Citing tight capital markets, Dobson Communications CEO Everett D...

DCC PCS had made $546 million in winning bids for 14 licenses in Jan. 2001 re- auction, results of which were overturned when U.S. Appeals Court, D.C., reversing FCC decision to cancel NextWave licenses for missed payment. Verizon Wireless last week also asked FCC again to “promptly” refund its entire $1.7 billion deposit from re-auction. U.S. Supreme Court agreed last week to hear oral argument in FCC’s appeal of D.C. Circuit ruling. Earlier this year, 12 winning bidders in re-auction, including Verizon and Dobson, had asked FCC for immediate refund of $3.1 billion in down payments after settlement agreement on licenses expired Dec. 31 when Congress failed to approve pact. While Verizon has sought full return of its down payment, Dobson said it believed both FCC and re-auction winners’ interests could be protected “by promptly refunding” all but 15% of each applicant’s down payments. “The Commission must be aware of the severe capital restrictions that currently face the wireless industry, many of whose members are Auction 35 winners,” Dobson wrote. Now most wireless carriers face capital market pressure to reduce leverage, he said. “Uncertain future” of NextWave spectrum means Wall St. is viewing this negatively by attributing little or no value to spectrum even though deposits are treated as expended funds, he said. “Indeed, in Wall Street’s view, the Auction 35 winners are, at this time, actually worse off for having won licenses in that auction.” Since carriers submitted joint request for return of down payments in Jan., they have collectively lost $29 million of additional interest and “unknown number of lost opportunities to expand existing services.”