The ARV Estimate: a “Zestimate” for Spectrum

By Zev Stravitz

The Airwave Research Valuation (ARV) is an estimate of spectrum value that can be used to quickly understand the dollar worth of a license, transaction, or portfolio.

We started Airwave Research because answering seemingly simple questions about the spectrum was difficult. Even the most basic questions, such as "What spectrum does Verizon own in LA County?” were expensive and time-consuming.

With Airwave Research, you can answer questions like that with ease, as well as:

Perform complex analysis on company portfolios or any list of call signs
Rank spectrum owners across every market
View the block holder for every single county in the US and Territories
Run a spectrum screen on what-if transaction scenarios
Search all application history and get email notifications when new activity occurs
View historical prices of spectrum in the primary and secondary market

While customers could answer specific questions with our tooling, understanding the worth of assets, even directionally, required additional steps. Users could view MHz-Pop instantly across any market or band, but more than MHz-Pop is needed when working across low, mid, and high band frequencies because portfolios heavier in mmWave licenses skew the results. On a purely MHz-Pop basis, GeoLinks is the 5th largest spectrum owner in the country. But their portfolio isn’t estimated today at more than $1.5M. Normalizing ownership across value would help teams analyze licenses, transactions, and portfolios more effectively.

Having our model generate the dollar value of assets enables folks to understand spectrum value quickly, but we felt one number was too rigid and opinionated. So, the model generates three values: a base (or average), conservative, and aggressive estimate. The base is the most likely worth, while conservative and aggressive estimates form the basis for the ARV range.

Integrating ARV into the platform

ARV has already been integrated into core functionality on the platform.

On the Portfolio page you can now see ARV estimates in the “Key Metrics” section.

In the Application module, there is an ARV estimate for every single application to understand the magnitude as well:

ARV has also been integrated into:

The Daily Digest to value each change in licensure
The Rankings page to rank spectrum holders by ARV
The Band Plan so that hovering over each block exposes the ARV of the associated license
The Call Sign Search page so that you can see the ARV of a individual license at a glance

We will continue to integrate ARV further into the platform.

How ARV works

At a high level, the ARV model works by utilizing channel-level valuations and adjusting prices across markets.

To read about the methodology in greater detail, you can access the whitepaper at https://www.airwaveresearch.com/spectrum-valuation-whitepaper.

The estimate does and should not serve as a fair market valuation.

Early results benchmarking against the AT&T and USCC Deal

The ARV model is based on historical benchmarks, so we waited to see how it would perform in an example with real world data.

In the recent AT&T-USCC deal, the ARV model estimated the price within 5% of the closing price. Based on a press release, the deal closed at $1.018B. The assets transferred are all of USCC’s 700L B and C block licenses as well as their 3.45 GHz spectrum.

Broken down, we valued the 700L spectrum at almost $193M and the 3.45 GHz spectrum at $873M, and in total, $1.065B. This means that our model predicted the price within 5%.

We will continue to refine the model, but this example proves that ARV will be immensely valuable to anyone doing spectrum research.

Getting access to ARV

ARV is available today on the Airwave Research platform. To get access, reach out at https://www.airwaveresearch.com/get-access.

Disclaimer