A fresh view can sometimes save a lot of money, and Auctionomics’ perspective is unique. In 2006, when the FCC was auctioning licenses to PCS (the new generation of radio spectrum), Paul Milgrom advised SpectrumCo in auction 66, and helped them save nearly $1.2 billion on its acquisitions, based on the prices paid by other large bidders. Our team can meet with you to evaluate whether your current auctions are maximizing your revenue, or whether substantial value is being left on the table.
If you wish to use auctions to increase the efficiency and liquidity of your markets, our team of experts can set the auction up fully. We’ll handle bidders’ application and reporting forms, auction rules, configuration of the auction for your bidders, and branded website- and software-hosting.
In Auctionomics’ designs, bidders can express their preferences in a way that allows our software to find efficient allocations even in the presence of substitute goods available from multiple vendors. Here is an example of bid we support: “I am an energy company and really need to buy at least 20 units of power in Northern California. That is a total limit, but I also have capacity constraints. I am willing to pay to buy up to 18 units at a high price of 11 from the Oregon Border, up to 21 units at a high price of 9 from the Southern California border and up to 20 units at a high price of 6 from the Northen California proper. I expect transmission losses from Oregon, so 21 units at the Oregon Border would result in only 20 units delivered into Northern California. At lower prices, I am willing to buy additional units from all three places, but I do not want to buy more than my total capacity for the year. In addition to the total quantity I can buy, I want to do a swap. Last month I bought 50 units at a high price from the Oregon Border. I would prefer to buy the same quantity from Southern California border if the price is lower there. I want these additional trades to balance exactly; I do not want to buy more power than I sell from the 50 units at the Oregon border and I also don’t want to sell more units than I buy.