Nextel to FCC: We’ll take the legal risk
Nextel Communications yesterday provided more details to the FCC on its revisions to the Consensus Plan and included a commitment to reband at 800 MHz and 1.9 GHz, despite an expected court challenge to an award of 1.9 GHz replacement spectrum.
“If the Consensus Plan is adopted, we are prepared to move ahead with rebanding immediate at 800 MHz and 1.9 GHz, even if there is pending litigation,” Nextel spokesman Tim O’Regan said.
O’Regan noted that Nextel would obey any direct court order calling for it to stop rebanding, which could be a possible outcome if some 800 MHz operators decide to fight moving to new frequencies. However, the commitment could be significant to public-safety groups and the Bush administration, both of which have feared that 800 MHz interference would continue as the expected legal fight regarding replacement spectrum is waged in a court battle that could take years.
Indeed, many analysts have cited that concern as a key reason for the FCC’s consideration of granting Nextel replacement spectrum at 2.1 GHz in any 800 MHz rebanding order. Verizon Wireless has said it would not challenge an award of 2.1 GHz airwaves—a key part of a plan proposed by the Cellular Telecommunications and Internet Association—but would litigate an award of 1.9 GHz spectrum, which it considers “beachfront property” for the commercial wireless industry.
Most of Nextel’s 11-page filing was devoted to providing more details regarding its “enhanced” Consensus Plan, which calls for Nextel to contribute an additional 2 MHz of 800 MHz spectrum but would remove 4 MHz of 900 MHz airwaves from the deal.
Verizon Wireless had raised a concern that the new 800 MHz airwaves would put public-safety groups on a band adjacent to Nextel, creating a possible repeat of the current interference situation.
However, O’Regan said the Nextel plan calls for a spectrum shuffle that would result in private wireless companies being adjacent to Nextel’s frequencies in the newly contributed spectrum. In return, the private wireless groups would give 2 MHz of their spectrum to public safety in a manner that would expand the new blocks of contiguous public-safety airwaves.
In addition to providing public safety with more 800 MHz spectrum, the “enhanced” plan would allow private wireless groups to benefit from the economies of scale created by a vendor community developing solutions for Nextel’s nationwide network, O’Regan said.
“This way, public safety gets more spectrum for their needs and private wireless has new opportunities for commercial development, particularly for those providers that wanted to be closer to the cellular band, so they could offer new technologies,” O’Regan said.
Overall, Nextel values its “enhanced” Consensus Plan at $5.155 billion, which includes $550 million to alter its system, $512 million to relocate broadcasters from 35 MHz of spectrum at 1.9 GHz, $850 million to pay the costs to relocate 800 MHz users and the contribution of 8.5 MHz of spectrum at 700 MHz and 800 MHz.
Verizon Wireless has said Nextel has overvalued its contributions and undervalued the 1.9 GHz spectrum it is seeking, meaning the carrier would receive a “windfall” if the FCC approves the Consensus Plan.