Nextel criticized a waiver request by NextWave and Cingular that ...

month approved a $1.4 billion deal in which Cingular is buying 34 PCS licenses from NextWave. The deal leaves NextWave with a national spectrum footprint and the FCC receives $714 million. But Nextel said in a filing Wed. that under the Commission’s unjust enrichment rules, which set requirements for designated entities (DEs) that sell spectrum, Cingular couldn’t be assigned the licenses until the FCC was paid in full, including unpaid principal and all unpaid accrued interest. Nextel said that would raise the total to $884 million, including $687 million in outstanding principal and $197 million in unpaid accrued interest. “The Commission should deny this waiver request,” Nextel said. “The waiver request also flies in the face of statements by Cingular’s owners -- SBC and BellSouth -- that strenuously opposed proposals in a 1997 Commission proceeding that would have reduced the debt owed on C-block licenses.” Last month, Cingular and NextWave filed applications with the FCC to assign licenses as part of the proposed deal. The applications included a request that the agency waive parts of its unjust enrichment rules, which require DEs to pay penalties if they sell a license to a non-DE during a restricted period to compensate for advantages such as bidding credits or installment payment plans (CD Oct 1 p1). “Granting Cingular -- the second largest wireless carrier and clearly not a small business -- a waiver of these rules would do great harm to the integrity of the FCC’s auction process,” Nextel said. It urged the FCC to turn down the waiver request and condition the license transfers on Cingular’s paying the higher amount that Nextel contends is due. Nextel also said the agency should probe whether Cingular had the “requisite character qualifications” to hold the designated licenses. “As the Commission staff has recognized, in 2001 Cingular failed to cooperate in remediating serious interference caused by its operations to a public safety system,” Nextel said: “This egregious failure to address potentially life-threatening interference raises serious issues that warrant further Commission investigation.” It cited Cingular’s “failure to cooperate” in resolving interference to public safety systems in Anne Arundel County, Md., in 2002. As for what Nextel characterized as interest payments that Cingular would owe, it said rates of 6.25% to 6.5% applied to NextWave’s installment payments for the C- and F-block licenses it acquired in 1996 and 1997. Separately, Eldorado Communications and NY Telecom filed a petition asking the FCC to deny the licenses NextWave is selling to Cingular. It urged the agency to “expand the scope of this proceeding” to allow for public comment. Eldorado and NY Telecom have raised similar concerns in the past at the Commission on the transparency of proceedings involving NextWave’s licenses, including a settlement agreement among large wireless carriers, NextWave and the FCC that ultimately died. If the license transfer applications are granted, the filing said, “NextWave will walk away with more than $700 million as a result of assigning licenses originally set aside for small entities like Eldorado to one of the largest wireless carriers in the country.” A Cingular spokesman said the carrier was reviewing Nextel’s filing late Thurs. “On initial review, however, Nextel’s comments are totally without merit and appear to be motivated by Nextel’s unhappiness with Cingular’s objection to Nextel’s attempt to obtain spectrum for free through its spectrum swap scheme,” he said, citing the “consensus plan” backed by Nextel for alleviating public safety interference at 800 MHz.