Editorial New trade association: Small Business in Telecommunications
You can’t win if you don’t try. Owners of small telecommunications businesses have been underestimating their market strength, says Robert H .Schwaninger Jr., a partner with Dennis C. Brown in the Washington, DC-based law firm of Brown and Schwaninger and our regulatory consultant and columnist.
At a March 1-2 meeting in St. Louis attended by 75 telecommunications business owners, Schwaninger invited them to join a new trade association, Small Business in Telecommunications (SBT), dedicated to representing small business before the FCC, Congress and federal courts. “Small business is being told the big lie,” he said. “Don’t try. You can’t win.” In reality, he explained, “You can’t win if you don’t try.”
SBT formed quickly, moving on March 2 to assemble an 11-member board of directors and to hold an election for a chairman by mid-March. Small businesses are threatened by certain FCC decisions that Schwaninger said ignore the agency’s own rules and regulations and federal law. “The fact is that small business can combine to achieve victories before the FCC, in the courts and in the halls of Congress,” he said. Small business has been put in a position of sounding too much like a whiner and challenger to change, rather than as the messenger of common sense, equity, fairness and the protector of the free market, Schwaninger asserted. “When an industry segment stops forwarding its agenda, it becomes vulnerable to having its agenda and opportunities shaped by others,” he said.
To shape a political and regulatory environment in which small telecommunications businesses thrive, Schwaninger told the audience, small business must accomplish the following: * Organize effectively. * Become adequately informed. * Focus on realistic goals. * Become politically active. * Become empowered. * Maintain commitment and vigilance. 800MHz is a beginning
Schwaninger sees the regulatory proceedings involving specialized mobile radio (SMR) and enhanced SMR (ESMR) telecommunications systems as only one battleground in the conflict between small and large businesses. Although there are exceptions in the form of regional systems, most SMR systems provide radio communications service to local areas. Most ESMR systems are intended by current and prospective builders to provide regional and national wireless services, such as cellular telephone, paging, messaging and personal communications services (PCS).
Two tasks lay before small businesses with respect to 800MHz systems. The first task is to show that pending regulation will not work to the benefit of the American public. One example is the auctioning of spectrum for economic area (EA) licenses that conflict with existing SMR systems throughout the country. (See “The FCC’s 800MHz Auction: Why It Won’t Work” on page 82.) If held, these auctions can be expected to prevent any further expansion of small telecommunications businesses with 800MHz SMR systems.Challenges to the FCC auction plan include the following: * that the commission’s rules do not meet its Congressional mandate requiring a demonstration of opportunity for small business, women and minorities. * that the commission’s system construction and channel use requirements would provide opportunities for extended warehousing of spectrum. * that the commission has not demonstrated that more than a small, discreet group of operators are positioned to ever gain licenses and to construct and operate the EA-based systems, including the provision of service form systems using contiguous spectrum. * that the commission has not demonstrated its legal authority to engage in auctions for the stated purposes.
The second task is to recover channels assigned for ESMR use for reassignment by the application process. For example, licenses for thousands of channels held by the largest ESMR operator were granted under a waiver issued March 14, 1991. The waiver spells out a five-year construction period, after which the licenses are to expire.
Brown and Schwaninger has filed a Petition for Special Relief asking the FCC to prevent the ESMR operator from continuing to hold authorizations for unconstructed stations beyond March 14, 1996.If auctions of the type proposed by the FCC (covering economic areas) would be held, recovery of these channels would allow small businesses a better opportunity to bid for EA licenses. The current warehousing of unconstructed channels by ESMR operators would make it difficult in some cases and impossible in most others for small businesses to bid. Additional efforts to recover channels may be undertaken. For example, a petition might be filed asking the FCC to set aside certain ESMR channel grants because the original applications, many of which seem to have been hastily prepared, did not meet FCC requirements.
Another challenge may be based on evidence offered that in-house counsel to one of the ESMR companies may have committed perjury and may have attempted to induce others to commit perjury in statements submitted to the FCC in a finder’s preference case. The commission thus far has ignored the matter, but a hearing could result in the loss of all of the ESMR’s licenses, freeing thousands of channels.
Future regulations If the FCC’s current plans for 800MHz SMRs are successfully implemented, there might be little to prevent the agency from using a similar blueprint for the other land mobile frequency bands and for other services, such as paging. Participation in SBT represents a good opportunity for two-way radio dealers, communications service resellers, and operators of small paging and SMR systems to protect their current interests and to secure a future in the telecommunications industry.
For the present, SBT shares offices with Brown and Schwaninger, and can be reached at 1835 K St. NW, Suite 650, Washington, DC 20006; tel. 202-223-8728; fax 202-659-0071. The association will be represented at the International Wireless Communications Expo in Las Vegas, NV, April 24-26. –Don Bishop
