FCC revisits D block sell off plan

US communications regulator the FCC is once again considering the auction of the troublesome ‘D block’ of 700MHz spectrum, which will form the foundation for a much needed nationwide public safety network.

Because the D Block did not meet its $1.3bn reserve price in the 700MHz spectrum auction held in early 2008, the FCC sought comment in May on whether it should revise the 700MHz public/private partnership and re-auction this spectrum.

The regulator is proposing to create a 10MHz license to be part of a public/private partnership with an adjacent 10MHz swathe dedicated to a public safety operation.

To make it more attractive, the minimum asking price has been cut to $750m but the new plan is also overwhelming in its complexity.

The FCC has proposed to use the auction process to determine whether the D Block spectrum is better licensed to a single licensee on a nationwide basis or split into 58 regional licenses. In order for the licenses to be broken up regionally, the regional licence winners must collectively raise more money than the sum paid for by the national licensee.

This also means that should the national licence bid fail to meet the reserve price, the D block auction would turn into a straight fight between LTE and WiMAX. As the licenses will be sold on a technology agnostic basis, whichever technology proponents – LTE or WiMAX – raise most money or cover more of the population, this has to be the technology used by all the other D block users. The FCC would then re-auction the spectrum secured by the ‘losing’ technology and invite new bids for the ‘winning’ technology as a replacement.

The FCC is also proposing to extend the licence term to fifteen years and to adopt performance benchmarks applicable at the fourth, tenth, and fifteenth years under the life of the licenses.

The regulator is now seeking further comment on the proposals, but these latest developments mean and auction could take place as early as the second quarter of 2009.

Commenting on the proposal, FCC chairman Kevin Martin said: “Today’s decision is a further notice and not a final action. It is the next step in our effort to provide our Nation’s first responders with the broadband network they need and deserve.It attempts to strike the right balance between serving the communications needs of public safety and the need to ensure commercially viability of the partnership.

“Let us be clear about what is at stake; without the partnership, there are no other viable tools for the Commission to ensure that this network can be built in a timely manner, with a maximum level of interoperability for use by all public safety entities small and large, rural and urban.”