Genachowski Urges Voluntary Solution to Address 700 MHz Interoperability Concerns

"I think you heard the same thing from all three commissioners,” Genachowski said after the FCC meeting. “Interoperability is important. We'd prefer to see a private, industry-led solution, but we all believed that the appropriate thing today was to act to launch this proceeding because an industry-led solution hasn’t yet arrived. We're all hopeful that this will become a vehicle and a spur to achieve interoperability in the band."

The NPRM doesn’t contain proposed rules, so it’s difficult to say what might happen if industry can’t craft a voluntary solution, said FCC Commissioner Robert McDowell. “It could go either way,” he told us. “My preference is for commission action to spark some consensus on this.” The uncertainty may provide an “incentive for industry to come up with a solution,” McDowell said.

An executive with a competitive wireless carrier pushing for an interoperability mandate questioned whether a voluntary approach will work. “The biggest players in the industry are the ones who created this problem,” the official said after the meeting. “If there were a way to achieve an industry-led solution over their objection, we would have had it by now."

"I believe Genachowski wants to focus on technical solutions to collapse Bands 17 and 12 together, since AT&T has publicly said that they would cooperate with voluntary solutions,” said a second small carrier official. “I think this is one way of getting to the answer which will ultimately have to be codified. But unfortunately I think it’s a little too much deference to AT&T."

Commissioner Mignon Clyburn questioned whether a voluntary solution goes far enough. “Unfortunately, the Commission did not foresee another way that the 700 MHz band could be used to harm consumer access to services,” Clyburn said in comments on the rulemaking. “It did not anticipate there would be a standard setting process, which would divide the lower 700 MHz band, and would impede the ability of devices for A-block licenses to work on B-block and C-block networks.”

Since the early 1980s, the FCC has sent continuing strong messages it expects wireless service licensees to offer consumers equipment capable of operating over the entire range of an allocated spectrum band, Clyburn said. “In any event, the commission’s failure to anticipate this particular anticompetitive development means the commission needs to move as quickly as possible to achieve true interoperability, in the lower 700 MHz band,” she said. “I understand the interest in giving the industry some time to arrive at a voluntary solution. I agree that, generally speaking, such an approach can offer a market greater flexibility to respond to evolving consumer needs and fast-paced technological developments. But, the industry has already had more than four years to find a solution."

"Government mandates should be a last resort,” McDowell said during the meeting. “That maxim is especially relevant here because minimal regulation in the wireless sector has created an environment that has maximized opportunities for investment, innovation, competition and job creation."

FCC action on 700 MHz interoperability is “long overdue,” said Steve Berry, president of the Rural Cellular Association. “Many RCA members own spectrum in the Lower 700 MHz spectrum but are unable to build out their networks and compete with others moving to 4G/LTE because of a lack of interoperability,” Berry said. “The sooner this is resolved, the faster customers all across the country will have access to 4G/LTE devices and services."

Any solution must be based on the consensus-driven 3GPP standards process, rather than FCC mandates, said AT&T Vice President Joan Marsh. “Some have argued that the technical and physical limitations of the band should simply be ignored, and have called for sweeping interoperability mandates,” Marsh said on the company’s blog (http://xrl.us/bmyz8v). “Such mandates would be an unprecedented regulatory intrusion into a carrier’s right to manage network and device deployment in a manner best suited to serve its customers. ... Such mandates would do nothing to resolve the very serious limitations that act as a prohibition on lower A-block deployment in over 30 markets nationwide."

"Issuing a Notice of Proposed Rulemaking on interoperability is a good first step but one that needs to be followed by timely and decisive action by the FCC to bring about interoperability in the lower 700 MHz band,” US Cellular said. “Although a voluntary industry solution would be ideal, the fact is that the anti-competitive effects of the fragmentation of the 700 MHZ band have been known for some time, without any industry resolution forthcoming. It is time for the FCC to aggressively drive this issue to completion. Ensuring interoperability is the number one measure that the FCC can take in 2012 to advance the cause of competition in the wireless industry.” Vulcan Wireless said: “We agree with [Wireless] Bureau Chief Rick Kaplan’s advisement that ‘every megahertz counts’ and hope for resolution by year-end."

The rulemaking was posted by the FCC at our deadline (http://xrl.us/bmy2o4). It clarifies in a footnote that the FCC could still ask questions about the need to expand the focus of the agency beyond the lower 700 MHz band: “Our focus on the Lower 700 MHz band in this NPRM does not preclude our consideration of broader interoperability issues, including interoperability across the entire 700 MHz band, in the future.”