T-Mobile Asks FCC To Revise Reserve Spectrum Trigger in Incentive Auction
T-Mobile asked the FCC to modify TV incentive auction rules to provide an additional “trigger” under which “reserve” spectrum would be set aside for carriers without significant low-band spectrum in a market. Currently, the auction would have a two-stage trigger.…
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The first occurs when proceeds in the top 40 partial economic areas (PEAs) exceed an average price of $1.25 MHz/POP, T-Mobile said, the second when the forward auction raises enough money to reimburse all broadcasters that surrender their spectrum and cover other remaining auction expenses, such as repacking. T-Mobile proposed a third trigger, which it describes as “simple fix” to guarantee that competitive carriers stay in the auction. Under the carrier's proposal, the first trigger remains the same but the second would be changed to offer an alternative mechanism -- also triggering the reserve when auction prices reach an average of $2 per MHz/POP in the top 40 PEAs. “The risk of the second trigger is that high clearing costs in the early rounds of bidding under a high clearing target create a ‘hangover effect’ for subsequent stages of the auction,” T-Mobile said in a filing posted Wednesday to docket 14-252. “If the initial spectrum-clearing target is high, the cost of clearing broadcast stations will be high, too. And if early-round bidding approaches, but does not reach, the reserve-creating trigger, those high bids will still hang over all subsequent stages of the auction even though the amount of spectrum available is less than in the initial stages.”