Forward Auction Week #1 Nets Nearly $11 Billion

Total is 12 percent of closing goal
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WASHINGTON—The first week of the TV spectrum incentive forward auction concluded with bids totaling 12 percent of the $88.4 billion closing goal. The bell on round seven of the auction rang Friday afternoon at 4 p.m. ET with $11 billion ($10.96 billion) in net proceeds. Total proceeds were $11.257 billion, yielding a net of nearly $11 billion minus around $567 million in discounts for small business and rural wireless providers.

The forward auction got underway on Tuesday of this week, with bids reflecting opening prices finalized by the Federal Communications Commission in June, and totaling $8.49 billion after the first round. Asking prices increase 5 percent between rounds for spectrum in demand, or roughly half of the spectrum blocks for sale, according to early indicators parsed by Wells Fargo analysts, who noted that demand was focused on 2,047 of 4,048 available spectrum blocks in the second round of the auction. 

Total proceeds without discounts for each completed round and the percentage increase in between is illustrated in the table below:
Round 1: $8.49 billion
6 percent
Round 2: $9.04 billion 
7 percent
Round 3: $9.7 billion 
4 percent
Round 4: $10.1 billion 
5 percent
Round 5: $10.6 billion 
4 percent
Round 6: $11 billion
X percent
Round 7: $11.5 billion (As of Friday, Aug. 19)
Should the rate of increase between bidding rounds remain at roughly five percent, total proceeds will just exceed $20 billion by the close of round 21 next Friday. However, this rate of increase is entirely dependent on continued demand, thus not assured. The FCC must raise $88.4 billion to cover the $86.4 billion layout generated by the reverse auction in which broadcasters conditionally sold 126 MHz of TV spectrum, plus relocation and administration costs. The auction will continue again Monday with round eight starting at 10 a.m. Eastern.

For more, see our Spectrum Auction silo.
Also see....

Aug. 18. 2016

Auction Net Inches Over $10 Billion
Net proceeds after round five of the TV spectrum incentive forward auction reach just over $10 billion on Thursday afternoon, the third day of bidding.

Aug. 17, 2016
Auction Round 3 Yields $9.2 Billion
The commission must raise around $88 billion from 100 MHz of paired spectrum, or an estimated $2.76 per MHz/pop.