Auctions unlikely until 2009: New president, Congress in place by time AWS, D-Block bids begin

FEDERAL COMMUNICATIONS COMMISSION CHAIRMAN KEVIN MARTIN said it will be hard to hold either the D-Block re-auction or advanced wireless services-3 bidding this year because of intense controversy over rules. Thus, competition for two valuable blocks of public airwaves likely will play out under a new administration and Congress in 2009.
“I think it’s very difficult to [start either auction in 2008] because in both cases the commission sought . additional comments. For us to complete either of either of the auctions by the end of this year, I think that that makes it difficult,” Martin said.
The FCC chief said it might be
possible to begin one of the two auctions – the D Block, most likely – but he didn’t appear confident that that would materialize. Comments on an open-ended rulemaking to re-auction the D Block were filed at the FCC last month. Reply comments arrived only recently.
While acknowledging the time pressures, FCC spokesman Robert Kenny said Martin remains committed to trying to get the D Block re-auction off the ground before the end of the year.
In its latest filing, the Public Safety Spectrum Trust Corp., a not-for-profit entity and FCC-approved 700 MHz broadband public-safety licensee, said significant support continues for a public-private partnership approach to the D Block and for removing uncertainties regarding the relationship between itself and the commercial operator.
PSST underscored changes it believes would improve the D Block and better balance public-safety and private-sector interests. The group recommends extending the license term for the winner from 10 to 15 years and extending population coverage benchmarks accordingly. PSST said it supports reducing the 10-year coverage requirement to 98%, with 99.3% population coverage a longer term objective as opposed to a requirement.
In addition, PSST said it believes public-safety priority access during emergencies should be limited to 70% of total network capacity and that first-responder pre-emption rights should not exceed 50% of the network capacity. Along those lines, PSST said it is willing to reshape its relationship with public-safety agencies in a way that minimizes encroachment into the D-Block’s commercial operations.
PSST said it opposes industry suggestions that the now-national D Block be split up into regional or smaller licenses. And PSST opposes a request-for-proposal approach to network buildout.
Representatives of various public-interest groups said the PSST license should be rescinded and interested parties asked to reapply. They also pushed for lowering or eliminating altogether the D-Block’s $1.3 billion reserve price.
The public comment cycle for the AWS-3 rulemaking was recently extended to July 25 and Aug. 11. T-Mobile USA Inc. and other wireless providers continue to raise questions about potential interference to wireless operations in adjacent frequencies. T-Mobile, the smallest of the four national cellular carriers, spent $4.2 billion on 120 licenses in the AWS-1 auction two years ago to improve its ability to compete against AT&T Mobility, Verizon Wireless and Sprint Nextel Corp. on the 3G front.
M2Z Networks Inc., a Silicon Valley-funded startup headed by former FCC wireless official John Muleta, has criticized the wireless industry for trying to derail effortsto realize greater social benefits from free wireless broadband service that’s devoid of pornography.
The FCC last year rejected just such a plan by M2Z, which wanted to bypass an auction but promised to pay a small portion of subscription-based revenues to the U.S. Treasury. M2Z subsequently sued the FCC for rejecting its wireless broadband application, but it is one of the agency’s biggest backers of Martin’s AWS-3 initiative. Key House Democrats like the idea so much they’re supporting legislation to make it a reality.
Some Republican lawmakers and wireless providers, however, are not fond of where the FCC appears headed on D-Block re-auction and AWS-3 rules. Among other things, they assert meddling micro-management by federal regulators will fail to further government objectives and hurt wireless providers and U.S. taxpayers in the process.