TERRORIST ATTACKS ALTER POLICY LANDSCAPE FOR 3G DECISIONS
Last week’s terrorist attacks appear to have dimmed prospects, for now, of wireless industry’s obtaining quick decision on relocating military spectrum users for 3G wireless. While insiders continue to stress need for additional spectrum for advanced wireless services, several told us that if nothing else, logistics of defense agencies focusing on response to last week’s attacks meant that Pentagon policymakers attention was focused elsewhere. On other hand, several wireless industry officials said key role played by mobile communications in aftermath of attacks, including final calls from passengers on hijacked planes, underscored very publicly importance of adequate wireless coverage.
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But with national security at top of Washington policy agenda, several industry observers said they didn’t hold out hope for 3G action on Capitol Hill this year. Legg Mason said in research report released Fri. that overall 3G impact was that effort to obtain military spectrum “will likely be significantly delayed… The new Washington reality will make it even more difficult to obtain the spectrum from the military anytime soon.” Meanwhile, closely voted FCC order is expected out as early as today (Wed.) that will take MMDS band out of consideration for 3G while providing flexible use of band.
“The events of last week underscore the importance of our defense intelligence community to be able to better communicate and do their jobs and to ensure that the wireless industry has a sufficient amount of spectrum to meet the needs of consumers, particularly in such horrific, devastating circumstances,” said Brian Fontes, Cingular Wireless vp-federal relations. Attacks underscore importance of spectrum management to make sure industry and govt. have respective spectrum needs met, he said. Fontes said his hope was that World Trade Center and Pentagon attacks didn’t hamper any part of debate on 3G and spectrum management, including some of govt. and other bands identified as candidates for additional capacity.
One complicating factor, several sources said, is that Pentagon repeatedly has emphasized extent to which “military readiness” could be impaired if services were asked to move prematurely from 1.7 GHz band. “I don’t think anyone has given up on the idea,” said Derek Khlopin, dir., law & public policy, Telecom Industry Assn. “Ultimately, DoD does need to modernize their communications networks.” If DoD users eventually are relocated to another band to make way for 3G wireless, Pentagon will receive money that in turn it can use to improve its own communications infrastructure, he said: “The critical thing is just making sure that there is no way that DoD capabilities aren’t diminished in the interim.” Prospects already had narrowed for 3G action on Hill last week when House Rules Committee rejected amendment by Rep. Kirk (R-Ill.) that would have reserved proceeds from 3G spectrum auctions for DoD modernization activities (CD Sept 13 p5).
Elsewhere on 3G front, FCC apparently has voted, although not yet released, order that will take MMDS and Instructional TV Fixed Service spectrum out of play for 3G relocation but would allow both fixed and mobile operations to operate in band. FCC Chmn. Powell had pledged at Aug. agenda meeting to have order out by end of that month on status of MMDS and ITFS (CD Aug 10 p3). Item cleared 8th floor before departure of Comr. Tristani Sept. 7, although several sources indicated wording of flexible use language had delayed release of item. Two sources said vote on item was 5-0, with partial dissents by Tristani and Comr. Copps.
Legg Mason report said any proceeding that didn’t have a lot of political momentum and that required significant focus by political leadership had slimmer chances now of moving forward. While attacks may have strengthened DoD’s hand in defending spectrum, “we do not believe this means the industry will never get access to any of the spectrum,” it said. In update to investors, Legg Mason cited Tauzin-Dingell broadband bill, which was set for House vote this month: “We think that is now less likely, particularly given its [already] poor prospects in the Senate.” Possibility for settlement in NextWave PCS licenses also is more complicated because of coordination such move would require among FCC, Justice Dept., Office of Management & Budget and Congress. Simple solution may be to allow litigation to just play out. (FCC plans to seek Supreme Court review of U.S. Appeals Court, D.C., decision that had overturned Commission decision to cancel NextWave licenses for nonpayment.) Some of immediate budget pressure for settlement may have eased as Congress dips into Social Security funds, Legg Mason said.
Meanwhile, FCC spokesman confirmed Tues. that FCC had received additional time from Supreme Court to file writ of certiorari in NextWave case. Commission had asked for 8 days beyond filing deadline of Sept. 19 to seek review of D.C. Circuit ruling in NextWave case. Supreme Court Chief Justice William Rehnquist has given govt. until Oct. 19 to file petition, FCC spokesman said. Separately, hearing in U.S. Bankruptcy Court in White Plains, N.Y., also was delayed until Oct. 1 from original date of Sept. 12 and 13.