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WIRELESS CARRIERS URGE FCC TO PUT SPECTRUM IN RURAL TELCOS’ HANDS

Rural telecom companies are uniquely positioned to provide wireless services in the vast majority of rural areas, parties said in comments filed with the FCC. They urged the Commission to adopt rules and policies that would provide opportunities for rural telephone companies and eliminate outmoded barriers to deployment of wireless broadband service. The comments came in response to a rulemaking the Commission began in Sept. (CD Sept 11 p6) asking how to promote spectrum-based services in rural areas.

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NTCA said the FCC had a statutory obligation to disseminate spectrum licenses to rural telephone companies under Communications Act Sec. 309(j). It said spectrum for rural telcos was a key to success of the Commission’s rural wireless auction policies. It urged the agency to adopt rules that would put spectrum into the hands of rural carriers, adding that small spectrum license territories and strict build-out requirements for wireless licensees were necessary. NTCA urged the Commission to adopt: (1) A rebuttable presumption that spectrum would be licensed by small geographic areas. (2) A “keep what you use” licensing approach when licensing large geographic areas, saying that would make unused spectrum available for other users after build-out: “This approach allows for the development of niche services, but does not permit a carrier to hold unused spectrum hostage.” (3) The “substantial service” approach when licensing spectrum for small geographic areas.

NTCA said licensed spectrum was a “more feasible option” for rural areas because interference concerns made the unlicensed spectrum unreliable and often unusable. It also cautioned against using competition as the sole policy tool to provide wireless to rural America, saying “if policies are designed to introduce more licensees than a market can support, the consumer will lose as these companies fail.”

The Rural Cellular Assn. (RCA) said adoption of a “substantial service” alternative for wireless services should have a condition that areas that remained unserved would be returned to the Commission and would become eligible for relicensing. CTIA said wireless providers should be afforded additional flexibility in construction requirements through the addition of a “substantial service” benchmark to the current construction benchmarks in all wireless services. However, it said the Commission shouldn’t impose additional construction requirements on license renewal.

Addressing possible ways to improve access to unused spectrum, CTIA said it didn’t believe that a spectrum audit was necessary now in rural areas. It said the Commission shouldn’t create “easements” or “underlays” for new licensed spectrum until a full framework has been developed to prevent interference with CMRS services. For future auctions, CTIA recommended that the Commission adopt the PCS “complete forfeiture” standard as the best approach for promoting rural infrastructure development.

CTIA also said the Commission should: (1) Investigate increasing power levels in rural areas, “so long as these studies responsibly address any potential interference concerns.” (2) Take a balanced approach to geographic service areas and mix combinations of larger areas with smaller ones in new spectrum blocks. (3) Ease access to capital by eliminating the cellular cross-interest role in RSAs and working with the Rural Utility Service (RUS) to ensure that its broadband loan rules are revised to ensure technological neutrality. (4) Continue to improve infrastructure sharing, including removal of state and local roadblocks to wireless deployment.

CTIA said it supported Commission efforts to survey Rural Radiotelephone Service (RRS) and Basic Exchange Telecom Radio Service (BETRS) users as a preliminary step to determine the effectiveness of those services. Should the data show that the RRS and BETRS spectrum isn’t being used well, it said it would support efforts by the Commission to reallocate RRS and BETRS spectrum to more efficient and commercially promising users.

On the definition of “rural area,” many parties, including OPASTCO, the Rural Telecom Group (RTG), RCA and CTIA agreed that the FCC should define it as any county with fewer than 101 persons per square mile. However, RCA and CTIA said it also could be defined as any area within an RSA as defined by the Commission for cellular licensing.

In a joint comment, OPASTCO and RTG also urged the FCC to: (1) Relax power limitations in “rural” areas. (2) Reserve at least one spectrum block in each newly allocated wireless service for licensing in MSAs and RSAs. (3) Create a stable regulatory environment with clearer rights and responsibilities for rural carriers. (4) Eliminate the cellular cross-interest rule in all RSAs. (5) Adopt rules to encourage the deployment of software-defined radios. (6) Advocate abolition of unfunded govt. mandates for rural carriers.

RCA said the FCC, to advance rural wireless deployment, should: (1) Auction all newly available and reclaimed spectrum according to MSA/RSA boundaries, not larger geographic areas. (2) Reclaim unused spectrum for relicensing to entities prepared to use it for service offerings after notice to licensees that they must “use it or lose it.” (3) Continue to make available to rural wireless carriers high-cost support for the Universal Service Fund (USF). (4) Avoid new “unfunded mandates” on wireless carriers because “small carriers lack pricing power in their markets and therefore cannot recover the costs associated with such mandates from their relatively small subscriber base.”

RCA also called for: (1) Increased power levels wherever they could be used effectively, according to benefit, cost, propagation behavior, prevention of interference and radiation exposure potential. (2) Relaxation of cellular cross-interest restrictions so that they were applied only in RSAs with 3 or fewer broadband PCS and cellular competitors. (3) Proposals that would permit infrastructure sharing. On the subject of security interests for lenders, RCA suggested that the FCC refrain from favoring the RUS with security interests that weren’t available to other lenders: “Indeed, there is no need to grant any lender a security interest in licenses because they already may obtain the proceeds from the sale of a license.”

The Wireless Communications Assn. (WCA) expressed concern that while Multipoint Distribution Service (MDS) and Instructional TV Fixed Service (ITFS) spectrum in the 2150- 2162 MHz and 2500-2690 MHz bands was “optimally suited” for delivery of wireless broadband service to rural areas, interference analysis, application process and licensing in the current MDS/ITFS rules imposed “entirely excessive transaction costs both in terms of time and money on providers of MDS/ITFS broadband service.” It said those costs were “particularly onerous” for broadband providers willing to serve rural areas, where they were unable to spread those costs over many subscribers. WCA urged the Commission to adopt the Coalition Proposal it submitted with the National ITFS Assn. and the Catholic TV Network last year to facilitate more rapid deployment of rural MDS/ITFS broadband service.

WCA supported the Commission’s proposal to adopt a “substantial service” alternative for all wireless services that were licensed on a geographic area basis and subject to construction requirements. However, it emphasized that at least for the next MDS/ITFS renewal cycle, the Commission should consider whether substantial service was provided at any time during the license term, as opposed to just examining the service provided at renewal: “To do otherwise would plainly compromise the Commission’s policy of flexible use -- licensees will be reluctant to migrate from current video services to broadband offerings when approaching renewal, regardless of marketplace demand, for fear that they will not be providing substantial service at renewal time.”

Cingular strongly opposed the adoption of new rules designed to require incumbent carriers to provide service in rural areas. It argued there was effective competition in rural areas, and services should be provided “where there is a return on capital invested. Requiring carriers to deploy where this basic economic criterion is not met creates inefficiencies and could potentially force certain carriers to exit areas currently served or the marketplace, thereby decreasing competition.” CTIA cautioned the FCC to “remain mindful of the success that has grown out of both the Commission’s procompetitive wireless policies and technologically neutral eligible telecom carrier designation process.”

Cingular urged the FCC to let recently adopted secondary markets rules address any concerns on the ability of parties to access spectrum in underserved areas before it intervened. It said the merits of easements or underlays in existing services shouldn’t be addressed until the success of the FCC’s secondary markets initiative could be evaluated. Cingular said the Commission should: (1) Eliminate barriers to the effective functioning of the marketplace, and specifically repeal the cellular cross-ownership prohibition in Sec. 22.942 and eliminate any policies that discouraged infrastructure sharing. (2) Avoid adopting new regulations that would inhibit the natural functioning of the CMRS market. (3) Refrain from drawing distinctions between urban and rural areas in the CMRS industry. (4) Streamline the cellular unserved area procedures to allow the remaining unserved area within cellular geographic service area boundaries to revert automatically to the incumbent licensee’s CGSA, except for unserved areas greater than 50 square miles in size. That proposal will expedite service to rural areas, it said.