FCC sells 10 licenses for advanced paging

July 30, 1994|By New York Times News Service

WASHINGTON -- The federal government set out to sell blue sky this week, and it succeeded beyond anybody's wildest expectations.

Concluding an unprecedented experiment to auction off the nation's airwaves, the Federal Communications Commission raised $617 million yesterday from the sale of 10 licenses for nationwide advanced paging networks. On top of that, it took in $216 million from the sale of about 300 licenses that may be used for interactive TV services in the future.

The biggest winners yesterday were companies already prominent in wireless communications.

Since the auction began on Monday, Paging Network Inc., the nation's largest paging company, dueled in round after round of bidding with McCaw Cellular Communications, the nation's biggest cellular telephone company. Yesterday, each ended up buying two advanced paging licenses for $80 million each -- 20 times what had been expected.

A fifth $80 million license went yesterday to a company backed by the Microsoft Corp. and its founders, William H. Gates and Paul Allen.

These big licenses will be used for nationwide two-way paging networks that will go beyond today's paging systems by letting customers send and receive both spoken and written messages through small wireless devices. The companies expect these networks to be built within five years.

Most of the companies that won paging licenses yesterday plan to offer a new service called "acknowledgment paging," in which a pager automatically responds to a message with a signal indicating that the message got through. But holders of the most valuable licenses also plan more elaborate networks that would allow people to type messages on their computers or hand-held communicators and transmit them anywhere in the country.

Five nationwide paging licenses for less powerful networks were sold for $37 million to $47.5 million each. Paging Network, based in Plano, Texas, also won one of these.

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