Auctions

Federal Communications Commission Chairwoman Jessica Rosenworcel said on August 5 that she is not worried about the impact on the ongoing 2.5 GHz auction if Congress fails to extend the FCC's auction authority by the end of September 2022, when it expires. There is bipartisan support in Congress to extend that authority, but the bill has not made it out of Congress yet and legislators are on their August break, after which they will be primarily focused on getting themselves re-elected, though there is certainly time to extend the authority before the September 30 deadline.

The Senate Commerce Committee's Subcommittee on Communications, Media, and Broadband held a hearing entitled Future of Spectrum to examine the management of spectrum. The Federal Communications Commission's spectrum auction authority is set to expire at the end of September. Congress has a unique opportunity to set future spectrum priorities and coordination goals to encourage efficient spectrum use. The hearing aimed to examine important policy considerations to ensure spectrum is utilized for the greatest benefit to the public.

The House of Representatives passed three communications and technology bills:

The Spectrum Innovation Act of 2022 (HR 7624) would modify and extend the authority of the Federal Communications Commission to auction licenses for the commercial use of the electromagnetic spectrum and authorize certain federal agencies to spend some auction proceeds without further appropriation. The Congressional Budget Office estimates that enacting the bill would reduce net direct spending by $2.5 billion over the 2022-2032 period. Outlays after 2032 would increase by approximately $2.4 billion.

A new reverse auction by the Nebraska Public Service Commission (PSC) will allow telecommunication companies to bid on funds. The PSC’s order for the auction, NUSF-131, was entered on June 28. It sets the procedure for the reverse auction to bring broadband services of at least 100 megabits per second to certain census blocks in the state. The affected areas are primarily in northeast and south-central Nebraska, with none of them venturing farther west than McCook (NE). This will be a first-of-its-kind effort for a state to pull off.

The House Energy and Commerce Committee Communications Subcommittee gave a big thumbs up to extending the Federal Communications Commission's ability to raise tens of billions of dollars through the treasury with spectrum auctions, not to mention freeing up spectrum in the process for Wi-Fi. The subcommittee voted unanimously to favorably report the Extending America’s Spectrum Auction Leadership Act of 2022, which would extend the FCC's spectrum auction authority, which otherwise would expire September 30 of this year, to March 21, 2024. Also favorably reported were:

Federal Communications Commission Chairwoman Jessica Rosenworcel responded to letters by members of Congress inquiring about the FCC's spectrum auction program. In separate letters to House Representatives and Senators, Rosenworcel responded to questions about related topics including upcoming spectrum auctions, specific frequencies that may be good candidates for auction, and policy changes the agency can make to improve the program.

T-Mobile leases much of its 2.5 GHz spectrum from educational institutions around the country. And the carrier has made great efforts to keep the terms of these Educational Broadband Service (EBS) leases private. For instance, it is engaged in a dispute with Christian College of Georgia and demands that the college not reveal the terms of its lease.

The Federal Communications Commission’s upcoming 2.5 GHz spectrum auction is generating some excitement among smaller rural US operators because of the FCC’s decision to offer flexible-use, county-based overlay licenses. The auction, which will start July 29, will be for licenses in the 2.5 GHz band where no one currently owns the spectrum. Top executives at several smaller operators have said that they were encouraged by the FCC’s format for Auction 108 because it will be amenable to rural operators.

The upcoming Auction 108 of 2.5 GHz spectrum is likely not going to raise a ton of money. But at least it will clean up the spectrum band, closing the many gaps where the spectrum is lying fallow and not being used at all. The auction will begin on July 29, 2022. While some auctions, such as the C-band auction held in 2021, aim to make billions of dollars to fill federal coffers, not all auctions are strictly focused on profit.