Speakers at the Incompas Policy Summit expressed hope Tuesday that the FCC will act soon to allow use of the 12 GHz band for 5G. Incompas has been a leading member of the 5G for 12 GHz Coalition, which seeks new rules for the band (see 2107080055).
Wireless Spectrum Auctions
The FCC manages and licenses the electromagnetic spectrum used by wireless, broadcast, satellite and other telecommunications services for government and commercial users. This activity includes organizing specific telecommunications modes to only use specific frequencies and maintaining the licensing systems for each frequency such that communications services and devices using different bands receive as little interference as possible.
What are spectrum auctions?
The FCC will periodically hold auctions of unused or newly available spectrum frequencies, in which potential licensees can bid to acquire the rights to use a specific frequency for a specific purpose. As an example, over the last few years the U.S. government has conducted periodic auctions of different GHz bands to support the growth of 5G services.
Lawmakers are frustrated that interagency spectrum policy infighting that became endemic during the Trump administration continues to be an issue one year into Joe Biden’s presidency, despite early hopes for a shift (see 2010260001). Some on and off Capitol Hill believe the Biden administration’s handling of the high-profile C-band aviation safety fracas that preceded delays last month in AT&T and Verizon rolling out commercial 5G use on the frequency (see 2201180065) has stirred an increased appetite for enacting a legislative solution. Others want to hold off on legislation for the time being in hopes recently installed NTIA Administrator Alan Davidson, FCC Chairwoman Jessica Rosenworcel and other officials will be able to quickly nip the squabbling.
House Transportation Committee members and witnesses at a Thursday Aviation Subcommittee hearing criticized breakdowns in the federal interagency spectrum coordination process as a primary cause of the C-band aviation safety fracas that preceded delays last month in AT&T and Verizon rolling out commercial 5G use on the frequency (see 2201180065). FAA Administrator Steve Dickson told lawmakers he believes “we are in a much better place than we were” in mid-January, before the wireless carriers and the agency reached agreement to temporarily defer turning on C-band 5G service around some airports. Lawmakers wondered if the situation will deteriorate again when cellular carriers lift those temporary restrictions.
Democratic FCC nominee Gigi Sohn told the FCC Thursday she will, if confirmed, recuse herself during the first three years of her term “from any proceeding before the Commission where retransmission consent or television broadcast copyright is a material issue.” Sohn’s recusal pledge appears to be the result of negotiations with Senate Commerce Committee leaders aimed at securing support from all 14 Democrats before a planned Wednesday panel vote to advance her nomination to the full chamber, lobbyists told us. Some panel Republicans pressed for concessions from Sohn over ethics concerns about her role as a board member for Locast operator Sports Fans Coalition (see 2201130071).
AT&T plans to deploy much of its C-band spectrum at the same time it deploys the 3.45 GHz licenses it bought in a recent FCC auction, CEO John Stankey told analysts on the company’s Q4 call Wednesday. Stankey said the radios needed for 3.45 GHz should become available in late spring or early summer. Installing the bands “together at one time with one tower climb … allows us to start really going what I would call good guns on this in scaling up,” he said. AT&T has followed a similar one-touch strategy in building out FirstNet spectrum.
Blame the Donald Trump administration, not the FAA, for the fight over the C band that slowed 5G deployment, former FCC Chairman Tom Wheeler blogged Friday. Wheeler noted the NTIA received a letter in December 2020, before the C-band auction, raising concerns, but the letter was never passed along to the FCC or the wireless carriers. President Joe Biden has shown the leadership needed to reach a compromise, Wheeler said. “When the prior administration’s failure to resolve the interagency dispute ended up putting at risk the wireless companies’ $81 billion [in C-band bids] and threatening the economic growth promised by 5G, President Biden and his aides stepped up,” he said: “Instead of meaningful spectrum policy management, the Trump administration produced slogans.” The CEOs of two major airlines said on earnings calls last week a resolution is in sight. “While we don't have a final resolution quite yet, I'm confident we'll get there,” said United Airlines CEO Scott Kirby: “While I wish it happened earlier, the good news is we now have everyone engaged, the FAA and [Department of Transportation] at the highest levels, the equipment aircraft manufacturers, airlines and the telecoms. And I'm confident we'll soon have a clear set of objective criteria that will allow a full rollout of 5G without significant impact to aviation.” The fight wasn’t the airline industry’s “finest hour,” said American Airlines CEO Doug Parker. “It's taken a while to get to the right spot, but I feel like we're in the right spot,” he said. “I don't think you're going to see any material disruption going forward because of this.” Neville Ray, T-Mobile president-technology, emphasized to customers that C-band delays didn't affect his company because it’s mostly using 600 MHz and 2.5 GHz. “T-Mobile’s 5G network, already covering over 1.7 million square miles and 310 million people nationwide, and our customers are not affected by this,” he said: “By the time we’re ready to put our C-band licenses to use in late 2023, we’re confident today’s concerns will have been resolved.”
AT&T’s industry-leading bids of $9.1 billion in the 3.45 GHz auction won't affect its ratings since expenditures in that range were expected, S&P Global Ratings said in a Wednesday note. AT&T’s adjusted debt to EBITDA ratio remains “elevated in the 3.7x-3.8x range” but should decline after its sale of Warner Media, S&P said. “We view AT&T's longer-term competitive position as weaker relative to that of its wireless peers Verizon and T-Mobile,” S&P said: “While the acquisition of 40 MHz of nationwide spectrum will improve the company's overall mid-band spectrum position, it still operates at a competitive disadvantage to T-Mobile, especially given T-Mobile's head start in building out its 2.5 GHz band for 5G services.” The firm sees few opportunities to buy more mid-band spectrum this year.
AT&T and Verizon plan to start turning on their C-band operations Wednesday, despite a push by major airlines to delay the start. Both said Tuesday they will defer the launch around some airports and expressed frustration with the FAA.
The biggest surprises in the 3.45 GHz auction were that Dish Network came in relatively big and T-Mobile small, according to the early analysis of the results, which were released Friday (see 2201140040). Verizon dropped out of the auction, after dominating the C-band sale, as expected (see 2111170037).
FCC handling of designated entities SNR Wireless and Northstar Wireless got probing Friday by Judge Harry Edwards as he repeatedly criticized the idea that ostensible investor protections gave Dish Network de facto control of the DEs when the FCC hadn't worried about those same protections in past DE situations. Judge Patricia Millett tore into the DEs' assertion that they had made substantive changes from the original terms of their investor agreements with Dish, in the nearly two-hour U.S. Court of Appeals for the D.C. Circuit oral argument (docket 18-1209). The DEs are challenging the FCC's 2020 rejection of the AWS-3 bidding credits -- the second time the agency did so (see 2011230062). New Street Research's Blair Levin said the panel appeared to side with FCC arguments, as was expected.