In the VoLTE article, we referred to AWS spectrums. AWS is not an actual service but a collective term used by the Federal Communications Commission (FCC) for various sets of electromagnetic frequency bands. It is typically associated with innovative fixed and mobile terrestrial wireless bandwidth that supports user applications including voice and data, Internet access, message services, and video.
AWS licenses are issued by the FCC and cover market areas and frequency channel blocks. Market areas typically consist of one or more counties. The current market areas for AWS licenses are the Cellular Market Area (CMA), the Economic Area (EA) and Regional Economic Area Groups (REAG). There are 734 CMAs, 76 EAs and 12 REAGs. Since 1994 the FCC has sold electromagnetic spectrum by auction. These auctions are open to any eligible individual or company bidder. Auctions are conducted over the Internet in simultaneous multiple-round auctions or package bidding where bidders may place bids on groups of licenses as well as on individual licenses.
In 2003, the FCC established rules to license AWS-1 in the 1710–1755 and 2110–2155 MHz frequency bands. AWS-2 spectrum in the 1915–1920, 1995–2000, 2020–2025, and 2175–2180 MHz frequency bands was established in 2013. Note the 1915-1920 and 1995-2000 MHz bands are referred to as the H block. In 2014 the AWS-3 spectrum in the 2155–2175 MHz frequency band was established. In 2012 the AWS-4 spectrum in the 2000-2020 and 2180-2200 MHz frequency bands was established. The frequency blocks in AWS-1, the “H” Block in AWS-2 and the AWS-3 frequencies are used primarily for terrestrial mobile communications services. AWS-4 is allocated and authorized for Mobile Satellite Service (MSS).
The auctions have created some astounding sales numbers. The AWS-1 auction in 2006 raised $13.7 billion. The 700 MHz band auction held in 2008 raised $18.9 billion. The AWS-3 auction held this year raised $41.3 billion in net bids. The major bidders in the AWS-3 auction were AT&T, Verizon, T-Mobile and Dish Network. Sprint was absent.
This set the stage for further controversy. What is Dish’s strategy since it doesn’t have an operating network? Will Sprint be harmed if the next planned auction of 600 MHz spectrum is delayed?
The government and the FCC argue that it regulates and manages the electromagnetic spectrum in the interest of the “public good.” However, does the auction system for selling frequency bands to the highest bidder maximize the “public good,” or does it only maximize the sales price for those frequency bands. If it is the latter case, the FCC may be simply establishing higher barriers to market entry, increasing the cost of building the network service, slowing the rate of innovation, and ultimately increasing the price to the end user.