How Exactly do these Auctions Work?
The FCC announces each spectrum auction four to six months in advance to give all potential bidders time to file their applications. All interested organizations or individuals must file an FCC Form 175 application electronically at least 45 days before the start date of the auction. Form 175 asks for basic information about the applicant’s business and financial structure, plus a list of which specific licenses will be bid upon.
For example, if you’re a Verizon customer, you can only use certain phones with their service. But if they adhere to the FCC provisions, we might see a day in the near future where any Verizon or AT&T subscriber with any device can log onto a blazing fast, nationwide wireless network. As it turned out, it was AT&T and Verizon — not Google — who walked away as the big winners of the 700MHz auction, buying enough licenses in enough regions to establish nationwide networks. They would not, however, have to sell any of their network bandwidth to third-party providers. The new rules are seen as a victory for open standards and increased competition. The FCC agreed to impose rules requiring that the license holders of the new 700MHz spectrum would have to open up their networks to all devices and all applications. Or if you buy an Apple iPhone, you must use AT&T as your cellular provider. For even more information on FCC auctions, wireless technology and related topics, check out the links on the next page.
The FCC allocates different frequency ranges for different types of radio technology (AM radio, cell phone signals, television broadcasts, et cetera). If you want to start a local radio station, for example, you need to apply for and purchase a license from the FCC to operate on a certain radio frequency (illegal, unlicensed broadcasts are called pirate radio). Since radio signals can only travel relatively short distances, the FCC will grant licenses for the same radio frequency to stations in different geographical areas.
If the form isn’t received in time, the application won’t be considered. All accepted bidders receive an information packet from the FCC with additonal details about the auction, including a list of the licenses that’ll be auctioned. All bidders must then make an upfront payment that serves as a refundable deposit securing them a place in the auction. The amount of the upfront payment depends on how many licenses the organization wants to bid upon. Over the course of several weeks, the FCC reviews each application and sends it back to the applicants as accepted, incomplete, or rejected.
