Subject: [NEXTEL-1] Industry Eyes FCC/NextWave Settlement Implications

From: [email-masked]
Date: Wed, 21 Apr 2004 15:48:28 -0400

Industry Eyes FCC/NextWave Settlement Implications
BY MARK ROCKWELL
APRIL 21, 2004

WASHINGTON -- While the wireless industry breathes a sigh of relief over
the spectrum settlement between NextWave Telecom and the FCC, some
analysts are wondering if it could ripple into the fight over 800 MHz
spectrum and other burning issues.

The settlement, announced late yesterday by the commission, requires
NextWave to relinquish 90 percent of its spectrum; looks to recover $1.6
billion in cash, including NextWave's down payment; and anticipates a
total of about $4 billion when cash and spectrum recovery are combined.
The deal also puts a nail in the coffin of the 7-year-old case, saying
that it "extinguishes" any possibility of future claims by NextWave
against the commission.

The deal requires approval by the U.S. Bankruptcy Court of the Southern
District of New York, the court handling NextWave's re-emergence from
bankruptcy.

The agreement also would require NextWave to compensate the FCC on the
sale of the spectrum the company retains if a "dramatic" increase in the
value of that spectrum occurs.

For its part, NextWave is looking forward to the next step in the
process: review by the bankruptcy court judge. The court is expected to
rule on the matter on May 25, says Michael Wack, spokesman for the
company, adding that no decision has been made yet on whether to sell
the licenses. The 30 10 MHz licenses retained by the company in 25
markets across the United States give the company a national footprint
that could be ideal for a data network, Wack says. The retained licenses
include footprints in markets such as New York City, Washington, D.C.,
and Boston. "It gives us 73 million pops nationally," he said.
The re-emergence of the long-contested NextWave spectrum into the public
arena has some industry observers wondering about the implications for
another long running spectrum battle -- Nextel Communications' bid to
swap 800 MHz spectrum with public safety. Nextel would get about 10 MHz
in the 1.9 GHz band in that deal, which has Verizon Wireless crying
foul. Verizon Wireless has called for a public auction of that spectrum
and has said its opening bid for it would be $5 billion.
Because the NextWave spectrum is similar in bandwidth and has national
reach, one analyst is questioning whether Verizon Wireless, in making a
$5 billion pledge for the Nextel spectrum, had stumbled. "I wonder if
Verizon has painted itself into a corner on a bid for any NextWave
spectrum," says Jane Zweig, CEO and partner at The Shosteck Group.

Verizon Wireless has tried to acquire NextWave spectrum in the past. Its
notorious $8.7 billion bid for 67 re-auctioned NextWave licenses two
years ago resulted in a bitter fight with the FCC over refunding a $1.5
billion down payment on the spectrum after NextWave asserted it still
owned the spectrum after it declared bankruptcy.

The U.S. Supreme Court ruled in January 2003 that the FCC acted
unlawfully in canceling NextWave's PCS licenses after the company filed
for bankruptcy shortly following its winning $4.7 billion bid in a 1996
spectrum auction. Before the court's decision, the FCC had already
re-auctioned the licenses to other bidders, including Verizon Wireless,
only to be subsequently held up as the legal case proceeded.  The FCC
finally relented on refunding deposits to the re-auction winners.
Verizon Wireless officials wouldn't comment specifically on whether they
had inadvertently set the bar on any bid the carrier may place on the
NextWave spectrum when it comes up for another auction at the commission
in the coming months. A Verizon Wireless spokesman did say, however,
that "whether it's the 1.9 MHz or return spectrum from NextWave, it
should be publicly auctioned."

Nextel officials declined comment on the matter. FCC officials said
Verizon's proposed bid could inadvertently set the bar for the NextWave
spectrum, but that it would have no effect on the ongoing 800 MHz
proceeding at the commission.
In any case, Verizon's proposed bid on the Nextel spectrum is most
likely a foundation for an appeal of the FCC ruling on the matter and
not an official offer, analysts say. In any case, the $5 billion for the
Nextel spectrum would be a good deal, says Roger Entner, Yankee Group
program manager, wireless/mobile services.

http://www.wirelessweek.com/index.asp?layout=newsat2direct&starting=1&pubdate=04/21/04

--
    "NEXTEL-1 IT'S NOT JUST NEXTEL"
  Note The New address
Subscribe to Nextel-1: http://www.groups.yahoo.com/subscribe/NEXTEL-1

  "NEXTEL2 FOR iDEN SOFTWARE DEVELOPERS"
Subscribe to Nextel2: http://www.groups.yahoo.com/subscribe/NEXTEL2

  "WIRELESS FORUM HOMELAND SECURITY GROUP"
     The Complete Resource for Wireless Homeland Security.
Subscribe to WFHSG:  http://www.groups.yahoo.com/subscribe/WFHSG

------------------------ Yahoo! Groups Sponsor ---------------------~-->
Buy Ink Cartridges or Refill Kits for your HP, Epson, Canon or Lexmark
Printer at MyInks.com.  Free s/h on orders $50 or more to the US & Canada.
http://www.c1tracking.com/l.asp?cid=5511
http://us.click.yahoo.com/mOAaAA/3exGAA/qnsNAA/61FxlB/TM
---------------------------------------------------------------------~->

-- 
    "NEXTEL-1 IT'S NOT JUST NEXTEL"
  Note The New address 
Subscribe to Nextel-1: http://www.groups.yahoo.com/subscribe/NEXTEL-1

  "NEXTEL2 FOR iDEN SOFTWARE DEVELOPERS"
Subscribe to Nextel2: http://www.groups.yahoo.com/subscribe/NEXTEL2

  "WIRELESS FORUM HOMELAND SECURITY GROUP"
     The Complete Resource for Wireless Homeland Security.
Subscribe to WFHSG:  http://www.groups.yahoo.com/subscribe/WFHSG

Yahoo! Groups Links

<*> To visit your group on the web, go to:
     http://groups.yahoo.com/group/NEXTEL-1/

<*> To unsubscribe from this group, send an email to:
     [email-masked]

<*> Your use of Yahoo! Groups is subject to:
     http://docs.yahoo.com/info/terms/