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The race to 5G just reached a key mile marker. The Federal Communications Commission (FCC) has confirmed that it’s completed its auction of 70 megahertz of 5G spectrum, the largest spectrum license ever recorded in an FCC auction. It netted the government more than $4.5 billion from wireless companies looking to bolster their networks.
We don’t know how much of the spectrum each carrier purchased — the FCC has not yet named the winning bidders — but the sheer amount of licenses sold will undoubtedly mark a major step forward in 5G’s evolution.
This is a banner day for American leadership in 5G and for American consumers. The 3.5 GHz auction has concluded, and I can say unequivocally: It was a resounding success.
There were more than 271 eligible bidders involved, from nationwide powerhouses like Verizon and AT&T, to more local operations like Texas A&M University. All in all, bidders won 91.1% of the 22,631 available licenses. By most accounts, demand for the mid-band spectrum was far greater than the supply.
“It represents the first opportunity in many years for wireless providers to acquire valuable mid-band spectrum for 5G,” wrote former FCC chief data officer Sasha Javid.
These frequencies are extremely valuable to wireless operators, as they support a wide range of 5G technologies that could work in tandem with low- and high-band spectrum for better performance. In fact, the mid-band spectrum that was just auctioned off is already the default for 5G service in China, South Korea and much of Europe.
How does a spectrum auction work?
In the U.S., anyone who wants to use frequencies on the electromagnetic spectrum must purchase a license from the government, with different frequencies used for different purposes. Since 1994, the FCC has sold these licenses at public auctions.
No, your favorite telecom CEOs don’t gather in one room with bidding paddles at the ready — even before gathering in a room was off limits. Instead, the FCC uses special software that allows interested parties to enter a call where they can place their bids. It’s all done anonymously, and can take weeks for larger auctions. In the case of the most recent mid-band spectrum auction, it began on June 25 and lasted for a full two months.
What does this mean for 5G?
The 3.5 GHz band of spectrum that was auctioned off has been described as a “sweet spot between capacity and speed.” The winning bidders are expected to use the spectrum to further 5G wireless deployment, as well as potential Internet of Things (IoT) applications.
“This auction has been a key part of our 5G FAST Plan and our ongoing push to make more mid-band spectrum available for 5G,” Pai said. “I look forward to this important spectrum being put to use quickly to provide service to the American people.”
The FCC isn’t slowing down anytime soon. While this was the largest spectrum auction of its kind ever conducted, there is more on the way in the same mid-band spectrum.
“I look forward to the Commission making available 280 more megahertz of mid-band spectrum for 5G in the C-band auction beginning on December 8,” said Pai. That’s four times as many licenses as the FCC just auctioned off.
In addition, the White House recently announced that it would be handing off the 3450 Mhz to 3550 Mhz spectrum to the FCC for auction — the band that’s directly below what was just sold. That auction is expected to take place in December 2021.
What does this all mean for the average American? Expect to see 5G coming to a town near you sooner than you might have thought. Each wireless carrier is gobbling up as much of this valuable 5G spectrum as they can get their hands on.
They didn’t pay a combined $4.5 billion to sit on it, either. Sooner than later, it will be coming to your phone.
Written by:Joe Supan
Senior Writer, Wireless & Streaming Content
Joe oversees all things wireless and streaming for Allconnect. He has utilized thousands of data points to build a library of metrics to help users navigate these complex spaces. These in… Read more
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