The undersigned Public Interest Organizations (New America Foundation, Public Knowledge and Consumers Union) welcome the Commission’s effort to reallocate fallow Mobile Satellite Spectrum for more fully flexible licensing in a manner that holds the potential to promote wireless industry competition, innovation and consumer welfare. Commenters have in the past supported the substantively equivalent ATC waiver that the International Bureau granted to LightSquared Subsidiary LLC because of the compelling public interest conditions associated with the waiver and with the initial license transfer to SkyTerra (LightSquared’s predecessor in interest). Similarly, public interest commenters support the Commission’s proposal to bypass competitive bidding and to make an equitable grant of new, flexible AWS-4 licenses to the incumbent 2 GHz MSS licensee, but only if the conditions attached to the grant recaptures for the public a substantial share of the multi-billion dollar value of the grant with obligations and safeguards that are equivalent to the public interest benefits that were attached to the similarly-situated L Band licensee.
The value of the proposed AWS-4 license grant and the risk that the spectrum could be “flipped” or leased out in a manner that would lessen rather than promote wireless industry competition and innovation are both so great that the Public Interest Organizations believe that conditions in addition to meaningful buildout requirements are appropriate to avoid unjust enrichment and to ensure that the public resource is actually used to promote competition, innovation and more affordable mobile broadband for the public. Specifically, the Commission should make its assignment of AWS-4 licenses subject to the following public interest conditions:
First, for the duration of the initial license period, the AWS-4 licensee must make up to 50 percent of its capacity available in each Economic Area for open wholesale leasing, or for roaming by other carriers, on a non-discriminatory basis at fair and reasonable rates. Since the Commission is withholding this spectrum from competitive bidding, and because it has revoked the ATC rights of the L Band Licensee (LightSquared), there is a compelling public interest in promoting both competition among wireless providers and innovation in the adjacent markets for wireless devices, applications and services by making the S Band’s future LTE capacity available on fair and equitable terms.
Second, whether or not the AWS-4 licensee is required to make up to 50 percent of its capacity available for wholesale leasing and roaming, the Commission should require that the licensee seek Commission approval before making more than 25 percent of the licensee’s data traffic capacity within any Economic Area available to any single carrier, or to any other entity, regardless of whether that capacity is accessed on a wholesale basis, roaming basis, under a spectrum manager lease arrangement, or as part of a network sharing agreement.
Third, any buildout requirements should be augmented by a “use it or share it” license condition that would permit other parties to make use of unused AWS-4 spectrum on a localized basis until such time as the licensee actually deploys service. The frequency bands covered by the new AWS-4 licenses should be registered in the TV Bands Database and available for non-interfering use by devices and/or systems that are multi-band, equipped with GPS, capable of periodically checking the database, and on notice that they will be denied permission to continue using the S Band frequencies in a local area once the licensee notifies the Commission and a TV Bands Database operator of the geographic areas where actual service will commence.
Fourth, the Commission should impose unjust enrichment penalties on sale of the AWS-4 licenses to either of the two largest mobile carriers. This condition would prevent DISH from unjustly realizing a windfall if it transfers or assigns the spectrum to one of the two largest CMRS and wireless data carriers within a specified number of years. This condition is particularly salient if the Commission decides not to attach the wholesale access and 25 percent approval requirements outlined in conditions one and two above. Precedents and models for mitigating unjust enrichment currently exist within the Commission’s rules. The unjust enrichment rules governing the benefits reserved for designated entity licensees (DEs) are a particularly appropriate and workable model for a condition ensuring that the S Band licensee does not use its enormous public subsidy to harm the public by worsening the competitive landscape of an industry that is already consolidating and threatening to become an effective duopoly.
The full comments are available on the FCC's comments page or for download as a PDF.
Press release from Public Knowledge regarding the submitted comments.