Robert Peck and his research team at Bear Stearns has been doing an amazing job of explaining, tracking arcane information and sending out brief snippets regarding the ongoing FCC mobile spectrum auction process. The volume of information they are tracking is both significant and lacks immediate transparency as the bidders are not immediately named.
This morning he pointed out that the D auction block is well it’s minimum and will likely be re-auctioned. What is significant about this is that the results of auction 73 can not be shared until all of the blocks are completed. Here is the exact text of what Robert Peck sent out this morning (emphasis added):
GOOG – 700MHz – How D Block Impacts Google…. Auction 73 completed its Round 35 bidding yesterday – results are posted on FCC website. We have previously alerted you to the fact that the PWB regional bids on all 12 regional licenses add up to $4.75B, higher than the $4.71B on the nationwide package which was entered in Round 17. Hence, the original bidder on the nationwide package is Google or another carrier, that bidder no longer has the obligation to purchase the spectrum. Industry advisers think Auction 73 could rap up as soon as the next two weeks.
However, we also want to point out that there are 5 blocks of spectrum in this auction and the 4th one (the D block) is currently set at $472M, below its $1.3B reserve. Many assume that this block will NOT meet the minimum reserve and will need to be put into Auction 76 to be re-auctioned. While this does not DIRECTLY impact Google or other block bidders (those blocks will be locked in at the end of the auction 73), it does INDIRECTLY impact Google in that no Auction 73 results can be disclosed until all 5 block are complete. This means that investors may be significantly delayed in learning who won the C block, as the only timeline deadline statute for the FCC statute in this auction is for all of the spectrum must be over and the money collected by June 30, 2008
Knowing Robert as I do, he probably wishes that they would have put this whole thing on Ebay. 🙂