House Telecom Subcommittee Vice Chmn. Stearns (R-Fla.) introduced bill late Wed. that would compel FCC to return remaining deposits of bidders in NextWave re-auction. In March, Commission returned 85% of deposits from re-auction but concluded winning bidders such as Verizon Wireless should continue for now to be held to nearly $16 billion in potential auction obligations until pending Supreme Court review played out (CD March 28 p1). Stearns bill would: (1) Require FCC within 15 days of passage of legislation to return full amount of re-auction deposits “for licenses that the Commission has not by that date delivered to such winning bidders.” That would amount to $400 million for 13 winning bidders. (2) Let each bidder wipe out its license rights under NextWave re-auction so it would be free of all remaining payment obligations. Bill’s co-sponsors include Reps. Boucher (D-Va.), Terry (R-Neb.), Pickering (R-Miss.), Towns (D-N.Y.), Rush (D-Ill.). “This is a matter of fairness,” Stearns said. “The successful bidders on Auction No. 35 have not received the spectrum they bid on and they have not received their total deposits back.” Verizon Wireless sued U.S. in April to obtain remaining deposit and sought ruling from U.S. Court of Federal Claims that auction “contract” for disputed licenses was void (CD April 9 p1). Lawsuit, also filed in U.S. Appeals Court, D.C., centered on $8.4 billion in auction prices for which Verizon bid in Jan. 2001 and for which it technically still would be liable should FCC prevail in Supreme Court case and be able to return licenses from NextWave to re-auction winners. Supreme Court earlier this year granted FCC request that it hear challenge to D.C. Circuit ruling that overturned agency decision to cancel NextWave’s licenses for missed payment. Verizon has argued that it has been harmed by its continuing debt obligation to FCC and that overhang from bid prices has affected its credit rating and ability to borrow. Carriers have contended that even if high court reverses D.C. Circuit, there’s likely to be further litigation on remand there. “The result is that there is not likely to be a final resolution of the status of the NextWave licenses, and the FCC therefore will not be in a position to deliver licenses to the winners of Auction No. 35, until 3 or more years from the time the auction was concluded,” bill said. It said FCC position was that winning bidders remained obligated to pay full amount of their bids on 10 days’ notice if Commission established its right in court to deliver those licenses. PCS licenses were returned to NextWave following D.C. Circuit decision last year. Several re-auction winners, including representatives of Salmon PCS, VoiceStream, NextWave and Verizon Wireless, recently met with staff of Sen. Stevens (R- Alaska) on possibilities of settlement in case. Settlement agreement last year reached by U.S., re-auction winners and NextWave expired Dec. 31 after Congress failed to pass legislation backing it up.
In action FCC said would “enhance opportunities for additional competition” for cable systems, agency Thurs. adopted order permitting use of Cable TV Relay Service (CARS) spectrum by any Multichannel Video Program Distributors (MVPDs). Made eligible for CARS licenses under order are Private Cable Operators (PCOs), Direct Bcst. Satellite (DBS) systems, Open Video Systems (OVD) and all others that provide multichannel program services. FCC said that while cable would continue to be predominant user CARS, new rule would increase number of frequencies available to more MVPDs “in a balanced competitive environment.” Commission said it reserved right to “examine in other proceedings” more flexible uses of CARS and “the expansion of eligibility for these frequencies.”
FCC Thurs. at its agenda meeting approved order designed to update Part 15 rules to permit new digital systems to operate at 915 MHz, 2.4 GHz and 5.7 GHz under current rules for spread spectrum devices. Order, approved unanimously, also adds flexibility in design and operation of frequency- hopping spread-spectrum systems such as Bluetooth at 2.4 GHz and did away with a processing gain requirement for direct- sequence spread-spectrum systems such as 802.11b wireless LAN. Agency has said these changes, in part, are meant to address extent to which there are increased high-speed wireless applications at 2.4 GHz. But Commission didn’t take additional step sought by several wireless applications developers. Several developers of Bluetooth and 802.11b systems, including Lucent spin-off Agere, had asked FCC to require smart hopping or so-called adaptive frequency-hopping techniques in exchange for system using fewer frequency- hopping channels. Officials said order gives manufacturers flexibility to design more diverse array of products for band.
FCC denied formal complaint that Jacqueline Orloff filed against Vodafone Airtouch Licenses d/b/a Verizon Wireless, and its affiliate, New Par. Orloff alleged that defendants had violated Communications Act by offering discounts and other inducements to certain customers taking service under defendants’ wireless calling plans that they didn’t make available to her. Commission said Orloff hadn’t established that defendants’ challenged practices were unreasonably discriminatory.
FCC launched rulemaking for what it said is further effort to “prevent undue delay” by TV stations in digital roll-out. Major part of proposal is system of “graduated sanctions” -- which could lead to revocation of digital license -- contemplating “an increasingly severe level of sanctions” every 6 months for stations that haven’t converted to digital transmissions, Commission said.
FCC asked for comments by June 14, replies July 1, on whether to change regulation of fees charged by LECs for changing consumers’ presubscribed interexchange carriers (PICs) (CD March 15 p5). Known as PIC change charges, fees are subject to $5 cap within which rates are considered reasonable. FCC seeks comment on whether fees should be based on carrier costs or whether they can reflect market forces. FCC also will look at: (1) What costs carriers should recover through PIC change charges and whether they can take non-cost factors into account in determining charge. (2) Whether to continue using safe harbor cap. (3) Whether LECs should submit cost support with their tariffs or if Commission should review rates solely through its enforcement processes.
FCC Wireless Bureau approved Nextel’s request to withdraw its petition for forbearance or request for waiver of Commission’s rules on 800 MHz SMR general category pool.
FCC officials and international policymakers will discuss broadband, spectrum allocation, competition, media regulation and homeland security policies in public forum at 1 p.m., May 22 at FCC hq. Discussion will include FCC Chmn. Powell and other commissioners, Industry Canada Asst. Deputy Minister Michael Binder, embassy officials from S. Korea and U.K. This is part of FCC’s new 21st Century International Communications Symposia.
FCC adopted report and order Thurs. that puts in place new service rules covering total of 27 MHz in 7 separate bands that have been reallocated from govt. to non-govt. use. More broadly, FCC officials also said at agenda meeting that agency will issue notice of inquiry (NOI) by year’s end on provision of wireless services in rural areas, topic that emerged during Commission negotiations on order. FCC Wireless Bureau Chief Thomas Sugrue said at press briefing after meeting that NOI will be fairly wide-ranging, touching on topics such as roadblocks and opportunities for provision of wireless service in rural areas, as well as auctioning and licensing policies. Order itself covers service and licensing rules for wide range of bands, including ways to continue protecting wireless medical telemetry service at 1.4 GHz. FCC Comr. Copps dissented in part on item, expressing concerns about spectrum rights given to band managers, which Chmn. Powell later defended as part of Commission’s purview. In lengthy separate statement, Copps also voiced concern that FCC shouldn’t rely on spectrum partitioning and disaggregation to help promote service in rural areas until it receives better data on how these tools are working.
Best response to homeland security emergency will be from “lean federal agency, probably FEMA [Federal Emergency Management Agency], that is able to coordinate strategy with local responders who probably already are flying to the scene,” former Va. Gov. Jim Gilmore (R) said Wed. He keynoted Safety and Security Solutions conference hosted by Motorola in Washington. Homeland security isn’t strictly federal responsibility, he said, and Office of Homeland Security (OHS), headed by former Pa. Gov. Tom Ridge (R), “has to be a planning office to coordinate federal, state and local responders and how they fit together. The office need not be the responder,” he said. Gilmore is chmn. of Congressional Advisory Panel to Assess Domestic Response Capabilities for Terrorism involving Weapons of Mass Destruction.