WASHINGTON-Industry negotiations aimed at clearing fixed microwave licensees off the 2 GHz band that next-generation pocket telephone systems will soon occupy have begun with a bang.
Personal Communications Industry Association President Jay Kitchen fired the opening discharge late last month, stating in a letter to Federal Communications Commission Chairman Reed Hundt that microwave users are being encouraged to “extract excessive premium payments in relocation negotiations.”
FCC rules require new personal communications services operators underwrite the costs of moving 2 GHz microwave users to comparable facilities on higher frequency bands.
Kitchen was alluding to marketing materials distributed by the Utilities Telecommunications Council, which represents electric, gas, water and natural gas pipeline companies operating microwave systems.
“I just think it’s kind of ridiculous that PCIA is trying to stir up a problem where one doesn’t exist,” said Jeffrey Sheldon, a UTC attorney.
Entities representing microwave interests, such as UTC, believe PCIA is engaging in hyperbole to better position PCS operators at the bargaining table. They say microwave licensees forced to vacate the 2 GHz band have every right to get the best deal they can, especially during initial negotiations when PCS operators might be willing to pay a premium in order to secure the maximum amount of spectrum before turning on digital wireless telephone systems.
“This is nothing more than a gross attempt by the PCS industry to bully and intimidate microwave licensees prior to the initiation of voluntary negotiations,” said Jack Richards, an attorney assisting microwave users in relocation talks.
A two-year voluntary negotiation period that began last month gives the more than 2,000 PCS licensees a chance to approach most microwave incumbents about moving off the 2 GHz band. Microwave entities do not have to depart during that time, but must relocate during a subsequent one-year involuntary negotiation period at the expense of wireless carriers.
In contrast to the initial negotiating phase, where no limits exist on the money microwave users can be paid, rules mandate that microwave licensees are eligible only for relocation costs during the involuntary negotiation timetable.
Kitchen suggested eliminating the voluntary negotiation period, capping relocation costs and doing away with a provision that allows microwave users to return within a year to their original 2 GHz facilities if they are not satisfied with new microwave operations.
Public-safety microwave users are subject to a three-year voluntary negotiation period and a two-year involuntary negotiation deadline. The Association of Public-Safety Communications Officials International Inc. has challenged microwave relocation rules in federal court. The FCC originally said public-safety users could remain indefinitely on the 2 GHz band, but later revised the policy.
If a settlement is not reached after voluntary and involuntary negotiation periods, the matter is referred to an independent mediator. The FCC then will step in, something the agency wants to avoid, should arbitration fail.
A tax break is available to microwave licensees to entice them to migrate to upper bands.
Microwave relocation is a novel process involving the change out of 8,000 to 10,000 microwave links used throughout the country by utilities, railroads, oil companies and state and local governments. UTC predicts it will cost an average of $200,000 to relocate each link. The total cost could exceed $1 billion.
The issues involved are not as clear cut as the dispute might imply, however. For instance, Thomas Stroup, president of Columbia Spectrum Management in Vienna, Va., said there is a push to make PCS operators pay for spectrum held by microwave users and for replacing entire microwave systems rather than just the portion of microwave links deemed problematic to pocket telephone systems.
