Questions Arise Over Spectrum Auction

The FCC’s just-finished auction of spectrum for a nationwide public safety radio network ended without a successful bidder, but now industry sources claim there’s something fishy about the process and Morgan O’Brien’s involvement. There was just one bid of $472 million, far short of the FCC’s minimum $1.3 billion bid. Sources say that O’Brien told potential bidder Frontline Wireless that, as the trust’s advisor, he’d be recommending a $50 million per-year, 10-year access commitment from the winning company, on top of other network build-out expenses. Hearing that cost, sources say, Frontline folded, leaving no bidder willing to meet the bid minimum. The claims are already complicating the FCC’s consideration of what to do now, without a successful bidder. The FCC is now evaluating its options on the D Block allocation, but it’s not know if this means another auction or bidding policy changes. Ironically, it was O’Brien who came up with the nationwide network concept, and got the D Block auction going. Read more about the allegations about here. Read Andrew Seybold’s commentary on where do we go next, and a story on the auction issues in the Washington Post.