Satellite TV pulls out of broadband auction

TEXT OF STORY

SCOTT JAGOW: The US government has some airwaves to sell. A lot of companies wanna buy them to expand their cell phone and wireless services. The big satellite firms wanted to bid during this auction, but they've now decided to drop out. From the Innovations Desk at North Carolina Public Radio, Janet Babin reports.


JANET BABIN: After watching rivals pad their bottom lines offering customers cable, Internet and voice services, satellite TV companies were hoping to do the same.

When new airwave space became available, EchoStar and DirecTV joined forces. They to put up a $972 million deposit just to bid on it.

But yesterday the sat-TV leaders quit the auction.

As bidding topped $9 billion, Telecom attorney Robert Rini says, the companies realized the cost to win the spectrum and build their own wireless network was prohibitive.

ROBERT RINI:"What they're signaling is it may make more sense to partner with others to offer a bundled video and Internet access service."

The new airwave space will likely mean fewer dropped cell calls and improved wireless connections.

The auction is expected to hit $15 billion before bidding stops.

I'm Janet Babin for Marketplace.

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