FCC, the US telecoms regulator, voted in favour of reserving wireless frequencies for smaller players in the 600MHz auction scheduled for 2015.
Under measures passed by FCC, designed to promote competition, up to 30MHz of 600MHz frequencies – currently held by US broadcasters – will be reserved for providers that hold less than one-third of available low-band spectrum (sub-1GHz) in a given licence area.
It means AT&T and Verizon Wireless will be restricted in the amount of 600MHz spectrum they can bid for, something which they have both argued against in the past.
Reuters reports, however, that AT&T and Verizon have welcomed the plan as the bidding restrictions are not as severe as once thought.
Fierce Wireless points out that while the regulator can reserve up to 30MHz of spectrum if broadcasters give up at least 70MHz of spectrum, there have been compromises. Where broadcasters have given up only 60MHz of spectrum, only 20MHz can be reserved; and where broadcasters have given up 50MHz of spectrum, only 10MHz can be reserved.
Non-nationwide providers will be able to bid on both reserved and unreserved spectrum in all license areas.
The actual amount of spectrum available only for reserve-eligible bidders will be determined, said FCC, when bidding in the auction “hits a spectrum reserve trigger that fairly distributes the responsibility for satisfying the costs of the incentive auction among all bidders”.
For example, if there is 100MHz of spectrum available in the auction, no more than 30MHz would be reserved for eligible bidders. But if eligible bidders demand only 20MHz in a given licence area when the trigger is met, then only 20MHz would be reserved and 80MHz would remain unreserved.
The intention of FCC, through the auction, is to help fund a new $7 billion public safety network and adequately compensate broadcasters for voluntarily giving up their airwaves.
AT&T and Verizon will also no doubt welcome FCC’s decision on the upcoming auction of AWS-3 spectrum. Due to the “relative abundance of high-band spectrum and current holdings by multiple providers”, FCC has set no auction-specific limits. All providers can bid for as much as they want, regardless of their existing spectrum holdings.
AWS (advanced wireless services) spectrum covers pairings of frequencies in the 1.7GHz and 2.1GHz bands. An extra 50MHz is up for grabs in total in the AWS-3 auction – 25MHz on the uplink (1755-1780 MHz) paired with 25MHz on the downlink (2155-2180 MHz).
FCC rulings on 600MHz and AWS-3 spectrum were accompanied by details on a revised policy on mobile spectrum holdings. If a wireless provider is involved in a transaction giving it around one-third or more of the available spectrum licences in a given market, FCC said the deal would face greater scrutiny.
With transactions involving sub-1GHz spectrum, FCC said that aggregation of approximately one-third or more of available low-band spectrum would be an “enhanced factor” in the competitive analysis of a proposed transaction.
The US regulator pointed out that the two largest nationwide mobile wireless providers – AT&T and Verizon Wireless – hold a combined share of approximately 70 per cent of all low-band spectrum licenses. The other two – Sprint and T-Mobile US – hold a combined share of approximately 15 per cent.
FCC added that in order for wireless providers to meet “skyrocketing demand” for mobile broadband, they need to put new spectrum to use and make more efficient use of existing spectrum holdings.