On Wednesday, the Federal Communications Commission announced the winners of a $ 81 billion auction for the license to use major airwaves, ideal for 5G.
The big winners were Verizon and AT&T. They need these waves to build 5G networks, which are significantly faster than today’s wireless service.
Verizon, through its subsidiary Cellco Partnership, offered nearly $ 45.5 billion in radio waves. AT&T, through AT&T Spectrum Frontiers, offered $ 23.4 billion. The third largest operator in the US, T-Mobile, offered the third largest amount of money, $ 9.3 billion.
The amounts spent by companies ended up well above expectations for last summer’s auction, which reflects the importance of obtaining licenses for air waves for operators.
“These record results highlight the demand and critical need for more licensed mid-band spectrum and demonstrate the importance of developing a robust spectrum auction pipeline,” said Meredith Baker, CEO of CTIA, in a statement. CTIA is a business group that represents the wireless industry. Bidders are still in a period of silence, when they are not allowed to comment publicly.
The 280 megahertz of spectrum at stake in this auction is the middle band spectrum, sometimes called the “goldilocks band”, which means that it is suitable for 5G networks, combining the ability to transmit large amounts of data with a wavelength that can travel a long distance.
The results are in line with previous sector expectations. Verizon and AT&T were expected to be the biggest bidders, because they did not have much middle band spectrum. T-Mobile had already acquired part of the middle band through its merger with Sprint.
Not all of the spectrum was sold at once. The 280 MHz spectrum was divided into blocks smaller than 20 MHz and later divided into 406 geographic regions. In all, there were 5,684 licenses in dispute.
In total, the three largest American operators won 90% of licenses at auction.
Here are the top five bidders, according to the FCC:
- Cellco Partnership: $ 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
- NewLevel II, LP: $ 1,277,395,688
The top five bidders by number of licenses granted were:
- Cellco Partnership: 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 operator in the United States. NewLevel II represents private equity firm Grain Management, while Canopy Spectrum is a venture between former Wells Fargo analyst Jennifer Fritzsche and investor Edward Moise Jr., according to LightReading.