Lessons From The 700 MHz Auction? More Of The Same

from the no-surprises-here dept

Thu, Mar 20th 2008 5:57pm — Mike Masnick

So the winners of the 700 MHz spectrum auction have been announced and to say that there were no surprises would be an understatement. It played out almost exactly as most observers predicted it would. Verizon Wireless ended up with the C-block (with Google only bidding right up to the cut-off amount to force Verizon to play by "open" rules) and AT&T added some spectrum as well, which it can add to the 700 MHz spectrum it picked up separately last year. The end result? Nothing too exciting for consumers. Whether or not Verizon Wireless's required "openness" makes a difference remains to be seen. What didn't happen was someone new entering the scene -- meaning that we're not going to see anything really new come out of all this spectrum.

In fact, perhaps the most bizarre bid of all was EchoStar spending $700 million on spectrum that can only be used for one-way communication. One-way communication is less and less useful these days. EchoStar has been making some interesting moves of late, but using this spectrum to build a mobile TV broadcast solution (which is what many expect) makes little sense. It will cost the company billions, and then they'll be limited to a one-way communication system just as people are recognizing that the real value is in multi-directional communications. It may give the company another option rather than relying on satellites (which are costly and troublesome at times), but the expense is way too high considering the limitations. So, even with EchoStar, we're talking about "more of the same." That's too bad, as there was a quiet hope that someone different would step in and do something really new and interesting with this valuable spectrum.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: 700 mhz auction, fcc, spectrum, wireless
Companies: at&t, echostar, verizon wireless

8 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Nick, 20 Mar 2008 @ 6:31pm

And once again the public loses
It's really sad that it ended up this way. This spectrum could have been so phenominally useful to all of the small ISP's out there to provide services in the areas that Verizon and AT&T have always, and will continue, to completely ignore.
[ link to this | view in thread ]
Quantity Surveyor Man, 20 Mar 2008 @ 7:23pm

Think harder
I can think of a whole lot of uses for a one-way broadcast band. Who says the answer has to come back in the same part of the spectrum?
[ link to this | view in thread ]
Matt, 20 Mar 2008 @ 7:23pm

not quite, there was something shady too
http://www.eweek.com/c/a/Mobile-and-Wireless/Ethical-Concerns-Swirl-Around-D-Block-Spectrum-Auction/

this link points to that there may be a little more than meets the eye in dealing with the emergency spectrum block, it seems.

So while EchoStar will fail, I wonder what will be done about D block?
[ link to this | view in thread ]
Mike (profile), 20 Mar 2008 @ 7:27pm

Re: not quite, there was something shady too
The D block will get re-auctioned without the open rules, and it will sell. I do think *something* fishy happened, but it's not clear how bad it really was. Unless there's more evidence, I'm not ready to say that anything really bad happened. It may have just been competitive jostling.
[ link to this | view in thread ]
Mark, 20 Mar 2008 @ 8:14pm

Not all that surprising. . .
that something auctioned off in huge segments by the federal gov't would not be being put to the most innovative use. We should go back to the pre-Hoover days when there were some private property rights in the spectrum.
[ link to this | view in thread ]
moe, 21 Mar 2008 @ 12:28am

Re: Think harder
That was my first thought, too.
[ link to this | view in thread ]
mjr1007, 21 Mar 2008 @ 7:36am

Anyone else notice.
The auction is just a giant tax on consumers. It's about the only thing that makes land lines competitive.

Dedicating parts of the spectrum might have made sense years ago because of interference but it no longer does.

Why not just let any and all companies use the spectrum and compete on price. Oh yea, the the bureaucrats and politicians wouldn't have anything to do or anyone to finance their campaigns.

This is just a giant waste of time and money while being incredibly anticompetitive.
[ link to this | view in thread ]
MaxB312, 21 Mar 2008 @ 12:28pm

What about the D Block
What about the D block? As I understand it Congress just wanted to give first responders the spectrum. But instead our dear Chairman Martin decided to double the amount of spectrum for a public safety network and then sell it back to them. That worked out well. Did the Chairman not understand that the incredible build out requirements for a public safety network would probably not make it the most business-friendly? I guess not, or, maybe, he just didn't care. Either way, we're out a public safety network and Martin still gets to call the auction a success. I feel used.
[ link to this | view in thread ]