Early signs this week are that smaller carriers may be interested in pursuing licenses in the 2.5 GHz auction, which starts July 29, as they fill in their mid-band spectrum holdings. The biggest player in the auction is still expected to be T-Mobile, which already has a dominant position in the band since its buy of Sprint, and is using 2.5 GHz for its 5G rollout. The Rural Wireless Association had a webinar Thursday on the nuts and bolts of auction participation.
Wireless Spectrum Auctions
The FCC manages and licenses the electromagnetic spectrum used by wireless, broadcast, satellite and other telecommunications services for government and commercial users. This activity includes organizing specific telecommunications modes to only use specific frequencies and maintaining the licensing systems for each frequency such that communications services and devices using different bands receive as little interference as possible.
What are spectrum auctions?
The FCC will periodically hold auctions of unused or newly available spectrum frequencies, in which potential licensees can bid to acquire the rights to use a specific frequency for a specific purpose. As an example, over the last few years the U.S. government has conducted periodic auctions of different GHz bands to support the growth of 5G services.
Carriers large and small are feeling pressure to offer 5G to their customers, executives said at a Competitive Carriers Association conference, streamed from Tampa Tuesday. “All broadband is local,” said CCA President Steve Berry: “Broadband deployment, broadband build, is local.”
FCC Chairwoman Jessica Rosenworcel cautioned House Communications Subcommittee members that some sales from upcoming auctions of the 2.5 GHz band and “construction permits for new full power television stations in communities with no license for the allotted station” will be on hold “pending reauthorization” of the commission’s auction authority if the current statute lapses Sept. 30 without a renewal. CTIA CEO Meredith Baker, meanwhile, urged the leaders of the House and Senate Commerce committees to adopt a stopgap renewal due to the limited legislative time before Sept. 30. The issue was a major focus of House Communications’ FCC oversight hearing last week (see 2203310060).
The Wireless Infrastructure Association urged House and Senate Democratic leaders Tuesday to not include language in a potential alternative version of the scuttled Build Back Better Act budget reconciliation package (see 2112170036) that would institute a 15% book alternative minimum tax on spectrum licenses. “Under the current tax code, companies that acquire spectrum licenses” via FCC “auctions are permitted to amortize these auction costs over a 15-year period, freeing up additional capital for investment in next-generation wireless infrastructure,” WIA President Jonathan Adelstein said in letters to Senate Majority Leader Chuck Schumer of New York, House Speaker Nancy Pelosi of California, Senate Finance Committee Chairman Ron Wyden of Oregon and House Ways and Means Committee Chairman Richard Neal of Massachusetts. “The book alternative minimum tax provision in last year’s Build Back Better bill would have changed this tax treatment -- spectrum licenses would be considered indefinite-lived assets under tax law, and the purchase of these licenses would receive no deduction for book income purposes.” At “a time when Congress is prioritizing the expansion of broadband infrastructure across the country, changing the current tax treatment would represent a retreat in the march towards reaching the nation’s connectivity goals,” Adelstein said.
Network testing and measurement are becoming more complex in a 5G world, speakers said during an RCR Wireless forum Tuesday. The size and speed of the 5G build worldwide makes keeping up technologically more complicated, speakers said.
The FCC could face a tough challenge in looking at possible standards for receivers, as part of a notice inquiry teed up for a commissioner vote April 21 (see 2203310065). Chairwoman Jessica Rosenworcel, working with Commissioner Nathan Simington, circulated a draft NOI last week. Receiver problems figured prominently in recent spectrum fights, most notably the C band, but industry officials said there’s no easy approach for the FCC. In the C band, the FAA and airline industry fought to protect altimeters operating in spectrum more than 200 MHz away.
House Communications Subcommittee members largely but not completely avoided using a Thursday FCC oversight hearing to make partisan points, amid the commission’s focus on bipartisan issues during the ongoing 2-2 split, as expected (see 2203300001). Lawmakers instead focused on questions about the FCC’s work to produce improved broadband connectivity data maps, its handling of the affordable connectivity program and Emergency Connectivity Fund programs, and how commissioners believe Congress should structure a renewal of the commission’s spectrum auction authority.
More than 14 months into the Biden administration, the White House hasn't designated anyone in the administration’s inner circle to oversee 5G or other telecom issues. Experts worry that not having anyone assigned to spectrum issues, at either the Office of Science and Technology Policy or National Economic Council, will complicate efforts to target further bands for 5G, and eventually 6G.
SNR Wireless exercised its put terms to transfer its licenses to a Dish Network subsidiary, the FCC confirmed Wednesday to the U.S. Court of Appeals for the D.C. Circuit. In a docket 18-1209 filing, the agency filed a copy of SNR's March 18 application for its license transfers. Per the application, transfer of the licenses to Dish subsidiary American AWS-3 Wireless III would let it quickly deploy SNR's licensed spectrum as part of Dish's 5G broadband network development, "resulting in the SNR spectrum being put to use years ahead of its final construction benchmark. American consumers will benefit both from improved and expanded wireless services offered by DISH and from competition in the marketplace for mobile broadband services." The state of SNR's ownership came up during D.C. Circuit oral argument in January in Dish designated entities SNR and Northstar Wireless' appeal of the FCC denying them AWS-3 auction credits (see 2201140032).
The FCC’s decision to start the 2.5 GHz auction July 29 doesn’t allow much wiggle room to complete the sale by Sept. 30 when the FCC’s auction authority expires, industry experts said. The FCC will do an ascending clock auction, as expected (see 2203100051), starting that date, said a notice in Tuesday’s Daily Digest. The agency also said it’s launching a mapping tool that can be used to help determine whether and to what extent unassigned 2.5 GHz spectrum is available in any U.S. county. The FCC will sell some 8,000 new flexible-use geographic overlay licenses in the band.