Communications Advisory Bulletin
FCC Adopts Final Rules for 700 MHz Auction
By Theresa
Cavanaugh
[August 2007]
In a proceeding that generated an unusual amount
of press coverage and widespread industry interest, the
Federal Communications Commission (FCC) on July 31 adopted revised
band plan and services rules for its upcoming auction of 700 MHz
band spectrum. The FCC will auction a total of 62 MHz of spectrum
during the 700 MHz auction, which according to federal law must
begin by Jan. 28, 2008. This spectrum is coveted by companies both
within and outside of the wireless industry because it is ideal
for carrying wireless signals.
The text of the FCC's Order has not yet been released, so the
specific details of the new auction rules are not yet known. We
have summarized the key elements of the FCC's News Release below,
and will issue further advice when the FCC’s final 700 MHz
Auction order is released.
Revised 700 MHz Band Plan
The FCC adopted a revised band plan for the “Lower”
and “Upper” 700 MHz bands. In general, the 700 MHz band
encompasses spectrum from 698 MHz to 806 MHz. Some of the spectrum
within this band previously was auctioned and licensed by the FCC.
In the upcoming 700 MHz auction, the FCC will auction a total of
62 MHz of spectrum, divided among five spectrum blocks. Some of
the specifics for each of these spectrum blocks are:
Block |
Bandwidth/Pairing |
Frequencies |
Market Type/Size |
| Lower A Block |
12 MHz/2 x 6 MHz |
698-704 MHz/
728-734 MHz |
EA -Economic Area
(larger than CMAs) |
| Lower B Block |
12 MHz/2 x 6 MHz |
704-710 MHz/
734-740 MHz |
CMA - Cellular Market Areas (smallest
market size) |
| Lower E Block |
6 MHz/Unpaired |
722-728 MHz |
Economic Area |
| Upper C Block
(Open Access) |
22 MHz/2 x 11 MHz |
746-757 MHz/
776-787 MHz |
REAG – Large multi-state
regions of US |
| Upper D Block
(Public/Private) |
10 MHz/2 x 5 MHz |
758-763 MHz/
788-793 MHz |
Nationwide License |
The FCC also adopted several significant revisions to the public
safety spectrum allocations within the 700 MHz band.
Performance Requirements
The FCC adopted new, more stringent build-out and performance
requirements for the new 700 MHz licensees. The performance requirements
described below were strongly opposed by the wireless industry.
- For smaller geographic market-area licenses (such as Economic
Area licenses and Cellular Market Area licenses), licensees will
be required to provide service to cover at least 35 percent of
the geographic area of the licensed market within four
years of license issuance; and 70 percent of the geographic area
by the end of the license term.
- For the larger, REAG market licenses, licensees will be required
to provide service to cover at least 40 percent of the population
of the licensed market within four years of license issuance;
and 75 percent of the population by the end of the license term.
- The FCC did not identify specific build-out requirements for
the nationwide Upper D block license. This licensee will be required
to partner with an adjacent Public Safety Broadband Licensee,
and to negotiate a Network Sharing Agreement to be approved by
the FCC, which will govern construction deadlines, among other
issues.
- If a licensee does not meet the four-year performance benchmarks,
the FCC will reduce its license term from ten to eight years,
thereby imposing an accelerated construction schedule.
- If a licensee fails to meet the end-of-term construction requirements,
the FCC will automatically reclaim any unserved areas of its license
area and re-license those areas.
Open Access
One of the more controversial aspects of the FCC’s new rules
is its decision to impose “open platform” requirements
on the winning bidder of the 22 MHz Upper C Block license. Specifically,
the Upper C Block licensee will be required to provide a platform
that will allow customers, device manufacturers, third-party application
developers and others to use the device and applications of their
choice on this spectrum block, subject to the condition that these
devices and applications do not harm the network.
Public Safety/Private Partnership
As mentioned above, the FCC will require that the winner of the
10 MHz Upper D Block nationwide license form a Public Safety/Private
Partnership with an adjacent nationwide public safety licensee,
to develop a shared, interoperable broadband network for both public
safety and commercial use. Under the new rules, public safety will
have priority access to the Upper D Block commercial spectrum in
times of emergency, and the commercial licensee will have preemptible,
secondary access to the adjacent public safety broadband spectrum.
Auction Procedures
The FCC adopted three noteworthy changes to its auction procedures
for the 700 MHz auction. First, the FCC will use anonymous bidding
for the auction, regardless of any pre-auction assessment of how
competitive the auction will be. Second, the FCC will use “package
bidding” procedures to auction the 12 Upper C Block REAG licenses,
to assist bidders that are seeking to create a nationwide footprint.
Finally, the FCC directed its staff to establish “reserve
prices” for this auction. These prices will allow the FCC
to decline to auction the 22 MHz Upper C Block license if the newly
imposed open access requirements on this spectrum depress bidding
to an unacceptably low level.
For more information, please contact:
This advisory is a publication of the Communications Group of Davis
Wright Tremaine LLP. Our purpose in publishing this advisory is
to inform our clients and friends of recent developments in the
communications industry. It is not intended, nor should it be used,
as a substitute for specific legal advice as legal counsel may be
given only in response to inquiries regarding particular situations.
Attorney advertising. Prior results do not guarantee a similar outcome.
Copyright © 2007, Davis Wright Tremaine LLP.
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