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Searching for clues on who spent what in latest mid-band spectrum auction

The clock phase of the latest mid-band spectrum auction finally ticked down, and everyone is speculating about who spent what.

After 151 rounds and $21.9 billion in total proceeds, the Federal Communications Commission's auction of 100 MHz of contiguous spectrum in the 3.45 GHz band concluded its clock phase earlier this month. Mid-band spectrum is a critical component of 5G networks and allows for better speed and coverage than high-band and low-band spectrum.

The auction will enter the "assignment phase" Dec. 9, which will involve eligible carriers bidding for service area blocks.

Big spenders

Identities of the auction's bidders have been guessed at since the first round. Many analysts are still convinced that Verizon Communications Inc. dropped out in October due to its heavy spending in earlier mid-band spectrum auctions.

Some previously speculated that DISH Network Corp. also dropped out, but that now seems unlikely given the company's recent secured debt offering earlier in November, said Chief Operating Officer at BitPath Sasha Javid.

New Street analyst Philip Burnett expects AT&T Inc. to be the auction's top spender and for T-Mobile US Inc. and DISH to follow, in that order.

"We expect AT&T spent nearly $9 billion," Burnett wrote, adding that T-Mobile likely landed somewhere near $8 billion.

"The biggest opportunity for surprise is probably from DISH. They could land anywhere from $4 billion to $6 billion," the analyst said.

Next steps

Overall, Javid viewed the latest auction as a success, even though proceeds started leveling-off during the last half of rounds.

"We crossed the $21-billion threshold in Round 73 on Oct. 28, which means that 78 rounds have passed where the incremental dollars gained where relatively small (at least for spectrum auctions)," Javid wrote.

According to an FCC public notice, bidders that won at least one generic block of spectrum in one FCC-designated service area, known as a partial economic area, in the clock phase of the auction are eligible to bid in the assignment phase for frequency-specific licensing blocks. The assignment phase is expected to last approximately two weeks and may be somewhat unique, according to Javid, because of coordination requirements with the U.S. Defense Department.

"While I do not expect this assignment stage to result in significant additional proceeds given the way the auction is structured, we may see a little more activity than usual," Javid wrote. "The coordination requirements with the DOD have created some differences between the blocks that were not fully captured in the categories created by the FCC."

Auction clock stage winners will be privately notified on how to proceed in the assignment phase, but it is unlikely that winners' identities will be available to the public until about two weeks after the assignment phase ends.

Prior auctions

This is the FCC's third mid-band auction in the past two years. In July 2020, the FCC opened bidding in the CBRS auction — 3.5 GHz to 3.7 GHz — which raised a total of $4.6 billion in gross bids over 76 rounds, awarding 228 bidders a total of 20,625 licenses. Verizon was the auction's biggest spender, offering up over $1.8 billion for licenses.

Subsequently, the FCC launched the C-band auction, offering 280 MHz of spectrum in the 3.7 GHz-3.98 GHz band. It proved to be the FCC's most lucrative auction ever, with bids topping $80.8 billion in the clock phase. Verizon led in bidding, spending $45.45 billion. AT&T was the second-biggest spender, paying $23.41 billion for 1,621 licenses, while T-Mobile US Inc. spent $9.34 billion for 142 licenses.

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