Industry consolidation has been underway for decades and its challenges for the communications bar are nothing new, communications industry lawyers said. Law firms face steady pressure to keep the rates they charge low and, as companies expand, many take routine matters "in-house," the attorneys said. But the attorneys also said technological evolution, including the explosion of wireless, has meant new areas of practice and new clients seeking representation.
The Congressional Budget Office’s monthly budget review for July mentioned that spending increases for the entire federal government during the first 10 months of FY 2015 were in part offset by certain FCC spectrum auction developments. “Payments to the [FCC] from auctions of licenses to use the electromagnetic spectrum increased by $30 billion,” said the CBO report, released Friday. “Because the proceeds from spectrum auctions are recorded in the budget as offsetting receipts, that increase in payments has resulted in lower outlays.”
Broadcasters and public interest groups lost their fight to keep all TV stations out of the duplex gap between uplink and downlink frequencies bought by carriers in the upcoming broadcast incentive auction. That was as expected (see 1507300042), though it left both broadcasters and the public interest groups upset. The FCC approved 3-2 the “procedures” for the auction, after a contentious debate. Commissioners Ajit Pai and Mike O’Rielly said the rules could set the auction up for failure.
The biggest trade associations in the video space spent less money lobbying in Q2 this year than last, according to second quarter lobbying disclosure forms. NCTA spending was $2.95 million vs. last year’s $4.01 million in Q2. NAB lobbying dropped to $4.17 million, from the $4.65 million it spent last year during the same quarter. Those forms were due Monday, and several weren't posted by our deadline.
The Senate Commerce Committee locked down July 29 as the date for its long-expected hearing on spectrum, several industry officials said. Witnesses are widely expected to include CTIA President Meredith Baker, a strong advocate for more commercial spectrum. The committee hasn't announced the hearing, confirmed the date or confirmed any of the witnesses. Industry observers told us that various pieces of spectrum-related legislation seem to be gaining momentum and may be ripe for advancement, though some questioned the carriers' demand for more spectrum.
Policymakers have had enough of T-Mobile’s requests for preferred treatment in the TV incentive auction and are just saying no to a larger spectrum reserve -- spectrum set aside for competitors without extensive low-band holdings in a particular market -- Mobile Future Chairman Jonathan Spalter alleged Friday in a blog post. T-Mobile CEO John Legere has made the issue a top regulatory priority for the carrier (see 1507020057). “After Periscoping his way through Washington, John Legere has left a path of alienation in his wake,” Spalter wrote. “Rather than declaring victory for convincing the FCC to block national rivals AT&T and Verizon from bidding on up to 30 MHz of prime spectrum in the upcoming broadcast spectrum auctions, Legere is seeking to publicly bully the commission into giving his company right of first refusal over even more bandwidth and at an even steeper discount.” T-Mobile is not responding to Spalter, a spokesman said.
Two House Republicans warned the FCC not to restrict participation in spectrum auctions. “We strongly oppose any rule changes that would depress participation in the upcoming incentive auction for 600 MHz [of] broadcast TV spectrum,” said Commerce Committee Vice Chairwoman Marsha Blackburn, R-Tenn., and Communications Subcommittee Vice Chairman Bob Latta, R-Ohio, in a letter sent Friday. They blasted the idea of “greater set-asides” than the FCC has already specified. They also said the FCC needs to further overhaul the designated entity rules. The FCC should be “guided by a simple principle: A small business program must serve small businesses and not become a forum for corporate welfare,” they said. “But real small businesses who are building mobile broadband to serve their communities do not have deep pockets, and placing too high a cap on bidding credits is only likely to encourage speculators and others more interested in profiting from this government program rather than deploying new broadband infrastructure and creating real competition.”
House Commerce Committee ranking member Frank Pallone, D-N.J., touted what he saw as congressional influence in the rules the FCC circulated for the broadcast TV incentive auction last week (see 1506250057). “This proposal is welcome news for our country’s small businesses that deserve a fair shot at competing in today’s wireless marketplace,” Pallone said in a statement. “Earlier this week, Energy and Commerce Democrats sent a letter to Chairman [Tom] Wheeler asking the FCC to do just that, and it appears that our call for reform was heeded. This proposal addresses our recommendations and will help to put in place the smart policies needed to level the playing field and prevent large corporations from gaming the system.” He called the proposal “bold.” Wheeler also reassured Rep. Steve Chabot, R-Ohio, chairman of the Small Business Committee, concerning the lawmaker’s concerns about the use of the designated entity process in the AWS-3 auction bidding. “It is my expectation that any new rules that are adopted will both reflect the dynamics of the current spectrum marketplace, and fulfill our statutory obligation to ensure that small businesses, rural telephone companies and minority and women-owned businesses have the opportunity to compete in spectrum auctions,” Wheeler told Chabot in a June 17 letter the FCC released last week.
The FCC shouldn't destroy the historic designated entity classification because of concerns over the bidding practices of a few DEs in the AWS-3 auction, U.S. Cellular said in a meeting with Wireless Bureau Chief Roger Sherman and other FCC officials, according to ex parte filing posted Monday by the FCC. AT&T and smaller carriers last month asked the FCC to restructure the DE program in light of alleged bidding irregularities by two DEs working with Dish Network in the auction, known in FCC parlance as Auction 97 (see 1505110048). The FCC should “not allow a justified concern over possible abuses among participants in a joint bidding arrangement in Auction 97 to obscure its traditional recognition of the necessary financial prerequisites of a solid DE program, one which allows DEs to achieve adequate scale and scope, and gives them a reasonable chance to succeed,” U.S. Cellular said. Since 1994 when the DE program was launched “the Commission has acknowledged that bidding credits for DEs have been a necessary incentive for these investments, which have allowed DEs to obtain more than a negligible number of licenses,” the carrier said. U.S. Cellular highlighted its work with DEs to bid in spectrum auctions. “The DE program has helped U.S. Cellular remain in business and invest aggressively as a mid-sized carrier in an industry dominated by giants,” it said. The filing was made in docket 14-70.
One House Republican doesn’t anticipate granting the FCC budget request increase of roughly $50 million for FY 2016. “That’s looking less likely,” Appropriations Financial Services Subcommittee Chairman Ander Crenshaw, R-Fla., told us of the agency’s request. “We’ll probably go to our subcommittee sometime after the break, in early June, so we’ll mark our bill up probably middle of June, that kind of thing. So we’ll know more then.”