In a bit of serendipity, the FCC cracked $20 billion in total bids for round 20 of the forward portion of the spectrum incentive auction.
As of 2 p.m. Friday, the auction had raised $20,058,375,000, which is $19.4 billion net of bidding credits and discounts. That is up from the total $19,314,547,000 and net $18,640 billion in round 19.
That net figure is the one to watch. That figure must ultimately equal or surpass $88,379,558,704 to cover broadcasters payments and moving expenses 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.
The FCC raises the price for the spectrum blocks up for bid by 5% each round, but is upping that to 10% per round on Monday (Aug. 29).
Currently, the price of a spectrum block in New York (there are 10 available) is $341,148,000 with one more round at 5% raises before the FCC starts raising the price by 10%.
If the FCC does not raise enough to cover the $88-plus billion figure, it will move to stage 2 of the auction, where it will lower the spectrum clearing target from 126 MHz to 114 MHz, continue the reverse auction at that lower figure--winnowing out some of the broadcasters that would have been paid at the higher spectrum-clearing total--then try to cover that new figure in a new forward auction.
The FCC has nine possible spectrum clearing targets down to a low of 42.
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