Wireless Spectrum Auctions

NTCA urged Sen. Burns (R-Mont.), who’s expected to become Communications Subcommittee chmn., to pursue legislation that will open more spectrum for rural service. In Dec. 13 letter to Burns, NTCA said FCC was establishing policies that “impede” rural carriers from accessing wireless spectrum and urged him to schedule hearing on wireless issues. NTCA cited bill (S-2075) introduced in recently concluded session by Sen. Baucus (D-Mont.) that would give “teeth” to 1934 Communications Act rural mandate on wireless service. “An important part of a well-thought-out national spectrum management policy would be ensuring that rural Americans have access to advanced wireless-based services on an equitable basis with urban Americans,” NTCA letter said. “Rather than facilitating their access to wireless licenses, the FCC has established policies that for the most part impede rural carriers from accessing wireless spectrum.” NTCA said Baucus’s proposed Rural Electromagnetic Spectrum Access Act of 2002 (RESA) would have required FCC to make spectrum licenses covering rural service areas more readily available and accessible to entities that were committed to providing service to rural areas. “It is vital to address rural carriers’ access to spectrum in any legislation you may develop in the forthcoming Congress to address our national spectrum management policy,” letter said. NTCA urged Burns to include rural perspective on any spectrum panel. In audio conference sponsored by Communications Daily’s parent Warren Communications News (CD Dec 4 p1), Burns aide Mike Rawson said Burns was considering “hybrid” approach in spectrum reform. Rawson said Burns viewed auction model as “fundamentally broken” and was considering system that would require participants to prove effectiveness of business model before entering in system. He said idea was to prevent companies from having to invest massive amounts of capital into spectrum. Rawson said new system could raise funds based on percentage of gross revenue.

FCC opened multiple notices of inquiry (NOIs) Wed. on wireless policy, including on whether existing spectrum policies impeded provision of wireless service to rural areas. That notice, adopted unanimously at agenda meeting, also examined whether changes were needed “to promote more extensive availability of spectrum-based services for rural consumers,” Wireless Bureau Chief Thomas Sugrue said. In separate inquiry, FCC sought feedback on its analysis of competition in commercial mobile wireless sector, including whether figures should be collected in new wireless areas such as Wi-Fi deployment.

Iridium asked FCC in ex parte Tues. to defer mobile satellite service (MSS) ancillary terrestrial component (ATC) decision until it could “correct the flaws in the current Big LEO [low earth orbit] spectrum band plan.” Company said current frequencies were monopolized by Globalstar, which uses 27.85 MHz for uplinking and downlinking that was to be used equally by 4 companies. Iridium uses 5.15 MHz for uplinking and downlinking, which it says isn’t enough to handle “its primary MSS offerings.” “Unleashing ATC services within the Big LEO band prior to revisiting obsolete band plan decisions would substantially bias the already tenuous competitive balance between the two Big LEO operators in favor of Globalstar,” letter said. Iridium proposed to increase its band use by 6 MHz, decreasing Globalstar’s use to 11.85 MHz and reclaiming 10 MHz for reallocation. Cingular Wireless and Sprint also submitted comments to FCC, saying authorization of MSS operators to provide ATC in MSS band would be unfair and illegal based on Sec. 309(j) of Communications Act. “The Commission is required by law to auction terrestrial rights if it decides to permit terrestrial services in the MSS band,” they said.

FCC intends to make decision on ancillary terrestrial component (ATC) service by end of year, said International Bureau Chief Donald Abelson in briefing Fri. Commission also plans to “work with Congress to get the permission to auction satellite spectrum. The flexibility to be able to auction is the important piece, and we need to study it carefully,” he said. Legg Mason analysts issued report Thurs. saying they expected FCC decision to help mobile satellite service (MSS) providers and wireless industry (CD Nov 22 p2).

Group of fiber-to-the-home (FTTH) business leaders told Capitol Hill audience Thurs. that Wi-Fi wireless broadband hadn’t been useful last-mile solution for broadband deployment. At FTTH Council panel in Hart Senate Office Building, experts who have deployed fiber and support it as solution said Wi-Fi worked well within home, but it wasn’t seen as viable for last-mile use. Their opinions came after Sens. Allen (R-Va.) and Boxer (D-Cal.) proffered draft legislation, along with letter to colleagues, that would allocate more spectrum for unlicensed usages such as Wi-Fi (CD Nov 21 p3).

Industry sources and analysts said FCC is likely to grant some degree of flexibility in coming months to mobile satellite service (MSS) operators to operate terrestrial services in their spectrum. Legg Mason said in report Thurs. it expected Commission could issue order as early as next month allowing MSS operators authority to use that spectrum for ancillary terrestrial component (ATC) service. That would be victory for Globalstar, Mobile Satellite Ventures and Craig McCaw-backed New ICO. Question, said several industry sources, is how narrowly Commission would define ATC service if it granted flexibility.

FCC Spectrum Policy Task Force released recommendations Fri., including legislative “blueprint” for working with Congress. Legislative proposals cover receiver standards, possible users fees and potential authorization for 2-sided auctions. Proposals include reassessing Orbit Act to consider permitting, but not requiring, FCC to use competitive bidding to resolve mutually exclusive applications for spectrum for international satellite services.

If FCC doesn’t address broadband deployment in its pending proceeding, House could take up broadband legislation again in 108th Congress, aide to House Commerce Chmn. Tauzin (R-La.) told Cato Institute conference Thurs. “The FCC has the ability, the power and the legal authority” to deregulate broadband on its own, said Howard Waltzman, telecom aide to Tauzin. “What we do is contingent upon what the FCC does.”

Citing tough economic conditions, FCC granted relief to NextWave re-auction winners Thurs., allowing them to opt out of their Jan. 2001 bid obligations without penalties. Commission approved order unanimously, with Comr. Martin dissenting in part on requirement that carriers withdraw from entire auction to be relieved from any of payment obligations. Order appeared to not impose penalties on withdrawing carriers by waiving default rules and allowing bidders that exited auction to acquire that spectrum in future auctions.

Protection of universal service will be top priority for NTCA in next session of Congress, but bankruptcy and spectrum management also will be on its agenda. In news conference Wed., NTCA officials said Assn. would lobby for “fair and stable contribution methodology” for universal service fund (USF) and modifications of portability and identical support rules to prevent competitive carriers from claiming funds to detriment of local rural incumbents.