NetCompetition Statement on FCC Incentive Auction Rules

NetCompetition

FOR IMMEDIATE RELEASE                                           

May 15, 2014

Contact:  Scott Cleland --703-217-2407

FCC Rules Take the “Auction” & “Incentives” out of the Supposed “Incentive Auction”

Auction will under-earn with FCC thwarting market forces by picking winners & losers   

WASHINGTON D.C. – The following quotes on the FCC vote on Incentive Auction rules may be attributed to Scott Cleland, Chairman of NetCompetition:

• Remarkably at most every turn, the FCC’s latest “auction” rules seem intent to ensure that the FCC, and not market forces, determine which companies win and lose in the FCC’s supposed spectrum “incentive auction.”  
• Most know the definition of an auction is “a sale to the highest bidder,” but these FCC rules seem obsessed with denying the sale of much spectrum to likely highest bidders, AT&T and Verizon, which have the most consumer demand for the spectrum, and have substantial financial wherewithal to bid for the most valuable spectrum ever auctioned.
• These FCC rules really create a “Disincentive Auction.” That’s because the public exclusion of the likely highest bidders creates powerful financial disincentives for broadcasters to sell their spectrum, because they know it won’t get a free market price, and for Sprint and T-Mobile to bid up spectrum prices, because the FCC rules facilitate an FCC-sanctioned wireless duopoly of Sprint and T-Mobile for spectrum bidding purposes that makes bidding collusion to not overbid much easier.     

NETCompetition.org is a pro-competition e-forum representing broadband interests.  See www.netcompetition.org.  

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