US regulator FCC has concluded an investigation into why D-band spectrum in its recent 700MHz auction failed to attract serious bidders. The FCC’s Inspector General wrote in a report published late last week that potential bidders had been deterred by default penalties and the network build-out costs and requirements associated with the spectrum, but he cleared an advisory body of charges that it had illegally discussed spectrum-lease payments from potential bidders. It was alleged that the Public Safety Spectrum Trust (PSST) and its consultant Cyren Call – appointed to oversee the sale of D-band spectrum – had asked for lease payments of US$50 million from prospective bidders during the “quiet period” when such discussions were prohibited. However, the Inspector General concluded in his report that “no rules were broken” during the auction process.

The PSST was set up to manage a 10MHz block of spectrum that will be paired with a similar-sized block from the FCC auction to create a ‘public-private’ network that could be used by both a commercial entity and by emergency service first responders. The FCC put a reserve price of US$1.3 billion on the spectrum in the recent auction but received only one bid: US$472 million from Qualcomm that was not considered as it was too low. According to the Inspector General, both Verizon Wireless and Frontline Wireless had met with the PSST and Cyren regarding a possible bid but neither decided to proceed.