The 700 MHz spectrum auction has set a record for bids, and at the end of round 24, had raised a total of $17.5 billion for the U.S. treasury. The previous record was $13.9 billion, set at the AWS auction of 2006. The bidding has slowed somewhat today, compared with yesterday, when over $4 billion was added. At the end of round 24, there were 1067 provisional winning bids among 1060 provisional winning bidders. The auction is expected to continue for several weeks, and will end when there are no more additional bids. Perhaps the biggest news of the auction is that the “open mandate” clause for the C block has been reached, as bids now surpass the $4.6 billion minimum bid required by the FCC to trigger it.
It’s somewhat unchartered territory for the open mandate of the C block spectrum. The concept is that consumers will have the ability to connect any compatible device they choose to the winning bidder’s network. Those devices will be available through consumer electronics channels, and consumers will not have to go through the wireless carrier to obtain them. It’s somewhat analagous to how you can connect any laptop or other device you want to W-Fi networks today. It could lead to a variety of new and innovative devices and applications as well as a somewhat different business model for mobile carriers. In addition to pre and post paid subscribers, “nomadic” users for the network will pay by a time period (say a day’s access), or maybe even by the megabyte. Other business models may emerge as well – perhaps free, but ad supported, access will be available. The open mandate was “championed” by Google. The potential for mobile ad placement and search creates a huge opportunity for Google. They will be driving much of the refinement of this new approach to mobile wireless and its impact on the competitive environment.
