Bidding Stalls Again on Key US Wireless Airwaves

WASHINGTON, Feb 5 (Reuters) – Bidding stalled on Tuesday inthe closely watched auction of a piece of wireless airwavesthat the U.S. government is selling, according to data releasedby the Federal Communications Commission.

There were no new offers for the nationwide "C" block sliceof wireless spectrum to top previous high bids totaling $4.74billion.

Tuesday’s pause prompted speculation that bidding for the Cblock spectrum may have run its course, and that the mostlikely possible winner could be either Verizon Wireless orInternet search leader Google Inc.

Bidders’ identities are kept secret until the entireauction ends, under FCC rules. The end won’t come until biddinghas stopped on all five blocks of spectrum up for sale in theauction, which will probably take at least another week ortwo.

The $4.74 billion in bids for eight regional pieces of theC block airwaves on Monday surpassed a $4.71 billion offer madelast Thursday for a nationwide package of the spectrum.

Stifel Nicolaus analyst Rebecca Arbogast said there wereseveral possible scenarios as to what companies had bid on theC block airwaves.

The most likely of those, she said, is that VerizonWireless pushed the C block bids up to $4.74 billion on Mondayin order to top an earlier bid by Google.

It was also possible that the earlier, $4.71 billion offerwas made by Verizon Wireless, and that another competitor isaiming to force Verizon to up its bid, Arbogast said.

Bidding on the C block had temporarily stalled on Fridayafter Thursday’s $4.71 billion offer. That bid exceeded a $4.64billion minimum price set by the FCC and triggered a conditionsought by Google that would require the winner to make thespectrum accessible to any device or software application.

Analysts have said Google may drop out of the bidding afterhitting the minimum price, content to let Verizon acquire the Cblock spectrum as long as the open-access conditions areguaranteed.

The C block is one of five groups of 700-megahertz spectrumbeing offered. The top bids on Tuesday totaled almost $18.94billion for all five blocks, raising more money than anyprevious FCC auction.

The 700-megahertz signals are valuable because they can golong distances and penetrate thick walls. The airwaves arebeing returned by television broadcasters as they move todigital from analog signals in early 2009.

Other potential bidders in the auction that began January24 range from entrenched carriers AT&T Inc and VerizonWireless, to possible new competitors like Google, EchoStarCommunications Corp and Cablevision Systems Corp.

Verizon Wireless is a joint venture of VerizonCommunications Inc and Vodafone Group Plc.

(Reporting by Peter Kaplan; Editing by Leslie Gevirtz)

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