UK wireless spectrum bids hit $35B

Bids for third-generation wireless spectrum in the UK hit a total of $35 billion in the latest round of an auction that started March 6, with only six companies remaining out of an original field of 13.

Vodafone Air Touch in London, which has formed a wireless partnership in the US with Bell Atlantic in New York, led the field with a bid of $9.4 billion. British Telecom in London trailed slightly behind with an offer of $9.1 billion in the previous round.

The auction will end when only five companies remain. The UK government plans to award a total of five licenses for spectrum capable of supporting high-capacity wireless offerings. The bidding companies plan to use this spectrum to offer a variety of multimedia services to business and consumer markets.

The staggering sums the UK spectrum auction has commanded has analysts concerned that prices for similar spectrum the Federal Communications Commission will sell in June could hit $100 billion. Corporate users worry that at these prices, which don't include the cost of building the wireless networks, they will not be able to pay the rates the carriers will have to charge to recoup their investments.

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