The closure of high-profile start-up Frontline Wireless suggests that the US federal government's spectrum auction could generate far less money than anticipated and puts the future of a public safety network at risk, according to reports.
Frontline, whose staff includes former Federal Communications Commission (FCC) Chairman Reed Hundt, was widely expected to successfully bid for a share of the spectrum set aside for a new public safety network designed to allow emergency services to communicate during disasters.
According to the LA Times, Frontline was unable to raise sufficient funds for the minimum bid of $1.3 billion and analysts told the paper that if a company as well connected as Frontline couldn't raise sufficient funds, other start-ups were unlikely to be able to compete with major players such as Google and AT&T, who are expected to bid for a slice of spectrum that will enable them to offer high-speed wireless services.
A Frontline Wireless statement confirmed the business had closed but declined to comment further.
FCC Chairman Kevin J. Martin told reporters that alternative bidders could replace Frontline.
"I'm still hopeful that there will be someone who will emerge as being willing to take on that challenge," he said.
If nobody meets the minimum bid the FCC could hold another auction with different rules, Martin said.
DTG Staff | 14.01.2008