The Federal Communications Commission on Wednesday announced the winners of an $ 81 billion auction for the license to use major airwaves ideal for 5G.
The big winners were Verizon and AT&T. They need these airwaves to build 5G networks, which are significantly faster than the current wireless service.
Verizon, through its Cellco Partnership subsidiary, offered nearly $ 45.5 billion over the air. AT&T offered $ 23.4 billion through AT&T Spectrum Frontiers. The third largest American airline, T-Mobile, is offering the third largest amount of money, $ 9.3 billion.
The amounts the companies spent ended up much higher than expectations for the auction last summer, reflecting the importance of securing licenses for the airwaves.
“These record results highlight the demand and critical need for more licensed mid-range spectrum and show the importance of developing a robust spectrum auction,” said CTIA CEO Meredith Baker, saying CTIA is a trading group representing the wireless industry. Bidders are still in a quiet period when they are not allowed to comment in public.
The 280 megahertz spectrum available at this auction is a mid-band spectrum, sometimes called the ‘goldilocks band’, meaning it is suitable for 5G networks, combining the ability to transmit large amounts of data with a wavelength that can travel long distances.
The results are in line with previous operating expectations. Verizon and AT&T were expected to be the biggest bidders, as they did not have much mid-range spectrum. T-Mobile has already gained a middle ground through its merger with Sprint.
Not all the spectrum was sold at the same time. The 280 MHz spectrum is divided into smaller 20 MHz blocks and further divided into 406 geographical regions. In all, there were 5,684 licenses at stake.
In total, the three largest U.S. transportation companies received 90% of the licenses at the 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 five best 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 US company. NewLevel II represents the private equity firm Grain Management, while Canopy Spectrum is a business between Jennifer Fritzsche, former analyst at Wells Fargo, and investor Edward Moise Jr., according to LightReading.