Frontline Wireless, the startup that was positioned as a key bidder in the upcoming 700 MHz auction, has closed its doors.

The company this week issued the following terse statement: ""Frontline is closed for business at this time. We have no further comment."

"Led by industry veterans and public policy leaders, Frontline Wireless, based in Greensboro, N.C., made a big splash in Washington in 2007 with its proposal to build a public/private network that would serve both public safety and consumers," explains eWeek's Roy Mark.

The New York Times' Saul Hansell says the company collapsed because "it could not raise enough money to bid in the government auctions of wireless spectrum that start later this month."

"The company's failure raises questions about the ability of the auctions to raise the $14 billion or more that the federal government wants in exchange for the broadcast spectrum that will be freed next year by the shift from analog to digital television," Hansell notes.

It's a sad day for wireless, says BusinessWeek's Olga Kharif. "With Frontline out of the running, this further narrows down the number of new companies that could potentially enter the wireless services market as a direct result of the auction," she writes. "There's Google, of course - but not much else. In a way, that's not surprising: Few investors would be mad enough - and wealthy enough - to want to compete with the likes of Google and incumbents such as Verizon. And this means that it could take longer for wireless networks to open up, the way Frontline envisioned."

And Wi-Fi Net News' Glenn Fleishman agrees. "This could throw open access into disarray, as if the auction doesn't produce the desired revenue, the rules requiring the C Block winner to allow any legal device running any applications and accessing any service would be revised to be more restrictive," he writes.

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