Federal judge has denied preliminary injunction in Starband’s breach-of-contract suit against EchoStar. U.S. Dist. Judge Claude Hilton, Alexandria, Va., issued order denying request for injunction May 24, day after Starband filed suit, court said. Starband, jolted by EchoStar’s decision in March to end distribution agreement, claimed in court papers it was owed “millions of dollars” in monthly and wholesale service fees by DBS provider. Starband charged that as result of EchoStar’s failure to turn over collections and billings functions it was suffering damages of $385,000 per week. It said EchoStar had accounted for 31,000 of its 41,000 subscribers, including 16,000 and 15,000 from retail and wholesale agreements, respectively. EchoStar spokesman declined comment.

Microsoft lost its appeal to block San Diego software company from calling itself Lindows.com and its Linux-based programs LindowsOS. In 7-page ruling, U.S. Dist. Court, Seattle, Judge John Coughenour said his March 15 ruling denying request by Microsoft to shut down Lindows was appropriate.

Mont. PSC concluded Qwest met requirements of Telecom Act Sec. 272 for interLATA long distance entry. AT&T had objected to PSC hearing examiner’s preliminary conclusion in Feb. that Qwest met requirement to demonstrate it would be providing in-region interLATA services through structurally separate affiliate and that it in no way would discriminate in favor of that affiliate. PSC dismissed all of AT&T’s objections, saying that if they were to stand, Qwest wouldn’t be able to make any advance preparations for its eventual in- region interLATA entry. PSC (Case D2000-5-70) said AT&T had produced no convincing evidence that Qwest might in future discriminate against competitors or that Qwest wasn’t in compliance with Sec. 272’s requirements. PSC said there had been some past issues on full separation of Qwest’s local exchange and interexchange units but company had taken action to address those issues and bring itself into compliance.

Proposal to grant Sirius Satellite Radio board authority to raise number of issuable common shares to 500 million from 200 million is up for shareholder vote at June 21 annual meeting in N.Y.C., company said in preliminary proxy statement filed with SEC Fri. Company had 161,580,493 shares outstanding April 30, filing said. It said board adopted resolution Fri. recommending that proposal be adopted on ground it would give company “flexibility” to issue common stock for variety of purposes without need for immediate shareholder action. However, it acknowledged that issuing additional shares could have “dilutive” effect on shareholder voting power. Increase in authorization of shares shouldn’t be construed as antitakeover move as no such action is expected, filing said.

Mass. regulators gave preliminary approval to new price capping system for Verizon that would limit increases in basic residential services to 5% annually and deregulate rates for most business services. In 108-page order adopted on 5-0 vote, Dept. of Telecom & Energy (DTE) concluded Verizon had demonstrated there was sufficient competition for most of its business services to permit rate deregulation. Verizon has been under caps since mid-1990s. Its last plan expired in Jan., and company technically reverted to rate-of- return regulation but proceeding on successor cap plan already was under way. DTE said residential rates could move between floor and ceiling levels to be defined later, except that increases couldn’t exceed 5% per year. It said Verizon should be allowed to set different residential rates for urban, suburban and rural areas to reflect cost differences despite opponents’ concern that would allow carrier to raise rates in rural markets where there was little or no competition to subsidize lower rates in markets such as suburban Boston where residential competition exists. Mass. Attorney Gen. opposed business rate deregulation, saying Verizon still controlled 80% of business market and little local business competition existed outside I-495 corridor. AG spokesman said agency might appeal to state courts if plan finally was adopted. DTE directed Verizon to file by June 5 detailed description of new rates it would charge, which must address issue of whether there would be significant differences between rural and urban rates.

European Commission (EC) said Wed. it suspected Germany’s Deutsche Telekom was charging anticompetitive rates for access to its local network. In statement of objection, EC contended that DT had abused its dominant market position through unfair pricing for local loop access. For retail local loop access, DT has more than 98% market share, even 4 years after Germany opened that market to competition, EC said. Commission said it believed DT abused its dominant market position in way that amounted to “a margin squeeze between its wholesale and retail tariffs.” “After 4 years of complete liberalization of the telecommunications markets in Europe, competition has come to a critical stage,” EC Competition Comr. Mario Monti said. “This is particularly acute in the local loop where many very promising new entrants have already been forced to give up their business.” EC said it considered DT to hold dominant market position for wholesale and retail local loop access. Alternatives such as fiber networks, wireless local loop, satellites, power lines and upgraded cable TV networks “are not yet sufficiently developed and cannot be considered as equivalent to DT’s local loop network,” EC said. Competitors such as Mannesmann Arcor complained to EC, saying there was insufficient spread between DT’s tariffs for retail subscriptions and wholesale local loop access. EC said DT could have averted “margin squeeze” situation by cutting wholesale access fees, increasing retail subscription fees or both. “In general, it is the Commission’s position that vertically integrated operators like DT must indeed fix their retail prices at a level sufficiently above the wholesale prices so as to allow new entrants to compete,” EC said. DT has 2 months to provide arguments rebutting EC’s preliminary analysis. Arguments also can be presented at oral hearing. Commission said it wouldn’t adopt final position until after those steps were completed. In Dec. 2001, EC began infringement proceedings against Germany, Greece and Portugal for failing to implement provisions of European Union regulation on local loop unbundling. EC said DT recently adopted tariff changes for both wholesale and retail service that were “step in the right direction” but it said they were “far from being sufficient in order to rebalance the local loop access tariffs.”

Coalition of private wireless operators on Mon. backed Cingular Wireless plan for 800 MHz rebanding that would move public safety operators to 700 MHz. But in face of “political” challenges expected to beset proposal, including required legislative changes, private wireless licensees called their alternative “repacking” 800 MHz band at cost of $1.2 billion, compared with $2.7 billion of original Nextel proposal, officials said Mon. FCC filing deadline closed Mon. on notice of proposed rulemaking (NPRM) soliciting comments on alternatives for alleviating public safety interference at 800 MHz. Among plans on which Commission sought feedback was proposal submitted by Nextel last fall that would swap 4 MHz of guardband spectrum at 700 MHz, 8 MHz of specialized mobile radio spectrum in lower channels of 800 MHz and 4 MHz of SMR spectrum at 900 MHz. Under that plan, Nextel would receive another 16 MHz at 800 MHz and from reserve mobile satellite services spectrum. One theme running throughout comments was thorny issue of who would pay cost of relocating incumbents. “There’s an issue of can anybody really afford to do this,” Washington attorney Robert Schwaninger said at Mon. news conference of private wireless operators.

In latest E911 quarterly reports at FCC, carriers cited progress as well as array of continuing challenges to meeting waiver conditions, including slow installation of LEC upgrades for automatic location identification (ALI). In report filed last week, Sprint PCS said pace of LEC upgrades was “major remaining obstacle to completion of Phase 2 deployment.” It said: “While the majority of LECs appear to have now agreed that such upgrades are necessary, details of how, when and where these upgrades will occur have still not been supplied.” Sprint said deployments scheduled for first half of this year now had been delayed until fall as result of LEC delays and “Sprint’s entire Phase 2 deployment schedule is now threatened.” Sprint PCS urged FCC to require LECs to disclose publicly Phase 2 ALI update schedules so public safety answering points (PSAPs) and wireless carriers could provide that information. Under that scenario, Sprint said, carriers could focus their E911 conversion efforts on areas that had ALI databases that were Phase 2 capable. In other areas, Sprint PCS said that in first quarter of this year it: (1) Completed installation of Phase 2 switch modifications in all Lucent markets in U.S., nearly 3 months ahead of schedule. (2) Sold more than 500,000 GPS-enabled handsets, up from 200,000 in 4th quarter of 2001. (3) Installed more than 240 Phase 1 systems in 3 months and trimmed number of Phase 1 PSAP requests pending more than 6 months by almost one-third. Nextel told FCC in report filed last week that it hadn’t received documentation from PSAPs required by FCC order issued in Oct. on validation of Phase 2 request’s validity. In response to request for clarification by city of Richardson, Tex., FCC in Oct. outlined what constituted valid PSAP request for E911 service. Order said such requests were valid if any upgrades needed on PSAP network would be completed within 6 months of request and if PSAP had made “timely request” to LEC for trunking and other facilities needed for E911 data to be transmitted. (Sprint PCS and Cingular Wireless filed petitions for reconsideration of Richardson order last year). In its E911 report, Nextel said it had requested that PSAPs that had submitted Phase 2 requests provide information required by Richardson order. “But to date only a very few have even attempted to fulfill the Richardson order’s validation requirements,” Nextel said. It said that in next 30 days, it again would contact each PSAP requesting Phase 2 service and “again attempt to elicit information regarding its readiness for Phase 2 E911 service.” Once validity of those requests is determined, carrier said, it would prioritize them for deployment by Oct. 1 or, for those received after April 1, within 6 months of receiving valid request. Nextel also said it had been continuing tests with Motorola of prototype handset with Assisted GPS (A-GPS) capability at Motorola lab in Fla. In March, Nextel said it and Motorola used preliminary versions of A-GPS handset in live network in Baltimore-Washington area. Although network assistance data weren’t yet available for test, Nextel said Motorola could generate “important information about the handset’s functionality in existing networks as well as performance in a nonassisted environment.” When FCC issued E911 Phase 2 orders last fall, it said it was referring to Enforcement Bureau waiver requests by AT&T Wireless and Cingular on GSM portions of their network. Commission is expected to release order on that decision as early as this week, source said.

EchoStar said first-quarter loss narrowed to $38.6 million from $169.8 million year earlier as it posted better- than-expected gain in subscribers. Revenue increased to $1.1 billion from $861.9 million. EchoStar added 335,000 net new subscribers in quarter, surpassing analysts’ estimates of 313,000, but down from 460,000 additions year ago. It ended quarter with 7.1 million subscribers, is targeting 8 million by year-end.

EchoStar said first-quarter loss narrowed to $38.6 million from $169.8 million year earlier as it posted better-than- expected gain in subscribers. Revenue increased to $1.1 billion from $861.9 million. EchoStar added 335,000 net new subscribers in quarter, surpassing analysts’ estimates of 313,000, but down from 460,000 additions year ago. It ended quarter with 7.1 million subscribers, is targeting 8 million by year-end.