Feb 20, 2004 12:00 PM

In a recent filing submitted to the Federal Communications Commission, Verizon Wireless assailed the Consensus Plan, which would alleviate interference problems in the 800 MHz band by providing Nextel Communications and public-safety organizations with contiguous spectrum in the band and giving Nextel spectrum the 1.9 GHz band. In the filing, Verizon Wireless defended an appraisal conducted last fall by Westfield, N.J.-based Kane Reece Associates, which said the value of Nextel’s spectrum holdings would increase by $7.2 billion.

Nextel had rebutted Kane Reece’s filings with its own study conducted by Sun Fire Group, which questioned the methodology used by Kane Reece. However, Verizon Wireless accused Sun Fire Group of also using flawed methodology, which resulted in a “simply not credible” conclusion that Nextel’s spectrum assets after adoption of the Consensus Plan would be roughly $1 billion less that the value of the spectrum the company holds today. Among the flaws alleged by Verizon Wireless was a “serious” overstatement of the value of the spectrum Nextel would relinquish.

In addition, while Kane Reece concluded that the “improved spectrum” Nextel would receive in the 800 MHz band would be worth an addition $2.3 billion to Nextel, Sun Fire Group “failed to assign any value” to this spectrum due to an allegedly “flawed kHz-for-kHz analysis that ignored the differences in attributes” between the non-contiguous, encumbered spectrum Nextel would turn in and the contiguous, unencumbered spectrum it would receive in return, said John Scott, Verizon Wireless’s vice president and deputy counsel-regulatory law, in the filing.

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