The auctions, which are due to start this Thursday, had been expected to be some of the most expensive yet seen in the U.S. The 700MHz bands are considered good for so-called "4G" deployments as well as providing extra potential spectrum for 3G networks.
FCC chairman Kevin Martin has already suggested that the credit crunch could hurt the auctions. While public safety startup Frontline Wireless, LLC dropped out because it couldn't get the funds together to bid.
I suspect that the usual suspects -- AT&T Inc. (NYSE: T) and Verizon Wireless -- will still stump up plenty for the spectrum. Acquiring the bandwidth is, after all, in the long-term interest of the cellular carriers.
It might, however, cast a cold new light on potential bids from companies like Google (Nasdaq: GOOG) and Qualcomm Inc. (Nasdaq: QCOM). Google's plans for the radio waves have always been somewhat unclear and some wonder how serious the company is about bidding. Qualcomm, meanwhile, has just reported a loss of $240 million for its MediaFlo mobile TV division in fiscal 2007, compared to a $133 million loss in 2006. The firm is expected to try and bolster this 700MHz network by attempting to add more bandwidth at auction.
With a jittery stock market I wonder if some of the potential bidders will pull back and try and focus on their core businesses rather than buy into a broadband wireless future that will be costly to develop and maintain.
— Dan Jones, Site Editor, Unstrung