WASHINGTON-In a highly unusual case involving improper lobbying by the lawmaker who may oversee the telecommunications industry one day, the Federal Communications Commission threw out two Louisiana rural cellular licenses after ruling that a firm’s reliance on wireless technology to provide fixed telephone service does not qualify it to hold cellular licenses set aside for local landline carriers.
As a result, BellSouth Corp. will likely get one of the two licenses and share the other with Columbia Cellular Inc.
MobileTel Inc., the company losing the two rural cellular permits it won in a 1989 lottery, was granted permission to continue operations until new licensees are in position to offer service. MobileTel plans to challenge the ruling.
After the lottery, Columbia and BellSouth argued that because MobileTel did not have a landline presence in either Louisiana rural cellular market, it could not hold wireline cellular licenses. Under the duopoly rule, one cellular license is reserved for a wireline carrier and the other for a nonwireline carrier.
MobileTel maintained it was eligible for both wireline cellular licenses, arguing that its sister company-Lafourche Telephone Co.-was certified by state regulators to provide switched service in several Louisiana markets, including the two rural cellular service areas in dispute.
But in those two markets, unlike others where it has landline facilities, Lafourche used wireless technology authorized by Basic Exchange Telecommunications Radio Service. BETRS is designed to give telephone companies the option of using fixed radio-based connections in areas where stringing copper wire is cost prohibitive.
The Mobile Services Division of the Common Carrier Bureau sided with MobileTel and affirmed the two cellular grants in October 1990.
The FCC overruled that decision on Jan. 27, 1995, and issued a press release Feb. 6, prompting Rep. Billy Tauzin (R-La.)-the next chairman of the House telecommunications subcommittee if the GOP retains control of Congress-to telephone FCC Chairman Reed Hundt twice with concerns about MobileTel’s ineligibility to hold the two wireline cellular licenses.
Then, on March 23, the FCC vacated that ruling before releasing the text and sent the proceeding to the Wireless Telecommunications Bureau.
The FCC said that when it took back MobileTel’s cellular licenses it was not aware of a settlement proposal between MobileTel and Columbia and a petition by BellSouth to withdraw its challenge against MobileTel. Columbia suggested the FCC succumbed to political pressure.
In discussing the matter, Tauzin and Hundt-both lawyers-violated a well-known rule that forbids lobbying in proceedings in disputes among private parties.
Hundt said he was made aware of the lobbying restriction by the FCC general counsel’s office after the two phone conversations with Tauzin.
Additional arm twisting, also constituting illegal lobbying, was applied by Thomas Moore, an aide to Sen. John Breaux (D-La.). Moore called Joseph Weber, an attorney in the Wireless Telecommunications Bureau, to register Breaux’s displeasure with the MobileTel ruling. Breaux is an influential member of the Senate communications subcommittee.
As a result of improper communications between FCC officials and Capitol Hill, Hundt and the entire Wireless Telecommunications Bureau were barred from participating in the latest MobileTel ruling.
