MAJOR CARRIERS PLAN BIG FIGHT ON AUCTION 58 RULES
Major wireless carriers were considering their options Tues. and are expected to ask the FCC to reconsider in one form or another its public notice late Fri. setting up the rules for Auction 58 next year (CD June 22 p3). The carriers hope ultimately to tweak the rules so far fewer of the licenses will be available just to designated entities (DEs). DEs and major wireless carriers, meanwhile, are likely to go to Congress seeking support.
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The first step will be filing comments on the public notice released last week. If carriers make formal filings they most likely would seek a rulemaking, said an attorney for the carriers. The attorney said a petition for reconsideration wouldn’t be enough.
Under the proposed rules, based on Auction 35 -- the original attempt to sell the former NextWave licenses -- in markets larger than 2.5 million, 20 MHz will be offered to all bidders and 10 MHz to just DEs. That ratio flips for markets below the cut off. If the FCC lowered the threshold it could open up many more licenses to open bids. “If you put the threshold at 500,000, markets like Hagerstown, Md., would be below the threshold,” said an attorney who follows auctions. The notice said that, based on the 2.5 million threshold, of the 234 10 MHz licenses sold 119 would be open to just DEs.
George Laub, managing dir. of CouncilTree Communications, one of the major DE bidders in Auction 35, said DEs will also bring pressure to bear on the Commission as the debate continues. “We don’t see any basis on which to tweak these rules in any respect whatsoever,” Laub told us: “These rules have been in place a long time and they've served their purposes well.” Laub said any changes in threshold levels would hurt DEs: “I don’t think there’s any room for changing the current set-aside rules such as they are. [Major carriers] are huge enterprises but we'll certainly do what we can to get our message out there.”
One regulatory attorney not affiliated with either side said he expects more political pressure than regulatory filings. “My guess is they'll put a lot of pressure on the Commission probably through the Hill,” the source said. But formal filings “would add additional time to the process. Once you file something the Commission traditionally puts it out for comment. [Carriers] don’t want to add any steps. They want spectrum.”
An attorney who has represented DEs said smaller companies would oppose any move to change the auction rules. “Auction 35 was one of the most successful auctions in the history of FCC auctions,” the attorney said: “There was enough thought and enough deliberation that went into this that [Commissioners] were comfortable with the decision they made… The DEs never got their shot under the Auction 35 rules. There is still a community willing, ready and able to participate. They want it as much as the big guys.”