FCC auction bidders named

Google may be grabbing the spotlight in the upcoming auction of 700MHz wireless spectrum, but it's not the only nontraditional player that wants a valuable piece of the airwaves.

The Federal Communications late Tuesday released the names of applicants that plan to bid in the much-anticipated January auction, and Google competitors may include cable operator Cablevision, mobile chipmaker Qualcomm, and satellite TV provider EchoStar.

That Google was among the 266 companies filing an application by the December 3 deadline was no surprise. Google said earlier this year that it was willing to put up at least $4.6 billion for licenses in the "C" block of spectrum--a chunk that Verizon and others would like to get their hands on.

Also throwing its hat into the auction ring is Vulcan Spectrum, a venture led by Microsoft co-founder Paul Allen.

It's difficult to predict which companies will actually get licenses, especially with big phone companies AT&T and Verizon Wireless also planning to bid. The auction, which begins on January 24, is expected to take several weeks. And the licenses will be split into several different blocks. Due to FCC rules, there is no information available about which blocks of spectrum bidders are considering or how much money they are committing to the process.

While Google is definitely a company to watch during the auction, I also think it's worth keeping an eye on what some of these other nontraditional players might do.

Qualcomm's participation, for example, is particularly interesting, given that the company already owns a substantial amount of 700MHz spectrum. A few years ago, Qualcomm quietly procured a swath of nationwide 700MHz spectrum that uses the analog TV channel 55. It has used this spectrum to build its own mobile video broadcast network using a technology it calls MediaFlo. The network has been built and is run by a subsidiary of Qualcomm's known as MediaFlo USA.

Qualcomm has not said yet what it plans to do with the additional 700MHz spectrum, but my guess is that it wants to increase network capacity or its network footprint. Right now, this may not be a huge threat to the phone companies. AT&T and Verizon are using the MediaFlo network to deliver live TV to cellular subscribers. But if Qualcomm manages to get more spectrum, it could start to look more like a rival than a partner.

As for Cablevision and EchoStar, these companies are likely looking to use the spectrum to develop services that could compete with the phone companies. The two largest cable operators in the country, Comcast and Time Warner, combined forces in the last big spectrum auction in 2006. These companies, under the name SpectrumCo, managed to acquire 137 wireless spectrum licenses. But so far the companies have not said what they plan to do with all the capacity. The companies that make up SpectrumCo also have a deal with Sprint Nextel to offer wireless service to their customers.

Comcast and Time Warner said earlier this month that they would not be bidding in the 700MHz auction.

All bidders are required to make some kind of initial payment to the FCC before January 4 to make them eligible to bid. But simply putting up the initial capital does not guarantee that any of these companies will come out with any licenses in the spectrum auction. In fact, many companies will drop out of the auction. In the Advanced Wireless Services (AWS) auction in 2006, EchoStar, which had partnered with DirecTV, dropped out in one of the early rounds.

At this point it's really anyone's game. Currently, more than half the potential bidders, including AT&T and Verizon, have incomplete applications. These bidders have until January 4, 2008, to complete their paperwork in order to participate in the auction.