Wireless carriers looking for additional capacity to build out high-speed 4G networks have placed bids exceeding $37 billion in a government auction selling precious airwaves.
The auction, dubbed “AWS-3,” kicked off on Nov. 13 and has now raised $37.5 billion in 35 rounds of bidding. The auction will end when there are no more bids.
The winners of the auction will gain access to valuable licenses that will in turn give carriers the capacity they need to enable customers to watch the latest cat video. The interest in the auction so far has far exceeded government expectations, which set the minimum reserve price at $10 billion. It is also nearly double what the last auction raised in 2008.
Bidding is confidential, but it is widely believed that most of the carriers are participating, including T-Mobile, Verizon Wireless and AT&T. In September, T-Mobile announced it was raising debt to participate in the auction after it failed to merge with Sprint.
Sprint is largely assumed to be sitting this one out, however, another likely participant is the Dish Network, which is assumed to only be interested in bidding up the price of the licenses to make its own stash of airwaves it is currently holding — but not using — more valuable.
The Federal Communications Commission, which is hosting the auction, generally uses proceeds from the sale to reduce the deficit, but in this case, it has earmarked the funds to pay for a new national wireless broadband network.