WASHINGTON-The Federal Communications Commission’s second report and order that codifies new auction rules for common carrier and private carrier paging along with partitioning of geographic licenses follows in most cases auction rules set up for other wireless commercial services.
However, the commission order is designed to take into account the competitive and financial needs of the traditional paging players-small businesses.
While most of the paging industry has resigned itself to the use of auctions as a method of licensing, some may take issue with the commission’s decision to dismiss most of the pending license applications filed since last July.
The order adopted the following geographic-licensing and competitive-bidding procedures for the paging industry:
All mutually exclusive non-nationwide 931 MHz channels and exclusive nationwide 929 MHz channels will be subject to bidding in 51 major trading areas. New MTAs include Guam and the Northern Mariana Islands, Puerto Rico and the U.S. Virgin Islands, and American Samoa. Alaska also will be considered separate from the Seattle MTA.
Those holding nationwide 931 MHz and 929 MHz licenses will be granted geographic licenses and will not be subject to bidding.
All other paging channels will be subject to bidding for geographic licenses in 172 economic areas. Channels allocated to the Basic Exchange Telecommunications Radio Service also are included in the auction scheme, and rural radiotelephone services and BETRS operators can petition for additional channels on a secondary basis.
Shared Part 90 channels will not be subject to either geographic area licensing or competitive bidding.
MTA and EA licensees must provide coverage to one-third of the population within three years of their grants, ramping up to two-thirds within five years. MTA and EA licensees also must provide “substantial service” to their geographic licenses within five years of the grant. If licensees fail to meet coverage deadlines, their geographic rights will be terminated and reauctioned.
But those licensees, according to the order, will be able to keep whatever sites were authorized, constructed and in operation at the time their geographic licenses were granted.
To stem co-channel interference affecting the 931 MHz and 929 MHz channels, the commission adopted fixed distances noted in the original notice of proposed rulemaking. All other paging channels remain subject to standing rules.
In adopting these rules, the commission also decided to dismiss all pending applications for mutually exclusive paging licenses filed on or before Feb. 19. All non-mutually exclusive applications filed on or before July 31, 1996, will be processed. In addition, any other applications for paging channels other than those for nationwide or shared channels filed after July 31, 1996, will be dismissed.
The dismissal clause reads: “Due to the transition to geographic-area licensing in this order, all pending mutually exclusive paging applications will be dismissed, including those filed under the interim rules.” It is this clause that may prove the most egregious to the paging industry.
According to Rich Feser of manufacturer E.F. Johnson Co., “This is going to hurt a lot of people, like incumbents who filed after the deadline, paid thousands of dollars for coordination and regulatory work, and who have built out sites on the assumption that their licenses would be granted.”
Charles Beard, president of CSSI in Dallas/Fort Worth, has expansion applications pending for sites in Texas, New Mexico and Oklahoma.
`The FCC has locked my door and told me I can’t accept any new subscribers.” Beard’s applications, filed after the deadline but following the commission’s decision last summer to partially lift the paging freeze, have been on hold for one reason or another, and he’s afraid he will lose his expansion opportunities in rural areas; he also thinks many in his situation will be forced to sell out.
Beard commented that his attorneys already are working on a petition for reconsideration.
However, according to Rob Hoggarth at the Personal Communications Industry Association, the commission had made it clear for the last 18 months that its goal was geographic licensing and auction of paging channels.
“No one who filed after the deadline should be surprised if their application is not granted,” he said. “Anyone who had been following this through the association or through their attorneys should have been prepared,” Hoggarth said.
Hoggarth added that PCIA members had been encouraged heavily to have any expansion applications in well-ahead of July 31, 1996, “and we had people working hundreds of hours to make sure we had the coordination finished.”
The order, adopted on circular by the commission Feb. 19, also contains a notice of further rulemaking concerning coverage requirements for nationwide licenses, whether spectrum disaggregation is appropriate in the paging arena and whether application procedures for shared channels should be revised.
The FCC determined that “while it is theoretically possible to convert shared channels to exclusive channels and to license them using competitive bidding, we conclude that the cost and disruption that would be entailed by such a transition outweighs any benefits that might be achieved …
“We believe that it is unlikely that creating geographic overlay licenses on these channels would significantly improve efficiency of spectrum use.”
The commission also declined to adopt a cap on shared channels, and it eliminated the 40-mile requirement for new sites.