Spectrum auction

A spectrum auction is a process whereby a government uses an auction system to sell the rights (licenses) to transmit signals over specific bands of the electromagnetic spectrum and to assign scarce spectrum resources. Depending on the specific auction format used, a spectrum auction can last from a single day to several months from the opening bid to the final winning bid. With a well-designed auction, resources are allocated efficiently to the parties that value them the most, the government securing revenue in the process. Spectrum auctions are a step toward market-based spectrum management and privatization of public airwaves, and are a way for governments to allocate scarce resources.Alternatives to auctions include administrative licensing, such as the comparative hearings conducted historically (sometimes referred to as 'beauty contests'), or lotteries. A spectrum auction is a process whereby a government uses an auction system to sell the rights (licenses) to transmit signals over specific bands of the electromagnetic spectrum and to assign scarce spectrum resources. Depending on the specific auction format used, a spectrum auction can last from a single day to several months from the opening bid to the final winning bid. With a well-designed auction, resources are allocated efficiently to the parties that value them the most, the government securing revenue in the process. Spectrum auctions are a step toward market-based spectrum management and privatization of public airwaves, and are a way for governments to allocate scarce resources.Alternatives to auctions include administrative licensing, such as the comparative hearings conducted historically (sometimes referred to as 'beauty contests'), or lotteries. In the past decade, telecommunications has turned into a highly competitive industry where companies are competing to buy valuable spectrum. This competition has been triggered by technological advancements, privatization, and liberalization. Mobile communication in particular has made many transitions since 2000, mobile technology has moved from second generation (2G) to third generation (3G) to fourth generation (4G) and is now in transition to fifth generation (5G) technology. With more providers in the mobile industry, the competition during spectrum auctions has increased due to more demand from consumers. When the United States made the transition in June 2009 from analog to digital broadcast television signals, the valuable 700 MHz spectrum became available because it was no longer being used by analog TV signals.In 2007, search giant Google announced that they would be entering the mobile business with their highly popular Android operating system and plans for a mobile broadband system.Google said that they planned to bid for the 'C' block of the spectrum auction which correspond to channels 54, 55, and 59 of the lower 700 MHz spectrum and channels 60, 61, 65, and 66 of the upper spectrum 700 MHz which are normally used to construct nationwide broadband services. Around the time of Google's announcement, AT&T and Verizon also announced plans to enter the spectrum auction in order to purchase 'C' block spectrum. Advantages of auctions: