WASHINGTON-Whether the spectrum cap should stay or go-one issue that distinguishes incumbent cellular operators and upstart personal communications services operators-“will hopefully” be decided by the Federal Communications Commission at its September meeting, said Thomas Sugrue, chief of the FCC’s Wireless Telecommunications Bureau.
The Cellular Telecommunications Industry Association, which represents incumbent cellular operators, asked the FCC to do away with the spectrum cap-the rule that wireless carriers can control no more than 45 megahertz in any geographic market-on Sept. 30, 1998. Congress established procedures in the Telecommunications Act of 1996 that allow entities to ask the FCC to stop enforcing rules that have become moot due to competition. The procedures require the FCC to rule on such requests within one year, but give the agency the option of a 90-day extension.
“Lifting the spectrum cap will provide for the inevitable changes that will take place in the market. No market except New York and Los Angeles can maintain nine wireless providers … Let the market determine viable transactions,” said Brian Fontes, CTIA senior vice president for policy and administration.
The Personal Communications Industry Association, which represents upstart PCS carriers, says it is too soon to remove the cap.
PCIA President Jay Kitchen recently sent a letter to members of Congress in a successful attempt to derail a proposed amendment to the FCC spending bill that would have eliminated or at least changed the spectrum cap. The purpose of the letter-to defeat the amendment-was necessary, PCIA said, because cellular carriers hold more than 80 percent of the wireless market nationwide.
The spectrum cap is one of a handful issues that will impact PCS carriers in the upcoming months, Sugrue said. The list also includes PCS resale, enhanced 911, and the implementation of the digital wiretap act, he said.
PCS resale
Although the mandatory PCS resale rules will sunset on Nov. 24, 2002, the industry-led by PCIA-would like the rules removed immediately. The Telecommunications Resellers Association, on the other hand, would like the sunset to be removed so the obligation remains.
The FCC has before it two petitions for reconsideration. Sugrue expects the commission to act on these petitions shortly. Often, the FCC doesn’t act on reconsideration petitions if it does not plan to change the rules. But it is unclear whether action on these petitions will mean a change in policy or rather is simply a move to address items in a more timely fashion.
E911
The FCC has been wrestling with finding out why the buildout of enhanced 911 technology has been, at best, spotty. Phase I E911 location technology-which includes a 10-digit call-back number and cell site location-was supposed to be implemented by April 1, 1998. But today only a handful of public safety answering points have the ability to call back a wireless phone. The industry and public-safety communities last week presented a report to the FCC explaining some of the reasons for this.
While several obstacles may be slowing deployment down, including liability and cost recovery, some experts believe a lack of cooperation among several parties and a low level of interest at the local public safety level may be partly to blame.
Notwithstanding the lack of Phase I deployment, the industry and the FCC also have to tackle Phase II deployment, the deadline of which is less than 15 months away. Phase II requires carriers to provide PSAPs with automatic location information accurate to 125 meters, or 410 feet, for wireless users dialing 911.
When the rules and deadline of October 2001 were set, it was generally assumed the technology would be deployed in the network and companies, such as TruePosition Inc., have based their business plans on the mandatory use of that technology.
Since the rules were set, handset technology using the global positioning system has been developed. Companies like SnapTrack Inc. hope the FCC either changes the rules or grants waivers allowing for handset technology to be used to comply with the E911 Phase II mandate.
The nub of the problem seems to be that neither network nor handset technology is good in every situation. While handset solutions seem to work well, there is a problem with GPS signals penetrating buildings, making them less desirable in urban areas. While network solutions work well in urban environments, they do not work well in rural environments with fewer antennas.
The FCC hopes to make a decision about technology for Phase II deployment in the early fall, Sugrue said. Part of that determination will include accuracy standards and whether the October 2001 date should be changed.
Phasing in E911 was the result of an agreement between public-safety officials and the wireless industry in 1996. Both phases only have to be implemented in an area when a carrier receives a request for a PSAP that it is capable of receiving and using the data and a method of cost recovery has been put in place.
Sugrue hopes all of the E911 questions will be answered by the end of the year.
CALEA
The industry is anxiously awaiting a decision on the technical standards for implementing the Communications Assistance for Law Enforcement Act of 1994.
The FCC got tangled up in the CALEA technical standards process after the telecommunications industry and law enforcement, represented by the FBI, could not agree on a standard. Privacy advocates claim the industry interim standard (which the FBI believes is too weak) is too strong. All three entities agreed to let the FCC determine what the proper standard should look like. The FCC sees its job as giving “law enforcement the tools it needs to fight crime and protect the public while at the same time safeguarding the public’s right to privacy,” said the FCC’s Meribeth McCarrick.
The FBI believes the industry interim standard would be sufficient if nine additional capabilities, known as the punch list, were added. These are beyond the scope of CALEA, according to the industry and privacy advocates.
When the FCC released its NPRM last fall, it tentatively concluded five of the items fell within the scope of CALEA, three went beyond the scope of CALEA and it did not rule on the final item.
This decision is being debated among the commissioners’ offices-a process known as circulation-and a decision is expected shortly.
C-block and the buildout
Due to his previous employment, Sugrue is recused from discussing how the FCC is handling the C-block PCS auction fallout, but many in industry expect the FCC to take a second look at this issue now that NextWave Personal Communications Inc. won another round in its bankruptcy proceeding.
Following NextWave’s win over the FCC in bankruptcy court, Airadigm Communications filed a bankruptcy petition. If others follow in Airadigm’s footsteps, the FCC may have no other choice than to change the way it handles bankrupt operators.
The process so far has been to fight the companies in bankruptcy court, claiming that the original bid price was the amount owed. In lieu of payment, the FCC was willing to take back the licenses but would not agree to refund any money paid. The three largest C-block players-NextWave, Pocket Communications Inc. and General Wireless Inc.-all declared bankruptcy to avoid this result.
In the meantime, the FCC may prevail in its attempt to get legislative authority to take spectrum off-the-table in bankruptcy proceedings.
Sen. Judd Gregg (R-N.H.), chairman of the commerce, justice, state and the judiciary subcommittee of the Senate Appropriations Committee, included language that would allow the agency to take back licenses tied up in bankruptcy, including licenses held by NextWave and GWI.
Similar language was not included in
the House version of the bill so a conference committee will debate the issue when Congress returns from its August recess.
Meanwhile, the five-year buildout dates for the A- and B-blocks are fast approaching and industry watchers are wondering what, if anything, the FCC will do to monitor the state of the buildout.
Licensees holding 30 megahertz blocks must provide service to at least one-third of the population in the license area within five years and two-thirds of the population in 10 years. The FCC awarded 99 licenses in the A- and B-blocks on June 23, 1995.
