Frontline Wireless Wants 70 MHz Cap for 700 MHz Band
Frontline Wireless wants the FCC to bring back a spectrum cap of 70 MHz by geographic area before auctioning the 1,099 licenses in the 700 MHz band in January. Frontline reminded the commission in comments filed late Friday the FCC had said in relation to the Alltel-Western Wireless merger that a single licensee having more than 70 MHz in a specific market was “likely to cause significant competitive harm.” Frontline Vice Chairman Reed Hundt was FCC chairman when the FCC instituted a spectrum cap of 45 MHz per market before auctioning the PCS licenses. The FCC under former chairman Michael Powell abolished the spectrum cap.
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The FCC should use the upfront payment amount as the minimum opening bid for the licenses, said the law firm of Blooston, Mordkofsky, Dickens, Duffy & Prendergast on behalf of a group of rural-wireless carriers. The Wireless Bureau cut upfront payments for rural service areas from 5 cents per megahertz per POP to 3 but set the minimum bid at 25 percent of the final bid price for the Advanced Wireless Services RSA. “In one case, the minimum opening bid for the Iowa 13 RSA has been set at a price that is 638 percent greater than the up-front payment,” the rural group said.
The minimum bid for the D-block license, a nationwide 10 MHz license designated as a partnership with public safety, should be $1.33 billion, said Verizon Wireless. “Because it is a single license, a bid below the reserve price is meaningless,” Verizon Wireless said. “In fact, setting a minimum bid below the reserve only ensures the type of gaming of the auction rules that the commission is attempting to curtail by adopting anonymous bidding.”
The FCC should avoid new, complex procedures and rules for the 700 MHz auction especially if it can’t adopt and test auction software in time for bidders, “particularly smaller and regional bidders” to acquaint themselves with it, U.S. Cellular said. “It will not be easy for the Wireless Bureau to assure itself that it has adopted fair, objective, open and transparent procedures that recognize the issues faced by smaller and regional bidders and provide all bidders with the flexibility and tools they need to manage their risks,” U.S. Cellular said.
The FCC shouldn’t let bidders drop bids, said Aleksandar Pekec of Duke University. If the FCC does allow dropped bids, it should clarify what happens with the license after a high bid is dropped, he said. Pekec said that after a bid is dropped, the new high bid should be set at the previously second-highest bid and that dropped bids should be subject to the same penalties as withdrawn bids.