half 180$60B of hot air evaporates. The U.S. auction is down to $10B compared to most estimates of $60-80B. Tim Farrar, one of the best analysts in this space, tells me it might come back up modestly, winding up at $0.90/MHz/pop. Last time, it came to $2.63/MHz/pop. Technology is increasing capacity of current spectrum faster than demand is growing. See my article  and the reporting on MIMO and Gig LTE. 

Everyone is better off with lower spectrum prices except those who own some. The broadcasters got the spectrum for nothing and mostly weren't using it. Every dollar in this auction would be a windfall profit, mostly to very rich men. Some of them are now crying like babies whose toys were taken away.

The prospects of spectrum holders Dish and Straight Path are dark.

I don't pick stocks and the market here runs on psychology, not facts. I wouldn't want to play poker against Charlie Ergen but he seems to be holding a losing hand.  The reduction of spectrum values implied also could chop $10B off the balance sheets of AT&T and Verizon, but the accounting there is so creative I wouldn't want to guess. 

 Too many people believed the lobbyist lies about a spectrum crisis. More spectrum slightly lowers wireless costs, somewhere about ~1% of the customer bill. By 2009, the engineers knew the spectrum crisis was invented; the folks at the Broadband Plan demanded the FCC Chair take their names off some of the propaganda he was putting out. Verizon's CEO Ivan Seidenberg was telling Wall Street they didn't have a spectrum crisis at the same time the telcos guy in DC were inventing one.

  

"There's never been a spectrum shortage and there never will be one," Marty Cooper told Washington in 2014. (Marty built the first cellphone and went on to be an antenna pioneer.) He was joined by several other Marconi Fellows who saw a 50X or 100X capacity increase coming. The engineers saw this coming, but DC ignored them as usual. Even after this demonstration, wireless lobbyist Stephen Berry claimed, "The entire communications industry is staring down a spectrum crunch in the early days of data-hungry 4G and 5G services, which consumers need and expect, and which require both high-band spectrum and more importantly 'greenfield' low-band spectrum for coverage." He belongs on the unreliable sources list. 

Legendary lobbyist Preston Padden should be particularly embarrassed by his high estimate; he should have known his peers like Jim Cicconi at AT&T were not to be believed. (Working for Disney, Preston got the Mickey Mouse copyright act through Congress, one of the greatest lobbying coups of my lifetime.)

dave askOn Oct 1, Verizon will turn on the first $20B 5G mmWave network, soon offering a gigabit or close to 30M homes. The estimates you hear about 5G costs are wildly exaggerated. Verizon is building the most advanced wireless network while keeping capex at around 15%.

The Koreans, Chinese, and almost all Europeans are not doing mmWave in favor of mid-band "5G," with 4G-like performance. Massive MIMO in either 4G or "5G" can increase capacity 4X to 10X, including putting 2.3 GHz to 4.2 GHz to use. Cisco & others see traffic growth slowing to 30%/year or less. Verizon sees cost/bit dropping 40% per year. I infer overcapacity almost everywhere.  

The predicted massive small cell builds are a pipe dream for vendors for at least five years. Verizon expects to reach a quarter of the U.S. without adding additional small cells. 

In the works: Enrique Blanco and Telefonica's possible mmWave disruption of Germany; Believe it or don't: 5G is cheap because 65% of most cities can be covered by upgrading existing cells; Verizon is ripping out and replacing 200,000 pieces of gear expecting to save half. 

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 5G Why Verizon thinks differently and what to do about it is a new report I wrote for STL Partners and their clients.

STL Partners, a British consulting outfit I respect, commissioned me to ask why. That report is now out. If you're a client, download it here. If not, and corporate priced research is interesting to you, ask me to introduce you to one of the principals.

It was fascinating work because the answers aren't obvious. Lowell McAdam's company is spending $20B to cover 30M+ homes in the first stage. The progress in low & mid-band, both "4G" and "5G," has been remarkable. In most territories, millimeter wave will not be necessary to meet expected demand.

McAdam sees a little further. mmWave has 3-4X the capacity of low and mid-band. He sees an enormous marketing advantage: unlimited services, even less congestion, reputation as the best network. Verizon testing found mmWave rate/reach was twice what had been estimated. All prior cost estimates need revision.

My take: even if mmWave doesn't fit in your current budget, telcos should expand trials and training to be ready as things change. The new cost estimates may be low enough to change your mind.