Wireless Carriers United Against FCC’s Renewal-Showing Proposal

"Up until now, licensees have understood that if they have met their construction obligations (where those exist) and have complied with other material regulatory obligations, they could reasonably expect their license to be renewed,” said the CTIA filing. “The NPRM seems to eliminate this expectation, without replacing it with any other expectation. In short, if the renewal showing factors are meant to form the basis of some type of ‘report card’ for a licensee’s performance with regard to each license, the Commission has failed to provide any guidance as to how to achieve an overall passing grade.” The proposed renewal showing would be a step backward, “harkening to the Commission’s earlier comparative renewal process and the related lengthy application renewal requirements,” the filing said.

CTIA conceded that the current renewal standards for a few wireless services are “somewhat vague,” but said the vagueness has allowed licensees “considerable flexibility in structuring their services and network deployments.” The proposal would require carriers to compile extensive data to file at the FCC, but “there is no indication of the relative importance of each criteria, whether some or all are optional, or what level of performance under each criteria will be deemed sufficient to justify license renewal,” the filing said. “The resulting regulatory scheme would be vulnerable to challenge in the courts as being impermissibly vague” and “courts have long disfavored agency decision-making based on vague or unintelligible standards.”

CTIA, AT&T, Cricket, Sprint Nextel, T-Mobile, U.S. Cellular and Verizon Wireless also jointly asked the FCC to drop the proposal for detailed renewal showings. “Conditional grant of license renewals constitutes impermissibly retroactive agency action in violation of the Administrative Procedure Act and well established court precedent, because it subjects past conduct to an as-yet undefined, future legal standard, and threatens to penalize licensees for failure to meet that standard -- even though licensees could not possibly have known what that standard is during their past license term,” they said. They warned that the proposal “will create uncertainty in the market, potentially disrupting business plans developed in reliance on existing rules.”

Rural carriers represented by the Blooston Law Firm expressed reservations about the proposal. “The Commission should make any proposed construction and service showing requirements in the license renewal context prospective in nature since it would be unfair to change the rules for auction winners and other commercial licensees who valued their spectrum and based their business plans on then-existing performance requirements,” the group said. “The Commission should not use a proceeding designed to ‘harmonize’ license renewal procedures as a vehicle to impose new substantive obligations on auction winners and other CMRS carriers.”

"Some of the proposed new rules are legally unsustainable because they constitute retroactive rulemaking that is unfair and unlawful,” MetroPCS said. “If adopted, these rules would place a dark cloud over the ‘renewal expectancy’ that is so important to enable licensees to finance the construction and operation of advanced wireless networks. Thus, rather than fostering expanded and improved service, the proposed changes, if adopted, would have the unfortunate, unintended consequence of inhibiting investment.”