As the FCC prepares to start the second half of its broadcast incentive auction next month, here are three key elements to keep in mind as bidders, including Comcast/NBCUniversal, prepare to do battle for beachfront wireless spectrum.
1. The FCC will be setting the prices. As with the reverse auction, the FCC will set a price — though in this case it will be raised incrementally rather than lowered — see how many folks meet it, and then raise the bar until there is just one buyer.
2. It ain’t over ’til its over. The auction won’t actually be over after all the winning bids are accepted. There will be an extra round. Initially, bidders will be bidding on generic blocks in a market. The extra round is for winning bidders to bid on specific frequencies.
3. Bid booster. There is an activity rule to prevent bidders from swooping in from the sidelines. In each round of the auction, a bidder must bid on 95% of the census blocks it has signaled it wants to bid on.