700MHz Bidder Frontline Wireless Reportedly Folds

Frontline Wireless, an investor-backed startup founded by former FCC chairman Reed Hundt, reportedly has folded after failing to make its down payment for bidding in the upcoming 700MHz spectrum auction.

A spokeswoman for Frontline Wireless told Virgo Publishing on Wednesday the firm is closed for business “at this time” and has no further comment.

The company was one of the most vocal voices in the debates over wireless open access and reserving more space for first responder equipment in the spectrum. It apparently failed to make its down payment, analysts and media said on Tuesday. Frontline Wireless was slated to pay $128 million in a down payment for the spectrum it wanted; the deadline for down payments was Jan. 4. It reportedly couldn’t come up with the money, according to the New York Times,

Frontline’s exit from the auction means the already limited chance that the event would produce new wireless broadband competition around the country becomes “even smaller than we previously thought,” wrote Blair Levin, a telecom analyst for investment firm Stifel Nicolaus and former FCC chief of staff. That’s good news for AT&T and Verizon Wireless, he said, while “mixed” for other wireless and broadband providers.

Frontline’s inability to raise money for the auction wasn’t a surprise considering it was a new entrant and wanted to bid in the D Block of the 700MHz spectrum. The D Block, set aside for public safety use, required an obligation to work with government agencies to build out a joint network; a non-refundable down payment; an aggressive build-out requirement; and details of the public safety trustee's requirements, Levin said.

“In short, Frontline's difficulties were unlikely to be specific to Frontline, which, because of the track record of some of Frontline's backers probably had as good a chance as any new entrant could in terms of raising money,” wrote Levin.

The 700MHz is set to begin Jan. 24. The spectrum is comprised of former UHF airwaves, which could be used for WiMAX and other broadband wireless technologies.

Frontline Wireless www.frontlinewireless.com

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