Proposed High Band Auction Raises New Questions on Spectrum Rights
The proposed auction of the upper 37 GHz band, to be looked at in a Further NPRM teed up for a vote at the Aug. 2 commissioners' meeting, would be the first in which the FCC would sell spectrum that licensees would hold on a co-primary basis with federal agencies. The FNPRM, primarily focused on the 39 GHz band, doesn’t fully address how this would work, though the issue was raised in an earlier proceeding. Commissioner Mike O’Rielly and some industry officials told us the auction raises potentially troubling issues on what exactly companies would be buying if they aren’t by themselves the primary licensee.
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How viable a 37 GHz auction will be "is a real issue,” O’Rielly said. “The federal government is not only asking for the right to stay but also the opportunity to potentially grow their footprint. That’s problematic if you’re trying to figure how do I build an auction in 37 GHz.”
“I do worry,” O’Rielly said. Some look at the 3.5 GHz band as a prototype for future sharing, but that band has been “problematic,” he said. “We’ve potentially put up in a new roadblock and raise questions in terms of whether anyone would want those licenses.” The concerns are bigger than just the 37 GHz band, since Chairman Ajit Pai is proposing to auction that band next year in the same auction as the 39 and 47 GHz bands, O’Rielly noted.
“It will be difficult for bidders to figure out how much the spectrum is worth when they don’t know the details of the rights that federal agencies will retain,” said Peter Tannenwald, lawyer at Fletcher Heald.
NAB has been working closely with DOD on a coordination mechanism in the 2025-2110 MHz band, “where we are both co-primary users,” a spokesperson said. “At 37 GHz, the number of government sites is fairly limited and all of the facilities are presumably at fixed locations. So, I would think that a coordination process could be developed, but a confounding factor at 37 GHz is that process would ideally be needed prior to the auction.” In 2013, a Commerce Spectrum Management Advisory Committee working group developed a recommended sharing framework for the 1695-1710 MHz band “with lots of government and industry input but it’s not clear how much of that framework could be applied at 37 GHz, especially if the commercial use cases are still being developed,” the spokesperson said.
The broader 37 GHz band includes 14 DOD sites and a limited number of NASA and other government sites that must be protected even as the FCC opens the upper part of the band for 5G. Some conundrums have arisen, including how DOD or other agencies could ultimately add to the list of protected sites. The questions aren’t new -- the 37 GHz band was a focus of the original spectrum frontiers order that commissioners approved two years ago. But as the FCC moves closer to an auction, it has a number of tricky problems to work through.
The third spectrum frontiers report and order and FNPRM, approved in June, explore the future use of the lower 37 GHz band. “We seek comment on a proposed coordination mechanism and alternatives,” the item says. “We anticipate that a sharing mechanism would facilitate quick access to spectrum without unreasonable processing delays and a predictable path for future coordination.” The lower 37 GHz band is important to future federal operations “and we will work in partnership with NTIA, DoD, and other Federal agencies to develop a sharing approach that allows for robust Federal and non-Federal use in this band,” the FCC said. Comments are due Sept. 10, replies Sept. 28, in docket 14-177. O’Rielly said in June the FCC should have also licensed the lower 37 GHz band for sharing with federal incumbents.
“There is a lot of interest in getting millimeter-wave spectrum out for commercial use,” particularly by competitive carriers, said Harold Feld, senior vice president at Public Knowledge. “Every [FCC] chairman loves to run an auction. They make money for the Treasury and are an easy thing on the list of accomplishments. For that reason, it becomes very tempting to push out as much spectrum as quickly as possible for auction and leave the harder decisions for later. If the harder questions prove impossible to answer before the scheduled auction, you can always carve that chunk of spectrum out and attach it to the next auction.”
Pai is proposing an incentive auction for the 39 GHz band, modeled on the TV incentive auction (see 1807120053). “FCC auctions folks have the successful broadcast spectrum incentive auction under their belts -- the most complex in the agency’s 20-plus years of auctioning,” said a former FCC spectrum official. “The issues that arise with 39 GHz band are more practical than groundbreaking.”
Carriers and the FCC are used to protecting government sites and have done so since the AWS-1 auction through the use of geographic exclusion zones, said Roger Entner, analyst at Recon Analytics. The FCC didn't comment.
Consulting engineer Michael Marcus noted that sharing gets easier the higher a band is above 20 GHz because of the propagation characteristics of high-frequency spectrum. The wireless industry has a “mantra” that exclusive-use spectrum is “like the Second Amendment; it’s a God-given right,” he said. “Since it makes sense at 2 GHz, it must make sense at 37 GHz.”