FCC bends for wireless

Spectrum-hungry wireless carriers in the U.S. received some hope recently as the FCC approved guidelines designed to encourage broadcasters to clear the 700 MHz band so that a spectrum auction can be conducted as early as next year.

Wireless carriers have been reluctant to participate in the proposed 700 MHz auction, which already has been postponed five times, because incumbent broadcasters do not have to vacate the spectrum until digital TV is prevalent — something experts believe may not happen for 20 years. Carriers feared that winning bidders would face the prospect of paying “ransom” sums to get broadcasters off the spectrum.

Under the order, broadcasters are given spectrum to relocate and a waiver from the FCC's 2002 deadline to build digital facilities. Meanwhile, a framework was established for broadcasters — most of which are part of the Spectrum Clearing Alliance — and carriers to negotiate private spectrum-clearing agreements before an auction is conducted.

“If [wireless carriers] didn't know what it was going to cost them, they didn't want to bid,” said Bud Paxson, organizer of the SCA and chairman of Paxson Communications. “[Now] the wireless guy will know that we're leaving and turning in the license, and there will be no funny business.”

SCA-affiliated broadcasters will be represented by the investment bank of Allen & Co., which will initiate negotiations with carriers in an attempt to ensure that agreements are reached by June of next year, Paxson said. Such deals will be a “windfall” to broadcasters, which face the task of financing the transition to digital technology amid a severe downturn in advertising revenues.

For wireless carriers, the 700 MHz auction has assumed added importance because other spectrum alternatives are in jeopardy. Recent court rulings for NextWave Telecom undermined January's spectrum PCS reauction, and recent terrorist attacks make it less likely that the U.S. military will relinquish its airwaves.

In other action, the FCC established guidelines that will encourage the development of software-defined radio (SDR) technology, designed to let carriers upgrade and reconfigure wireless equipment via software downloads instead of the expensive, time-consuming process of replacing network hardware.

Previously, carriers altering wireless networks had to register changes through a licensing procedure that can take six months to complete; the FCC's action creates a streamlined “permissive change” procedure to let operators change networks in less than a month.

SDR's near-term commercial applications will be to help operators upgrade and maintain wireless networks, said Dick Shrum, regulatory committee chairman for the SDR Forum. SDR handsets — now being trialed for military applications — may not be seen in the commercial sector for two to five years but are high on carriers' wish lists, he said.

“NTT DoCoMo has had a series of recalls [that] have cost them hundreds of millions of dollars because they had to bring [handsets] back into the factory to correct software problems. You can imagine how easy it would have been to do those if you would have been able to via download.”