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Dow Jones & Company, Inc. Reproduced with permission of copyright owner. Further reproduction or distribution is prohibited without permission.WASHINGTON -- A single company could bid for more than half of the lucrative airwaves spectrum to be auctioned by the government early next year, a potential boost for Verizon Wireless, which has seen the auction as a way to expand its services.
Potential new entrants to the market, such as Google Inc., had pressed Federal Communications Commission policy makers to include a rule to ensure an incumbent wireless carrier such as Verizon or AT&T Inc. wouldn't be able to take the lion's share of the spectrum being sold. Rules released last week didn't include such a provision.
The auction, which must be completed by the end of January, is seen as the last chance for a potential new entrant to the wireless- broadband market to be able to acquire enough spectrum to compete nationally.
The absence of a rule prohibiting a major swoop by a bidder doesn't mean such a move is likely. It would cost upward of $7.5 billion if sold at the forecast price for the entire 62 megahertz.
But Verizon Wireless is known to be keen to buy substantial spectrum to bolster its development of fourth-generation, or 4G, wireless- broadband service.
"It would have been very wise to include such a rule, because even if it would be unlikely, the fact that a big player would have to choose between one strategy or another would have bolstered other potential participants," said Harold Feld, senior vice president of Media Access Project, a public-interest group.
Two sections make up 32 megahertz of the airwaves being sold. They include one 22-megahertz swath with so-called open-access requirements attached -- actually six separate pieces of spectrum that can be added together -- and an additional 10-megahertz chunk that will be used to provide wireless-broadband service to the emergency-services community, with any spare capacity able to be used for commercial purposes.
The remaining 30 megahertz has been broken up into several hundred licenses. They are likely to be bought by smaller or rural wireless carriers that couldn't afford to bid for the larger sections.
Ultimately, the FCC decided not to include such a rule after public- safety representatives voiced concern that it might limit interest in the 10 megahertz of airwaves that affects them, according to an FCC official.
The official said public-safety providers feared that if large bidders were forced to choose between the 22-megahertz chunk and the 10-megahertz one, they would choose the former.
Verizon Wireless, jointly owned by Verizon Communications Inc. and Vodafone PLC, declined to comment.
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