Qualcomm Inc. said it may seek a stay of the upcoming channel 60-69 auctions if the Federal Communications Commission denies its petition that requested spectrum from this auction as a remedy for a pioneer’s preference license it was denied in the last decade.
As it stands now, the commission is not inclined to grant Qualcomm’s request, according to an ex parte letter detailing meetings between Qualcomm and FCC staff last week. Qualcomm is asking for a 20-megahertz license in the Southeastern region of the United States.
An FCC spokeswoman declined to comment on the situation since the action is pending before the commission, but indicated the ex parte letter was an accurate description of last week’s meetings.
Qualcomm has asked the commission to quickly deny its petition so that it could appeal the decision and seek a stay of the auction before the auction date of May 10.
Qualcomm in January petitioned the FCC for the license. It wants the commission to quickly award it spectrum to make up for the pioneer’s preference license the FCC denied Qualcomm. The two fought in court over the matter for nearly a decade. A U.S. appeals court last July ordered the FCC to swiftly find spectrum comparable to the Miami major trading area license.
The FCC plans to auction 30 megahertz of spectrum, one 20-megahertz license and one 10-megahertz license in six economic areas. The government is transitioning channels 60-69 (746-806 MHz) from television use to other areas, including mobile-phone and advanced fixed wireless services. All operators are clamoring for more spectrum to compete on a nationwide basis and prepare for spectrum-eating third-generation systems.
Qualcomm fears it will be unable to receive spectrum it deserves until 3G frequencies are released in 2001 and 2002. It wants spectrum now.
However, the FCC wants to give Qualcomm returned C-block spectrum from bankrupt NextWave Telecom Inc., a prospect it continues to push as an alternative for Qualcomm even though it’s unclear if the FCC will ever gain control of those license as it battles with NextWave in several courts. This alternative is unacceptable to Qualcomm.
“We want to move this process forward, and we’re making suggestions to the commission and hoping to resolve this fairly,” said Kevin Kelley, vice president of external affairs for Qualcomm. “We don’t know where the C-block spectrum is, and if there’s no spectrum now, then when?
The commission also, as a distant second alternative, presented the option of giving Qualcomm a transferable bidding credit that Qualcomm could use in any auction within the next three years. It’s unclear the amount the voucher would be and whether Qualcomm could use it for more than one auction or on more than one property. Qualcomm has said it would not accept less than the average discount granted to other pioneer’s preference winners. It wants the amount set at $150 million. The FCC will determine whether a bidding credit will be possible but fears that outside parties may appeal this remedy.
At least five major operators-AT&T Corp., GTE Corp., BellSouth Corp., SBC Wireless Inc. and U S West Wireless-have filed petitions opposing Qualcomm’s request for the Southeastern license. They argue the spectrum is not comparable to the Miami MTA license Qualcomm should have received in 1993. They also fear that giving Qualcomm a license would disadvantage other bidders attempting to obtain nationwide or near-nationwide service areas.
