verizon Communications and Sprint did not place any bids.

Comcast sold spectrum from three of its NBCUniversal owned stations in New York, Philadelphia and Chicago for USD 481.6 million. US Cellular, in a filing with the US Securities and Exchange Commission, said it submitted bids for a minimum amount of USD 327 million. The company said it will pay the total amount in the second quarter, using cash on hand or borrowings from its revolving credit agreement.

The FCC also announced new channel assignments for 957 non-winning stations that will now change channels in order to clear new airways for mobile broadband.

Of the USD 19.8 billion, over USD 7 billion will go to reduce the US deficit and USD 10.05 billion to broadcasters casting off spectrum. Up to USD 1.75 billion will go to broadcasters taking charges to change channels.

Reuters noted analysts saying they had expected broadcasters to earn more and sell more spectrum. Sellers had initially looked for USD 86.4 billion for 126 MHz.

The FCC said that a total of 14 MHz worth of spectrum will be available for unlicensed use and wireless microphones.

Categories:

Mobile

Companies:

Sprint,  Comcast,  FCC,  US Cellular,  Verizon Communications,  Dish Network,  T-Mobile US

Countries:

United States

Tags:

Production planning & operations, Government telecommunications licensing, Wireless, Internet Access, Government policy, Corporate strategy

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