FCC ready to launch next stage of wireless auction

The Federal Communications Commission is poised to start the second phase of an innovative auction for wireless spectrum this week.

The commission purchased spectrum from broadcasters and, starting Tuesday, will attempt to resell it to wireless providers and other interested parties. Officials are trying to make more spectrum available for consumers, who increasingly rely on their smartphones for information.

{mosads}Earlier this year, broadcast stations sold unwanted spectrum to the agency in a so-called Dutch auction. Stations agreed to lower and lower prices until the agency locked in a price and purchased the spectrum.

Tuesday now marks the start of the “forward” phase of the auction, where buyers will vie for those wireless airwaves.

The commission held a mock auction last week to prepare bidders for the real sale, where buyers will bid through a more traditional auction.

“Unlike the reverse auction, in which there is a limited number of possible rounds, forward auction bidding rounds for a stage can continue without limit so long as demand outpaces supply for any product,” said the two officials leading the auction in a blog post last week. “As such, we cannot predict when the forward auction will conclude.”

The FCC has a significant task ahead. The “reverse” auction among broadcasters yielded a potential $86.4 billion worth of spectrum, meaning that buyers have a high value to meet.

If buyers don’t meet the high number set by broadcasters, the commission will launch another round and attempt to sell a smaller amount of spectrum.

The never-before-tried auction comes as wireless providers say they need more access to spectrum, the wireless frequencies that carry data to mobile devices, to handle data-hungry smartphones.

FCC Chairman Tom Wheeler previously predicted that the auction would be a “spectrum extravaganza” and painted it as a singular opportunity for broadcasters to make money off of their valuable spectrum.

This story was updated at 1:11 p.m.

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