Applications are in and a date is set. On October 5, the Federal Communications Commission of the US will hold another mid-band spectrum auction, following last year’s Citizens Broadband Radio Service (CBRS) spectrum auction and the record-setting C-band auction that took place in early 2021. While the bidding this time around won’t reach near the levels seen at the C-band auction, it will be pivotal for players like AT&T and Dish, which need to shore up their spectrum holdings to keep up with competitors.

AT&T is likely to be the most aggressive bidder in the upcoming auction. While AT&T and Verizon have both expanded their mmWave networks in 2021, they are facing significant pressure from T-Mobile, which enjoys a major advantage due to the 160 MHz of 2.5 GHZ spectrum obtained through its merger with Sprint. T-Mobile has since been rolling out its mid-band 5G network that now covers over 165 million Americans. This far outpaces AT&T and Verizon and has left them scrambling to catch up.

Verizon largely addressed its mid-band spectrum needs in February’s C-band auction, where it spent a remarkable $45 billion to more than double its mid-band holdings. AT&T was a distant second, spending about $23 billion. With T-Mobile’s substantial existing mid-band network and Verizon’s spectrum lead, AT&T has some catching up to do.

Source: Raymond James, Counterpoint Analysis

Despite its network lead, some are expecting T-Mobile to emerge as the second-highest bidding operator on October 5. T-Mobile’s lead in terms of spectrum holdings was significantly cut down following the C-Band auction and the operator may be looking to try and build its lead back up. Meanwhile, Verizon is not expected to participate beyond driving up prices. With its gargantuan spend in the C-band auction, Verizon has little need for more spectrum and instead must focus on building out its network infrastructure and delivering mid-band 5G to consumers.

Top Spenders at Mid-band Spectrum Auctions

Outside of the major carriers, it is expected that Dish will make a play for more spectrum as it works towards building out its own 5G network over the next several years. After sitting out of the C-band auction and its 5G network launch later this year in Las Vegas, Dish will have to shore up its holdings to compete with the major operators.

Conspicuously absent from the application list for the 3.45 GHz auction are Comcast, Charter and Altice. Each of these MVNOs sat out of the C-band auction but were major players in the CBRS auction in 2020. While each would likely benefit from greater spectrum holdings, it seems they are still in the process of operationalizing their CBRS spectrum, which could take until 2023. Since it will be a while until these players have the resources to establish significant networks of their own, they have little need for more spectrum until then.

With all of this said, the upcoming 3.45 GHz auction won’t be the massive auction that the C-band auction was. But it will play a significant role in the competition between the major carriers, as well as Dish’s ability to create an effective 5G network. AT&T, T-Mobile and Dish are likely to be the top spenders, while Verizon could creep into the mix if it tries to bid up prices.