FCC spectrum auction hits snag

With just three days to go, the Federal Communications Commission has confirmed 214 companies as eligible to bid on radio spectrum in the public auction starting Jan. 24.

Yet the fate of the planned nationwide broadband network for first responders is still up in the air since the only bidder that had publicly indicated interest in the D Block is now defunct.

The FCC had set aside 10 Megahertz of spectrum in the D Block for sale to be shared by public safety users and commercial users. The winning bidder of that segment must negotiate a sharing arrangement with a public safety group designated by the FCC.

The sole bidder, Frontline Wireless LLC, a startup with several prominent backers, did not submit the $128 million down payment to the FCC needed to qualify to bid.

"Frontline Wireless is closed for business at this time. We have no further comment," the company said in a Jan. 12 statement. Company officials could not be reached for comment.

Media reports have speculated that Frontline was unable to get enough financing to cover the minimum required reserve bid of $1.33 billion for the D Block, an amount set by the FCC.

If no one bids for the D Block, the FCC has the option of re-auctioning the spectrum and revising the rules it has imposed on the winning bidder. For example, it could provide the winner with a longer time to build out the new public safety network in comparison to the 10-year construction currently envisioned.

Meanwhile, companies such as Google Inc., AT&T Inc. and Verizon Wireless have been deemed eligible to bid in the auction. However, under FCC confidentiality and noncollusion rules the companies may not discuss which block they are interested in. The bidding also is held anonymously.