Update on Round 42 of the FCC Auction 97

Posted December 2, 2014 by admin

 

The latest round (Round 42) of bidding has pushed the total price of the FCC Auction 97 up over $39.5 Billion. Bidding has slowed down finally with the richest 10 markets generating over $12.7 Billion in bids. Estimates of the total reserve value (pre-auction) were in the $10.6 Billion dollar range. Here is the list of the 10 richest markets so far.
Cell Site Capital - 97 Auction Bidding.

 

With prices of the auction being much higher than anticipated you are starting to hear the investor crowd start to ask if the price is worth it. In order to pay of this spectrum, the big 4 wireless carriers will need to generate $5 – $7 more in revenue per customer per month. Remember, this is not even the ideal spectrum for the wireless carriers. The lower band auction that is better suited for the carriers is due sometime in 2015.

You are starting to see this affect the buildout for more cell sites. AT&T wireless has been rumored to have cut its buildout for the northeast United States dramatically. This would include less than 30 sites next year and slashing the site acquisition budget by $3.7 Billion. T-Mobile is finally starting to decommission the Metro PCS sites and Clearwire to Sprint has been happening along with decommissioned cell sites. One of the bright spots is T-Mobile and Verizon’s wireless revenue rose 10.6% and 4.8%, respectively in Q3. On the other side, Sprint’s fell 5% and AT&T’s dropped slightly as well.

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