The Federal Communications Commission (FCC) started its historic wireless spectrum auction on Tuesday with the first bids.
At 10 a.m. on Tuesday morning, the agency began buying spectrum, the invisible radio frequencies accessed by mobile devices, from television stations.
It’s only the first step in the never-before-attempted auction. The commission will buy airwaves from television stations and then sell them back, in a repackaged form, to wireless providers. The success of the second part of the auction depends on whether the FCC is able to get broadcasters to give up enough of their spectrum licenses.
Bidding is scheduled to continue at least throughout the week, with one round on Wednesday and two scheduled rounds on Thursday and Friday.
Bidding in the broadcaster section of the sale works like a Dutch auction, with stations agreeing to lower and lower prices until the FCC makes the decision to lock in a price and purchase spectrum. Stations can either leave the airwaves entirely or share a channel with other broadcasters.
Industry observers and policymakers are closely watching the so-called incentive auction.
The wireless industry hopes it will provide a windfall of new spectrum it can use to meet growing consumer data demands. Broadcasters have expressed some concerns about how the transition for wireless airwaves will be handled.
FCC Chairman Tom Wheeler has touted the auction as a “spectrum extravaganza” but has declined to provide specific details on how many, or which, broadcasters are participating. The commission is aiming to move a total of 126 megahertz of spectrum after the auction, the maximum amount allowed.