TRW filed petition with FCC Wireless Bureau Thurs. to deny Advanced Radio Telecom (ART) renewal applications for 39 GHz licenses. ART had warned it would halt service after it filed for Chapter 11 bankruptcy protection March 30. TRW said renewal “would undermine [FCC’s] goals” of preventing “warehousing of spectrum” for any company “with no immediate ability to provide service to the public.”
Wireless Communications Assn. lauded FCC Mass Media Bureau decision to reject emergency petition filed last week by Verizon Wireless (CD April 5 p6). Bureau turned down petition asking that decisions on 2-way applications for Multipoint Distribution Service and Instructional TV Service licensees be deferred until Commission made larger decisions on 3G spectrum allocations. “The FCC deserves applause for its prompt decision to permit broadband deployments to move forward by rejecting this outrageous and unprecedented request by Verizon Wireless,” WCA Pres. Andrew Kreig said.
Civil rights and consumer groups urged FCC to approve bid by Broadwave USA to provide pay-TV and high-speed Internet access service using “Northpoint technology” that would share satellite providers’ spectrum. In petition filed late Wed., Center for Media Education, Consumer Federation of America, Consumers Union, Leadership Conference on Civil Rights, Media Access Project and United Latin American Citizens asked Commission to approve Broadwave’s application because startup would bring more competition to cable. Saying that 80% of participants in Broadwave’s 69 local affiliates were women and minorities, groups said company would “introduce tremendous diversity into a marketplace that has been homogenized through media consolidation.” Finally, they said, they backed Broadwave’s application because they said company would make Internet service available “at reasonable price” to people in poorer and underserved areas. Broadwave plans to offer 60-90 TV channels for $20 per month to consumers with satellite dish, plus high-speed data for additional $20 per month. AT&T and EchoStar have filed in opposition to Broadwave’s proposal.
Coalition charged with coming to consensus on future of universal service offered policymakers 7 options for funding program in coming years as new technology makes current system less practical. In report Thurs., Consumer Energy Council of America (CECA) deliberately didn’t pick one of 7 options, saying Congress, FCC and Federal-State Joint Board on Universal Service should have full range of thinking by group. Broad-based organization included representatives of state and federal govt., consumer groups and wide variety of industry including long distance companies, incumbent LECs, CLECs and wireless providers. About 60 people were listed in report, although not all of them attended every meeting. Report will be submitted to FCC as ex parte filing and will be sent to key members of Congress.
Panelists at Congressional Internet Caucus lunch Thurs. didn’t rule out need for congressional intervention of some type on pending Internet-capable 3rd generation wireless allocation decisions involving Dept. of Defense, NTIA and FCC. At lunch on Capitol Hill sponsored by advisory committee to caucus, several panelists suggested Congress could have role to play, specifically on mandatory auction date for certain bands now under consideration for 3G allocation. FCC is overseeing decisions on 2.5 GHz spectrum now occupied by Multipoint Distribution Service (MDS) and Instructional TV Fixed Service licensees and NTIA has purview over 1.7 GHz band occupied by govt. users, mostly military systems. Under Executive Memorandum signed by President Clinton last Oct., FCC would have to make spectrum allocation decision in July to meet congressional deadline of Sept. 30, 2002, for depositing proceeds in U.S. Treasury from auction of certain bands. “I hope that Congress recognizes that we may have to slow down just a little to speed up and get the right solution,” said Steven Berry, CTIA senior vp-govt. affairs. Issue of making sure there’s enough time for decisions is particularly important given bifurcation of 3G decision-making authority between NTIA and FCC in that area. “That’s where Congress has a role,” Berry said. FCC Wireless Bureau Chief Thomas Sugrue described potential for reaching solution on vacating incumbents from one of existing bands under consideration, although he said logistics for how some of that would happen were less clear-cut. “We would not resist and would in fact welcome some help from our friends in Congress to help make this happen,” Sugrue said. Panel was moderated by Washington attorney Gerry Waldron, with other speakers including NTIA’s Joseph Gattuso, Motorola Vp-Telecom Strategy & Regulation Richard Barth, Pegasus Communications Vp Cheryl Crate and consultant Leslie Harris for WEBNow, coalition representing ITFS licensees. Several panelists cited extent to which reimbursement, which is required for moving federal licensees from incumbent spectrum, is likely to make relocation decisions somewhat more tenable. “This is an area where the spectrum is potentially so valuable to 3G services, there should be enough money I think to make some of this work out,” Sugrue said. “The money makes things not a zero-sum game anymore. Otherwise, we're taking from DoD and giving it here, or we're taking from MMDS and giving it there and they move and someone else wins and that’s a hard way to get anybody to agree.” NTIA’s Gattuso said the NTIA report released Fri. on possibilities for 3G spectrum sharing and segmentation in 1.7 GHz left open options. “We have seen a lot of interest by the Secretary of Commerce and the Administration in general to look at this issue at the highest levels of government and to work with industry to look at our options,” he said. Harris stressed that ITFS licensees were in thick of deployment plans for rolling out wireless broadband services, including those covering “congressional” priorities of distance learning and service to typically underserved inner city and rural areas. “There is more at stake here than can you move incumbents,” Harris said. “There’s a real opportunity here -- DoD needs advanced, digital highly encrypted telecommunications capabilities for the 21st century,” Berry said, reiterating CTIA’s view that DoD spectrum would be best for 3G. “Right now they're in analog systems,” he said of Defense communications. He cited ITFS estimates for relocating incumbents of up to $30 billion, with DoD estimates closer to $4 billion. “Quite frankly I was surprised by the dollar number that DoD gave to NTIA."
FCC Chmn. Powell expressed strong doubts about future importance of traditional over-the-air TV in nation where more than 80% of households rely on cable and satellite for their TV viewing. In news conference on TV issues at Commission hq Thurs., Powell said he didn’t see agency intervening much further in such marketplace issues as disputes over DTV standards and network affiliate practices because he wasn’t sure how most consumers were affected. With combined cable and satellite penetration seemingly on its way toward 90% of U.S. TV homes, he argued that such broadcasting industry battles were relevant to increasingly fewer viewers.
News Corp. Chmn. Rupert Murdoch said at Sky Forum in N.Y. that company could live “with or without” DirecTV or entity in U.S. market. Reiterating familiar theme during negotiations with Hughes Electronics and GM, Murdoch said “although the U.S. is an important part” of strategy to develop global satellite broadband company, Sky Global is “viable without a U.S. presence.” He said U.S. presence was nice to have, but it wasn’t necessary to the overall success of the operation.” Moments later, Murdoch wouldn’t comment directly on status of talks despite widespread reports Hughes no longer was interested in selling DirecTV unit and had backed out of deal. However, News Corp. spokesman said as Murdoch was being ushered out side door followed by throng of reporters: “We're still talking to DirecTV. The deal is not off, but the talks are going very slow.”
FCC gave 3-6-month extensions of DTV construction deadlines to all 23 applicants in decision released Thurs. Only applications that were opposed were those of 4 Denver stations, where Canyon Area Residents for Environment wanted DTV licenses rescinded entirely. Commission gave 3-month extensions to 4 stations that indicated that was all they needed, 6 months to rest. FCC Comr. Furchtgott-Roth said extensions should be up to May 2002. NAB, meanwhile, said WAVY-TV Norfolk, Va., began DTV broadcasting, increasing total to 186 stations in 64 markets.
Shares of Lucent closed up $1.17 to $7.92 following precipitous drop to 52-week low of 5.50 Wed. on heels of bankruptcy rumor quicky squashed by company. Rumor, spread in part by Internet chat boards, was credible to enough investors to trigger 30% plunge in early morning trading. Incident highlighted Lucent’s financial situation, which is far short of Chapter 11, but still precarious.
Don’t expect FCC to be as eager to place issue-oriented conditions on merging companies as past Commissions, FCC Chmn. Powell told reporters in news conference Thurs. on telecom issues. He said FCC votes depended on all 5 commissioners but he wouldn’t be pushing for kind of conditions that were imposed on SBC- Ameritech, Bell Atlantic-GTE and other mergers. Powell held 2 news conferences for trade reporters Thurs., answering questions on video issues in morning session (see separate story) and telecom questions in afternoon.