Verizon Cleans Up At Spectrum Auction

Verizon came out as the big winner of the FCC’s 700MHz broadband spectrum auction, spending somewhere between $8 to $10 billion on a huge swath of the coveted C-Block, previously and ironically dubbed "the Google Block."

It was called that because Google set the stipulations for its sale by persuading the FCC to set openness standards for the winner. Google pledged to bid the minimum reserve in order to push those requirements through. Though Verizon filed suit to stop it, and eventually withdrew its suit), the company complained alongside AT&T there would be less incentive to bid if such standards were in place.

The FCC only approved two of four openness standards in the end. Where was Google, the so-called white night? Well, reportedly Google made a package bid early on, but didn’t commit enough to outbidding Verizon in the end, which relegates Google’s role as white knight and potential steep competitor to some kind of weird openness police force.

But Google’s presence in the auction and insistence on openness also served the company well strategically, guaranteeing a certain amount of openness once the Google Android phone becomes a reality.

One has to wonder also if investor concerns about Google getting away from its core search competency and nervousness about GOOG stock didn’t dissuade the company from bidding more aggressively.

AT&T, though picking up a huge chunk of spectrum privately in advance of the auction, still bought up about $6 billion worth.

Those incentive-arguments may seem erroneous and self-serving only until you look at what happened with the D-Block of spectrum, which didn’t meet the $1.3 billion minimum reserve. The D-Block came with stricter stipulations about sharing with the public in order to bolster emergency response communications.

Apparently, no one was interested, not even the white knight Google.

The FCC said it would hold another auction for that particular swath of spectrum, though, perhaps at a lower set price, with the hopes that first-responders will have a better communications network sometime in the future, perhaps after another major disaster proves the need for it once again.