Subject: [NEXTEL-1] FCC Approves Spectrum-Leasing Plan

From: [email-masked]
Date: Fri, 16 May 2003 05:01:11 -0400

FCC Approves Spectrum-Leasing Plan

At its meeting today, the FCC a plan to permit wireless carriers to lease
portions of the spectrum they are licensed to use. Creating a secondary market
among carriers would allow the companies to alleviate call capacity problems in
large markets and provide more service to rural areas. FCC Chairman Michael
Powell expressed support for a more market-based approach to spectrum
management. “Permitting secondary markets for spectrum will deliver to
carriers improved access to the airwaves, increasing their flexibility and bringing
down their costs, which should ultimately result in lower prices for consumers,”
said Tom Wheeler, president and CEO of CTIA. “Football teams aren’t done
after draft day. They continue to meet their changing needs through trades and
late season acquisitions. Wireless carriers deserve, and will now receive,
similar flexibility.” CTIA highlighted a couple of important points in today’s
decision. First, the industry believes this decision will improve carriers’ ability to
utilize this limited natural resource. Additionally, CTIA notes that greater
flexibility to pursue market-driven decisions, matched with streamlined
procedures for spectrum transfers will enable service providers to acquire and
use spectrum more efficiently. In the end, these decisions should provide
increased access to spectrum for consumers whose carriers had been
spectrum-constrained, leading to fewer dropped calls and improved quality of
service.

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    Updated 5/15/2003 4:22 PM

Wireless carriers soon may lease airwaves

By Paul Davidson, USA TODAY

In a major policy shift, federal regulators
voted Thursday to allow wireless carriers to lease their airwaves to
others — a bid to ease a capacity crunch that has clogged cell phone
networks and limited service in rural areas.

The 4-1 vote by the Federal Communications Commission lifts a
40-year-old rule requiring airwave license holders to tightly control
services that use that spectrum.

In the past, regulators wanted to ensure that licensees bore
responsibility for any interference to competing services or other
violations of FCC guidelines. The rule has effectively prohibited
leasing in all but a few circumstances.

But FCC Chairman Michael Powell, a Republican, has called for a
more market-based approach to airwave management that gives a
lesser role to the government. His view has gained traction largely
because of a shortage of spectrum that has led to busy cell phone
signals and slowed the rollout of wireless Internet services.

"Today's marketplace demands that we provide license holders with
greater flexibility to respond to consumer wants, market realities and
national needs without" getting the "FCC's permission," Powell said
recently.

The proposed change lets license holders strike deals that shift
responsibility to lessees. Some benefits:

• A wireless carrier with unused airwaves could lease slices to a rival during peak usage
hours or for a few years,
easing congestion for subscribers.

"Say, I'm short on spectrum in New York City, I might like to lease a couple of channels
for a couple of years," says
Diane Cornell of the Cellular Telecommunications & Internet Association.

• Small carriers that can't afford to participate in multibillion-dollar FCC license
auctions could lease from big
companies. Delbert Wilson, CEO of Central Texas Telephone Cooperative, would use leasing
to beam phone
service to new homes in outlying areas without the expense of installing wires.

• An alarm service could rent a mobile phone firm's spectrum at night, when few of its
channels are in use.

• News services could lease airwaves for events like the Olympics.

Analyst David Hoover of the Precursor Group says the change initially will not have a big
impact because there is little
spectrum surplus. But Rebecca Arbogast of Legg Mason says it will let carriers "fill in
temporary or isolated
(coverage) gaps" without building towers or acquiring companies.

In the next year, the FCC is expected to help set up a clearinghouse that would let
carriers lease airwaves in a spot
market, much as commodities such as metals and grains are sold.

The agency will also examine whether broadcasters and public-safety agencies, which got
their airwaves free, can
lease them to mobile-phone and other industries. That could irk carriers that paid
billions for their airwave licenses.

http://www.usatoday.com/money/media/2003-05-14-airwaves_x.htm

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CTIA Applauds FCC On Secondary Markets For Spectrum

WASHINGTON, D.C. - The Cellular Telecommunications & Internet Association (CTIA) today
praised the Federal Communications Commission for its decision to allow secondary markets
for wireless spectrum.

“Permitting secondary markets for spectrum will deliver to carriers improved access to the
airwaves, increasing their flexibility and bringing down their costs, which should
ultimately result in lower prices for consumers,” said Tom Wheeler, President and CEO of
CTIA. “Football teams aren’t done after draft day. They continue to meet their changing
needs through trades and late season acquisitions. Wireless carriers deserve, and will now
receive, similar flexibility.”

CTIA highlighted a couple of important points in today’s decision. First, the industry
believes this decision will improve carriers’ ability to utilize this limited natural
resource. Additionally, CTIA notes that greater flexibility to pursue market-drive
decisions, matched with streamlined procedures for spectrum transfers will enable service
providers to acquire and use spectrum more efficiently. In the end, these decisions should
provide increased access to spectrum for consumers whose carriers had been
spectrum-constrained, leading to fewer dropped calls and improved quality of service.

CTIA is the international association for the wireless telecommunications industry,
representing carriers, manufacturers and wireless Internet providers.
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