Spectrum Auction: Broadcaster Exit Price Is $86,422,558,704

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If wireless companies and other forward auction bidders cooperate, the government will pay TV broadcasters $86,422,558,704 to reclaim their spectrum in key markets. The Federal Communications Commission will have to collect at least that much in the forward auction to cover what it will have to pay broadcasters at the 126 MHz clearing target it set for the first stage of the reverse portion of the spectrum auction, which closed June 29 after 52 rounds. The FCC announced that much-anticipated and speculated about "clearing cost" figure on the auction website.

“Today, bidding concluded in the reverse auction, establishing the cost for clearing 126 MHz in the TV band for wireless use," said Gary Epstein, chair of the FCC's Incentive Auction Task Force. "Strong participation from broadcast stations made this initial clearing target possible. Now the action shifts to the forward auction, which will give wireless bidders the opportunity to compete for this beachfront spectrum to meet America’s growing mobile data needs.” The FCC was able to clear that much spectrum thanks to the robust participation by TV broadcasters looking for a big payday. Actually, the FCC will need to make a couple billion dollars more than that figure in the forward auction to cover the $200 million-plus in projected auction expenses and another $1.75 billion to cover the cost of repacking broadcasters in their tighter spectrum quarters after both parts of the two-sided auction are completed.


Spectrum Auction: Broadcaster Exit Price Is $86,422,558,704 Huge $86B clearing cost could lead to extended incentive auction (Fierce)