C-band auction for 5G spectrum explodes with $1.7B in first-round bids

Bidding in the FCC's C-band spectrum auction was hot and heavy in first-round action, with the session generating a total of $1.7 billion in gross proceeds.

To put that into perspective, the FCC's CBRS spectrum auction this summer raised a total of around $4.6 billion in gross proceeds after fully 76 rounds of bidding.

The first round of bidding in the C-band auction helps reinforce the idea that it could ultimately be the FCC's biggest spectrum auction ever, surpassing even the $45 billion raised in 2015 by the AWS-3 spectrum auction. After all, the C-band auction offers an enormous amount of spectrum (280MHz versus the 70MHz in the CBRS auction), as well as mostly unfettered licenses (the CBRS licenses included several restrictions).

Indeed, prior to the start of the C-band auction, the financial analysts at New Street Research estimated the event would generate $51 billion in total winning bids. However, other analyst firms offered lower estimates; for example, the financial analysts at Morgan Stanley Research pegged the total at around $35 billion in their high-end estimate released prior to the start of the auction.

The C-band spectrum auction will include several rounds of bidding per day until bidders stop bidding – many expect that to happen sometime early next year.

The FCC did not release the identities of the bidders in the first round (though Verizon is widely expected to walk away with the bulk of the C-band licenses up for grabs). However, the agency is releasing details on which licenses are receiving bids, and how much those bids are. For example, two licenses covering New York City received bids up to $15 million each – those were the licenses that received the highest bids. The second most-valuable location was Los Angeles, where licenses received bids up to $11.6 million. Other licenses receiving top bids included Chicago ($5.6 million), San Francisco ($5.4 million) and Washington, D.C. ($4.7 million).

"Today opens what may be the most important wireless auction of our time. Who 'wins' the C-band auction will shape the competitive dynamics of 5G for a decade," wrote the financial analysts at MoffettNathanson in a note to investors Tuesday, issued just prior to the end of the first round of bidding. "Yes, the stakes really are that high."

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Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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