Subject: [NEXTEL-1] Nextel's Swap Proposal Raises Ire

From: [email-masked]
Date: Wed, 02 Jul 2003 23:59:27 -0400

Nextel's Swap Proposal Raises Ire

The United Telecom Council has opposed the plan for a long time, but its
opposition is getting more heated as its members require spectrum to
modernize systems.

BY MARK ROCKWELL
JULY 1, 2003

WASHINGTON— Nextel Communications Inc.'s spectrum swap proposal has been
pending almost a year now at the FCC and it continues to be the source of a lot
of behind-the-scenes skirmishes in the tangle of interests involved in the
proposal.

The company has long contended that its plan could be a solution to aligning
interleaved public safety and private spectrum needs in the 800 MHz band, as
well as opening up spectrum to other uses, but it also could be a huge windfall
for the company, analysts say. Combining public good with self-interest, they
say, is what propels the controversy over the proposal, both on the Nextel side
and to a certain extent on the plan's opposing side.

Basically, Nextel's plan would realign the 800 MHz spectrum for public safety and
business users. The company also would give up spectrum it owns in 700 MHz
and 900 MHz. It would divide the tangled public safety/private company owned
800 MHz band into two areas: one for cellular-based systems and another for
other wireless technologies. In exchange, the company asks for spectrum in the
1.9 GHz band to compensate it for the rearranged spectrum.

DEBATE CONTINUES According to Bob Foosaner, senior vice president at Nextel,
the plan would address interference from public safety and Nextel, provide
additional spectrum for public safety and divide the technology used in the 800
MHz spectrum to reduce interference in the band. Nextel would provide full
funding.

The problem, according to many of the plan's opponents, is Nextel will get
spectrum for free, edging out competitors, while also soaking up spectrum that
could have been given to other interests.

The opposition, which includes the United Telecom Council, a group representing
utility companies in Washington, long has complained about the plan, but its
arguments are getting more heated these days. UTC has said although public
safety interests should be supported in these perilous times, its
members–power, water and gas companies–also are "first responders" in the
sense they provide critical services. The organization says its members, who use
private radio systems to keep up with their power grids and pipelines, need
spectrum to inject newer data-oriented systems into their communications
capabilities.

The group's members haven't received any federally appointed spectrum in
decades, contends UTC President Bill Moroney. He says it's time that "critical
infrastructure" in the United States is allocated spectrum that allows it to
modernize, so their systems, which are critical in times of local, regional and
national emergency, don't get interference from other localized private radio
sources, such as taxis and limousines.

UTC'S ALTERNATIVES UTC has been pushing alternative plans to Nextel's for
quite a while, introducing one last May as part of the 800 MHz User Coalition that

would seek a more hard-nosed approach to lessening interference in the band
short of swapping spectrum. The plan would identify and avoid interference
before it happens; set up a notification mechanism for public safety/critical
infrastructure protection licensees to contact "potential interfering entities"
and
make those entities take part in on-site engineering analysis; require any
"interfering entities" to mitigate their interference within 60 days; and use
existing Association of Public-Safety Communications Officials-International "best

practices" recommendations.

The plan calls for incumbent 800 MHz licensees to provide engineering expertise
and assistance to public safety on interference issues and to inject more
flexibility in pursuing private market agreements such as frequency swaps to
reduce interference. It also calls for a review by an independent agent working
with affected stakeholders to judge the record of the best practices being
employed.

The plan is still pending at the FCC, where it joins a host of other alternatives
to
Nextel's original plan. Most recently, the divisiveness between Nextel and those
seeking to head off the company's plans has reached a boiling point, although
the FCC doesn't seem ready to decide on which plan to implement, says Rudy
Baca, vice president and global strategist at The Precursor Group.

The acrimony among Nextel and others proposing their own plans is just below
the surface of the technical arguments. On June 11, CTIA backed the
"mitigation" plan also supported by UTC, calling such an engineering-based
solution "proactive, effective and sensible." Nextel's CEO, Tim Donahue, gave up
his position as CTIA's board chairman in June as part of the planned rotation of
officials there.

June also saw a hearing on Capitol Hill convened by the House subcommittee on
telecommunications and the Internet concerning the spectrum needs of first
responders. Officials from UTC and Nextel presented testimony at the hearing.

"We have requested a small, exclusive allocation of six to 10 megahertz, on
which we propose to construct a nationwide system. This system would be
interoperable among the multiple utilities that always respond to regional
emergencies, and would be made available to traditional public safety, federal
agencies and others through additional equipment, or as part of a network of
networks," said UTC Chairman Stephen Carrico in his testimony.

In his testimony, Nextel's Donohue said the alternative plans that the FCC is
considering rely "heavily on case-by-case 'best practices' to respond to
interference. This reactive approach is inadequate, however, where emergency
communications are involved. Even a single case of interference to a policeman
or firefighter's radio can jeopardize the safety of first-responders and the
citizens
they serve."

POWER PLAYS? Foosaner says UTC's plan to build a nationwide network using a
six to 10 megahertz spectrum allocation to utilities would also allow the
utilities
to sell extra bandwidth to other communications providers. "They showed their
true colors at the hearing," Foosaner says. UTC's plan is basically a "power play"

to get 10 megahertz of spectrum, he says. "They want it for free, next to the
public safety band to sell it to public communications providers," he says.

The acrimony in the hearing room that day was apparent in many ways, but not
overtly. UTC officials and Nextel officials were unusually tense about being in
the
same room with one another. Although publicly they shook hands and were
polite, privately they heaped disdain on one another, saying the other's plan was
only a power grab and a self-interested, "spectrum-for-free" proposal, to
paraphrase both UTC and Nextel officials in the room.

The FCC is in no hurry to settle the issue, The Precursor Group's Baca says, as it

is taking some time to review the plan. In the meantime, the issue remains an
emotional one because of the implications of the proposals, and also because
both sides seem to genuinely want to help sort out emergency responders'
spectrum issues. It doesn't hurt, analysts say, that whichever solution is chosen,

helps the sponsor.

Nextel recently signed a much-anticipated 10-year agreement with the National
Association for Stock Car Auto Racing (NASCAR), making it the title sponsor for
that organization's national racing series beginning next year. Under the deal,
NASCAR's highly visible "Winston Cup Series" will become "Nextel's Cup Series."
Reportedly, Nextel could spend as much as $40 million over the life of the
contract.

With that kind of promotional money at hand, Nextel could have a difficult time
arguing at the FCC that it should get spectrum for free, Baca says. "The FCC
could see this as reneging on public safety. After all, if you've got money to
spend on NASCAR, then you can spend money" on spectrum, he says.

http://www.wirelessweek.com/index.asp?layout=article&articleid=CA308505&spacedesc=Departments&stt=000

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