Parties prep for 700 MHz auction
With less than four months until the FCC auction of 700 MHz frequencies, interested parties are busy preparing to meet some potentially challenging timelines to complete mandated tasks prior to the first bids being made on Jan. 16, 2008.
Last month, the FCC’s Public Safety and Homeland Security Bureau outlined the criteria for the national public-safety licensee, which will control 10 MHz of spectrum in the band and is expected to negotiate an agreement with the D Block winner to establish a nationwide broadband network for public safety.
Applicants must be a nonprofit organization with a board made up of representatives from nine organizations specified by the FCC. Applications needed to be submitted to the FCC by Oct. 10, after which the agency will select the national public-safety licensee.
Most industry observers believe there will be little choice to make. As of press time, the only entity expressing interest in becoming the national public-safety licensee is the Public Safety Spectrum Trust (PSST), which was established in June by several public-safety organizations to serve this purpose. PSST President Harlin McEwen said he would not be surprised if his organization is the only applicant.
“The eligibility requirements are so tightly written out that I find it hard to believe that anybody else could be eligible,” McEwen said.
In fact, the PSST was not yet eligible as of press time, as the organization was still working to reconstitute its board of directors to meet FCC specifications for the national licensee, McEwen said. Until that work is done, the PSST will not hire an agent/adviser from the list of three finalists selected in August, he said.
Once the national public-safety licensee is announced, the decision is expected to begin a whirlwind of activity leading up to the auction. Of particular importance is the need for the public-safety licensee to state its requirements for the shared network so D Block bidders are aware of their obligations before deciding whether to bid the $1.3 billion minimum reserve price in the auction.
FCC reserve prices have been a source of contention, especially the $4.6 billion reserve price attached to the 22 MHz C Block, where licensees are required to adhere to open-access rules that allow users to connect any device to the network that does not harm the network.
While telecom giant Verizon filed suit in an appeals court to get the open-access obligations dismissed, economists funded by Frontline Wireless expressed concern that the FCC’s unprecedented reserve price for the C Block spectrum will result in gamesmanship and, ultimately, a new auction of those airwaves because the reserve price will not be met.
“I’m not saying the disaster is a certainty, but it’s a possibility that the FCC would want to avoid,” said Peter Cramton, economist with the University of Maryland. “My expectation is that there is a significant chance that will happen.”
Meanwhile, public-safety licensees already operating narrowband systems in the 700 MHz band are gathering information about those networks, which must be relocated by Feb. 17, 2009, to accommodate the new band plan. The D Block licensee will pay a maximum of $10 million to fund the rebanding of the few 700 MHz systems operating as of Aug. 30.
Several public-safety representatives expressed concern at the relocation timelines, which some interpreted as stating that 700 MHz systems currently being deployed or have been contracted for deployment soon would not be eligible for reimbursement. However, the FCC is accepting waiver applications for such systems.
THE 700 MHZ CHECKLIST
Cutoff date for 700 MHz narrowband equipment to be considered operational without an FCC waiver.
Deadline for organizations to submit FCC applications to be the national public-safety licensee.
FCC to name national public-safety licensee.
Public-safety licensee and FCC inform potential D Block bidders of public-safety requirements for the nationwide broadband wireless network. Typically, such an event occurs 60 to 75 days before an auction.
Deadline for 700 MHz auction bidders to declare their intent to participate. Typically, this occurs 45 to 60 days before an auction.
JAN. 16, 2008
700 MHz auction scheduled to begin.