Saturday, November 3, 2007

News 9 - AT&T Will Bid in Wireless Auction

1. I learned this week of various types of auctions. For example, the English clock auction is one in which the beginning price is set by the seller and then the price increases by a certain increment. At each increment, all participating bidders are asked to decide whether to stay in the auction or to drop out. The last bidder who does not drop out is the winner of the auction and pays the price at which he or she wins the auction.

Another type of auction is the Dutch clock auction. The high price is set by the seller. The offer price then decreases at fixed amounts until the first bidder to take the offered price and agrees to buy the item.

2. AT&T will bid for more wireless spectrum:
http://www.pcworld.com/businesscenter/article/138687/att_will_bid_in_wireless_auction.html

3. In the article, the author discusses AT&T uncertainty of whether it should bid for wireless spectrum on the 700 MHz band due to complex conditions of sale set by the FCC. The FCC requires the winning bidder to open access to all wireless devices for certain bands of spectrum.

Many believe that there will be much competition in the auction for parts of the wireless spectrum capable of providing high speed data service. According to recent news, prices offered to buy spectrum are at record highs. In addition to telecom companies, internet companies such as Google are trying to enter the scene, as well as Apple, a computer and multimedia company.

In my opinion, AT&T probably has already made a decision regarding acquisition of more of the coveted spectrum. I believe that it is possible that they are purposely keeping bidding information discreet because it is advantageous for bidders to reveal as little information as possible to other bidders prior to bidding for an item to increase their chances of winning in this type of auction.

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