The agency starts auctioning off airwaves that TV broadcasters agreed to give up earlier this summer, but the process is likely to drag on into 2017.
Wireless carriers and others like Comcast and Dish Network are getting their checkbooks ready as they start bidding on airwaves the government has reclaimed from TV broadcasters.
The second phase of the Federal Communication Commission's so-called incentive spectrum auction kicked off Tuesday. This first-of-its-kind auction allows wireless operators and others to buy airwaves that TV broadcasters have agreed to give up in an earlier stage of the auction.
The first part of the auction, which included a "reverse auction" in which station owners agreed to sell spectrum licenses for a certain price, ended in June. More than 60 bidders, including wireless operators like AT&T, Verizon and T-Mobile as well as cable operator Comcast and satellite TV provider Dish, have registered to participate in this next stage of the auction.
This particular swath of spectrum is highly prized -- industry insiders call it "beachfront property" -- because it operates at a lower frequency. That means it can run across greater distances and go through walls for superior coverage. The additional spectrum will be used by network operators to improve in-building coverage and extend wireless service to more places.
Experts agree the wireless operators and other spectrum seekers are unlikely to pay the $86 billion price tag TV broadcasters are seeking for their licenses, considering the industry spent almost half that in a record-setting auction last year. Analyst John Hodulik of UBS said in a research note that the industry might spend as much as $40 billion in the auction.