Small Carriers Oppose Early 700 MHz Auction Start

Wireless Bureau staff want an early date to make sure the U.S. gets all auction proceeds by June 30, 2008, as required by law, Martin said. The 2006 advanced wireless services auction began in Aug., and FCC preparations for that auction were as far along a year ago as preparations for the 700 MHz auction are today, Martin said. “I would think that at this point the earliest would probably be some kind of a similar time frame” as the 2007 auction, Martin said: “It would be difficult for the Commission at this stage to move any faster.”

Smaller carriers may have a tough time lining up financing before the 700 MHz auction, and they need as much lead time as possible, sources said. MetroPCS, Leap and other midsize carriers active in the AWS auction probably could get financing but need time to integrate AWS spectrum into their systems before the 700 MHz auction.

“The Wireless Bureau is pretty active on this and it wouldn’t surprise me to see them moving up the timetable for 700 MHz earlier than year-end,” a source active in previous spectrum auctions said: “They're making it harder for midsized and smaller carriers, because its coming so quickly after the AWS auction… People are trying to get their capital in place and their plans in place and it’s tougher to do being so close to AWS.”

“There is concern that accelerating the timetable too much for the 700 MHz auction… could disadvantage the regional carriers who will need some time to implement their business plans for the Auction 58 and AWS spectrum before turning their attention to raising money for the 700 MHz auction,” a lawyer said: “It would be very unfortunate to leave these carriers on the sidelines, or to reduce the level of their participation, since they were among the most active bidders in recent auctions and bring great promise in terms of new services and increased competition.”

An early date would complicate efforts to solve interference and other technical problems, the source said: “For example, the recent NPRM exploring possible broadband uses in the 24 MHz of public safety 700 MHz spectrum has possible technical implications on the adjoining bands, and this issue should be concluded well before bidders are required to set auction values on the commercial band.”

“August would be very aggressive,” a carrier source said: “You could certainly count the smaller players out and it’s unclear what would happen to the middle-sized guys.”

During a news conference after the FCC meeting, Martin said customer proprietary network information (CPNI) rules he has proposed focus on 2 rule changes. Carriers would have to protect CPNI by requiring customers to use passwords. The rules allow other ways to get the information - for example, a carrier rep could call customers on the line in question. Second, the FCC is limiting sharing of information among carriers and partners in joint ventures, and with independent contractors. Customers would have to “opt in” before private information could be shared. That change don’t apply to data sharing with corporate affiliates.

The CPNI item seems headed for approval, sources said. “It’s on circulation, so the commissioners can vote at any time,” Martin said: “If we haven’t been able to make any progress on circulation, I would probably put it on the Feb. meeting agenda.”

Martin predicted quick consideration of an order on whether the FCC or state regulators have jurisdiction over early termination fees. Wireless firms say federal oversight is more appropriate. The FCC has a “strong track record” on consumer issues, Martin said: “From a broader policy directive, I don’t think that if you're talking about the Commission versus the local government taking on an issue… that is inherently either proconsumer or anticonsumer.”