FCC to auction off spectrum for US digital switchover

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With the US scheduled to switch from analogue to digital television in 2009, the FCC is auctioning off its 700MHz wireless spectrum for use in data and broadcast applications.

Google is predicted to be the highest bidder in the auction with other major existing wireless companies. The sell-off could net the US government $10-30 billion (£5-15 billion) according to current analyst estimates.

The UK is scheduled to begin its own switchover in 2008 with completion expected for 2012. A similar sell-off of the spectrum used for analogue TV in the UK is also planned.

"The switch is about efficient use of the spectrum. The future is digital and it's better to make the spectrum available to wireless rather than using it up on both analogue and digital," said Jan Dawson, analyst for Ovum.

The rules for the use of the spectrum are still under debate. One major rule up for discussion is the open platform requirements which will allow users to connect any device to the spectrum. This requirement comes out of concern that successful bidders may try to block certain applications from using their services.

Dawson says, however, that there is another side to this argument. "If Google does purchase the spectrum, it may feel limited as to how it can use it. It will have its own vision of how it wants to use it and would want its vision to be the only one."

Traditionally with auctions like these, the FCC would issue multiple individual licences, carving the spectrum up into portions. It is up to the FCC to establish the rules. The auction will be multi-round, where the highest bidders proceed and the lowest bidders are weeded out.

The FCC auction is set to take place at the end of January 2008.

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