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danny burstein <dannyb@panix.com> wrote in message news:<ca4q0t$2f4$1@reader2.panix.com>...
>
> It would be oh, so appropriate, if no one bids on these. The NextWave saga
> ranks only a few notches above Enron in the smell test.
There is some unfortunate truth to your statement. Despite a majority
of the proceeds going to the FCC & other creditors, NextWave will
still profit immensely from the continued leveraged divestment of its
spectrum assets, if simply because wireless spectrum is a finite
resource, hence inflatedly valuable. Though quite possible that
NextWave may never construct its proposed cdma2000 or TD-CDMA
broadband wireless network, financially NextWave will likely walk away
from this debacle smelling like roses. But lean a little bit closer,
see that roses really smell like poo-ooo-ooo...
Like it or not, however, someone will step up to the table for the
Denver, Portland (OR), Sarasota, Tampa, & Tulsa BTA licenses. As I
recall, the auction reserve prices for those license are all less than
$40 million.
As for a potential buyer for the NYC BTA PCS C3 10 MHz disaggregation,
I see it as a two-horse race -- VZW & Cingular. However, that is true
only if either or both horses decide to run, as the reserve of $930
million is exceedingly steep for a single 10 MHz PCS license.
At FCC Auction 4, SPCS' WirelessCo LP consortium paid about $443
million for the PCS B 30 MHz license for the entire multi-state NY
MTA. Comparatively, at FCC Auction 5 in 1996, NextWave paid $994
million for the full PCS C 30 MHz license for just the NYC BTA. And,
at FCC Auction 11 in 1997, for again the NYC BTA, the PCS D 10 MHz was
won by Omnipoint for a little bit less than $51 million, the PCS E 10
MHz was grabbed by AT&TWS for nearly $58 million. Interestingly the
closed-bidding entrepreneurial PCS F 10 MHz license for the NYC BTA
sold for an even higher price than either of the open-bidding licenses
-- slightly more than $75 million to Cablevision's Northcoast PCS.
The last was the highest price paid at auction for a 10 MHz PCS
license.
A more contemporary market precedent was set earlier this spring by
the Cingular acquistion of 34 10 MHz or 20 MHz PCS licenses from
NextWave. Included were 10 MHz disaggregations or full license
transfers in the LA, Chicago, San Franciso, Dallas, Houston, Boston, &
D.C. BTAs et al. Total purchase price was $1.4 billion.
http://people.ku.edu/~cinema/wireless/nextwave_map.html
By setting the reserve price of the NYC disaggregation at the rarefied
level of $930 million -- only $64 million less than NextWave
originally paid for the entire 30 MHz license! -- which in turn was
itself the largest sum ever bid for a single PCS license at FCC
auction -- NextWave is hedging its bet. View it as an indication that
NextWave is somewhat ambivalent about parting w/ a third of its most
valuable asset. After all, that idle PCS C 30 MHz license in arguably
the most important market in the world has singularly made NextWave
relevant, impossible to ignore. Thus, NextWave will only sell the NYC
10 MHz if it can receive an astonishing premium for the spectrum.
And, as such, the NYC license may very well not sell.
Andrew
--
Andrew Shepherd
cinema@ku.edu
cinema@sprintpcs.com
http://www.wirelesswavelength.com/
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