Wireless Spectrum Auctions

T-Mobile may be onto something with HotSpot@Home, a service that lets users switch voice calls seamlessly between Wi-Fi and the T-Mobile network, analysts said. Using Wi-Fi increases T-Mobile’s reach to homes and will save the company “billions” long term, said ThinkEquity analyst Anton Wahlman. He called it the “exact right architectural approach” and “one of the most genius moves of all time in cellular.” Jupiter Research analyst Julie Ask agreed that the service is a “good fit” for 3G-less T-Mobile, but said it may not make sense for rival carriers.

AT&T warned the FCC that a lawsuit could be filed to stop the auction of the 700 MHz band if the commission imposes any open access obligations on the spectrum, it said in a letter responding to comments from Google this week. Meanwhile, Frontline Wireless held a media luncheon to show it is still fighting for the FCC to adopt rules that would let it build a nationwide fourth generation wholesale public-private wireless network.

House Democratic lawmakers strongly endorsed a unreleased plan at the Federal Communications Commission (FCC) urging open access rules for the impending 700 MHz auction. Two hours into a heated and sometimes technical debate Wednesday in the House Telecom Subcommittee, Commerce Committee Chairman John Dingell, D-Mich., asked if he could use his new Apple iPhone on networks other than AT&T. “Why not allow this choice for consumers?” Dingell asked.

Proposed rules mandating conditional open access rules for the 700 MHz auction could be circulated as early as today, FCC officials said. The rules prompted heated debate ahead of today’s (Wednesday) hearing on the issue by the House Commerce Telecom Subcommittee. Consumer and public interest groups say FCC Chairman Kevin Martin’s proposal does not go far enough to ensure adequate market competition.

The Public Safety Spectrum Trust (PSST) Corp. late Monday issued a request for proposals enabling it to “identify one or more entities to serve as agent/adviser,” it said. Players picked would represent PSST in talks with auction participants and commercial wireless providers on public-safety broadband network deployment. Notices of intent to bid must arrive by July 20; complete bids, July 30, PSST said. PSST was created to give public safety an organizational structure for making decisions needed “to guide the construction and operation of an interoperable nationwide broadband network,” it said. PSST is positioning itself to be the licensee, if the FCC picks one nationwide public-safety licensee, for the broadband network to be built with 700 MHz band spectrum freed by the transition to digital TV.

Open access should not be required of the winner of the 700 MHz E-block, said the National Public Safety Telecommunications Council (NPSTC) Friday. But NPSTC wants the option of negotiating open access issues, “some of which may agree to and some of which we may not,” it said. One reason for NPSTC’s squishy position on open access is “due to the absence of a commonly agreed upon definition of what open access means.” To proponents, it means attaching any device to the network and requiring carriers to offer service to anyone. Frontline Wireless said Monday that if open access had been the rule, Apple would not have been forced to sign a 5-year exclusive deal with AT&T for its new iPhone (CD July 3 p3). The wireless industry has called open access “a poison pill.” Even without an endorsement of open access, seen as key to the Frontline proposal, Frontline issued a statement claiming to have won-over public safety. NPSTC’s statement “underscores that public safety supports a ‘national new build’ network funded by the E-Block licensee,” Frontline said. “That means way more than a cosmetic tweak of Verizon’s network. It means a real facilities-based alternative. That’s good for consumers and public safety: two sides of same coin.” NPSTC released several recommendations as the FCC considers service and auction rules for the 700 MHz band spectrum being made available with the transition to digital TV. NPSTC is asking the FCC to designate a National Public Safety Licensee (NPSL) to govern the use of 10 MHz of public safety’s 24 MHz. The spectrum would be combined with the E-block’s 10 MHz to form the public-private partnership. The 20 MHz network would be built under a specific process set forth by NPSTC. Auction participants should be reasonably certain of the public- safety network requirements so the FCC should specify them “both in terms of geographic scope and service levels consistent with public safety on street and in-building needs,” said NPSTC. To help, the FCC should encourage the NPSL to host a bidders conference to educate potential bidders about public safety’s needs. Once the auction is held, the NPSL and E-block auction winner would negotiate to develop a network sharing agreement. If no agreement is reached within a specified time, the FCC would resolve the differences. If the NPSL is satisfied with the FCC’s solution, the E-block licensee would be bound to it. If not, the E-block spectrum would be reauctioned and the process would begin anew, under the NPSTC plan.

Frontline plans a written response to a letter released late Friday by a bipartisan Congressional group that slammed its proposal to build a national fourth-generation wireless network for commercial and public-safety uses (CD Jul 2 p1), Frontline Vice Chairman Reed Hundt told reporters Monday. “They don’t seem to have heard of the iPhone,” said Hundt, a former FCC chairman. Frontline cited the iPhone’s launch to urge the FCC to make it even better by creating a national wireless fourth-generation network and mandating it be open to all. “If it isn’t open access then you will just recreate the deal you see with the iPhone -- the only communications device in America where the device is completely the slave of the network,” Hundt said.

Government incumbents are being slow to exit spectrum sold in the 2006 advanced wireless services (AWS) auction, top members House Commerce Committee members, including Chairman John Dingell of Michigan and ranking member Joe Barton of Texas, told the administration. The letter marked a victory for T-Mobile, which has been lobbying hard on clearance of the spectrum, which is key to its survival. T- Mobile particularly frets about lagging by the Departments of Defense, Justice and Homeland Security. The House members’ letter, sent to Office of Management and Budget Director Rob Portman and Commerce Secretary Carlos Gutierrez, asks for an update by July 13 on progress toward relocation, with quarterly reports to follow. “We also remind the agencies of their responsibility to coordinate in good faith with AWS licensees prior to relocation,” the letter said: “Bidders who paid the U.S. government billions of dollars for licenses are entitled to make use of these frequencies as long as there is no harmful interference demonstrated.” Also signing were Ed Markey, D-Mass., Fred Upton, R-Mich., Bart Stupak, D- Mich., and Ed Whitfield, R-Ky.

AT&T’s acquisition of Dobson Cellular likely faces few regulatory hurdles at the FCC or Justice Department, analysts and industry sources agreed Monday. AT&T announced a deal late Friday to buy Dobson for $2.8 billion. Dobson sells service to some 1.7 million customers under the Cellular One brand. Both use GSM-based technology, simplifying system integration. And Dobson has 850 MHz spectrum well-suited to serving rural areas, analysts said. AT&T and Dobsons hope to close the deal this year.

A Frontline executive wants to debate Verizon CEO Ivan Seidenberg on how best to use 700 MHz spectrum to be auctioned by Jan. 28, 2008, and stage the event at the FCC. FCC service and auction rules for the band are expected this summer. Vice Chairman Reed Hundt of Frontline complained to Communications Daily that Verizon has been attacking his company’s ideas for the spectrum using “surrogates,” not it own executives. Hundt invited Seidenberg, accompanied by a teammate, to pick any two Frontline officials to debate. It is “time for Verizon to show, in factual detail,” its position on 700 MHz, said the former FCC chairman. Hundt admitted his ire at a Wednesday Washington Post op-ed article criticizing Frontline’s 700 MHz proposal. Seidenberg “is not available to debate” Hundt, said a Verizon Wireless spokesman. “There is a process at the FCC which former Chairman Hundt knows well,” he said. “That’s where we will air these issues.” Frontline also drew fire from AT&T for including in the record a blog purporting to show AT&T support for part of Frontline’s proposal. AT&T said it doesn’t back imposing a requirement that the winner of a 700 MHz E-block license offer wholesale spectrum usage and let all legal devices connect to the network, commonly known as open access. “Our position has not changed,” said AT&T. “As we've stated on the record at the FCC, mandated ‘open access’ conditions on licenses in the 700 MHz band should be rejected.” Added an AT&T spokesman, “We need to see the specific rules the FCC adopts for the auction before determining our level of participation.”