About The Spectrum Auction

    In June and July of 2016, the Federal Communications Commission (FCC) hosted a pair of auctions (Auction 1001 and Auction 1002) to buy 600 Mhz spectrum from television stations and resell it in the open market. The FCC had determined that spectrum allocated to television stations years ago would be more productive and would achieve a higher value if it was re-licensed to wireless operators. The FCC's approach to maximizing the value of the 600 Mhz wireless spectrum was to acquire a swath of spectrum (126 Mhz) in the 600 Mhz band that would be national in scope.
    In the Reverse Auction (Auction 1001), the FCC approached existing holders of 600 Mhz spectrum (each of whom owned 600 Mhz worth of spectrum in a local area) and told them that they would have to sell their stations or move to a less desirable part of the band. After assembling 126 Mhz of wireless spectrum in the 600 Mhz band, the FCC repackaged the spectrum into 10 Mhz blocks.


    The FCC then divided the country into 416 geographic segments called Partial Economic Areas (PEAs). In each PEA, the FCC put up for sale ten blocks of 10 Mhz spectrum in the Forward Auction (Auction 1002). In Auction 1002, bidders were given the chance to bid on spectrum in one or more PEAs. Potentially, bidders could have bought one block in each PEA, giving them a nationwide footprint.

    Videos come from https://www.youtube.com/user/KLRU & https://www.youtube.com/user/NABroadcasters


    The Federal Communications Commission (FCC)

    • “Cartel Manager” - reallocating previously assigned spectrum FROM technologies which are redundant/obsolete TO current technologies
    • Stated goal of creating a more competitive wireless business environment

    What is spectrum and why the 600MHz bandwidth?

    • Spectrum is the basic resource of wireless transmission
    • Spectrum is a limited asset. Demand for wireless spectrum currently outstrips supply

    - 40% of spectrum is reserved for military use

    - 60% of spectrum is available for commercial use

    • 600 Mhz spectrum is “Beach Front Property”.   It is very valuable due to its superior propagation qualities

    Mies Jansen was approached by a client interested in acquiring spectrum in certain PEAs. We assembled a team of experts in valuation, dynamic bidding and cloud computing to help advise the client on valuation and bidding strategies.

    STEP 1

    Empirical Model

    Produce an Empirical Model which estimates the fundamental value of the spectrum in each PEA

    STEP 2

    Bidding Strategy

    Overlay a Game Theory model on top of the Empirical Model and Market Model to inform the client's precise bidding strategy

    STEP 3

    Implementation and Oversight

    Create a program to bid in the Forward Auction and monitor and oversee the actual bidding process