US mobile startup, Frontline Wireless, is rumoured to have closed its doors, just days ahead of the major spectrum auction that it had been painted as such as key player in.

Frontline, which has on its board former FCC chairman Reed Hundt, was one of the leading proponents of open access for the 700MHz spectrum and champion of a public-private network partnership concept.

But the understanding is that Frontline failed to secure enough funding to bid in the auction, which kicks off on January 24.

The startup’s departure means that there are less likely to be any new faces on the US wireless scene, with only Google and Vulcan Spectrum, headed up by Microsoft co-founder, Paul Allen, among the noticeable debutants.

Frontline’s game plan was to build a nationwide public safety network in the 700MHz band. The company believes that adopting wholesale, open access use for a portion of this spectrum will benefit competition in the wireless and broadband markets, providing consumers with more choices and first responders with better alternatives for wireless broadband.

Credit rating agency Fitch Ratings said this week that the establishment of a public-private partnership network in the nationwide 10MHz D-block of spectrum was a significant item for the auction, which also has the most aggressive build out requirements of all the blocks in the auction. The closure of Frontline has raised some concerns as to whether any other party would be interested in this particular block of spectrum.

Fitch said it expects the upcoming auction to generate total bids significantly beyond the excess of the FCC’s reserve price of $10bn. “The relatively close timing of this auction in relation to the advanced wireless service (AWS) auction in 2006 (bids of approximately $13.7 billion) has tempered the interest of some wireless operators who have decided not to participate, most notably T-Mobile USA and Sprint Nextel Corp. However, many new entrants have expressed interest including Google Airwaves, which has committed to bid the reserve price for the C-block ($4.64 billion),” the agency said.