On Wednesday, the Federal Communications Commission announced the winners of a $ 81 billion auction to obtain the license to use major waveforms ideal for 5G.
The big winners were Verizon and AT&T. They need these waves to build 5G networks, which are significantly faster than current wireless service.
Verizon, through its subsidiary Cellco Partnership, offered about $ 45.5 billion for the airwaves. AT&T, through AT&T Spectrum Frontiers, offered $ 23.4 billion. The third largest US operator, T-Mobile, offered the third amount of money, $ 9.3 billion.
The amounts invested by the companies ended up far above expectations for last summer’s auction, reflecting the importance they have for carriers in securing wave licenses.
“These record results highlight the demand and critical need for a more licensed mid-range spectrum and demonstrate the importance of developing a robust spectrum auction supply,” said Meredith Baker, CEO of CTIA. CTIA is a trading group representing the wireless industry. Bidders are still in a quiet period, when they are not allowed to make public comments.
The 280 megahertz of spectrum that can be obtained in this auction are medium band spectra, sometimes called “goldilocks band”, which means that it is very suitable for 5G networks, which combines the ability to transmit large amounts of data with a wavelength that can travel long distances.
The results match the previous expectations of the industry. Verizon and AT&T were expected to be the biggest bidders, because they didn’t have much mid-band spectrum. T-Mobile had already acquired a middle band through its merger with Sprint.
The whole spectrum was not sold at once. The 280 MHz spectrum was divided into blocks smaller than 20 MHz and divided into 406 geographic regions. In total, there were 5,684 licenses pending.
In all, the three largest companies in the United States won 90% of the licenses at auction.
Here are the top five bidders, according to the FCC:
- Cellco Association: $ 45,454,843,197
- AT&T Spectrum Frontiers LLC: $ 23,406,860,839
- T-Mobile License LLC: $ 9,336,125,147
- United States Cellular Corporation : $ 1,282,641,542
- New level II, LP: $ 1,277,395,688
The top five bidders according to the number of licenses granted were:
- Cellco Association: 3,511
- AT&T Spectrum Frontiers LLC: 1,621
- United States Cellular Corp..: 254
- T-Mobile License LLC: 142
- Canopy Spectrum, LLC: 84
US Cellular is the fourth largest US operator. NewLevel II represents private equity firm Grain Management, while Canopy Spectrum is an adventure between Wells Fargo analyst Jennifer Fritzsche and investor Edward Moise Jr., according to LightReading.