M2Z Auction Proposal Under Review at FCC
Chmn. Martin circulated but subsequently withdrew an order that would scuttle M2Z’s proposal to build a free, nationwide wireless broadband network in the 2.1 GHz band, in favor of auctioning the spectrum, sources said. The order denied M2Z’s petition for forbearance and launched a proceeding on service rules and procedures for an auction. Several other companies, including Speedus Corp.-backed NetFree, have also contended for the spectrum.
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Industry sources said Thurs. they wouldn’t be surprised if the proposal was rejected since M2Z, headed by former Wireless Bureau Chief John Muleta, has always faced an uphill fight. Muleta, who testified Thurs. before the House telecom subcommittee, had no immediate comment. M2Z asked for 15- year licenses to build a broadband network in “underutilized, fallow and unpaired” spectrum in the 2155-2175 MHz band. The network would be free, but supported in part through a premium service for customers seeking higher connection speeds.
“Muleta has been exceptionally successful in getting people to write letters [endorsing the plan],” one source said: “This certainly leaves M2Z free to participate in an auction for the same spectrum.” An attorney who represents wireless clients said M2Z has built a “robust record” and in the order the Commission is going to have to go to some pains to justify rejecting its petition. Sec. 309(j)(6)(E) of the Communications Act, a key provision for M2Z, gives the agency discretion to use means other than auctions for awarding spectrum when doing so is in the “public interest.”
“There are a lot of groups that have supported the proposal,” the attorney said. “The support is coming from people who think there aren’t enough choices for broadband. The Commission is going to have to grapple with the public interest commitment M2Z has made, the most important being free broadband access.” The source predicted any order will state that while M2Z’s goals are “laudable” the company “could go to an auction” and acquire spectrum through more conventional means.
“It was an incredibly heavy lift,” another wireless attorney said: “They made a run at it. It’s very hard to get free spectrum.”