WASHINGTON-The Federal Communications Commission apparently has come up with a winning plan to expand its current rules regarding partitioning and spectrum disaggregation by commercial mobile services licensees.
Many current personal communications services licensees are looking forward to increasing their service areas not by auction but by acquiring “doughnut licenses,” as the FCC has called them, from other licensees who want to sell off part of their holdings. Current FCC rules only allow rural telcos to contract for such licenses.
The overwhelming majority of commenters on this highly specialized subject introduced July 15 supported the proposal’s tenets, offering only a few possible refinements.
UTC, which represents the telecom interests of gas, electric and water utilities along with natural gas pipelines, urged FCC clarification that any operator of partitioned or disaggregated spectrum would be subject to the same obligations as other licensees for the protection of incumbent microwave systems. “To ensure that partitionees and disaggregatees are aware of their obligations to protect and, if necessary, relocate incumbent fixed microwave systems, UTC recommends that the parties to any assignment/transfer application be required to identify in the application all microwave facilities with which the proposed [new licensee] may have to coordinate,” it wrote.
The Cellular Telecommunications Industry Association agreed with UTC, writing, “If the transferring licensee already has paid any or all of its cost-sharing obligations, a licensee can seek recovery of its expenditures as part of its agreement to disaggregate its spectrum or partition its license area.”
PCS license winner Omnipoint Corp. told the commission that licensees also should be able to sway like licenses for like licenses after an auction ends. “Once the auctions are completed, the public-policy purposes of the [entrepreneur’s block] set-aside are in no way diminished if an entrepreneur with a 10 MHz F-block license is permitted to swap it for the 10 MHz D-block license … Spectrum swaps for the same licensed area would permit PCS licensees to negotiate with other license holders in the market to avoid adjacent-channel interference issues,” it wrote.
The Personal Communications Industry Association pointed out that nothing had been said about possible defaulting by a doughnut licensee. The group proposed that the original licensee should be allowed to reclaim any defaulted license if its own system has met the commission’s five- and 10-year construction benchmarks. “Allowing the use of such contractual measures would avoid confusion concerning the status of a partitioned block after default,” it wrote.
Cook Inlet Region Inc. suggested that the commission “require prospective transferees to demonstrate their financial qualifications for the assignment of this fixed government obligation” before such a deal is signed.
Disagreeing with the commission’s NPRM as a whole was the Organization for the Promotion and Advancement of Small Telephone Companies. OPASTCO claimed that many of its rural members were shut out of the A-, B- and C-block auctions because of the high prices.
“Having been rebuffed, many of these small rural telephone companies are relying or have relied upon the exclusive right to partition their areas in order to provide PCS to their customers,” the group wrote. “Ironically, by broadening the partitioning process, the commission may actually be erecting a market barrier to rural telcos, unable to compete with the deep pockets of the other entities’ backers.”
