FCC Overrode Adelstein’s Objections in Handing Down Globalstar Order

"The Open Range loan represents the single largest loan of the RUS Broadband Program,” Adelstein warned. “A loan failure of a large magnitude could significantly affect the subsidy rate of the program and necessitate larger Congressional appropriations, or would otherwise result in what could be a major reduction of the agency’s present lending level.” Such a result “would be contrary to the mission of the RUS and the Commission’s shared goal of expanding broadband throughout the U.S., especially during this time of constricted private capital."

The FCC didn’t heed Adelstein’s warning in the order, clarifying that Open Range “may not continue to operate under Globalstar’s ATC authority.” The order gave the company 60 days to make other arrangements to minimize disruption to its existing customers. Wireless industry sources said Open Range will be forced to seek spectrum elsewhere -- for example from Sprint Nextel, which is building a WiMAX network in combination with Clearwire.

Open Range spokesman will continue to “work positively with the FCC and RUS on this issue,” a company spokesman said. “USDA and Open Range remain committed to providing broadband to the hundreds of rural communities in their proposed service areas,” said an RUS spokesman. “USDA is working closely with the FCC and Open Range to develop an agreement suitable for all parties. We are optimistic we will reach this goal in the next several days."

Adelstein was an FCC member December 2004 to June 2009, when he left to become the head of RUS. Open Range and Globalstar announced in 2008 that Globalstar would use the spectrum to rollout WiMAX services to 540 communities in 17 states. At the time, Adelstein supported the waiver of ATC gating criteria, pointing to the importance of the RUS loan. He noted the importance of the deadlines requiring Globalstar to regain compliance. “We should not allow an MSS system with an ancillary terrestrial component to evolve into a terrestrial system with an ancillary mobile satellite component,” Adelstein said. “The determination we make here is a narrow one, one that is limited to a date certain, and one that is terminable if the compliance deadlines are not met."

Many considered the FCC’s decision on Globalstar’s license surprising, considering the commission’s recent efforts to increase mobile broadband in the band, possibly by relaxing ATC gating criteria. In comments on the commission’s rulemaking notice for the 2 GHz band and a notice of inquiry on how to increase investment and use across all MSS bands, satellite companies were largely supportive of the FCC’s goal of increasing mobile broadband use in the spectrum. DBSD said that while the addition of terrestrial service as a co-primary allocation in the 2 GHz band was a good change, preventing reassignment of returned or canceled spectrum in the band to other MSS licensees would be a mistake. The rule would reduce the amount of spectrum for MSS and deny the “very flexibility” the commission has found that MSS licensees should have for use of the spectrum, it said.

The FCC should get rid of the ancillary terrestrial component gating criteria requiring a spare satellite, said TerreStar. The requirement to maintain a spare satellite on the ground “may actually inhibit investment and innovation” when applied to operational companies, the company said. Building and storing a satellite is expensive, and once the craft is needed, its technology is likely several years behind, the company said. It described incentive auctions as an “interesting concept,” but didn’t offer much on an opinion on the possibility since there’s no firm proposal and congressional approval would be required for this kind of auction. A co-primary allocation for terrestrial wireless broadband services provides “an appropriate preliminary step that sets the stage” for further action to increase ground-based broadband in the band, said EchoStar. The agency should put MSS spectrum under the policies on spectrum leasing in the secondary market that are used by wireless terrestrial services, the company said.

Spectrum fees are unnecessary and LightSquared’s investments in the bands demonstrate the agency’s rules already provide enough incentive for use of MSS/ATC spectrum, that company said. It said the ground spare rule should be eliminated since it imposes an expensive, unnecessary burden on MSS operators.

The band is “ideally suited” for wireless broadband, CTIA said. “Spectrum bands below 3 GHz are the most desirable for mobile broadband because of their propagation characteristics, large continuous blocks of spectrum best enable next-generation network standards, international harmonization will lower equipment costs and enable innovation, and proximity to existing mobile broadband spectrum facilitates the development of mobile equipment.” CTIA said the FCC should continue to look closely at the amount of spectrum available to MSS operators “to assess whether these providers are fully and efficiently using their spectrum authorizations, and whether this spectrum can be reallocated to terrestrial uses."

A voluntary incentive auction would be the most effective way to get the 2 GHz MSS spectrum into play, Verizon Wireless said. Verizon agreed that the spectrum will be useful to wireless carriers. “This band is between 400 MHz and 5 GHz, which the ITU has concluded is the spectrum most suitable for mobile communications,” the carrier said. “Spectrum bands in this range allow sufficient mobility, while also affording an acceptable trade-off between coverage and cost."

AT&T also said the band is well suited for wireless broadband. It asked the FCC not to move forward on various spectrum initiatives in isolation from each other. “A comprehensive band plan, considering all the spectrum available for mobile broadband services as well as the interactions between the various bands and the interference challenges associated with particular spectrum pairings, would yield the greatest return for the public,” AT&T said. “In particular, such an effort should address important unresolved spectrum issues, including repurposing the 1755-1780 MHz band for pairing with the AWS-3 spectrum and reallocating the 1675-1710 MHz band for terrestrial mobile service.”