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The $10 Billion Poker Game Begins
Hugh Pickens writes "Monday was the deadline for potential bidders to file with the Federal Communications Commission over the auction of the 700-megahertz band, a useful swath of the electromagnetic spectrum that is being freed up by the move to digital television. Once bidders file they become subject to strict 'anticollusion' rules that in effect prohibit participants from discussing any aspect of their bidding until the auction is over. The next official word will be late December or mid-January, when the FCC announces who has been approved to bid. The auction will start on January 24. Participants will use an Internet system to enter bids on any of 1,099 separate licenses that are being offered (pdf). Most coveted seems to be the C block, 12 regional licenses that can be combined to create a national wireless network. This is the spectrum Google is presumed to be most interested in. The bidding will be conducted in a series of rounds (pdf)."
Once bidders file they become subject to strict 'anticollusion' rules that in effect prohibit participants from discussing any aspect of their bidding until the auction is over.
It's very hard to prove that you did not collude with someone. If AT&T wins, and a year later it turns out they had a secret deal with Verizon, what happens? Will the license be revoked? Or will AT&T successfully argue about the need to "put the past behind us"?
Apology to Ubuntu forum.
There's more than one round. $4.6 billion is merely the minimum you have to be able to front in order to be allowed to bid in the first place.
A truly free-market stance would open up the spectrum to all, and let the strongest signals win.
O gee... that's a brilliant idea! We'll have cell towers broadcasting over each other. Ever been in a midway point between two radio stations broadcasting on the same frequency? Sure, the phase locked loop will lock on one or the other, but what happens when you pass off from one cell to another and there is no way to guarantee that you will get picked up on the next cell. There is also no guarantee that in the middle of the conversation somebody else won't power up stronger and your call will get dropped.
Add to that the fact that the spectrum license presumably would include limits as to transmission power for safety and other reasons. Let's just shoot very very high power microwaves every where and see what happens.
Strongest signal wins doesn't work in the cell phone/wireless industry. Otherwise, the company with the most money could just put up signal generators cranking out radio waves to prevent anybody else from using a channel until they were ready to roll out infrastructure.