Rebanding of public-safety licensees operating at 800 MHz continues to proceed slowly as participants await answers to several key policy issues from the FCC, and mediation for Wave 3 NPSPAC licensees begins.

Foremost among the pending issues is a joint request from national public-safety leadership and Sprint Nextel asking the FCC to direct the Transition Administrator (TA) to identify NPSPAC licensees that can be rebanded this year and establish benchmarks for future progress.

“We're trying to build a building without a blueprint, and you have to keep the building functional while this is being done,” said Larry Krevor, Sprint Nextel's vice president of government affairs for spectrum. “The missing piece is the blueprint, or the plan.”

That plan will have to accommodate some rebanding work beyond the June 27, 2008, deadline the FCC established for the massive project. This date reflected a 36-month timetable, but not a single public-safety licensee has completed rebanding 22 months into the process. Most rebanding participants believe at least two additional years will be needed to complete reconfiguration of the 800 MHz band.

And there appears to be little hope for improvement in the near future. At IWCE in March — when mediations for all Wave 1 and Wave 2 NPSPAC licensees were scheduled to be completed with rebanding deals in place — TA Director Brett Haan reported that 62% of the 547 mediation cases lacked a final contract or pre-contract agreement.

Meanwhile, Wave 3 NPSPAC licensees were scheduled to enter mandatory mediation on April 1. During the first two NPSPAC waves, about 90% of licensees were required to enter mediation after failing to reach an agreement with Sprint Nextel, and most rebanding sources believe that Wave 3 will yield a similar percentage.

“The way the process has morphed is that the negotiating period is not where the action is happening; it's happening in mediation,” Krevor said. “[Mediation] is producing agreements. Whether it's the optimal way to get there is another matter, but it's working.”

But the glacial pace of negotiation is creating frustration on a number of fronts. There are 24 contested rebanding cases pending at the FCC — a figure that would be greater if licensees did not have to pay their own legal costs for appealing disputes to the commission, according to several public-safety representatives. Furthermore, no treaties have been signed to address rebanding on the Canadian and Mexican borders, meaning many Wave 4 licensees cannot begin negotiations on a rebanding deal.

And many vendors and consultants have been left in a financial quandary. Based on the FCC's rebanding time-table, these businesses — a large percentage of them small and medium-sized companies — invested in additional personnel and products to handle the surge of work expected from rebanding. However, with most public-safety licensees mired in lengthy negotiations, these vendors typically have seen little or no revenue to date.

A Subscriber Equipment Deployment (SED) program introduced in March was supposed to help address at least a portion of this problem by giving licensees the opportunity to reprogram or replace mobile and portable radios prior to reaching a final rebanding agreement with Sprint Nextel. Although TA officials hoped most NPSPAC licensees would eagerly participate and initial inquiries were positive, fewer SED applications were received during the first three weeks of the program than expected.

“The TA would like to emphasize that licensees do not have to gather every detail of their subscriber equipment inventory to commence participation in SED,” the TA said in a statement. “Rather, they have the option to amend their request or their contract as additional details become available.”

Meanwhile, any hopes Congress had that some of the $2.8 billion Sprint Nextel reserved to pay for rebanding would be left over to deposit into the U.S. Treasury appear to be slim. Whether rebanding will cost Sprint Nextel the $7 billion figure estimated by Gil Stocks of Tusa Consulting remains to be seen, but most participants agree that the $2.8 billion threshold will be exceeded, as the carrier already has spent more than $1 billion on rebanding, with only a small fraction of that figure going to licensees.

“It'll be tough,” said Alan Tilles, a partner in the law of Shulman Rogers Gandal Pordy & Ecker, when asked about rebanding costing Sprint Nextel less than $2.8 billion. “I think they [Sprint Nextel officials] were really shocked by the costs on the public-safety side, as was I.”

THE REBANDING BOTTLENECK

IN PROCESS BREAKDOWN
Mediations (total) Resolved In process In planning Pre-contract agreement At FCC In negotiations
Wave 1 323 118 205 139 20 23 23
Wave 2 224 47 177 67 23 1 86
Totals 547 165 382 206 43 24 109
Source: Transition Administrator