After Monday's (Aug. 29) first round of the spectrum auction -- Round 22 -- in which the FCC raised the per-round price increases from 5% to 10%, the bids totaled $21,436,324,000, or up a little over 4% ($867,927) from round 21's $20,568,397.
That means while the FCC is upping its top prices for the spectrum by 10% in each round, in many markets the demand is not supporting that price increase, given that if the FCC were getting that higher price in all markets, the bid total would have increased by more than $2 billion.
But in many markets supply is exceeding demand, though that could change as money moves around.
Net of bidding credits and discounts, the round 22 total was $20,790,000, which is the figure that has to eventually get to $88,379,558,704 or more to cover broadcasters' payments and moving and auction expenses if the auction is to close after Stage 1, in which 126 MHz is being auctioned in 416 geographic license parcels to 62 qualified bidders, including Comcast, AT&T, Dish and T-Mobile.
Demand was lower in some of the top 10 markets over the past few rounds as demand began to align more with supply. In New York, demand continued to exceed supply by 2 to 1, but in Chicago and San Francisco, for example, there were 10 bids for the 10 available licenses.
In Dothan, Ala., there were bids for only three of the 10 licenses, and while the FCC had raised the price to $715,000, those three bids were for only $650,000.
Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.
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