But hey, if you bid over $1 billion, the FCC gives you free shipping. Such a deal!

Why is it that they bother with the reserve anyway? Why not just start the bidding at 4.6B?

Especially since eBay charges a percentage fee of the reserve price.

@alhypo: you limit participation with a known reserve price. the fcc will attract more companies by making a lower minimum bid and leaving an undisclosed reserve price. Besides, there is no reason that reserve price needs to be preset. It could just be a safety mechanism to make sure companies aren't cheesing the auction like in the Swiss or German cellular spectrum auctions.

Is this auction for the SDTV channels. I had heard that the government was going to sell these channels to try to make up the deficit but that is bs because they will waste more on get every one subsidies to buy converter boxes for HD.

What the??????

Ok, I bid $3 billion.

If there's no way I can win at that price, and EVERYBODY knows what the reserve price is, what's the point of it? A silent reserve I understand. If you aren't ultimately willing to bid at least $4.6, you shouldn't be in the game.

Alright, alright... I bid $3.5 billion.

Something just seems so wrong about auctioning off air for 4.6 billion dollars.....

It's not air, it's the right to broadcast using a certain frequency so as not to interfere with other communications. Someone has to manage this shit, and ensure that everyone (and every piece of equipment) is compliant.

@yg17: Probably because it's nothing like "auctioning off air".

Anyone know if this spectrum is available as a result of switching from analog to digital over-the-air broadcast TV?

@RottNDude: I know exactly what it's actually for, but 4.6 billion still seems absurd. I doubt it costs the FCC anything near that, and all it does is prevent competition. Who knows, a startup cellular company who would actually give two shits about their customers and product might want to buy that, but just can't afford the initial investment, so the same old big corporate assholes get it. But if there's one thing the FCC's good at, it's stifling competition.

@varco: I know, please read my previous comment. And yes, the 700MHz band is what makes up a portion of the analog TV spectrum.

Yes, yes - something is only worth what someone will pay for it.

And I still have to say, "What the...."???????

@yg17: It costs the FCC nothing, but the winner of the auction may make enormous profit on their investment. The spectrum belongs to the people and the funds from the auction go to the people.

The auction and licensing is there so that the spectrum is regulated. If it wasn't regulated, everyone would broadcast on whatever spectrum they wanted, there would be all sorts of interference, and nothing would work. If a small cell phone start-up (and that is sort of an oxymoron) wanted to buy into the spectrum, they could always try purchase a license from whoever wins the auction.

The FCC definitely stifles competition, but this auction isn't really related to that.

Re: that last comment,

I would argue that the FCC's biggest effort to stifle competition lies in efforts to lower barriers for the consolidation of media ownership, despite a great and righteous public outcry against it.

@Hyland: If that's the case, then why is the reserve disclosed, to the point where Google says they will bid it?

@varco: "The spectrum belongs to the people and the funds from the auction go to the people."

Cool! When do I get my check?

I always thought letting the bidding start below the reserve was for two things:

1)to build up buying momentum and competitiveness, so once it hops past the reserve the buyers will keep on rolling strong

2)Because if it doesn't meet the reserve, the seller could suck it up and sell it anyway?

@supersally:

That's pretty much it. If they require the first bid to be $4.6BN, and it doesn't attract a bid, all they know is "4.6BN is too much." If they let people bid below $4.6BN, they know "$4.6BN is too much, BUT people were willing to pay $4.1BN."

@glass: You don't get a check, you get a chance to receive two of those $40 coupon from the government to buy converter boxes so you can keep watching TV. /sarcasm

@scoosdad:

You also get to either (a) pay lower taxes or (b) have a smaller share of the national debt.

@JustAGuy2: In theory the money benefits us, in practice they will probably find some pork to spend it on.

@K-Bo:

Fair enough, but that's a separate issue.

The bidding rules are so complex that it makes Texas Hold'em look like Go Fish. To stay in the auction, companies need to bid a minimum amount each round. But they can move their bids around, meaning that often companies "park" their bids in auctions they are not really interested in to see how the bidding emerges for the auctions they do care about. What is more, bidders get three waivers - rounds in which they do not need to bid anything. And they strategically drop out for a round to try to assess their competition.

Does that not sound like an awesome game to play?

After it's all over I hope they show the bid history like eBay does.

What is the BuyItNow price for the spectrum?

Something like this should not go simply to whoever has the most money. They should have an essay contest.

do they accept paypal?

Let's all pool our money that we will be receiving from the Economy stimulation plan and buy the spectrum ourselves...by my calculations we should be able to come up with $100 Billion give or take. Anyone with me?

Rachacha: that's awesome. HD public access, anyone?

@Rachacha: We all own the spectrum. It's public property and the FCC is selling it for us to (a) distribute it to companies that will hopefully do something interesting with it and (b) make some bank, yo.

@timmus: The topic is "What this spectrum of wireless transmition means to me."

@Rachacha: i'm with you...but i'd rather we bought something in the 40 Hz range, built a large microwave emitter & pointed it towards capitol hill.