FCC Chairman Ajit Pai has decided a public auction, led by the agency, is the best way to handle clearing out a portion of the C-band spectrum for wireless use. In letters Monday to Sens. Roger Wicker, (R-MS), chairman of the Senate Committee on Commerce, Science, and Transportation, and John Thune, (R-SD), chairman of the Subcommittee on Communications, Technology, Innovation, and the Internet, Pai said: “After much deliberation and a thorough review of the extensive record, I’ve concluded that the best way to advance these principles is through a public auction of 280 MHz of the C-band conducted by the FCC’s excellent staff.”
Pai’s decision comes as Wicker and Thune introduced the 5G Spectrum Act. Their measure requires a transparent and competitive public auctioning process. The bill specifically mandates that at least 50 percent of the value of auction revenues be reserved for the U.S. Treasury and that the auction starts no later than December 31, 2020.
FCC officials told reporters the Commission will move directly to an order for a public auction, rather than starting with a notice of proposed rulemaking and then conducting a comment period on the NPRM. Officials said the agency would seek public input on auction procedures.
Because of the time saved by handling the process this way, officials believe the Commission could vote on an order early next year; if so, the auction would begin by the end of 2020.
Pai confirmed to the Senators that out of the total 500 MHz, the agency would re-purpose 280 MHz, and designate a 20 MHz guard band. The decision means incumbent users — satellite operators that provide programming for television, radio and cable — would be re-packed into the upper portion of the band.
This portion of the Chairman’s plan follows what the C-Band Alliance proposed. However, the decision to have a public auction is a blow to the CBA members Intelsat, SES, and Telesat. They consistently said they could conduct a private auction that would repurpose the spectrum more quickly. FCC officials said the CBA ultimately did not demonstrate they could conduct a “fair and transparent” auction.
In response, the CBA on Monday stated the Chairman’s plan, “is a significant departure from the CBA’s market-based proposal. The announcement does not address the critical involvement of the incumbent satellite operators in executing the complex task of reconfiguring and transitioning their networks. Nor does the announcement address the fundamental modification of the rights afforded by the existing FCC licenses held by the CBA members which would be required under a public auction approach.”
The license change the CBA is referring to is significant. Current licensees have access to the entire C-band so that if one channel is not available or not working, the satellite operator can immediately switch to another channel to deliver live programming.
Detractors of the CBA plan, including smaller satellite companies and government watchdogs, favor fiber as a backup in these cases. The CBA, plus broadcasters and cable companies, say fiber is too expensive to use as a back-up and vulnerable to “backhoe cuts.”
The CBA also stated: “To ensure U.S. national security interests, U.S. leadership in 5G innovation and the expected accompanying GDP and job growth, the full cooperation of the satellite operators will be required to ensure the successful clearing of the C-band while protecting the incumbent broadcast services enjoyed by millions of U.S. households. We will continue to work cooperatively with the FCC to develop an effective alternative plan and achieve the best outcome for the American public while protecting the interests of our users and the rights of our companies.”
Reaction from some of Pai’s colleagues was swift. FCC Commissioner Brendan Carr said, “Getting this done in 2020 is the right call. With even more mid-band spectrum added to the mix of [spectrum] already freed up for 5G, I’m excited about the opportunity that next-gen connectivity will deliver to America’s families and businesses.”
“I’ve said consistently a public auction is the best and fastest way to make the C-band available and ensure that all Americans benefit,” said FCC Commissioner Geoffrey Starks. He added he’s glad Pai agrees, and looks forward to working with his colleagues on the next steps.
By Leslie Stimson, Inside Towers Washington Bureau Chief
November 19, 2019