Washington - The head of the Federal Communications Commission (FCC) is fearful that the nation's current credit woes could lead to lower bids in a major auction of wireless spectrum that is being closely watched by the local technology community that is scheduled for next Thursday.

"Is it an ideal time to necessarily be conducting an auction? I'm not so sure," said FCC Chairman Kevin Martin.

The news comes a week after Frontline Wireless -- which was hoping to build a national network for emergency responders -- dropped out of the auction and shuttered its business, according to Reuters.

The auction, mandated by federal law to begin by Jan. 28, has been expected to raise about $10 billion for the government, and includes airwaves that TV stations will no longer use as they switch to digital signals.

Some of the most prominent potential bidders include AT&T, Verizon Wireless and Google.

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