Google wins 700 MHz auction


In fact, Google issued a statement congratulating Verizon on being the winner of the “C block” in the auction with a bid of 4.74 billion bucks. Google had lobbied hard and heavy – and successfully – for a trigger requiring open access if bidding for the C block reached 4.6 billion. Verizon had opposed that provision, but the C block would have been pulled out of the auction and re-bid later if the top bid didn’t reach 4.6 billion. So, rather than see someone else grab control of that spectrum, Verizon anted up after bidding crossed the threshold and ended up the winner at 4.74 billion.

While Verizon will have to build out the system in spectrum being vacated by the digital television transition, in addition to forking over the 4.74 billion to the US Treasury, it also has to make the new wireless network able to accommodate all mobile services. So, Google will have lots of new opportunities to deploy new services and sell more ads – and it won’t have to spend a penny on the infrastructure.

The C block was just part of what Verizon won in the bidding. All in all, it had the winning bids on 9.4 billion worth of spectrum offered in the auction in 1,091 blocks, large and small.

AT&T is the other company that will have to write a mega-sized check to the Treasury. It bid 6.6 billion for the pieces of spectrum it won. Dish Network’s Frontier Wireless bid nearly 712 million for spectrum it is expected to use for new mobile television services. Qualcom won bids totaling 558 million. We now also know that it was the high bidder for the public/private block at 472 million, but that spectrum will be re-bid – likely with the whole public/private scheme re-evaluated – because it failed to reach the FCC’s 1.3 billion minimum.

RBR/TVBR observation: Pretty smart, huh? The 800-pound gorilla scares everyone into thinking they’re going to be bidding like a drunken sailor at a high-stakes poker game, so the existing telecommunications giants place big bets to ensure that they will be the owners of these big swaths of primo spectrum, not Google. But it was all a bluff. Google didn’t intent to buy any spectrum at all. Instead, it got Verizon to build it a nice, new platform on which to deploy new services and sell more ads. Google’s stock price may have fallen from its astronomical heights of late, but don’t count these guys out. They know how to play poker.