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Bidding billions for airwaves

Lisa Napoli Aug 9, 2006


KAI RYSSDAL: The Federal Communications Commission opened up an auction today, one that might put your neighbor’s brisk business on eBay to shame. Many of the nation’s biggest companies will be bidding on something you can’t even see. But Marketplace’s Lisa Napoli explains chances are you’ll find it useful one day anyhow.

LISA NAPOLI: Right now, 168 companies are waging a bidding war for a massive invisible highway otherwise known as radio spectrum.

Cable companies. Cell companies. Satellite companies. All want a piece of it, and they’ve plunked down billions just for the chance to bid.

Glenn Fleishman of Wi-Fi Networking News explains why:

GLENN FLEISHMAN: Well, this is about the future of watching video on your telephone.

You may not care about doing that, but the companies that are bidding aren’t going to the trouble because of those of us over the age of 25.

FLEISHMAN: The YouTube generation, the MySpace generation, this is a way to get that crowd into the next generation of cellular technology.

That next generation is about transmitting not just video wirelessly, but music and data at high speeds.

It’s also about the continued blurring lines between cable, phone and media companies. They’d like to be one-stop shopping for all your communications needs.

And the existing spectrum’s getting crammed up. Jim Puzzanghera of the LA Times says the competition is fierce.

JIM PUZZANGHERA: Cable TV and satellite particularly are looking for ways to fill in gaps in their services.

It’ll probably be weeks before we know who wins the complicated bidding process, and it’ll be a few years before the spectrum’s actually in use.

The government stands to raise at least $15 billion from the sale, and more spectrum will go on the block in 2008.

In Los Angeles, I’m Lisa Napoli for Marketplace.

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