FCC International Bureau said it planned public forum June 17 on international satellite network coordination process and domestic regulatory aspects of ITU’s satellite network filing process. Bureau said it was seeking “cross- section” of views that could lead to Commission or govt. action in both areas. Forum will be at FCC hq 2-3 p.m.
Comcast received handful of “complaints” from local franchising authorities (LFAs) in response to its notice that it was ceasing collection and payment of franchise fees on cable modem service, spokeswoman said. LFAs acknowledged it was issue with FCC and not cable operators, she said. Company has no plans “at this point” to reconsider decision, she said when asked whether it was considering continuing to collect fees and hold money in escrow.
Verizon Wireless asked U.S. Appeals Court, D.C., this week to establish expedited schedule for hearing its challenge to March 27 FCC order that returned 85% of NextWave re-auction deposits. Verizon told court that FCC didn’t oppose expedited schedule for briefing and arguments. Earlier this month, Verizon Wireless filed suit in U.S. Court of Federal Claims to obtain remaining deposit from re-auction and seek ruling that auction “contract” for disputed licenses was void (CD April 9 p1). Separate challenge also was filed at D.C. Circuit over Commission order. Last month, FCC returned 85% of deposits to re-auction winners but concluded winning bidders should continue for now to be held to nearly $16 billion auction obligations until Supreme Court review is finalized (CD March 28 p1). Verizon Wireless told D.C. Circuit that agency refused to return all of carrier’s down payment and kept it obligated to pay “on 10 days’ notice” $8.4 billion for licenses if Commission eventually reacquires them. Filing said: “The order is wrong under fundamental principles of contract law, and it irreparably injures Verizon Wireless.” Carrier told court that “the Commission’s assertion that Verizon Wireless remains on the hook to pay this enormous sum on short notice has led 2 major credit- rating agencies to revise from ’stable’ to ‘negative’ their credit outlook for Verizon Communications.” Credit rating agencies attribute Verizon Wireless’s debt to Verizon, which co-owns Verizon Wireless in joint venture with Vodafone. Verizon Wireless told court that its agreement to participate in re-auction of NextWave licenses meant it took on risk that it might have to surrender licenses if D.C. Circuit issued ruling that returned them to NextWave, which occurred in June and is now being appealed to Supreme Court by FCC. But Verizon Wireless said it “did not accept the risks that the FCC now seeks to impose on it -- that if this court’s decision in the pending litigation made the licenses unavailable, the FCC would nonetheless compel Verizon Wireless for years to bear a contingent liability to pay more than $8 billion on 10 days’ notice if and when the FCC succeeds in reclaiming the licenses.” Verizon said it didn’t accept risk that it would bear such burdens “for an indefinite period without any assurance that it would ever receive the licenses that it won at auction.” Briefing schedule proposed by Verizon Wireless would set June 10 deadline for it to file brief and July 24 date for FCC. Final briefs would be due Aug. 30.
Commerce Secy. Donald Evans urged FCC Chmn. Powell, in letter released Thurs., to postpone June 19 auction of 700 MHz band, even without congressional action. Writing on behalf of Administration, he warned that until there was more certainty about spectrum clearing, auction “would be premature and contrary to public interest.” While lauding recent FCC proposal for voluntary steps for accelerating DTV transition, Evans said: “Significant uncertainty remains today about the date on which the spectrum in those bands will become available for new wireless services.” He said Administration still believed legislative postponement of auction deadlines was “preferable” and that it would continue to work toward that. But he said FCC previously had “exercised its discretion” to delay 700 MHz auction and urged it “to do so again.” Evans’ letter came day after Powell testified before House Appropriations subcommittee that in absence of legislative change, he would be uncomfortable about delaying auction again and violating congressional mandate (CD April 18 p1).
FCC granted waiver of its rules defining systems subject to small system rate relief for Caribbean Communications Corp. Rule allows rate relief for systems with no more than 15,000 subscribers and a small cable company is defined as serving total of 400,000 or fewer subscribers in all of its systems. Caribbean’s system has 15,985 subscribers and its parent company, Innovative Communications Corp., easily qualifies as small cable company, Commission said. Part of Caribbean’s argument was that it only slightly exceeds 15,000 subscriber threshold. FCC agreed, saying it was in public interest to grant waiver because Caribbean shares many characteristics of small system.
Northpoint decision will be released today (Fri.), FCC Chmn. Powell told us Thurs. He said Commission was “finalizing statements” and draft of press release. “There’s nothing major.” Earlier FCC official Tom Tycz told reporters: “It’s over when it’s over.” Northpoint had no comment on delay. Industry sources, including those close to Northpoint, continue to speculate that Commission decision involves some kind of auction. Northpoint officials have said in past they will file court appeal if that happens. Correction: Northpoint petition never was on agenda for FCC’s April 18 open meeting (CD April 18 p1).
FCC opened door for delivery of new Ku-band satellite services with adoption of flexible spectrum sharing plan in 10.7 -14.5 GHz band at agenda meeting Thurs., bringing 5-year proceeding closer to end. Commission action means applicants Boeing, Denali, Hughes, Skybridge, Teledesic and Virtual GEO will be able to use same spectrum to roll out advanced data, video and telephony services after licenses are issued. Hughes filed 2 applications in proceeding. Details of order remain sketchy, although Commission released statement that provided general overview. Final order is due out next week, FCC source said.
Executives of ALTS member companies are lobbying in Washington this week to urge FCC, Congress and White House not to “tinker” with Telecom Act to help Bell companies’ agendas, they said at news conference Wed. KMC Telecom COO Roscoe Young said CLECs had changed their business plans to adjust to new business realities and now were worried that regulatory climate would stymie their efforts. “A number of proceedings [at FCC] raise a lot of questions about our future,” ALTS Pres. John Windhausen said. Executives said they got good response from FCC commissioners and staff who encouraged them to continue educating them about how agency’s actions could effect CLEC businesses. “They made it clear that they don’t want unintended consequences” from their actions, one said. ALTS also issued annual report on state of local competition that showed CLEC market share increased in 2001 to 10% from 8.5%, despite difficulties in capital markets -- www.alts.org.
Reacting to cable operators’ decision to stop collecting and remitting franchise fees on cable modem service in light of FCC ruling that it was interstate information service, many cities have told MSOs that it’s “premature” move that could find them in breach of local franchising agreements. Cities that have contested cable modem franchise fees decision of MSOs are basing claims on franchise agreements that require cable operators to pay percentage of gross revenue of all services provided on cable system. Some other cities such as Portland (Ore.), wary of costs of likely legal battle, are choosing not to fight MSOs on issue, preferring to have National Assn. of Telecom Officers & Advisors (NATOA) and other local govt. organizations take up legal challenge on their behalf.
Paxson Communications said Spectrum Clearing Alliance had added dozen new members since FCC Wireless Bureau last week turned down CTIA request to delay June 19 date for 700 MHz auction. Paxson, which has urged FCC not to delay auction for upper and lower bands, also contended that some wireless carriers were “eager to participate,” citing examples such as Council Tree Communications and Nextel. Council Tree, which is investor along with AT&T Wireless in Alaska Native Wireless, which had won spectrum in NextWave re-auction, recently urged FCC to not delay auction, citing interests of small bidders. But Nextel spokeswoman said that carrier hadn’t publicly stated position on auction date. She said she couldn’t comment on Paxson press release that she said she hadn’t seen. Paxson also listed board members to Spectrum Clearing Alliance elected at NAB convention. They included Andrew Hobson, Univision Communications; Lowell Paxson, Paxson Communications; Leon Brown, Clear Channel Communications; Walter Ulloa, Entravision Communications; Bennett Smith, Shop at Home; William Smith, Unicorn Communications; Benton Miller, Trinity Bcstg. Network; Christian French, WRNN-TV; Joe Kelley, Josie Park Bcstg. Alliance has planned to negotiate with 700 MHz bidders on compensation for broadcast incumbents and is working on “private market mechanism” for clearing Ch. 60-69.