Court Challenge Likely if FCC Approves Free-Broadband Auction Rules
Wireless carriers seem to be girding for a court fight over a pending FCC order meant to pave the way for the advanced wireless services 3 auction and requiring the licensee to offer free national broadband. Meanwhile, we have learned, FCC Chairman Kevin Martin has circulated two variants on the AWS 3 order, the second stipulating 20 MHz for the band, the earlier providing 25 MHz. Each has its own interference protections.
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Industry sources expect carriers prominent in 2006’s AWS 1 auction to challenge the order in federal court if the FCC proceeds as expected, they said. A filing to the FCC by CTIA seems to lay groundwork for such a legal challenge, industry sources said Thursday. “I would be surprised if the carriers that have the most at stake, like T-Mobile, don’t got to court, unless the FCC makes major changes,” said a wireless industry attorney.
“Based on information submitted in the record on handset testing and filter technologies… proposed mobile transmissions in the H block and the AWS-3 block will cause harmful interference to adjacent broadband PCS and AWS-1 operations and thereby limit the utility of portions of the broadband PCS and AWS-1 allocations,” CTIA said.
CTIA said the proposed AWS 3 order would violate Sect. 309(j) of the Communications Act, “which requires the Commission to place interested bidders on notice of the characteristics of licenses and bidding rules in advance of auctions,” as well as Administrative Procedure Act bars on retroactive rulemaking and the takings clause of the Fifth Amendment to the Constitution.
CTIA noted that the first AWS auction, a huge success, grossed nearly $13.9 billion. “Auction winners rightfully had high expectations for their spectrum,” the group said. “The F Block raised the highest revenue per POP per MHz of all the licenses offered for auction. The E Block raised the second highest revenue per POP per MHz of all the licenses offered for auction. Empirically, those results belie the suggestion that AWS-1 licenses had knowledge that the band would become encumbered as currently proposed.”