FCC Makes Frontline-Friendly Change to Auction Rules

FCC MAKES FRONTLINE-FRIENDLY CHANGE TO AUCTION RULES
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The Federal Communications Commission made it easier for Frontline Wireless to bid in the 700-megahertz auction of reclaimed TV-broadcast spectrum set for January, and for small companies in general to combine with larger ones and still get a break on the price of the spectrum. The FCC had said that a small business or other designated entity bidding for the spectrum could not resell more than 50% of the spectrum and still get a bidding credit. The spectrum must be used for a public-private partnership that creates an interoperable public-safety network for first-responders. The FCC has cracked down on what it had called "impermissible material relationships" -- cases in which a smaller company got the bidding credit as a front for a larger one -- but in this case, it made an exception, saying that to apply that eligibility rule in this case would be "unnecessary and inequitable." Frontline Wireless, which had proposed such a shared network, agreed, arguing that with the steep build-out requirements for such a network -- the government wants that emergency network ASAP -- no small business like Frontline could afford to win the bid and make the business work unless it was allowed to wholesale the spectrum. The FCC also said that since it would have an ongoing oversight role of the dual network -- public-safety officials get to commandeer it in an emergency -- "The FCC’s significant oversight role, along with the requirements and obligations of the license, will ensure that today’s waiver will not undermine the underlying purposes of the ‘impermissible material relationship’ rule or risk any abuses that the rules is designed to address."
http://www.broadcastingcable.com/article/CA6501882.html?rssid=193

* FCC to allow wholesaling of D block spectrum: Decision seen as victory for Frontline
http://www.rcrnews.com/apps/pbcs.dll/article?AID=/20071116/FREE/71116005...

* Media Access Project Reacts to DEs Order for Upcoming 700MHz Auction
"We are pleased that the Commission recognized the importance of encouraging a wholesale model by granting limited DE relief. The limitation on leasing capacity adopted last year to discourage the use of "sham" DEs remains an important protection against previously well documented abuses, and the limited relief granted given the unique circumstances of the D Block will serve the public interest without compromising this necessary safeguard."
http://www.mediaaccess.org/press/2007-11-16-DE700MHz.pdf