700 MHz Auction Oversight Hearing Recap

OVERSIGHT HEARING
700 MHz Auction Oversight Hearing Recap
FCC: Public Safety Is DTV-Transition Priority

_Testimony/Statements_
Subcommittee Chairman Ed Markey
FCC Chairman Kevin Martin
FCC Commissioner Copps
FCC Commissioner Adelstein
FCC Commissioner Tate
MAP's Harold Feld

OVERSIGHT HEARING

700 MHZ AUCTION OVERSIGHT HEARING RECAP
[SOURCE: Benton Foundation]
The House Subcommittee on Telecommunications and Internet oversight hearing on the Federal Communications Commission's 700 MHz auction is getting a lot of ink. Lawmakers want to know why plan aimed at using public airwaves and private money to create a nationwide emergency communications network failed to attract any interest in an otherwise successful spectrum auction. All five members of the FCC testified (see links to statements below) about what went wrong. Four of the five commissioners said they had concerns about the Public Safety Spectrum Trust's (PSST) contract with outside advisors in the auction. The FCC has given PSST, a coalition of 15 public safety groups, control of about 10MHz of spectrum, and the agency tried to auction another 10MHz block to a commercial operator under the condition that the winning bidder would build a nationwide voice and broadband network to be shared by public safety agencies and commercial interests. Republicans on the panel complained that the FCC imposed conditions on some of the "D Block" spectrum which may have decreased the value of the lucrative commodity. They proposed that the FCC re-auction a block of public airwaves to the highest bidder and turn the proceeds over to public safety professionals to fund a nationwide emergency communications network. Harold Feld of the Media Access Project Feld believes it will not work because doing so would require a drastic change in the spectrum band plan. Feld suggests it would take months to resolve the engineering issues, and that an auction based on necessary rules would fetch very little money. Meanwhile, Democrats, including Subcommittee Chairman Ed Markey (MA), asked tough questions about what the FCC intended to do now with a section of the spectrum that didn't sell at all. Democratic lawmakers also said they were disappointed by the fact that large incumbent players in the wireless industry were the big winners in the auction, rather than a new competitor in that marketplace. House Commerce Committee Chairman John Dingell (D-MI) said he was "presently unmoved" by suggestions that the block should be auctioned for "purely commercial use" and the proceeds handed to public safety. "At this moment, I consider such an approach to be an admission that we are not serious about attaining true interoperability," he said.
(see links to source material below)

FCC: PUBLIC SAFETY IS DTV-TRANSITION PRIORITY
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
All of the Federal Communications Commission members agreed Tuesday that the No. 1 priority for the digital transition was not DTV converter boxes nor the education program, but creating an interoperable broadband public-safety network with spectrum being reclaimed from that transition. That came in response to prompting from legislators in a House Telecommunications & Internet Subcommittee hearing on the recently completed 700-megahertz spectrum auction -- recently completed, that is, except for a block of spectrum, the so-called D block, which is supposed to be used to help create that network via a public-private partnership.
http://www.broadcastingcable.com/article/CA6551686.html?rssid=193

_Testimony/Statements_

SUBCOMMITTEE CHAIRMAN ED MARKEY
[SOURCE: House of Representatives Commerce Committee]
The recently-completed auction for licenses in the 700 megahertz band had a certain "Dickensian quality" to it - it was the best of auctions and the worst of auctions, simultaneously. First, despite the so-called "D-block" license not selling, the auction raised over $19 billion. This is no small feat in current economic conditions. Second, I am pleased that the C-block license did sell successfully. This license, for which the Commission had the wisdom to adopt openness requirements that I strongly advocated for, will unleash hundreds of millions of dollars in investment in wireless devices and applications and create new jobs in an economy that sorely needs them. I congratulate Chairman Martin and the Commission for this initiative. However, in spite of these success stories, this is essentially a tale of two auctions. And so, with the good news there is also some bad news. Obviously, the D-block is disappointing. Yet I believe that pursuing ways for public safety entities and the private sector to partner toward achieving a network that possesses nationwide interoperability and broadband capability remains our best option going-forward on the D-block.
http://markey.house.gov/index.php?option=content&task=view&id=3319&Itemi...

FCC CHAIRMAN KEVIN MARTIN
[SOURCE: Federal Communications Commission, AUTHOR: FCC Chairman Martin]
The 700 MHz spectrum auction closed almost one month ago. It achieved a number of significant milestones, including: the largest auction in FCC history, raising a record $19.6 billion in bids; advancing new open platform policies; affirming aggressive build-out obligations; creating what will be a new wireless broadband provider to compete with the incumbent telephone and cable companies in nearly every home in the U.S.; and providing small businesses, new entrants, rural providers and existing nationwide wireless providers with access to additional spectrum needed to deploy the next generation of wireless networks.
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-281550A1.doc
* PowerPoint presentation
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-281550A2.pdf

FCC COMMISSIONER MICHAEL J. COPPS
[SOURCE: Federal Communications Commission, AUTHOR: FCC Commissioner Michael Copps]
Five principles that can lead us to a better outcome this time around: 1) resolve as many technical details as possible about the network before beginning a re-auction; 2) clarify the roles of each of the partners-public safety and the commercial licensee-again before beginning a re-auction; 3) the FCC needs to make sure that it has, in-building or via contract, the expertise it needs to contribute network, technical and operational knowledge to this effort and to play its honest broker role; 4) the FCC needs to perform, or otherwise obtain, a careful economic analysis -- the same kind of analysis that a large carrier would perform before building a multi-billion dollar network or an investor would perform before loaning money to a new venture; and 5) when the FCC has done the hard work of formulating a set of network and operational specifications, put them out for public comment.
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-281551A1.doc

FCC COMMISSIONER JONATHAN S. ADELSTEIN
[SOURCE: Federal Communications Commission, AUTHOR: FCC Commissioner Jonathan Adelstein]
We need to do a top-to-bottom review of what went wrong so we can make it work in the next round. First and foremost, we must provide upfront appropriate and detailed guidance to allow parties to make a bona fide financial viability assessment. We should consider limiting eligibility for the D Block re-auction and if so, in what way. Can and should the Commission use this re-auction as an opportunity to balance the goal of providing an interoperable broadband communications network for public safety with that of facilitating a new entrant? What type of re-auction provisions should be included? What technologies and features are feasible? How do we better define the role of the Public Safety Trust and its interplay with the commercial entity? What additional licensing term flexibilities might create incentives for bidders?
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-281552A1.doc

FCC COMMISSIONER DEBORAH TAYLOR TATE
[SOURCE: Federal Communications Commission, AUTHOR: FCC Commissioner Deborah Tate]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-281553A1.doc

MAP'S HAROLD FELD
[SOURCE: Media Access Project, AUTHOR: Harold Feld]
The auction raised over 19 billion dollars. It may have given DBS provider Echostar a boost for providing new video services. And the C Block condition may finally give subscribers to Verizon a chance to connect their own devices to the portion of Verizon’s network that uses the C Block spectrum – depending on how firmly a future FCC enforces these conditions. That’s it. No third pipe. No new wireless competitors. Instead, the auction simply cemented AT&T and Verizon’s position as the dominant wireless companies, free to integrate the spectrum most suited for wireless broadband with their existing wireless and wireline assets. The two companies jointly paid $16 billion dollars in exchange for staying top dogs of the wireless world for the foreseeable future. A great deal for AT&T and Verizon, but a rather nasty deal for the American people. And to make matters worse, we didn't even get the public safety network built. In keeping with the Passover Season, I can only say to Congress “Let the American People Go!” We can start by rethinking the D block, and trying to develop rules for a public/private partnership that puts our public interest goals first and maximizing revenue out of the picture. But whether it is thinking about how to resolve the outstanding problem of D block and getting a public safety network built, opening wireless networks, or encouraging new entrants who will provide economic opportunities to all Americans regardless of gender, color or where they live, Congress and the FCC must change course. We must stop making auction revenue our highest priority while praying that somehow the next spectrum auction will be different. Because, unless Congress and the Commission have the courage to start “picking winners,” we can expect to see the same results again and again and again.
http://www.mediaaccess.org/file_download/223/2008%2004%2015%20HFeldPISCT...