CTIA outraged by bait and switch

The Cellular Telecommunications & Internet Association (CTIA) called for the Federal Communications Commission (FCC) to reallocate and auction a majority of the 2 GHz MSS spectrum instead of simply allowing ICO Global access to it for Ancillary Terrestrial Component (ATC) uses.

ICO Global had filed a petition with the FCC requesting that it be allowed to sell wireless phones without satellite capability for use in its own satellite-designated spectrum.

“It’s a classic bait and switch,” said Steve Berry, Senior VP of Government Affairs at CTIA. “ICO promised the FCC it would build satellite telephone communications, and in return, the FCC gave ICO billions of dollars worth of spectrum free of charge.”

It appears that ICO Global now wants to use its free spectrum to provide regular, wireless service, “…thumbing its nose at promises it made to the FCC, but keeping the spectrum it got in the deal.”

In its filing, ICO Global claimed that “Mobile Satellite Service (MSS) providers must have the flexibility to offer ATC user terminals that are more comparable in size, cost and battery life to existing terrestrial wireless phones.”

CTIA’s Berry counters by saying, “The only reason ICO needs Commercial Mobile Radio Service (CMRS) phones is to compete head to head with CMRS providers — without having to pay for the underlying spectrum.”

In its letter, CTIA said that should the commission grant some form of ATC to MSS licensees, then it must ensure that any ATC capability must be truly ancillary and not merely a pretense for MSS carriers to acquire terrestrial service capability without having to pay for that right at auction.

In its pending petitions before the commission, CTIA says that several MSS licensees have admitted that their service is not viable and several MSS licensees have failed to satisfy the initial 2GHz MSS milestone required as a condition of their license.

Furthermore, CTIA said in its five page letter delivered to the Federal Communications Commission Chairman Michael K. Powell on Dec. 17, the FCC should use, as a starting point, its own proposed definition of “ancillary” from the Notice of Proposed Rulemaking (NPRM) — that ancillary services “refer strictly to services provided by MSS operators that are integrated with the satellite network, use assigned MSS frequencies, and are provided for that purpose of augmenting signals in areas where the principally service signal, the satellite signal is attenuated.”

To give definition to this MSS context, the commission should consider using gating criteria to ensure the terrestrial service remains ancillary, as the MSS carriers request, and that the overall service continues to be a true satellite service, as the MSS carriers have promised.

The FCC should at a minimum put any gating criteria that it is considering out for comment before moving ahead, citing that a hasty decision “granting ATC would most likely result in a morass of legal proceedings, and a guarantee that this spectrum would either lie fallow or be inefficiently used for years to come.”

CTIA ended the letter with the comment: “Consumers would be far better served if the Commission were to reallocate and auction the 2 GHz spectrum that is licensed to MSS companies that have missed milestones or are not viable, than to grant those licensees additional terrestrial capabilities that the MSS licensees themselves have conceded will do nothing to help their profitability outlook.”

Universal service hits carriers

The FCC on Dec. 13 almost doubled the amount wireless carriers contribute to the Universal Service Fund, in what could be the beginnings of a complete overhaul of the creaky USF system.

To help bolster the fund, which supports the provision of affordable telephone service to all Americans, the FCC proposes that wireless carriers make a contribution equal to 28.5 percent of their assumed interstate revenue, compared with the current 15 percent fee.

The move is part of the commission’s immediate “interim measures” to shore up the fund to “ensure the near-term sustainability” of the fund, says the FCC. Despite the heavier contribution load that wireless carriers would pay into the fund, CTIA was supportive of the FCC’s plans.

The association has expected, and even suggested, that wireless carriers contribute a bigger chunk to the fund, possibly in the 18 percent of revenue range.

“A revenues-based collection system is both fair and equitable in the near-term,” said Tom Wheeler, president and CEO of CTIA. “But policymakers must soon face the reality that they need to rethink the current universal service system. A universal service fund should have truly universal support, with all forms of communications contributing to the fund. And the fund should be dispersed in a technology-neutral manner, so that all consumers can fully enjoy the benefits of cost-effective, ubiquitous communications.”

The FCC also put out for comment several longer-term plans that could substantially alter how wireline and wireless carriers contribute.

The FCC asked about three possible new contribution methods that would:

• Impose a minimum contribution on all interstate telecom carriers and a flat charge for each end-user connection depending on the nature and capacity of the connection (could be used to encompass high-speed connections);

• Assess all connections based only on capacity-which would share contributions between access and transport providers;

• Assess carriers based on contributions of switched connection providers based on telephone numbers.

All three of the proposals have been discussed at length at the FCC. Commissioner Kevin Martin suggested at a press briefing weeks ago that the use of connections and telephone numbers to assess contributions could prove viable.

Spectrum policy update imminent

The leaders of the FCC and National Telecommunications and Information Administration said Dec. 11 that they plan to issue in the coming months the first update to their joint oversight of spectrum policy since the 1940s.

In one of the first formal meetings between FCC Chairman Michael Powell and NTIA chief Nancy Victory resulting from last spring’s spectrum summit, the two said late Tuesday they would issue a memorandum of understanding detailing the terms of how the two government agencies will work together to further spectrum policy. The MOU will incorporate details concerning how the two could capitalize and coordinate their efforts in the face of advancing technological capabilities in spectrum.

The MOU is the first produced by the two agencies, which have been sharing spectrum oversight, since the 1940s, according to the FCC and NTIA.

The meeting between Victory, whose official title is assistant secretary of commerce for communications and information, and Powell included senior spectrum policy teams from NTIA and the FCC. The groups “explored areas of common focus and priority,” the FCC and NTIA said in a joint statement. More specifically, the groups discussed the existing process of government and commercial spectrum use while trying to curb interference; emerging spectrum access and interference technologies; alternative licensing schemes; unlicensed uses of spectrum; the strengths and weaknesses of licensing models and how new models can be developed.

The next formal meeting between the two teams is slated for the early summer of 2003.

Motorola hastens division changes

Driven by what it calls a need to hustle after business created by the homeland security craze, Motorola named Dec. 13 a new head its commercial, government and industrial solutions sector and hastened the departure of the current division leader.

The company today named Greg Brown, who currently is chairman and CEO of business software provider Micromuse, as president and CEO of the CGISS, which provides communications and information systems and other solutions for public safety, utility, government and now homeland security organizations.

The unit was responsible for developing the FedEx Power Pad wireless handheld that the shipping giant plans to begin deploying to its 40,000 couriers early next year.

Brown, whose appointment takes effect Jan. 1, replaces Bob Barnett, who the company says agreed with Chairman and CEO Chris Galvin that the division requires leadership continuity for a longer period than Barnett had planned to stay on board, ‘given the positive changes taking place in homeland security communications and related fields served by CGISS.

As of Jan. 1, Barnett will be begin working for Motorola’s Office of the Chairman and will retain his executive vice president title. CGISS already is showing signs of a business wave spurred by public safety and homeland security contracts. The division’s operating earnings after special items in the first nine months of this year surged to $124 million from $26 million in the same period last year.

“Bob has worked relentlessly to serve and support our key stakeholders: communities, customers, employees, shareholders and suppliers,” Galvin stated. “His success and personal leadership are reflected in CGISS recently being named a recipient of the Malcolm Baldrige National Quality Award.”

During Brown’s tenure at Micromuse, the company’s revenue rose nearly 500 percent, the company says.

He also has extensive executive experience in telecom, having spent the 12 years before joining Micromuse in 1998 at Baby Bell Ameritech.