From laser pointers to paintings like ‘Green Leaves and Bust’, auctions have been used to find prices where none exist. In the “English” auctions most people are familiar with, bids are public and the highest bidder wins. In online auctions, usually it’s not known who is bidding until contract award. A reverse auction reverses the roles of buyers and sellers and the lowest bidder wins.
Since 2004, the White House Office of Federal Procurement Policy has encouraged agencies to take up reverse auctions. And auctions are used to price spectrum in most countries. During 2016 the Federal Communications Commission ran reverse auctions for television spectrum.
In telco service markets, reverse auctions have not traditionally been used. The reasons are more than supplier squeamishness. Features like a variable pricing and bill complexity have slowed the buyers from using reverse auctions.
But those features are no longer barriers. For over a decade, suppliers have been offering teenage customers fixed prices for mobile. Fixed price contracting is now the standard for business buyers across mobile, voice, and data. Meaning the benefits to buyers seen in the wholesale markets are now available in the retail service market. Time to bring on the auctioneer!