AT&T, Verizon Wireless and Vulcan among winning bidders in airwave auction

WASHINGTON — The nation's two largest cellphone companies dominated bidding in a record-setting government airwaves auction, according to results released Thursday.

And Microsoft co-founder Paul Allen won two airwave licenses in the auction that ended this week, offering $112.8 million for spectrum in the Pacific Northwest.

Allen's Vulcan Spectrum Management spent $69.2 million for airwaves covering the cities of Seattle, Tacoma and Bremerton, the Federal Communications Commission (FCC) said Thursday on its Web site. The Seattle company also pledged $43.6 million for spectrum in the Oregon cities of Portland and Salem.

Allen is chairman and founder of Vulcan Ventures, which has invested in Internet, cable and media companies. The airwaves Allen bought are ideal for mobile Internet access because they can travel long distances and pass through walls.

Together, AT&T and Verizon Wireless account for $16 billion of the $19.6 billion bid in the auction, an Associated Press analysis of the FCC data shows. Verizon Wireless bid $9.4 billion and AT&T $6.6 billion.

Those results raised concern that the auction failed to attract new competitors to the cellphone market to challenge the dominant companies.

Google was not among the winners, meaning the search-engine giant will not be entering the wireless business.

One new entrant, Frontier Wireless, owned by leading satellite-television company EchoStar, won nearly enough licenses to create a nationwide footprint.

Frontier bid $712 million, according to FCC data.

Until Thursday, the names of bidders were kept anonymous to discourage collusion during the auction. The bidders have 10 days to make down payments.

Verizon Wireless, a joint venture between Verizon and British telecom giant Vodafone, won nearly every license in the consumer-friendly "C block."

The frequencies, which encompass about one-third of the spectrum at auction, is subject to "open access" provisions pushed by FCC Chairman Kevin Martin. That means people on the network can use whatever phones or software they wish.

Verizon won enough licenses to cover every state but Alaska and said it was very pleased.

The third leading bidder was Qualcomm, which had pledged $1 billion.

A section of airwaves dedicated for a nationwide emergency communications network failed to attract a winning bidder.

Martin said Thursday he had ordered an investigation into the circumstances surrounding it.

Material from Bloomberg News was used in this report.