With Sen. McCain (R-Ariz.) poised to take reins of Senate Commerce Committee, industry observers are expecting deregulatory agenda. Leadership change also appears to give FCC Chmn. Powell powerful ally on Capitol Hill. Broadcasters may have biggest interest in McCain’s agenda, especially as some observers believe he will use position to push for free air time for political candidates, 2nd phase of his campaign finance reform agenda. Media ownership also will be prominent and digital TV issues probably will receive more attention, we're told.

President Bush signed Dept. of Justice (DoJ) reauthorization legislation (HR-2215) that included directive to create commission designed to study whether existing antitrust laws were applicable to modern economy. That provision is from Antitrust Modernization Commission Act of 2001, by House Judiciary Committee Chmn. Sensenbrenner (R- Wis.). Appointments to 12-member commission will be balanced equally along party lines. It will provide report to Congress and White House within 3 years of its first meeting. Report will include recommendations, if deemed necessary, for legislative and administrative actions. New law also includes mandate for DoJ to report annually to Congress on use of its DCS 1000 electronic surveillance system, formerly known as Carnivore. Justice must update leadership of House and Senate Judiciary committees on how often federal investigators use e-mail interception program, in addition to how well evidence it produces stands up in court. Sensenbrenner said mandatory requirement would enable Congress to safeguard civil liberties (CD Sept 30 p3). DoJ in its report must identify how often encryption was encountered during investigations and whether use of cryptography by suspects thwarted law enforcement from intercepting plain text of targeted communications. Other provisions of law include: (1) Language of Technology, Education & Copyright Harmonization Act of 2001, authored by Senate Judiciary Committee ranking Republican Hatch (Utah), which updates copyright law by making it easier for educators and students to transmit digital data. (2) Allowances under certain circumstances to extend 6-year maximum on H-1B visas for foreign technical workers in U.S.

Despite funding uncertainty for fiscal 2003, National Communications System (NCS) still plans to begin national rollout of initial operating capability of wireless priority service by year-end, Govt. Emergency Telephone Service (GETS) Dir. John Graves said Wed. He told Telecom Service Priority (TSP) Oversight Committee meeting at NCS hq in Arlington, Va., that 2003 capability for service designed to give priority to national security personnel and responders in emergencies still was on track because $208 million set aside to get program running was “any-year” money. Uncertainty involves $73 million sought by Bush Administration after Sept. 11 attacks that House and Senate conferees recently zeroed out of defense appropriations bill (CD Oct 15 p1). For initial capability, NCS is close to signing contract with T-Mobile USA and with Cingular Wireless, Graves said.

As clock ticks nearer to 180-day mark on proposed merger of AT&T Broadband and Comcast, coalition of consumer groups is challenging FCC’s standard in determining subscriber numbers. “Recent disclosures of questionable subscriber counts and even outright fraud by multichannel video programming distributors (MVPDs) demonstrates that the Commission cannot reasonably rely on ‘generally accepted industry data,'” said Consumer Federation of America (CFA), Consumers Union (CU), Center for Digital Democracy (CDD) and Media Access Project in filing last week at FCC. Groups were referring to revelations that Adelphia had fudged its subscriber counts, that Charter counted cable modem customers as subscribers of basic video service even if they didn’t actually get TV service, and that DirecTV had counted people who were interested in service but hadn’t actually signed contract. FCC spokeswoman declined comment. NCTA spokesman said group wouldn’t comment until it reviewed filing.

LAS VEGAS -- FCC is moving forward on 3G spectrum allocation and should have it on meeting agenda by year-end, speakers said at CTIA Wireless IT & Internet 2002 conference here late Wed. Julius Knapp, deputy chief of Office of Engineering & Technology (OET), indicated Commission would have rulemaking lined up for agenda meeting by then on service rules for 90 MHz being made available for 3G and other advanced wireless services. Two items are expected to be lined up for Commission approval: (1) Allocation report and order. (2) Notice of proposed rulemaking covering service rules. Bush Administration had released report earlier this year that outlined way to clear total of 90 MHz for advanced wireless services, including 1710-1755 MHz used by military incumbents and 45 MHz of 2110-2170 MHz occupied by nongovt. users.

Report on testing that FCC has undertaken in wake of ultra-wideband (UWB) order adopted in Feb. is expected to be released shortly, Office of Engineering & Technology (OET) Chief Edmond Thomas told us in interview. Thomas said testing was examining areas such as ambient noise levels in different environments rather than actual UWB-based communications devices, which weren’t available in commercial quantities for such analysis. Lack of significant body of data about noise floor levels has been concern in UWB proceeding when opponents and advocates of technology disagreed on interference potential of UWB. “There’s a profound lack of data” on noise floor levels, Thomas said. “It’s profoundly difficult data collection, but it should be done as far as I'm concerned.”

FCC order mandating that DTV tuners be installed in all TV receivers by July 2007 (CD Aug 9 p1) exceeds Commission’s “jurisdiction and statutory authority,” is in violation of Communications Act of 1934 and is “arbitrary, capricious” and “an abuse of discretion.” So argued CEA in petition filed Oct. 11 with U.S. Appeals Court, D.C., asking that FCC order be set aside.

Wireless carriers urged FCC to provide relief to NextWave re-auction winners, but some differed on details, including whether withdrawing winners should be penalized. FCC last month floated alternatives for allowing NextWave re- auction winners that faced potential payment obligations of $16 billion to opt out of their bid commitments, which were entangled in pending litigation. FCC returned licenses to NextWave after U.S. Appeals Court, D.C., reversed agency’s decision to cancel licenses for nonpayment. Nextel told FCC that applicants wanting to opt out of their commitments shouldn’t be able to re-bid on them in subsequent auctions or acquire them in secondary market for limited period. Alaska Native Wireless, on other hand, argued that winners shouldn’t be penalized for withdrawals and should have at least 180 days to make decision.

FCC’s Office of Engineering & Technology rejected 3 petitions for rulemaking that sought rule changes for spectrum at 2300-2305 MHz. That spectrum was part of 27 MHz that had been reallocated from govt. to non-govt. uses. Microtrax asked that FCC issue proposal for spectrum, including 2300-2305 MHz, that would provide at least 5 MHz for its proposed personal location and monitoring service. AeroAstro sought primary allocation for fixed and mobile services and co-primary allocation for amateur service. AeroAstro is eyeing proposed satellite-based location and messaging service in that spectrum. American Radio Relay League (ARRL) asked FCC to upgrade existing secondary amateur radio allocation to primary. On Microtrax request, order released Thurs. said FCC had completed or had pending proceedings addressing all of transferred federal bands company suggested for personal location service, except for 2300-2305 MHz. “Microtrax has not demonstrated that an additional allocation is warranted,” order said. In case of AeroAstro, FCC said it had several interference concerns that its petition for rulemaking didn’t cover. AeroAstro is seeking changes that would allow its satellite enabled notification system messaging service to allow users to transmit short data messages in real-time. System’s mobile terminal would transmit low-power, spread spectrum signal to satellite that would relay data to nearest ground receiver station. AeroAstro wants to use 2300-2305 MHz for uplinks to satellite or tower. Commission said AeroAstro didn’t make showing that Deep Space Network would be protected by changes to out-of-band limits. It said company also didn’t explain how mobile terminals communicating with satellite would avoid transmissions near sensitive Deep Space Network operations. FCC said AeroAstro hadn’t demonstrated its proposed system could operate in environment created by existing amateur operations.

Cable modem service is cable service within meaning of Communications Act and FCC was wrong in concluding otherwise in its March declaratory ruling, coalition of local govt. organizations said Thurs. in their opening brief filed in 9th U.S. Appeals Court, San Francisco. Alliance of Local Govt. Officials Against Preemption (ALOAP) brief challenges FCC’s classification of cable modem service as interstate information service, taking it outside the scope of Title VI of the Act. Cities said that at stake in appeal was estimated $300 million per year in cable franchise fees, a figure that was likely to increase in the years ahead. Local govts. couldn’t afford that in light of current economy and increasing costs being incurred for homeland security, ALOAP said.