FCC Announces Auction 110 Procedures

On June 9, 2021, the Office of Economics and Analytics and Wireless Telecommunications Bureau released a Public Notice announcing the Procedures for the 3.45-3.55 GHz Band Auction (“Auction 110”).  Bidding in Auction 110 is scheduled to begin on October 5, 2021 and 4,060 licenses will be available in the 3.45-3.55 GHz Band (“the Band”).  The Band has been divided into 10-megahertz blocks, designated A through J, in partial economic areas (“PEA”) which span the contiguous 48 states and District of Columbia.  All licenses will be issued for a 15-year, renewable license term, and certain licenses will subject to cooperative sharing requirements with federal incumbents, as described in the Second Report and Order.  The Notice adopts a two phase bidding procedure for Auction 110, which is described in greater detail below.

The following Procedures have been established:

  • Relevant Dates and Deadlines:
    • Auction Application Tutorial – available no later than June 22, 2021
    • Short Form Application Filing Window Opens – July 8, 2021, 12:00 PM Eastern Time
    • Short-Form Application Filing Window Deadline – July 21, 2021, 6:00 PM Eastern Time
    • Upfront Payments – September 2, 2021, 6:00 PM Eastern Time
    • Bidding Tutorial – available no later than September 16, 2021
    • Mock Auction – September 30, 2021
    • Bidding Begins – October 5, 2021
  • Application & Upfront Payment Information:
    • Participants will be required to submit a complete and accurate short form application prior to the filing window deadline (6:00 PM Eastern Time on July 21, 2021).  After the window closes, applicants will only be permitted to make minor modifications to their application.
    • The short form application must contain all of the license areas on which a participant may want to bid from the list of available PEAs.
    • Applicants that submit a short form application will be subject to the rules prohibiting certain communications set forth in section 1.2105(c).
    • Designated Entity Bidding Credits will be available to applicants that can demonstrate eligibility for a small business or rural service provider bidding credit and subsequently win licenses.  Applicants must choose either to claim either a small business bidding credit or a rural service provider bidding credit, but not both.  Bidders that qualify as a small business are eligible to receive a 15% discount, and bidders that qualify as a very small business are eligible to receive a 25% discount.  Rural service providers will be able to receive a 15% discount.  A $25 million cap is imposed on the total amount of bidding credit discounts that may be awarded to an eligible small business, and a $10 million cap is imposed on the total amount of bidding credit discounts that may be awarded to an eligible rural service provider.
    • Upfront payments must be wired to the FCC before 6:00 PM Eastern Time on September 2, 2021.  FCC Form 159 must be submitted and information on this form must match the applicant’s short form application.
  • Preparing to Bid:
    • Potential applicants are reminded that it is their responsibility to investigate and evaluate all technical and marketplace factors that may have a bearing on the value of the licenses they seek in Auction 110.   Potential applicants are also reminded that they should identify associated risks and investigate and evaluate the degree to which such matters may affect their ability to bid on, acquire, or make use of licenses available in Auction 110.
    • Potential applicants are encouraged to carefully consider the impact of the transition process for incumbent Federal and non-Federal radiolocation and amateur operations out of the Band, as well as the cooperative sharing requirements within the Band.
    • Potential applicants are reminded of the spectrum aggregation limit for licenses in the Band which allows any entity to hold a maximum of 40 megahertz (4 blocks) in any PEA at any point in time for four years post auction.  Consistent with this limit, the bidding system will limit the number of blocks a bidder can demand in any given PEA to 4 blocks.  The system will not prevent an entity from bidding on more licenses than it may be allowed to hold under the attribution rules, so applicants should conduct necessary due diligence prior to the short-form application deadline to determine whether attributable interest holders may have an impact on their ability to bid.
    • A mock auction will begin on September 30, 2021.  Details regarding the mock auction will be announced in a future public notice.  A separate mock auction will be scheduled after the clock phase of the auction concludes to prepare bidders for the assignment phase.
  • Bidding Procedures:
    • Auction 110 will proceed in two phases, a clock phase followed by an assignment phase.
    • Clock Phase – bidders will indicate demands for generic license blocks in a bidding category in specific PEAs.  There may be one or two bidding categories in a given PEA.  Bidding will proceed in rounds, will bidding being conducted simultaneously for all spectrum blocks in all PEAs available in the auction.  During each round, the system will announce a per-block clock price for each category in each PEA and qualified bidders will submit the number of blocks they seek at the clock price associated with the round.  For each category in a PEA, the clock price for a generic license block will increase from round to round if bidders indicate total demand for blocks in that category exceeds the number of blocks available. Bidding will continue until the total number of blocks bidders demand does not exceed the supply for all blocks available.
      • Activity Requirement – During the clock phase, bidders must be active on between 90% and 100% of their bidding eligibility in all clock rounds. During the first round, a bidder’s activity percentage will be set at 95%.  If a bidder fails to meet their activity requirement, the bidder’s eligibility will be reduced.  To avoid having eligibility reduced as a result of submitted bids that could not be applied during processing, bidders will be allowed to submit bids with associated bidding activity greater than current bidding eligibility.
      • OET and WTB have adopted minimum opening bid amounts for a block in a PEA based on $0.03 per MHz-pop for PEAs 1–50, $0.006 per MHz-pop for PEAs 51–100, and $0.003 per MHz-pop for all other PEAs, subject to a minimum of $1000.  For more detailed information, see Attachment A.
      • Clock prices will increase by 10% initially, but may be adjusted within a range of 5% to 20% as rounds continue.  The total amount of the increase will be capped, initially at $50 million, but may be adjusted as rounds continue.
    • Assignment Phase – following the clock phase, winners in the clock phase will be able to bid an additional amount for licenses with specific frequencies.  All winning bidders, regardless of whether they bid in the assignment phase, will be assigned licenses for the contiguous blocks within a category in a PEA.
      • The assignment phase will be done in rounds beginning with the top 20 PEAs.
      • Bidders will be asked to assign a price to the requested frequency assignments which will represent the maximum payment that the bidder is willing to pay in addition to the price established at the block phase.
    • Winners will be announced by Public Notice after bidding has concluded.
  • Post-Auction Procedures:
    • Down payments totaling 20% of the net amount owed for its winning bids must be received within 10 business days after the Public Notice announcing the auction closing.  Ten days after that, winning bidders will be required to make final payments.
    • Long-form applications will be due on the same day as down payments.
    • Bidders that intend to deploy over Tribal lands will be able to apply for Tribal lands bidding credits.

The FCC also released a News Release on Auction 110, announcing the start date of the Auction.

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