"Beachfront Spectrum" is what analysts are calling that soon-to-be-auctioned upper 108 MHz, because it is ideal for cellular services. Signals at those frequencies propagate farther and penetrate buildings better than signals in today's cellular bands, which go up to 1.9 gigahertz. Best of all, cellphone system operators expect infrastructure costs to be reduced by 90 percent, because fewer cells will be required, given the longer distances signals will travel.

Thanks to such advantages, the cellular phone companies are likely to compete hard for this valuable bandwidth. Exactly what they would do with it is a closely guarded secret, at least until winning bidders are selected. Nevertheless, it's not hard to imagine the winners launching third-generation services, including mobile video and wide-band Internet access, which would enable cellphone users to receive video programming and e-mail on the run.

The FCC's huge menu of allowable uses for the new frequencies identifies "[f]lexible fixed, mobile, and broadcast uses, including mobile and other digital new broadcast operations; fixed and mobile wireless commercial services, as well as fixed and mobile wireless uses for private, internal radio needs. Could also include two-way interactive, cellular, and mobile television broadcasting services."

Perhaps the best early indicators of what will happen with the freed-up bandwidth are recent events in Berlin—the first city to turn off analog television—and in the United States, where a couple of preemptive auctions gave developers access to segments of spectrum on the condition that they not interfere with broadcasters still using them.

The "Berlin Switch" is an intriguing novelty. It was possible because the region affected is relatively small, with 1.8 million households in the TV market, and because an overwhelming number of those households—all but 160 000—subscribe to cable or satellite television. Nonsubscribers each coughed up at least $200 to buy a set-top converter, and for less than $1 million, the government subsidized the purchase for families on welfare.

What the switch gave Berliners, mainly, was an increase in the number of broadcast stations—from 12 to 27. Multiplexing allows four digital channels to fit in the space previously allotted to a single analog channel. (This excludes HD broadcasts, because they require more bandwidth.) The switch also gave the government 35 MHz to use—or sell—for new services.

With more channels, viewers of broadcast television in Berlin have access to niche programming and channels previously available only to cable or satellite subscribers. Programming now includes Eurosport; Arte, with art movies, documentaries, poetry, and theater; Phoenix, with political news; Viva II, with pop culture for people in their 20s; and several new local channels.

In the United States, in 2001 and 2002, the FCC auctioned off four small slices of spectrum totaling 6 MHz in the 746- to 806-MHz range, the upper 700-MHz band, that had been allocated as "guard bands." Along with the right to use the spectrum came tight rules to minimize interference with public-safety services. This RF real estate is intended for the rental market: the buyers will act as landlords, leasing the spectrum to third parties. The FCC packaged the spectrum in two pieces for 52 market areas, creating 104 licenses, which were auctioned for $540 million. The top three winners were Access Spectrum, Nextel, and Pegasus Communications.

Access Spectrum LLC, in Bethesda, Md., winner of 21 licenses, announced at the time that it had begun negotiating rental agreements. In addition, Access, formed in 2000, is likely to build private wireless networks for businesses in some of its bands.

Plans of the other winners are murkier. Nextel is using its 40 licenses as bargaining chips and recently agreed to return them to the FCC as part of a deal involving interference reduction in the 800-MHz band. Pegasus won 34 of the 104 licenses but has been quiet about its plans. The largest independent provider of the DirecTV satellite service, Pegasus is having financial problems, and some of its subsidiaries filed Chapter 11 bankruptcies in 2004.

Then, in 2002 and 2003, the FCC auctioned off 18 MHz between 698 and 746 MHz, which covers three UHF channels, 54, 55, and 59. Again the spectrum was packaged into geographical pieces, both to be attractive to buyers and to maximize returns. Channel 55 was sold in six regional chunks, while 54 and 59 were sold as a pair in 734 markets. Altogether the sales brought the U.S. government $145 million.

Qualcomm Inc., of San Diego, won the auction for the spectrum previously occupied by channel 55 in five of the six auctions. It then bought the rights for the sixth region from Aloha Partners LP, of Providence, R.I. Aloha was formed to provide wireless broadband service and has been a big player in the auctions so far.

Qualcomm intends to use its spectrum to send video and audio programming to cellphones, PDAs, and other portable devices nationwide. It hasn't announced what it intends to broadcast, but the content could include hit TV shows, clips of sporting events, and movie trailers. The company calls its service MediaFLO ("Media" plus "Forward Link Only"). Qualcomm plans to store video in the handsets to supplement video streamed live; that way, it hopes to eliminate the dropouts endemic to cellphone reception. If a voice signal drops out temporarily, you can just say, "What?" Video signal dropouts, however, cause annoying freezes, jerks, or blanks in the picture, and would discourage users.

Qualcomm is developing MediaFLO as a way to promote CDMA cellphone technology, which it pioneered. CDMA is winning out over the TDMA standard (popular in the United States) and is emerging as a strong competitor to GSM (popular in Europe). Today, CDMA is used in 35 countries, including the United States and South Korea. Qualcomm plans to integrate MediaFLO into its chip sets and to offer the service through partnerships with cellphone operators. It may eventually spin it off as a separate company.

Technology alternatives to MediaFLO are available and could be used for competing services in spectrum bands yet to be auctioned. One example is a variant of the Digital Video Broadcasting standard widely adopted in Australia, Europe, India, and elsewhere. The variant, called DVB-H, provides TV broadcasts to handheld devices and, like MediaFLO, is being used in the 700-MHz band. In South Korea, yet another standard for TV broadcasting to handhelds is being deployed—Terrestrial Digital Multimedia Broadcasting, or T-DMB—and it may emerge as a competitor in the United States.