Actually, this isn't the first time the FCC has postponed the auction. In fact, the "once-in-a-lifetime" event was supposed to happen this year. But in 2013, the FCC said it was delaying the auction to 2015 over concerns about logistics. This is a complicated, technical process, one that involves setting up all-new computer algorithms that can award money to TV broadcasters interested in trading their spectrum for cash while also selling that same spectrum to wireless carriers. All kinds of decisions need to be made about how the auction will be run before that software can even be written.
"I think it was inevitable that the commission was going to push back the auction from its mid-2015 target," said Paul Gallant, a telecom analyst at Guggenheim Securities. "There are just incredibly difficult things that need to be done to make this work. It's hard to overstate how different this auction is from prior auctions."
In a blog post Friday, the FCC partly blamed procedural deadlines in an ongoing court case against the auction for the latest delay. An FCC official also acknowledged that work on the auction had slipped slightly behind schedule, though industry officials say the agency had been working hard to hew to the mid-2015 time frame.
The auction can't work without buy-in from broadcasters. One looming question has been whether the FCC will attract enough broadcasters to make the auction successful. To that end, the FCC is trying to convince broadcasters to participate, most recently by releasing estimates showing how much a TV station might expect to make from giving up their spectrum. The agency is set to embark on a roadshow to pitch TV stations on the idea, but analysts and industry officials agree that the report, compiled by the investment bank Greenhill & Co., has already caused an uptick in broadcaster interest.
"I've talked to several mainstream, big-group broadcaster executives who, after the Greenhill book, are taking a far more serious look at the auction," said Preston Padden, who leads a coalition of broadcasters who are interested in participating in the sale.
The increased interest suggests we can eliminate at least one possible reason — reservations about participating — for the auction delay.