NEW YORK LICENSES UP TO $3.5 BIL. ON DAY 8 OF AWS AUCTION

Sharon Armbrust | August 20, 2006, 04:10 PM

Of the $11.4 bil. total interim net high bids on the table as of Round 28 of the FCC's AWS Auction #66, 77% of the offer money is pointed at four U.S. regions--Northeast, West, Great Lakes, Southeast-- dominated by five major markets--New York, Los Angeles, Chicago, Washington DC and Miami.

The serious players were getting more focused by day 8 of the bidding and the big money was focused exclusively on the big markets. By the end of the day Friday (8/18) four would-be buyers had bid up the six licenses that include New York City as their core to $3.5 bil., in a range of $.91-$1.33/MHz pop.

Verizon has been sitting unchallenged on the big 20 MHz regional Northeast license since Round 16, wagering $1.335 bil. or $1.23/MHz pop. This region has over 50 mil. pops, making it unaffordable to all but a few. Plus the territory is Verizon's birthright region which may be why it has been able to warn off challengers so far.

New York area interim high bidders thr. Round 28:

Northeast 20 MHz REA: Verizon $1.335 bil. $1.33/MHz pop
New York/Newark 20 MHz MSA: T-Mobile $396 mil. $1.23/MHz pop
Northeast 10 MHz REA: MetroPCS $553 mil. $1.10/MHz pop
NYC/Long Is./NJ/CT 10 MHz EA: MetroPCS $246 mil. $0.96/MHz pop
Northeast 10 MHz REA: T-Mobile $473 mil. $0.94/MHz pop
NYC/Long Is./NJ/CT 20 MHz EA: SpectrumCo $468 mil. $0.91/MHz pop

As of Round 28 the 2nd most valuable anchor market and territory was the West where T-Mobile has the provisional top bid at $0.89/MHz pop or $895 mil. for the 20 MHz West REA, another 50 mil. pop territory with Los Angeles and San Francisco in it. The two other 10 MHz West REAs are in the hands of Cingular and MetroPCS for now. T-Mobile also has high bid on the Los Angeles MSA, with 15.6 mil. pops and is willing to pay $0.55/MHz pop for it so far. San Francisco's value is still far down the scale with 32-33 cent/MHz pop bids in place. All nine major license in the West (3 West regionals, 3 LA megalopolis, 3 San Francisco extended metros) were going for $2.2 bil. in total on Friday.

If the bidding were to cool from here, the winners would be walking away with many bargains. But with 242 licenses still in FCC hands, the big bidders so far using just 65-70% of their eligibility units and markets like San Francisco, Atlanta, Dallas, Seattle and Las Vegas going for prices in the 30s cent/MHz pop range, there's definitely more firepwer and fireworks to come.