Last summer when the Public Interest Spectrum Coalition (PISC) pushed hard for things like anonymous bidding and mandatory wholesale open access (ultimately watered down to the weaker but still useful open device/Wireless Carterphone condition on C Block), we kept getting told that such changes would discourage entry and make the auction less competitive. “Nonesense,” we replied. “Having such conditions will encourage lots of new entrants and actually increase revenue. “Nonesense back,” replied just about everyone. “It's obvious that puting conditions on an auction makes the auction less attractive.” Indeed, when the Washington Post ran an
op ed against our conditions, the Post rejected my reply on the grounds that my argument that our proposed rules would encourage new entrants (and thus a more competitive auction) made no sense.
Well, the FCC has now released the list of companies that applied to bid. Dr. Gregory Rose, whose economic analysis of the 2006 AWS auction and additional economic analysis throughout the FCC proceeding were criticial in getting the rule changes we won has started a 3 part series on his blog
Ekonoclastic analyzing the short forms and making predicitions.
Part I analyzes the short forms for trends. Of the 266 potential bidders (up slightly from the 252 that applied for the AWS auction in '06), nearly 60% are first time bidders. In addition, while the number of minority owned businesses applying remained pitfully low, it represented a signficant increase from the AWS auction (5.26% of applicants as opposed to 1.19%). Further, the number of bidders with ties to existing licensees dropped, further underscoring the importance of the new rules urged by PISC in attracting a new, diverse pool of bidders. By contrast, previously succesful bidders with a history of blocking behavior — such as SpectrumCo. — decided to sit this one out.
I highly recommend reading Greg's analysis in full, as well as reading the other two parts as they appear. Oh, and Washington Post, still waiting on that apology. . . .