FCC: Limited Open Access, No Wholesale Requirement for 700 MHz
The Federal Communications Commission approved (pdf) a set of 700 MHz ground-rules today for the spectrum auction this January. Band Plan Chart: pdf, Martin Statement: pdf, Copps Statement: pdf, Adelstein Statement: pdf, Tate Statement: pdf, and McDowell Statement: pdf.
The FCC split the 24 MHz reserved for public service (12 MHz x 2 blocks) into 12 Mhz of narrowband and 12 Mhz of broadband. Frontline proposed sharing the broadband PS spectrum with commercial users. In exchange, public safety users wouldn’t have to front the cost of building towers and providing service. Elements of Frontline’s approach were incorporated into the FCC’s band plan (along with 2 MHz Guard Bands).
The Commission approved limited open access, with no wholesale requirement requirements for 22 megahertz of the 60MHz, steering a moderate course between the more open proposal of Google and the “walled garden” approach favored by cellular carriers. The agency suggested a $4.6 billion minimum price for the new block of commercial airwaves. If that price was not reached, then the airwaves would be auctioned again without the access requirement, reports Reuters.
The sale could raise $15 billion, but would not likely be available for use until after broadcasters move out of the band, sometime after 2009.
Commercial providers will be able to bid on large regional licenses and smaller individual market licenses. An additional 10 Mhz of spectrum will be sold to a nonprofit entity for public safety officials to use but it could be shared with commercial operators.
The vote was not unanimous, reports the Washington Post. Republican Commissioner Robert McDowell dissented on the open access provision, his first “no” vote since joining the commission. Republican Deborah Taylor Tate also expressed concerns about the provision, but she did not oppose it.
The two Democrats, Michael Copps and Jonathan Adelstein, would have preferred that the rules had included the wholesale concept sought by Google and consumer groups. Still, they ended up supporting the final rules.
The text of the rules was not released at Tuesday’s meeting. The language in the document ultimately will determine which investors will commit billions of dollars to develop new wireless networks and which may not bid at all.
“The 700 MHz auction may well be the FCC’s most important wireless-related action for many years, because it could lead to the introduction of new facilities-based providers of broadband services, wielding new business models,” Google attorney Richard Whitt wrote in a letter earlier this month to the FCC.
Google carefully lauds the FCC for its action in a post on the company’s public policy blog, but, says GigOm, both Google and other observers are guessing that the fine print in the rules (likely be published in a couple weeks), will make it extremely hard for any new national provider to surface.
Verizon and AT&T are expected to be participants in the 700 MHz auction. The band is important, not because of its capacity, but because of its reach. Between one third to one tenth the number of towers will be required to provide coverage. Conversely, the low frequencies penetrate walls much better, improving indoor reception.
In related news, Verizon Wireless said today it has agreed to buy Rural Cellular Corp. for $2.67 billion in cash and assumed debt.
Verizon Wireless said the proposed acquisition will expand its wireless service coverage in rural areas; Minnesota-based Rural Cellular has networks located in such states as Massachusetts, Maine, New Hampshire, and Vermont, as well as in Minnesota, North Dakota, Wisconsin, and several other states.
Verizon Wireless said the acquisition will increase its customer base by more than 700,000 and allow expansion into some areas where it had little or no presence.
The deal comes one month after AT&T Inc. agreed to buy larger rural wireless service provider Dobson Communications for $2.8 billion.
Related 700MHz stories on DailyWireless include; FCC Testifies at House Committee, Equal Access Happy Talk, Broadband Wireless — Hello Goodbye, Google To FCC: $4.6B for Open Network, Frontline: Martin Plan Not ‘Open’, Equal Access Happy Talk, Frontline: Rumble in the Jungle, Adelstein: Open Access for 700MHz, Hearings on 700MHz, NXTcomm 2007, Broadcasters: Portable Devices Kill DTV, FCC: Beltway Vs Valley, 700Mz Support for “Open Access” Grows, Apple Developers Conference, 700MHz Battle Begins, AT&T “Open” to 700MHz — Not, General Dynamics Wins IWN Contract, Martin: Sharing is Good, Harold Feld on 700MHz, FCC Indecisive on 700MHz.
Sam Churchill and Don Park run the DailyWireless.org website which summarizes the news from Community Lan and other industry related sectors with detailed updates from around the world. It is full of sausy talk, viscious rumors and tantilizing tidbits.