The spectrum auctions: Mobile investment in a vice

[Commentary] Several factors could make the next spectrum incentive auction much less productive for the US Treasury and for the broadcasters who currently own the licenses that the auction is supposed to reassign in 2016.

These factors include:

• The AWS-3 auction has become much more costly to mobile carriers than anyone predicted. Will carriers be willing to pony up more billions in just two years?
• Carriers are engaged in an increasingly intense price war now that all of them can offer the same group of smartphones.
• Mobile carrier share prices are falling.
• The Federal Communications Commission's threats to impose Title II regulations on mobile broadband and refusal to allow mergers among national carriers.
• The splitting up of territories among smaller carriers could create a digital divide scenario where rural users pay much more than urban ones for mobile services.
• The FCC remains focused on wired broadband for high-speed rural networking.