Amid some wireless industry efforts to delay June 19 700 MHz auctions, FCC held first pre-auction seminar for upper band bidding Tues. (Pre-auction seminar on lower band auction is set for today -- Wed.) “We are ready to go, at least operationally,” Deputy Wireless Bureau Chief Kathleen Ham said. She said CTIA had petition pending at Commission to review bureau decision in April to retain June 19 date for auctions of both upper and lower bands at 700 MHz. “I think we are going to resolve that as soon as possible,” she said. (FCC set expedited filing schedule on CTIA petition late last week, with oppositions to group’s petition due Fri.). Meanwhile, filing window opened Tues. for applicants for Ch. 60-69 auction to submit Form 175 short forms. Deadline for final submission of that preliminary bidding form is May 8. Few FCC presenters at day-long seminar made passing reference to tug-of-war between some large wireless carriers, which want auction delayed, and broadcasters and others that are fighting delay. “The ground may move beneath my feet at any moment,” quipped Stanley Wiggins, attorney with bureau’s Policy Div. More than 30 on-site attendees at seminar included representatives of Verizon, AT&T Wireless, Spectrum Exchange, Nextel. Actual participation in auction, however, isn’t signaled until carrier files short form application that contains financial information. Because meeting was streamed, presence of other participants was less visible. As for pending petitions that could affect availability of licenses, Wiggins cited petition for reconsideration filed by National Public Safety Telecommunications Council (NPSTC) last year. NPSTC objected to FCC decision not to change certain technical rules for commercial operators in 747-762 MHz and 777-792 MHz bands. Group said lack of modifications could “greatly increase” harmful interference to public safety operations.

Posting preliminary results for its fiscal year ended Jan. 31, Game Group Plc -- formerly Electronics Boutique Plc -- said its operating profit before goodwill amortization and provision for rebranding increased 126% to ?31.2 million from ?13.8 million year ago. Company took ?5.2 million charge for estimated cost of re-branding its U.K. stores to bear Game name. Chain also said pretax profit before goodwill amortization jumped 102% to ?26.3 million from ?13 million as turnover expanded 48% to ?453.8 million from ?307.1 million, basic earnings per share increased to 3.33 pence from 1.06 pence, final dividend jumped 21% to 0.4 pence from 0.33 pence. Company said it saw positive contribution from acquisitions completed during year to expand business in France and Spain. In year, company’s store base widened to 389 from 311, of which 323 are in U.K. and Ireland and 66 in continental Europe. Game Group said it was off to “excellent start to current year with like-for-like sales up 26% for the first 12 weeks.” Chmn. Peter Lewis said: “Exciting new platforms have ensured that the videogames market is growing and we are confident about our leading role in that market.” Reuters report from London said chain reported Game Boy Advance and PlayStation 2 were top sales drivers in year. Company also said recent Xbox console price cut in Europe to 299 euros from 479 (CED April 19 p2) was likely to boost sales, while GameCube preorders were at high level. Reuters quoted Lewis as saying: “These new consoles, together with the continued success of existing formats, will stimulate further the expansion of our market.”

Movie Gallery said same-store revenue for its first quarter ended April 7 increased 3% compared with its previously announced targeted range of flat to slightly negative same-store revenue for quarter. Dothan, Ala.-based video chain also increased its targeted range for first-quarter pro forma earnings per diluted share to 33-35? from previous range of 26-28?. Company also said it expected first quarter earnings per diluted share of 32-35?. Movie Gallery plans to announce actual results for first quarter May 10. Chain also said Thurs. it had reached agreement to resolve class action lawsuits involving its extended viewing fees. Under settlement, class members will receive one of 3 coupon packages, depending upon amount of extended viewing fees they had paid in past, company said. However, Movie Gallery will continue to charge customers extended viewing fees. CEO Joseph Malugen said: “We believe the agreement is fair and is of mutual benefit to both Movie Gallery and its valued customers. We believe that our extended viewing fee policy is in no way improper and is a valid component of our rental pricing structure. Nevertheless, after considering the time and resources that must be expended to defend multiple cases, we determined that it was in the best interest of our company and our customers to resolve these cases through agreement. This agreement provides value to our customers and allows our management team to focus on our business.” Chain said its agreement was “very similar to the terms of settlement reached in extended viewing fee class action cases involving certain of its competitors within the last year.” Movie Gallery said it would provide eligible customers with coupons with values of $9-$16 that could be used toward movie or game rentals or purchases at Movie Gallery and affiliated stores nationwide. Chain said agreement received preliminary court approval April 19, but was subject to fairness hearing currently scheduled for Nov. 22. If final approval is received, coupons will be issued and will be redeemable Jan. 30-June 30, 2003, it said. Company also announced it was revising its membership agreement to clarify its extended viewing fee policy and was changing its pricing structure on certain of its product offerings. Starting May 27, extended viewing period for all product offerings will match initial viewing period, it said: “As a result, when customers keep a movie or game beyond the initial viewing period, they will automatically re-rent that item for the same price and for another period of the same duration.” Malugen said change in rental policy was result of various market factors, including policies in effect at other nationwide video specialty retailers. He said: “We believe this pricing structure is easier for our customers to understand and is consistent with current competitive practices.”

FTC shuttered spam scam that promised prize from Yahoo but delivered pornography site, Bureau of Consumer Protection Dir. Howard Beales said at news briefing. Calling scheme “one of the worst we've seen so far,” he said it worked this way: Consumers received e-mail congratulating them on winning prize in Yahoo sweepstakes contest. Gift most often mentioned, he said, was Sony PlayStation 2. However, Beales said, message wasn’t from Yahoo, and there was no prize. Instead, he said, “just 5 clicks later you were connected to a pornographic Web site at a cost of up to $3.99 a minute, with no meaningful disclosures along the way.” Come-on appeared legitimate, he said, until consumers waded through 8-9 pages of fine print to discover they would be billed $3.99 per min. for 900-number call, and that Web site was pornographic. FTC doesn’t know how many bogus e-mails were sent out, Beales said, but AT&T billed more than $11 million for 900- number calls from May or June through Dec. 2001. Telecom company was good about issuing refunds to consumers who complained, he said, but agency is seeking redress for those who didn’t get reimbursements as well as permanent injunction closing down operation. In March, FTC charged 3 companies and 3 individuals - - BTV Industries, National Communications Team Inc., LO/AD Communications Corp., Rik Covell, Adam Lewis and Nicholas Loader -- with violating unfair or deceptive practice provisions of FTC Act and Pay-Per-Call Rule, which implements requirements of Telephone Disclosure & Dispute Resolution Act of 1992. Enforcement action, filed in U.S. Dist. Court, Las Vegas, was sealed until Wed. It’s part of International NetForce law enforcement initiative in which FTC, 8 U.S. state law enforcers and 4 Canadian agencies are investigating and bringing 63 actions against alleged deceptive e-mail scams and Web frauds. Court last month issued temporary restraining order that: (1) Gave FTC expedited discovery powers so it could gather information on extent of scam’s harm to consumers. (2) Ordered spam violations stopped. (3) Froze corporate defendants’ assets. Preliminary injunction hearing is set for April 29, FTC said.

SES Americom filed FCC petition for license to launch new satellite service for TV broadcasters and consumers in U.S. Americom2Home would allow programmers or content providers to deliver broadband services directly to public through small satellite dishes and other equipment in which 2-way digital technologies had been incorporated. At time when DBS market is consolidating, new SES service could provided much-needed competition for EchoStar and DirecTV, Pres. Dean Olmstead said. “We plan to create a best-in-class DBS satellite platform,” he said. SES has received “favorable reaction” from some big players in market that could provide content, Olmstead said. He said he planned preliminary talks on interference issues and outline plans for service with EchoStar Chmn. Charles Ergen and DirecTV Chmn. Eddy Hartenstein at Carmel Group Satellite Conference in Monterey, Cal. (see separate story, this issue).

Work on U.S. draft proposal for World Radio Conference (WRC) 2003 that would create international identification of public safety spectrum has been slowed by continued opposition of U.S. military over one band, sources said. Sustained DoD opposition to use of 380-400 MHz, historically used by NATO for global operations, contributed to Motorola’s recent withdrawal from one of lead roles in drafting U.S. proposal in that area. Still under consideration are 700 MHz and 4.9 GHz, both allocated in U.S. for public safety, but NATO band already designated in Europe for public safety interoperability appears to be off table in U.S., several sources said. Steve Sharkey, dir.-spectrum & standard strategies for Motorola, said 700 MHz and 4.9 GHz are “great bands” for U.S. to back for international harmonization for public safety. But as to key objective in crafting U.S. position on spectrum harmonization in this area, he said: “We have been frustrated in not being able to achieve that and that is one of the reasons that we have decided to use our resources elsewhere.”

Qwest got good news from Ariz. but bad news from Ida. in its efforts to win interLATA long distance approval. In Ariz., operation support system (OSS) tester Cap Gemini Ernst & Young reported Qwest successfully completed retesting of critical OSS functions that were found wanting in Dec. preliminary report and now had passed. Qwest said final favorable OSS report on Ariz. meant it should be able to seek FCC long distance approval for Ariz. in late May. Ariz. test was separate from 13-state regional OSS test conducted by KPMG Consulting. On that regional test, whose preliminary results were released April 19, CLEC AT&T said Qwest’s claims that test results showed it passed with flying colors might be overstated. AT&T said KPMG identified several issues where “the scores Qwest kept for itself are suspect.” AT&T said that raised question whether Qwest actually was doing what it was saying it did. AT&T said data integrity and other questionable areas in KPMG draft report would be reviewed over coming weeks and final report could contain “significant alterations” from draft findings: “Anyone who claims or suggests that the draft report is the end of the process is engaging in significant and irresponsible exaggeration.” Qwest’s bad news came in Ida., where PUC concluded its long distance entry wasn’t in public interest because its unbundled network element (UNE) rates weren’t cost-based. PUC said current UNE rates in state were set in arbitrated 1999 interconnection agreement between AT&T and Qwest, but there was no evidence showing those prices satisfied FCC requirement that UNE rates be based on total element long run incremental cost (TELRIC) or that UNEs in contract conform to list of UNEs that must be offered to CLECs. PUC said there was pending docket to review Qwest UNE rates and terms in Idaho but proceeding was nowhere near completion.

Source familiar with proposed merger of AT&T Broadband and Comcast said companies were “in discussions” about possibility of speeding up elections for members of what would be board of merged AT&T Comcast. Discussions were disclosed as Senate Judiciary subcommittee prepared to hold hearing Tues. (today) on proposed merger. In recent weeks, Council for Institutional Investors and N.Y.C. Comptroller William Thompson complained to SEC about merged company’s corporate governance provisions as they were described in preliminary proxy statements sent to investors. Among provisions that raised objections was plan not to hold elections until 2005. Source said companies now were considering pushing elections up to 2004. AT&T CEO Michael Armstrong and Comcast Pres. Brian Roberts are among those scheduled to testify at hearing of Subcommittee on Antitrust, Competition and Business & Consumer Rights. Meanwhile, Consumer Federation of America and Computer & Communications Industry Assn. were planning to try to steal some thunder from corporate executives touting merger. CFA and CCIA, which weren’t invited to subcommittee hearing, planned to hold press briefing beforehand to release their study exposing what they called “myth of cross-technology competition” and FCC’s hopes that intermodal competition would influence cable’s market power. “The proposed Comcast merger would create the nation’s largest cable company, threatening competition and further weakening consumers’ choice,” groups said in written statement. One competitor, BellSouth, also got out front, saying in statement that regulatory disparity between cable and phone companies didn’t serve public interest. In meantime, BellSouth Vp-Govt. Affairs Herschel Abbott said, consumers wouldn’t be served by “creating a behemoth” that would dominate market for high- speed Internet service. AT&T spokesman responded to BellSouth’s criticism by saying combined AT&T Broadband- Comcast would further challenge BellSouth’s dominance of local telephone service “and weaken the monopoly they hold so dear.”

NTIA is raising interference concerns over some parts of notice of proposed rulemaking (NPRM) issued by FCC in Oct. that would update sections of its Parts 2, 15 and 18 rules, including provisions that would modify emissions to limits on certain Part 15 devices above 2 GHz. In letter to Office of Engineering & Technology Chief Edmond Thomas, NTIA cited part of proposal that would increase allowable field strengths for radio frequency identification (RFID) rules. On RFID systems, proposal would harmonize U.S. rules with standards for such devices in Europe and Australia. NPRM sought comment on changes in power levels for RFID tags operating at 425-435 MHz, which NTIA said was within 420-450 MHz allocated on primary basis to federal govt. Military systems operating in that spectrum include radiolocation operations for aircraft and missile surveillance, early warning and fire control, said letter from Fredrick Wentland, acting associate administrator of NTIA’s Office of Spectrum Management. “The radiolocation radars in this band include ground, shipborne and airborne radars that are essential to the nation’s homeland defense,” Wentland wrote. NASA also uses band for telemetry and telecommand, he said. Citing preliminary NTIA analysis, he said power level changes in parameters for RFID tags “could result in interference to federal systems” and NTIA and federal agencies “cannot support the proposed rule changes.” In next 90 days, NTIA and agencies will complete studies and provide them to Commission. In NPRM, FCC said it agreed with Savi Technologies that proposed Part 15 changes would allow more advanced systems to operate at 433 MHz. In other areas: (1) NTIA objected to 11 dB increase in field strength limits for RFID tags in 13.11-13.41 MHz. It said 13.26-13.36 MHz was allocated to aeronautical mobile services, which are designated for safety-of-life communications. FAA uses that spectrum for communications in oceanic and remote areas. “The increase in field strength by 11 dB could severely reduce the distance that an aircraft can successfully communicate with a ground flight tracking system,” NTIA said. NTIA recommended use of another part of high frequency band that wouldn’t require increase in Part 15 emission limits in frequency band allocated for Aeronautical Mobile Services. NTIA said it needed 90 more days to complete studies in that area. (2) NTIA said it and other federal agencies also needed another 90 days to complete studies on protection of sensitive services and to identify continuing R&D projects above 38.6 GHz. FCC sought comment on need for changes in restricted bands above 38.6 GHz and whether there were Part 15 rules designed to protect sensitive service such as govt. operations that should be modified. Among govt. services operating in that spectrum are 13 bands used by NASA for space research and Earth exploration satellite service sensors for missions such as weather forecasting and global warming measurements, NTIA said.

When commercial users need more wireless spectrum, “the federal government cannot continue to be the spectrum grocery store,” Badri Younes, Defense Dept. dir. of spectrum management, said Thurs. “This is not right,” he told Washington conference of World Computer & Internet Law Congress, sponsored by FCBA and Computer Law Assn. While he said federal govt. users such as DoD were interested in coming up with solutions on where additional spectrum for 3G would come from, he raised series of questions that he said must be answered first. FCC and NTIA last fall undertook scaled-back assessment of bands available for 3G, including 1710-1770 MHz now occupied by federal govt. users, mostly military. Younes said questions included whether spectrum could be reallocated from existing users without endangering national security and whether FCC had done all it could to ensure that industry had incentives to use spectrum efficiently. Younes also questioned 200 MHz of spectrum that CTIA has cited as needed for provision of advanced wireless services, based on past ITU estimates. Many assumptions on which ITU based estimate “have not been looked at very carefully,” Younes said. In particular, he said that 3G services haven’t developed as quickly as originally thought, with Merrill Lynch estimating that many systems aren’t expected to begin operating until 2005, Younes said. He called for more “realistic” assessment of 3G prospects, compared to optimistic estimates created in late 1990s when financial markets were brighter. “The need is not real,” he said. “We need more time to make public policy decisions on advanced spectrum services.” He reiterated view of several DoD officials at recent public policy forums that there is imbalance in how policy decisions are made when officials weigh national security and public safety needs of federal users versus need to accommodate growth of commercial services. “The current public policy debate shows the imbalance in how spectrum is evaluated and allocated,” Younes said. “Dropped calls should not take precedence over misdropped bombs,” he said. Stressing need for interagency coordination, he raised possibility of “White House-level oversight committee” in which diverse entities could be brought together to decide such issues. Noting difficulties in preliminary assessment of whether parts of 1710-1770 MHz band could be freed for 3G, he said “nobody should assume that band is going to be made available” although DoD, NTIA and FCC are continuing to work together. In keynote, NTIA Dir. Nancy Victory said spectrum search for new technologies or expanded uses of existing ones “often seems to pit the innovators against the incumbents. The debates get cast an either/or proposition. That needs to change.” Outlining themes from recent NTIA Spectrum Summit, Victory noted policymakers “need to remove the clouds over spectrum availability and provide certainty for the deployment of new services.” Among areas of intense debate over additional wireless spectrum is 800 MHz band and spectrum under evaluation for 3G, she said. Victory called recent FCC proposal to examine alternatives for mitigating interference to public safety users at 800 MHz “a good starting point and a catalyst for rethinking how things should be done in the future.” She said federal, state and local public safety systems “need a plan for an effective and orderly transition to a fully interoperable web of systems.”