FCC Auction 110 rakes in $22.5 billion in gross proceeds for 3.45 GHz Service

The results of the FCC’s 3.45 GHz auction were announced today. On January 4, 2022, bidding in Auction 110—the auction of new flexible-use licenses in the 3.45–3.55 GHz band—concluded following the close of bidding in the assignment phase.1 Auction 110 raised a total of $22,418,284,236 in net bids and $22,513,601,811 in gross bids, with 23 bidders winning a total of 4,041 licenses.

With $22.5 billion in gross proceeds, Auction 110 was the third highest grossing auction in the FCC’s history.

The 3.45 GHz action makes available 100 megahertz of mid-band spectrum for commercial use across the contiguous United States. Licensees can use it for fixed or mobile uses.

Here are the big winners:

  • AT&T: $9.1B
  • Dish: $7.3B
  • T-Mobile: $2.9B

AT&T won 1,624 licenses in the 3.45 GHz auction, and Dish, bidding under the name Weminuche LLC, won 1,232 licenses. US Cellular acquired 380 licenses, followed by Cherry Wireless LCC with 319. T-Mobile acquired 199 licenses.  Meanwhile,  Verizon bid =ZERO.

The remainder went to a relatively familiar list of private equity investors, including Grain Capital, Columbia Capital, and Charlie Townsend’s Bluewater Wireless.   Here’s the complete list of bidders:

Bidder Bidding entity Winning bids Licenses won
AT&T AT&T Auction Holdings, LLC $9 billion 1,624
Dish Network Weminuche L.L.C. $7.3 billion 1,232
T-Mobile T-Mobile License LLC $2.9 billion 199
Columbia Capital Three Forty-Five Spectrum, LLC $1.4 billion 18
Uscellular United States Cellular Corporation $580 million 380
Whitewater Wireless II, L.P. $428 million 14
Grain Management NewLevel III, L.P. 0 $376 million 8
Moise Advisory Cherry Wireless, LLC $211 million 319
N Squared Wireless, LLC $101.8 million 55
Skylake Wireless II, LLC $39 million 57
Blue Ridge Wireless LLC $8.9 million 39
Agri-Valley Communications Agri-Valley Communications $8 million 7
LICT LICT Wireless Broadband Company, LLC $7.7 million 24
Viaero NE Colorado Cellular, Inc. $6.7 million 18
Nsight Nsight Spectrum, LLC $4.7 million 6
East Kentucky Network East Kentucky Network, LLC $4.4 million 2
Carolina West Wireless Carolina West Wireless, Inc. $3.8 million 11
PVT PVT Networks, Inc. $2 million 6
Chat Mobility RSA 1 Limited Partnership $1.7 million 1
Raptor Wireless LLC $845,700 6
Horry Telephone Horry Telephone $88,060 12
PocketiNet PocketiNet Communications $59,501 1
Jones, Anthony L $1,575 2
Bidder identity included where available.  Source: FCC

The results were pretty much as expected- Dish spent more than expected, and AT&T a bit less, but in rank order and in magnitude, the numbers were relatively close to expectations.

Credit:  Getty Images

The “mid-band spectrum” that was auctioned off is considered crucial for mobile operators’ deployment of next generation of wireless service such as 5G, which promises to deliver much faster wireless service and a more responsive network. Mid-band spectrum provides more-balanced coverage and capacity due to its ability to cover a several-mile radius with 5G, despite needing more cell sites than lower-tiered spectrum bands. Its ability to connect more devices and offer real-time feedback is expected to spark a sea change in how we live and work, ushering in new advances like self-driving cars and advanced augmented reality experiences.

“Today’s 3.45 GHz auction results demonstrate that the Commission’s pivot to mid-band spectrum for 5G was the right move,” said FCC Chairwoman Jessica Rosenworcel.  “I am pleased to see that this auction also is creating opportunities for a wider variety of competitors, including small businesses and rural service providers. This is a direct result of the Commission’s efforts to structure this auction with diversity and competition front of mind.”

Craig Moffett wrote in a note to clients shortly after the auction results were announced by the FCC:

“After the almost $100B spent on the C-Band auction [1.], these numbers might sound almost quaint.  Still, AT&T’s $9B translates to nearly a quarter turn of additional leverage.  And for Dish Network, it is roughly two years of EBITDA, or two full turns.   As always, spending money on spectrum is only the beginning.  Now starts the spending on putting the new spectrum to work.  The carriers did not pay up for this spectrum to allow it to languish in a fallow state, and the Towers will be natural beneficiaries of the deployment process over the coming years.  Carrier plans for the C-Band suggest that spectrum will ultimately be deployed in a fairly broad-based manner, rather than just in more densely populated areas of the country, and a similar result seems likely for this spectrum, given its broadly similar propagation attributes.”

Note 1.  The C-band auction broke records with its $81.2 billion in gross proceeds.

Analysts at New Street Research thought T-Mobile was going to win more spectrum than it did. They were predicting T-Mobile to spend in the range of $6.6 billion and Dish to spend about $5 billion.  The FCC is planning for even more auctions in the future.

References:

https://www.fcc.gov/document/fcc-announces-winning-bidders-345-ghz-service-auction

https://www.fcc.gov/auction/110

FCC Auction 110 for mid-band 5G spectrum gets $21.9B in winning bids

https://www.cnet.com/tech/mobile/at-t-and-dish-big-winners-in-latest-5g-auction/

https://www.fiercewireless.com/wireless/att-dish-top-list-fccs-345-ghz-auction-winners

One thought on “FCC Auction 110 rakes in $22.5 billion in gross proceeds for 3.45 GHz Service

  1. AT&T, Dish, and T-Mobile spend billions on more 5G spectrum

    AT&T, Dish, and T-Mobile dropped billions of dollars in a Federal Communications Commission (FCC) auction to acquire more 5G spectrum licenses in the midrange 3.45GHz to 3.55GHz band.

    While AT&T was the biggest spender at $9 billion, Dish spent $7.3 billion, and T-Mobile followed behind at $2.9 billion. Verizon was notably absent from the auction. A number of smaller players also made the list.

    The auction officially ended in November, but the FCC hasn’t publicly disclosed the winning bidders until now (PDF). Total bids reached about $22.5 billion, making it the third-largest FCC spectrum auction yet. Only last year’s $80 billion C-band auction (over half of which was contributed by Verizon), and 2015’s $44.9 billion AWS-3 auction top this amount of spending, as pointed out by Next TV (via Light Reading).

    When it comes to using the 3.45GHz band, however, Light Reading says that companies will have to deploy new radios on cell towers that have the ability to broadcast signals across it. Smartphones that support C-band may already be capable of using the band, Light Reading also notes, as they both fall under the 3rd Generation Partnership Project’s (3GPP) n77 technical standards that cover 3.3GHz to 4.2GHz, which existing 5G smartphones already use.

    Although the 3.45GHz band operates closely to C-band, the WSJ notes that it’s not as likely to interfere with aircraft equipment. Verizon and AT&T are set to deploy their expanded 5G C-band services on January 19th after the Federal Aviation Administration (FAA) delayed the rollout twice due to aircraft safety concerns.

    https://www.theverge.com/2022/1/15/22885320/att-dish-tmobile-5g-spectrum-billions-auction

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