Bidding on Airwaves

This past week, the Federal Communications Commission announced that there will be an auction of low-frequency airwaves in the US. These airwaves have been given up by the large broadcast carries. In return, the bidders be bidding for the chance to improves their wireless networks. It is expected that a large amount of money will be exchanged for these airwaves.

In order for these new airwaves to be auctioned off, there will be a reverse auction to start. In this reverse auction, the federal government will be buying the airwaves from the broadcast companies. After the reverse auction is done, a new auction will occur for the airwaves. It is not stated in the article, but you can conclude that the auction will be a  sealed-bid auction. It is a sealed bid auction because the FCC will receive buds from all of the wireless network companies. we do not know if it is a 1st or 2nd price auction. There are over 100 wireless companies bidding for the airwaves. These companies include Verizon, AT&T, and T-Moblie, to name a few.

These “auction like” processes are very common around the US and the world. You see it a lot with construction contractors bidding to have a chance to build a structure for a company.

 

SOURCE: http://www.reuters.com/article/us-fcc-auction-idUSKCN0WV2DO 

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