700MHz "C" block receives $1.24 billion opening bid -- $3.36 billion to go for open-access

According to Reuters, the 700MHz "C" Block has received an opening bid of $1.24 billion. Unfortunately, a minimum bid of $4.6 billion is required to trigger the open-access rule. The rule which requires the victor to open that long-propagating and basement-penetrating spectrum to any and all mobile devices and software applications. It's so important that Google, Verizon, and others have been battling over it even before the FCC auction began. No worries, the auction has several weeks to go. If no one else steps up, Google is on-deck with that minimum bid.

[Daniel D @ Jan 25th 2008 5:56AM]

Yes I agree this is a very nice and clever picture regarding this issue, although maybe you want to alternate between this and another one, maybe on of a laptop with waves coming out of it to you know, just mix it up a little bit?

[Tom @ Jan 25th 2008 10:25AM]

Please God, don't let AT&T win this.

[Paris @ Jan 25th 2008 8:18AM]

I don't get it. We all know that the minimum bet is $4.6b and yet someone thought to bid $1.24b ? What did the bidder think?

[Bender Bending Rodriguez @ Jan 25th 2008 9:38AM]

@ Paris,

All the info is in the short blog. $4.6B is needed to trigger the "open-access" rule.

Moving on...
I think Google has this, despite having the deepest pockets, they also have the most to gain from open-access.

[Mike @ Jan 25th 2008 9:40AM]

@Paris: No no. The minimum bid for the spectrum to be "open-access" - usable by any company for a fee (like how Verizon has to lease other phone companies its lines) is $4.7 Bln: that is the total minimum bid set by the gov't for the C and D blocks of the 700Mhz (C and D are the only blocks used for two way communication - very valuable).

Technically you could get the C and D blocks for less than the minimum bid and have closed-access, but that won't happen. The bid is already up to $2.78 Bln since this blog entry was written, and is expected to reach nearly $10 Bln, so I don't think there are any worries that the C and D blocks will be closed-access.

RTFA ;)

[mrblack @ Jan 25th 2008 11:42AM]

@Mike

Actually, the auction did NOT go up any since this post was made. Read the article again, there has been about 2.78 bln dollars in TOTAL bids for all the blocks, which includes 1.24 bln for the C block alone. Also, the money made from ALL the blocks is expected to reach 10 bln, not the C block.

We could very well end up with closed-access, thats why Engadget is following it so closely...

[JDizzle @ Jan 25th 2008 4:09PM]

If I'm looking at the right thing on the FCC website, the "C" block looks liek it's almost at $1.8 Billion.

http://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=73

and click view auction results then sort by PWB Amount.

That's the right auction, correct?

[Thomas Ricker @ Jan 25th 2008 6:19PM]

JDizzle,

Yes, that's the one. Using that link, click "view auction results" and then watch the "Package 50 States"... that's the C Block.

Thomas

[Joe @ Jan 25th 2008 6:16AM]

Go get 'em Goog !

[Mr. Frank Negroponte @ Jan 25th 2008 6:34AM]

Dearest Mr. Engadget,
I am willing to make you a second chance offer on EBAY Item number191414-1812-412-404, the very valuable 700 MHZ telecommunication spectrum. The winning bidder, Google, could not offer payment for this item, so instead of relisting it, I would like to make you a second chance offer. Click on the link below and enter in your information.

www.ebay.com

In addition, I have fled Nigeria with the sum of 20,000,000 british pounds after my father, the late General Edubuntu Kubuntu, was killed. I would like to deposit this into your bank account. Please click on the link above and enter your information.

[Kizorblade @ Jan 25th 2008 6:55AM]

Nigerian scams ROCK. Although it's fun to read when people reply to these mails:
http://www.scamorama.com/

The links to the scams are further down the page

[Daza @ Jan 25th 2008 7:27AM]

lmao, General Edubuntu Kubuntu

[Bender Bending Rodriguez @ Jan 25th 2008 9:40AM]

Also LMAO off at Edubuntu Kubuntu.

[harveyhanson @ Jan 25th 2008 6:40AM]

Wonder what the ebay fees on this are going to be:

5% of 4.6billion = 230million?

Pay by Paypal! another 230million in payment fees, nice!

P.S. Dont know what the fees are so dont start moaning, its just a joke yeah

[William @ Jan 25th 2008 6:50AM]

So if Google is so 'on board with the minimum bid', why doesn't it just bid that now and get it over with? Either it wins because nobody else keeps voting, or someone else wants it more and out-bids them.

[John Laur @ Jan 25th 2008 1:47PM]

It's not really that simple. First, either the Engadget writeup or the Reuters article are misleading. 4.6 billion is not the amount that triggers the open-access rule but the reserve price of the C block itself. If the C block does not receive 4.6 billion it does not sell at all. If it sells in this auction, the open-access rule applies. If it does not sell, the price and rules will be reevaluated and it will be re-auctioned.

As far as saying "Why doesn't someone just bid and get it over with?" it's not really that simple. The last spectrum auction of this type took 5 weeks to complete. You don't just throw 4 billion dollars on the table if you don't have to. It's quite possible (though it seems unlikely) that someone will ultimately license the C block nationwide for less than 4.6 billion. What companies say they are prepared to spend seldom has any bearing on what they actually spend, particularly when bidding on stuff that has very subjective value. Secondly it's not that simple because the C band is actually a multi parcel auction. The FCC is taking bids on it nationwide as a package, as Atlantic and Pacific oceanic packages, and individually in regional licenses. Anyone interested in bidding on the national package probably wants to wait to gauge regional interests before really bumping the price of the national package.

If you just want to see for yourself, just go watch the auction on the FCC site and read the 325pg public notice. It's slow going but you can see its far more complex than just asking everyone for their top dollar amounts.

[nd @ Jan 25th 2008 10:44AM]

haven't ebayed much have you? ;)

google snipe.

[Cesar Cardoso @ Jan 25th 2008 7:22AM]

I can't stop laughing with this photoshopped eBay image.

[Todd @ Jan 25th 2008 7:35AM]

Mr. Ricker, thank you for staying on top of this, I very much appreciate the up to the minute reports. I feel there is no more important tech story at the moment than the auction, but concede its not "sexy" like a Jobs key note. If possible can the auction posts get their own RSS feed so I can route them to my phone?

[Zenshai @ Jan 25th 2008 10:01AM]

I dont understand something here... what does a company gain if they win the auction with a bid higher than $4.6b? I belive someone said it is expected to go over $10b, what will the winner get in that case?

[TJ Johnson @ Jan 25th 2008 11:32AM]

If I'm not mistaken (which I probably am), they'll still get the block but they'll be required to open it to other carriers for a fee. For example, lets say Google wins since they have the most to gain giving the Android project. Google will be able to support their own devices on the spectrum but will also be required to allow VZ, ATT, Sprint, etc. in exchange for a service charge of some sort and the ability to regulate/control it. I think the idea behind this rule is that once it hits the magical $4.6b mark, it would protect the losers to an extent and give an alternative means of use. Feel free to correct me if there's something I missed, yo.

[DT @ Jan 25th 2008 11:38AM]

Shipping better be free, that's all I can say.

[Xenoterranos @ Jan 25th 2008 12:35PM]

The spectrum is only 99 cents, it's the shipping that's 4.6 billion $$$. :D

[dataset @ Jan 25th 2008 1:59PM]

A+++++ SELLER WOULD BUY FROM AGAIN

[Tufas @ Jan 25th 2008 2:32PM]

LOLOL!

[IndiaTech @ Jan 25th 2008 2:33PM]

What is the "Buy it Now" price for the item?

[skulldriveshaft @ Jan 26th 2008 2:22AM]

No Action on the Pacific and Atlantic Packages for some reason - aren't those the biggest cellphone user areas?

I think Google is keeping a big stick behind their back to make sure the open access rules minimum bid is reached - everything after that is just a free for all.

Will it matter who is in control if the activation mark for the open access rules are surpassed?

If you don't have a share in google right now - start buying.