Spectrum Auction Should Please Both Camps

By Carmen Nobel  |  Posted 2002-09-02

The Federal Communications Commission last week began auctioning a chunk of spectrum in the lower-700MHz range, while keeping its plan to auction the rest of the 700MHz spectrum in January.

The abbreviated auction is a compromise authorized by Congress, addressing rural wireless carriers immediate need for additional spectrum while still acknowledging urban carriers assertions that they dont want to pay for new spectrum before the current tenants exit the band.

Under the terms of the deal, one license will be offered in each of 734 MSAs (metropolitan service areas) or RSAs (rural service areas), and one license will be offered in each of six EAGs (economic area groupings), for a total of 740 licenses, according to FCC officials, in Washington.

"Were glad that the majority of the 700MHz band has been held," said Travis Larson, a spokesman for the Cellular Telecommunications Industry Association, a lobbying group for commercial wireless carriers, in Washington. "It will allow the FCC in conjunction with Congress to devise a better spectrum management plan."

In late May, the FCC postponed the auction of the 700MHz frequencies for the sixth time, from June 19, 2002, to Jan. 14, 2003. Spectrum in the 747MHz-to-762MHz and 777MHz-to-792MHz ranges is still due for auction in January.

The 700MHz auction has been delayed many times because prospective bidders have complained that it doesnt make sense to bid on spectrum that is already occupied. Several cable television stations already occupy the 700MHz band.

The television stations are required to leave the band as part of a national transition to digital television, but they are required to leave by 2006 or when 85 percent of households can receive digital television signals, whichever is latest.

The FCC has suggested that potential bidders negotiate with the broadcasters and pay them to move them out earlier.

In a statement last year, the commission said, "The private sector ... [will] determine the band-clearing mechanisms that will best suit broadcasters and potential new 700MHz licensees needs."

An FCC official said last week that the abbreviated auction and the larger auction will be governed by the same rules.

So far, the broadcasters have not budged. Rep. Billy Tauzin, R-La., has plans to introduce legislation to address this issue next month.

"We look forward to seeing that," Larson said.

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