FCC to provide full refunds to NextWave bidders

The FCC today said that the winning bidders in the NextWave license auction would be released from their obligations and granted full refunds of their deposits.

Only those who participated in the Auction 35 disbursement of C and F block licenses previously granted to NextWave Personal Communications, NextWave Power Partners or Urban Comm-North Carolina are eligible to receive a refund. Winning bidders have 45 days to decide whether to accept the relief.

The commission said it was under no legal obligation to provide such relief to these entities, but believed it would be beneficial to consumers to do so, because it would promote greater stability in the wireless sector, and allow the winning bidders to redirect their capital and focus resources on providing communications services.

FCC Chairman Michael Powell said in a statement that the decision was consistent with his six-point plan for telecom’s recovery, of which debt reduction is a primary goal. “Although the commission cannot cure the capital crunch, it can remove the cloud of uncertainty that has followed the Auction 35 winners,” Powell said.

FCC Commissioner Martin dissented, in part, because the decision requires the winning bidders to withdraw from the entire auction in order to be relieved of their obligations.

“I do not see a need to require carriers to make a single election for all of the markets awarded at auction as a condition to withdrawing from any one market,” Martin said.

The Cellular Telecommunications & Industry Association praised the decision. “This is a straightforward solution, allowing those resources to be put to work creating jobs in the telecom sector and increasing service levels for wireless consumers,” the trade group said in a prepared statement. “It is also a fair solution, releasing bidders from a transaction that never occurred.”