FCC Spectrum Auction: Meet The Bidders

If Google is still “very interested” in bidding during next year’s FCC spectrum auction, they will have a powerful host of rivals to compete with — mostly existing wireless giants. Because this is probably the last significant auction the FCC will hold for a long time, “for those who need spectrum to enter or expand into new markets,” Stifel Nicolaus analysts wrote in a note Monday, “it’s ‘win or go home’.”

Expect the two biggest wireless companies, AT&T and Verizon Wireless, to give Google (and other potential new entrants like satellite TV firms) their biggest challenge.

According to Stifel’s report, Basking Ridge, N.J.-based Verizon Wireless and T-Mobile have the lowest average spectrum holdings of nationwide carriers. (Though in New York City, Verizon holds the most, followed by Sprint Nextel, AT&T, and T-Mobile.) T-Mobile spent $4.2 billion — much more than any other bidder — in the last spectrum auction and “may not be going after significant acquisitions” in the upcoming sale. Sprint has all but pulled itself out of the auction, though Stifel’s team thinks they may patch some holes with new friend Clearwire for their WiMax networks. But Verizon and AT&T “remain the most likely winners,” the report says.

Smaller companies will likely bid aggressively to expand their networks. Stifel expects Alltel (the No. 5 U.S. carrier, recently bought out by private equity), Leap and MetroPCS to “bid aggressively” to build out. Leap and MetroPCS both sell cut-rate, all-you-can-eat wireless plans — a big threat to other carriers who still get more than 80% of their revenue from voice calls. MetroPCS holds some spectrum in New York City but has not started selling service here; Leap owns none.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.