Analysts: Verizon might be playing coy with 600 MHz auction participation to get more favorable rules

Verizon indicated that it thinks it has enough spectrum for the foreseeable future and is taking a "wait and see" approach to the Federal Communications Commission's 600 MHz incentive auction of broadcast TV spectrum. However, some analysts think that Verizon is playing coy as a way to get auction rules that it finds more favorable or to delay the auction. While AT&T has said it plans to purchase between 20 MHz and 40 MHz of spectrum in the incentive auction, Verizon has never made any such commitment.

Some analysts think Verizon is angling to get more favorable rules by holding off from committing to participate in the incentive auction. "You can't take AT&T and Verizon out of the auction," said Armand Musey, a managing director at Goldin Associates. "They make up more than 70 percent of the market. And they have much deeper pockets than anyone else that would participate in this auction." If the incentive auction were delayed again (and it's already been delayed twice) Verizon might push to have the auction held after the next presidential election, which could change the composition of the FCC if a Republican wins. Such a change would likely help Verizon implement auction rules it finds more attractive. Additionally, it would give Verizon some financial breathing room following the AWS-3 auction.