AT&T threatens to boycott airwave auction

AT&T is threatening to sit out the Federal Communications Commission’s highly anticipated spectrum auction in 2015, which will sell billions of dollars’ worth of airwaves.

As the FCC plans the auction, it is considering "complicated and unnecessary" restrictions on large companies, AT&T Vice President Joan Marsh said. “Such restrictions would put AT&T in an untenable position, forcing AT&T to reevaluate its potential participation in the auction,” Marsh wrote.

AT&T’s filing pointed to the auction’s x-factors, including where the FCC sets the revenue benchmark. The proposal in front of the agency -- which will be voted on at the FCC’s May meeting -- “does not define the threshold for initiation of the restrictions, instead deferring this determination to a subsequent order,” Marsh wrote. She urged the FCC to set the benchmark “at a significant and material level” to keep the small wireless carriers from getting the airwaves “at a discount that the FCC cannot afford to give in this auction.”

Marsh also noted the uncertainty around how much of their airwaves broadcasters will be willing to sell back. If they’re only willing to sell back 60 MHz or less, AT&T and Verizon will be forced to split the available three 10-MHz blocks.

“The restrictions would thus put AT&T in an untenable and unacceptable position,” the filing said. “AT&T could either participate in the auction, accepting that it will likely obtain only a fragmented and inefficient 600 MHz footprint, or it can choose to withhold its capital for other investments and sit out of the auction entirely.”