AM auction ends with more than half the permits unsold.
Through the history of spectrum auctions, the FCC has seemed motivated by a Field of Dreams-like belief: “If you hold the auctions, they will come.” And sure enough, for the most part the bidders have indeed shown up.
So it’s got to be a disappointment, if not a surprise, that Auction 84, the most recent auction of AM construction permits, has ended with only five of the available 22 permits drawing any active bidding beyond the opening minimum, and more than half not attracting any bids at all.
The full details of Auction 84, which was first announced last November and concluded on May 13, 2014, may be found at the FCC’s website. As noted, a total of 22 AM CP’s were up for grabs, of which five went for the minimum bid (or, in one case, just a tad over that minimum) and five sold after active bidding – leaving 12 unsold on the auction block. The ten that got sold gave the U.S. Treasury a total take of only $891,500, the bulk of which was attributable to two CP’s, one each in the New York and Los Angeles markets. The final bid for the Los Angeles-area permit (that would be in Culver City) was $409,000; which is precisely the same as what the New York City-area permit (Stony Point Town) fetched.
While the lack of interest may be attributable in some measure to the much-reported disadvantages – technical and otherwise – to which the AM industry is subject, other factors certainly came into play. This was a “closed” auction, after all, and the only eligible bidders were folks who had filed applications for the permits back in 2004. After ten years of waiting (with a near-Depression-level economic crisis dominating much of the intervening time), it’s understandable that applicants may have lost their lust for an AM in, say, Kuna, Idaho (motto: “Gateway city to the birds of prey”) or Windsor, Virginia (2000 U.S. Census population of 916 – although we hear that that has since more than tripled thanks to the annexation of some nearby county land).
Suffice to say, the peculiar (if not unique) circumstances of this auction are not likely to be duplicated in future auctions for spectrum in other services.
In any event, the five markets for which there was any bidding contest at all, and the successful bids, were:
- Culver City, California $ 409,000
- Stony Point Town, New York $ 409,000
- Chugiak, Alaska $ 34,000
- Montoursville, Pennsylvania $ 9,400
- Eaton, Colorado $ 4,700
Five other markets attracted only the minimum opening bid (or very close to that minimum) set by the Commission:
- Spring Valley, Nevada $ 10,000
- Enola, Pennsylvania $ 5,000
- Micanopy, Florida $ 5,000
- Bozeman, Montana $ 2,500
- Coalinga, CA $ 2,900
In the “Loss” column, the following 12 permits got no takers at all:
- Lovelock, Nevada
- Deschutes River Woods, OR
- Huntsville, AL
- Alturas, CA
- Colorado Springs, CO
- Kachina Village, AZ
- Waynesboro, GA
- Lebanon, TN
- Canyon, TX
- Windsor, VA
- Henderson, NV and
- Kuna, ID
All bidders and interested parties are reminded that the FCC anti-collusion policies remain in effect until the FCC’s down payment deadline. Accordingly, auction participants should avoid discussing the auction with one another for several more weeks.