FCC Tells Court AWS Auction Saw Significant DE Participation
The recently concluded AWS auction was a major success, despite complaints by Council Tree and other designated entities seeking to overturn the results, the FCC told the 3rd U.S. Appeals Court, Philadelphia. The agency acted within its authority under the Communications Act in significantly curbing designated entities’ (DEs') ability to buy licenses at reduced prices and then sell them through the secondary market, it told the court.
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The FCC and intervenors CTIA and T-Mobile answered a pleading by Council Tree, Bethel Native Corp. and the Minority Media & Telecom Council. The DE advocates said the revised rules effectively killed DE participation in the auction (CD Sept 8 p3). The court has yet to schedule oral argument in the much-watched auction case. The court could throw out the auction results if it finds for the DEs led by Council Tree.
“By any objective standards, DEs participated substantially in the AWS auction,” the FCC said: “DEs comprised 100 out of the 168 qualified bidders.” DEs Denali and Barat Wireless placed among the top ten bidders in terms of dollar value, the agency said. The FCC said claims that DE participation was much lower than in previous auctions ignore that the FCC clamped down on relationships between DEs and carriers, which meant fewer winning DE bidders. For example, in 2005’s Broadband PCS auction the number 2, 4, 5 and 7 top bidders were DEs with ties to carriers that no longer are allowed.
The rule changes were well within Commission authority, the agency said. They “reflect the Commission’s reasonable judgment on how best to balance the statutory goals in light of past experience, the record before it, and the acknowledged urgency of proceeding with the AWS auction without delay,” the FCC said, calling the revisions “within the Commission’s statutory discretion and are not arbitrary or capricious.”
CTIA and T-Mobile, which want the auction upheld, backed the FCC in a filing. “While intervenors may not agree with every element of the new rules, the rules are reasonable and fall squarely within the Commission’s statutory authority,” they said, agreeing the AWS auction had succeeded. “DEs did well in the auction -- many DEs bid, and more than half the winning bidders were DEs,” intervenors said: “Auction 66 achieved this while promoting the act’s other competing goals: the auction’s results promise broader service in rural areas, greater competition in many urban markets, and new advanced services from spectrum-strapped carriers.”