AT&T and Verizon will be eligible to bid for incentive auction reserve spectrum in many markets where they now hold less than 45 MHz of low-band spectrum, and that's a point being missed by many investors, Wells Fargo analyst Jennifer Fritzsche said Thursday in a research note. The FCC released information Oct. 15 in a public notice that listed all of the markets in which each of the four major national carriers is reserve eligible (see 1510160065). By Fritzsche’s calculations, AT&T qualifies to bid in 242 markets covering 81.8 million POPs and Verizon in 112 markets covering 58.7 million. Their eligibility overlaps in 69 markets with a population of 19 million POPs, she said. While that means T-Mobile will face off against Verizon or AT&T in many markets, the news isn't all bad for the carrier, she said. T-Mobile already has 700 MHz A-block licenses covering 190 million POPs and recently bought an additional 20 million POPs, she said. T-Mobile will also be helped by Sprint’s absence from the auction and Verizon’s signaling that it may not be that active in the auction, Fritzsche said. She said neither Verizon nor AT&T is reserve eligible in Chicago, the biggest market in which T-Mobile doesn't own 700 MHz spectrum. “In our view, this, in addition to Sprint's absence in the auction, still makes [T-Mobile] well positioned to strategically acquire 600 MHz spectrum in certain markets to augment its existing 700 MHz network,” she said. “But this auction may not be as easy as a cake walk as most think for Team Magenta!”

T-Mobile offered a positive take on the TV incentive auction Tuesday, in comments by CEO John Legere as the carrier released Q3 results. The tone of a call by company executives with analysts was upbeat as T-Mobile reported it continues to take customers from its rivals. T-Mobile reported 2.3 million total net adds, including 1.1 million postpaid adds.

The FCC released its order on the methodology to be used during the TV incentive auction to predict interservice interference (ISIX) between broadcasters and wireless providers. The vote was 5-0, though Commissioners Ajit Pai and Mike O’Rielly both had quibbles with some decisions. The order largely follows the approach approved last year on ISIX methodology (see 1410170053). The agency affirmed its decision from last year not to adopt a cap on the aggregate amount of new interference a TV station may receive from other TV stations in the repacking process.

The FCC provided clarity on when operations start once a licensee starts to deploy in the spectrum, CTIA and NAB said, and the FCC determined a provider “commences operations” when it conducts site commissioning tests.

Recent comments by carrier executives raising doubts about whether they will bid in the TV incentive auction are more than just gamesmanship, industry officials said Friday, responding to comments Thursday by FCC Chairman Tom Wheeler (see 1510220041). Wheeler suggested wireless industry comments on the auction are mostly “positioning” and typical “shenanigans” seen before any major spectrum auction.

Carriers are playing games on their level of interest in 600 MHz spectrum in the buildup to the TV incentive auction, FCC Chairman Tom Wheeler said at a news conference after Thursday’s meeting. After the commission’s Aug. 6 meeting, Wheeler said pointedly it was up to carriers whether they want to play in the auction (see 1508060028). Sprint since said it wouldn't bid and Verizon this week downplayed its need for additional low-band spectrum (see 1510200058). Wheeler was president of CTIA and has a long history in spectrum auctions. “I think we’ll have a very successful auction,” he said, chuckling, noting the auction starts in just 157 days. “I think what we’re seeing right now is the marketing has begun, everyone is positioning a little bit,” he said. “This is all pre-auction shenanigans that one can expect [to] happen in any kind of a marketplace.” Wheeler said the key goal of the auction is getting more spectrum in play for wireless broadband, not bringing in huge revenue. He was asked about broadcaster concerns that the voluntary incentive auction isn’t really voluntary. “There are no armed FCC agents holding guns to heads,” he said. “You are free to decide whether or not you want to participate.”

The FCC approved an NPRM on spectrum frontiers, spectrum at 24 GHz and above for 5G, Thursday. Commissioners Ajit Pai and Mike O’Rielly were critical of the approach in the NPRM. As some predicted (see 1510190067), they partially dissented. Pai said the NPRM leaves out critical spectrum bands that deserve more discussion. The NPRM tees up for further investigation the 28, 37, 39 and 64-71 GHz bands, the FCC said in a news release. The NPRM wasn't released Thursday.

Three incentive auction items that had been on the agenda for Thursday’s FCC meeting were approved and won’t be part of Thursday’s session, agency officials said in interviews. An item involving proposed rules for broadcaster channel sharing was released Wednesday after being approved by the full commission. Rules on interference after the auction between wireless carriers in the 600 MHz band and broadcasters, and an item defining when broadcasters and unlicensed users need to vacate their spectrum to make way for the new wireless owners, have also been approved, they said.

Verizon Chief Financial Officer Fran Shammo sounded a note of caution on the outlook for the TV incentive auction, on a Tuesday quarterly earnings call with analysts. Shammo said the 600 MHz spectrum that will be auctioned by the FCC doesn’t fit well with the 700 MHz spectrum Verizon already owns. Verizon reported earnings of 99 cents per share on revenue of $33.2 billion, which was slightly above analyst estimates.

With Sprint dropping any pursuit of licenses in the TV incentive auction, questions remain about how big T-Mobile will go in pursuit of low-band spectrum. Both carriers had pushed the FCC to adopt rules setting aside 30 MHz of “reserve” spectrum for carriers without substantial low-band holdings in an individual market. Industry officials said that one complicating factor is that T-Mobile USA parent Deutsche Telekom ultimately will decide how much T-Mobile USA can spend, and DT is subject to German regulations limiting how much debt it can carry.