Wheeler: Incentive Auction on Course for 2016

Given AWS-3 Prices, Bidder Fatigue Unlikely
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Federal Communications Commission chairman Tom Wheeler reiterated Thursday (Jan. 29) that the agency is on track to wrap up the incentive auction framework by the end of this year and hold the incentive auction at the beginning of 2016.

That came in a press conference following the FCC's January monthly meeting. "We are on course and speed for making the final decisions in the auction at the end of this year so we can begin the auction early next year," Wheeler saud. "Nothing has changed."

Asked if the FCC should pause the process to give likely bidders such as Verizon and AT&T a change to catch their financial breath, given that the AWS-3 wireless spectrum auction just closed with more than $44.8 billion in bids, most of it thought to have come from the two largest carriers, Wheeler essentially said no. He said the winning bidders were getting spectrum that they could raise revenue on and had "bid on a budget" knowing that the incentive auction was coming up.

"The CFOs of these companies didn't just fall off the turnip truck," Wheeler said, adding that he has been on the other side, and the companies that bid were "bidding to a plan."

He also said that while the $44.8 billion bid in the AWS-3 auction is a large "absolute number," it is not so large in relative terms compared to revenue, cash flow and earnings for the wireless industry. "I think they got a deal," he said.

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