The Federal Communications Commission (FCC) has announced the results of their first broadcast incentive auction. T-Mobile came on top with the acquisition of 45% of all low-band spectrum offered, with Comcast and Dish coming close too.
The auction was an exchange between broadcasters who offered airwaves and wireless carriers that bid for them. The result is hundreds of TV stations and channels need to transition towards mobile broadband, a process that could take nearly three years.
America’s mobile industry is in for big changes in coming years, and this is just the start of a more competitive environment in the country. FCC Chairman Ajit Pai may bring a troublesome future for consumers if he carries out his plan to roll back net neutrality rules.
T-Mobile continues to disrupt the mobile ‘duopoly’
T-Mobile “cleaned up” at the historic auction that closed last March 30 after a year of bids and offers. The Un-carrier made its biggest investment move ever, chipping in $8 billion to acquire 45% of the overall low-band spectrum sold.
CEO John Legere celebrated the results of the auction and congratulated the FCC for the initiative, teasing its competitors at the same time for the fast-changing landscape that is about to come.
The company managed to acquire an equivalent of one million square miles of 600 MHz spectrum, which is basically more space for mobile airwaves to travel. This allows more coverage and capacity for data to flow freely.
T-Mobile will now be able to reach every corner of the U.S. and Puerto Rico with its mobile service, becoming a third nationwide contender against the giants of Verizon and AT&T.
What does this all mean for consumers?
“CONSUMERS ARE THE REAL BENEFICIARIES, AS BROADCASTERS INVEST NEW RESOURCES IN PROGRAMMING AND SERVICE, AND ADDITIONAL WIRELESS SPECTRUM OPENS THE WAY TO GREATER COMPETITION AND INNOVATION IN THE MOBILE BROADBAND MARKETPLACE,” said Ajit Pai.
TV stations and affiliates voluntarily put up their spectrum capacity for sale, and almost 1,000 broadcasters came up as winners in the FCC auction. More than $10 billion of the $19.8 billion in revenue generated will go to those who sold their airwaves to mobile carriers.
It will take up to 39 months to relocate all the stations to new frequencies and channels, the Commission said, but the process is set to begin as early as November. Some of these broadcasters will entirely cease to transmit or will partner up with others.
During the auction, there was a prohibition clause that forbade bidders from talking to each other, but that period ends on April 27. We might see some major and minor merger and acquisition deals announced after that date as a result of the huge shift occurring in the industry.
Bottom line, TV stations have to put up a notice at least 30 days before switching frequencies or going off the air so viewers know of the change.