T-Mobile this week lost a bid to expand the amount of spectrum that will be set aside for smaller providers in next year's FCC spectrum auction.
The auction, which is now scheduled to begin on March 29, will dole out much-needed spectrum to providers big and small. Those smaller providers, however, have long requested that the FCC set aside a section of spectrum that major players like AT&T can't touch. Without those restrictions, they argue, there's no way they can outbid their larger, wealthier rivals.
The FCC agreed and set aside 30 megahertz of spectrum per market for that purpose. T-Mobile had been lobbying for 40MHz, but the commission this week denied that request, arguing that 30MHz is sufficient.
In a statement, FCC Chairman Tom Wheeler said 30MHz is a good happy-medium. "Some parties have petitioned the Commission to increase the size of the reserve, while others have argued for its elimination," he said. The FCC "rejects both entreaties and maintains the reserve size at the previously approved level."
The 30MHz option will "provide protection that bidders without significant amounts of low-band spectrum could not be predatorily prohibited from gaining the necessary competitive capacity by those whose interest might be served by eliminating such competition," Wheeler continued.
To bid on that 30MHz, a company or entity will need to hold less than one-third of available high-quality, low-band spectrum in a given license area.
As Fierce Wireless pointed out, T-Mobile wanted the increased reserve because the 30MHz plan would only let carriers bidding on that spectrum get one 10x10 MHz configuration, which is a technical way of discussing how much bandwidth that spectrum will actually provide (5x5 vs. 10x10 vs. 15x15 and up—the higher the better).
On Twitter, T-Mobile CEO John Legere said his company put up a good fight and that the allocation of 30MHz is still a "victory."
"Good news—the reserve includes great quality spectrum & looks like the @FCC will be monitoring closely so duopoly can't game the system," Legere wrote. "T-Mobile is committed to showing up, playing hard and being successful at the auction."
In a blog post, AT&T said "the commission was right to reject T-Mobile's demands." But the carrier still has some concerns when it comes to the nitty-gritty details of the auction. Last year, AT&T threatened to ditch the auction entirely if the FCC put in place restrictions that were too onerous.
The auction, meanwhile, will allow broadcasters to sell their unused spectrum to mobile carriers, and get a cut of the purchase price. Already moved from 2014 to 2015, a legal challenge last fall pushed the event into 2016.
The last major spectrum auction of this nature was in 2008, when AT&T and Verizon were the big winners. Verizon has said it does not need any more huge blocks of spectrum, but we'll have to see who places bids come March 2016.