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Summary

On March 12, 2020, the FCC concluded the auction of the 37GHz, 3.9GHz, and 47GHz bands, raising $7.6bn. With this auction, the regulator has now issued nearly 5GHz of millimeter-wave (mmWave) spectrum in the US, far more than elsewhere in the world. The US will next be auctioning mid-band spectrum – the 3.5GHz band in June 2020 and the 3.7GHz band in December 2020.

If the Sprint/T-Mobile merger goes ahead, Dish will use its newly acquired spectrum to launch a commercial 5G network

On March 12, 2020, the FCC announced the conclusion of Auction 103, which made 3,400MHz of mmWave spectrum available in the 37GHz, 39GHz, and 47GHz bands. The auction raised $7.6bn, with 28 bidders winning a total of 14,142 licenses. This is the largest amount of spectrum that has been offered in a single auction in the US. $3.1bn of the proceeds will be used as incentive payments to existing licensees in the 39GHz band that have committed to relinquishing their holdings, leaving $4.5bn in net proceeds. The four main winners were Verizon ($1.6bn), AT&T ($1.2bn), T-Mobile ($873m), and Dish Network ($203m).

Dish has spent billions of dollars over the past 10 years on accruing spectrum licenses in various bands, including spending over $200m in this most recent auction. If the potential Sprint and T-Mobile merger goes ahead, then Dish has agreed to use some of its licenses to launch a nationwide, commercial 5G network. However, there are concerns over whether Dish has the funds to set up a wireless network using all the spectrum it has amassed.

This was not the only time that the FCC auctioned mmWave spectrum. In 2019, the regulator auctioned the 28GHz (raising $703m) and 24GHz (raising $2bn) bands. These two bands, together with the 37GHz, 39GHz, and 47GHz bands, mean that around 5GHz of high-band spectrum has been made available for commercial use – this is more than the total amount of spectrum currently used for terrestrial mobile broadband by all the US wireless service providers combined. Following this auction, the US will become one of the few countries globally to have allocated a significant amount of spectrum across a wide range of frequencies for the deployment of 5G.

mmWave spectrum can transmit large amounts of data at very high speeds; however, these frequencies cannot travel great distances. Therefore, mmWave 5G buildouts have so far mostly been in busy urban areas and it seems unlikely that the spectrum would be used in more rural areas. In order to ensure nationwide coverage, operators require low and mid-band spectrum too. The US plans to auction the 3.5GHz band in June 2020 and the 3.7GHz band in December 2020. The country’s 5G FAST plan, which should enable US consumers to benefit from 5G networks, insists that low, mid, and high-band spectrum will be made available by the FCC. However, this is only one area that will ensure the new technology is successful. In addition, the regulator will need to work to promote the deployment of 5G infrastructure, as well as reforming regulations to encourage fiber deployment.

Appendix

Further reading

US (Country Regulation Overview), GLB005-000151 (May 2019)

Spectrum Auction Tracker: 4Q19, GLB005-000217 (January 2020)

5G Service Provider Tracker: 4Q19, GLB007-000339 (January 2020)

Author

Sarah McBride, Analyst, Regulation

[email protected]

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