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Federal Register / Vol. 86, No. 118 / Wednesday, June 23, 2021 / Rules and Regulations
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start-of-round price and the clock price at which its demand for blocks changes.
In placing an intra-round bid, a bidder will indicate a specific price and a different quantity of blocks it demands if, after bids for the round are processed, the price for blocks should increase beyond that intra-round amount.
201. An intra-round bid gives the bidder the flexibility to indicate that it wants to change its demand at a price lower than the clock price. However, intra-round bids will be optional; a bidder may choose to express its demands only at the clock prices.
Permitting intra-round bids allows the auction system to use relatively large increments, thereby speeding the auction, without running the risk that a jump in the clock price will overshoot the market clearing pricethe point at which demand for blocks equals the available supply.
8. Bids To Change Demand, Bid Types, and Bid Processing 202. Under the ascending clock auction format the Commission proposed for Auction 110, and which OEA and WTB adopt, a bidder will indicate in each round the number of blocks in each product that it demands at a given price, subject to the in-band limit of four discussed above.
203. A bidder that is willing to maintain the same demand for a product relative to its demands from the previous round as processed by the bidding system at the new clock price would bid for that quantity at the clock price, indicating that it is willing to pay up to that price, if need be, for the specified quantity. Bids to maintain demand will always be applied by the auction bidding system. A bidder that wishes to change the quantity it demands would bid at the clock price or at an intra-round price, depending upon the point at which its demands change.
204. For example, if a bidder has processed demand for two blocks entering a round in which the start-ofround price is $2,000 and the clock price is $2,500, but it is only willing to buy one block if the price should increase above $2,100, the bidder can submit an intra-round bid indicating a bid quantity of one at a price of $2,100.
Or, if the bidder is not willing to pay more than the start-of-round price of $2,000 for any blocks, it can submit an intra-round bid requesting a quantity of zero at the start-of-round price of $2,000.
205. To facilitate bidding for multiple blocks in a PEA, bidders will be permitted to make two types of bids:
Simple bids and switch bids. A
simple bid indicates a desired
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quantity of blocks in a product at a price either the clock price or an intra-round price. A switch bid allows the bidder to request to move its demand for a quantity of blocks from Cat1 to Cat2, or vice versa, within the same PEA at a price for the from category either the clock price or an intra-round price.
Switch bids are allowed only in PEAs with two categories.
206. OEA and WTB will not incorporate any form of package bidding procedures into the clock phase of Auction 110. Package bidding would add complexity to the bidding process, and OEA and WTB do not see significant benefit from such procedures, given the clock auction and assignment phase format OEA and WTB
adopt. A bidder may bid on multiple blocks in a PEA up to the limit of four and in multiple PEAs. As set forth below, the assignment phase will assign contiguous blocks to winners of multiple blocks in a category in a PEA
and give bidders an opportunity to express their preferences for specific frequency blocks, thereby facilitating aggregations of licenses. Also as set forth below, if there are one or more bidders that win blocks in both categories, the assignment phase bidding system will assign blocks that are contiguous across the categories to one such bidder.
207. OEA and WTB adopt bid processing procedures that the auction bidding system will use, after each bidding round, to process bids to change demand to determine the processed demand of each bidder for each product and a posted price for each product that will serve as the start-of-round price for the next round.
a. No Excess Supply Rule for Bids To Reduce Demand 208. Under the ascending clock auction format, the FCC auction bidding system will not allow a bidder to reduce the quantity of blocks it demands in a product if the reduction would result in aggregate demand falling below or further below the available supply of blocks in the product. Therefore, if a bidder submits a simple bid to reduce the number of blocks for which it has processed demand as of the previous round, the bidding system will treat the bid as a request to reduce demand that will be applied only if the no excess supply rule would be satisfied.
Similarly, if a bidder submits a switch bid to move its demand for a quantity of blocks from Cat1 to Cat2 within the same PEA, the FCC auction bidding system will treat the bid as a request that will be applied only if the no
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excess supply rule would be satisfied for Cat1 in the PEA.
b. Eligibility Rule and Aggregation Limit for Bids To Increase Demand 209. The bidding system will not allow a bidder to increase the quantity of blocks it demands in a product if the total number of bidding units associated with the bidders demand exceeds the bidders bidding eligibility for the round. Therefore, if a bidder submits a simple bid to increase the number of blocks for which it has processed demand as of the previous round, the bidding system will treat the bid as a request to increase demand that will be applied only if it would not cause the bidders activity to exceed its eligibility.
The eligibility rule for bids to increase demand does not apply to switch bids because the bidders processed activity does not change when a switch bid is applied.
210. In addition, in light of the inband aggregation limit of 40 megahertz in a PEA established by the 3.45 GHz Second Report and Order, the bidding system will not permit a bidder to increase the number of blocks it demands in a PEA if its total demand in the PEA would exceed four blocks.
c. Partial Application of Bids 211. Under the bid processing procedures OEA and WTB adopt, as in all previous FCC spectrum auctions using the clock auction format, a bid simple bid or switch bid that involves a reduction from the bidders previous demands can be applied partiallythat is, reduced by fewer blocks than requested in the bidif excess demand is insufficient to support the entire reduction. Accordingly, the bidding system will apply a bidders request to reduce demand as much as possible consistent with the no excess supply rule. A switch bid may be applied partially, but the increase in demand in the to category will always match in quantity the reduction in the from category. A simple bid to increase a bidders demand may be applied partially if the total number of bidding units associated with the bidders demand exceeds the bidders bidding eligibility for the round, or if fully applying the bid would violate the aggregation limit. Therefore, the bidding system will accommodate a bidders request to increase demand as much as possible consistent with the aggregation limit and as long as the bidders activity does not exceed its eligibility.
d. Processed Demand 212. As proposed, OEA and WTB
adopt procedures to determine the order
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