Federal Communications Commission (FCC)

FCC granted conditional approval for $47.5 billion merger of AT&T and Comcast, nation’s first- and 3rd-largest cable companies. Merged company would have 27.02 million subscribers -- 28.9% of all U.S. multichannel video programming distributor (MVPD) customers in 41 states. However, public interest groups immediately said they would take decision to court.

FCC proposed service rules on licensing and use of 5.9 GHz band for dedicated short-range communications (DSRC) services in intelligent transportation system (ITS), it said in text of item adopted Nov. 7 (CD Nov 8 p9). In text released Fri., FCC proposed to permit entities providing public safety DSRC operations to use 5.9 GHz band. It also proposed to apply application, licensing and processing rules under part 90 of Commission’s rules for public safety entities. FCC also proposed to apply competitive bidding procedures under Commission’s Part 1 competitive bidding rules in case it allowed non-public safety radio applications in 5.9 GHz band and in case licensing scheme it selected for those ITS applications resulted in mutually exclusive licenses. FCC also requested comments on issues raised by 2 petitions for reconsideration or clarification of allocation order. Commission said it dismissed petitions from PanAmSat, which was seeking reconsideration of FCC’s decision that prior coordination between DSRC operations applications and fixed satellite service (FSC) uplinks was unnecessary, and from Mark IV Industries seeking reconsideration or clarification of power levels and emission mask requirements established in allocation order. Comments are due 60 days after Federal Register publication, replies 90 days.

After 2 previous failed attempts at instituting EEO rules for broadcasters, cable and satellite companies, FCC adopted new set of rules Thurs. that it believes will hold up in court this time. That’s because new rules are basically carbon copy of part of its previous rules that U.S. Appeals Court, D.C., found acceptable last time around. Commission left out part of its old rules that court overturned on constitutional grounds.

In next step toward carving out more 3G spectrum, FCC Thurs. approved spectrum allocation order and proposed service rules for 2 blocks of 45 MHz of contiguous spectrum. Allocation means 5 MHz of Multipoint Distribution Service (MDS) spectrum, which is itself connected to other proceedings, and incumbent point-to-point microwave licensees will have to relocate. FCC officials said order, which appeared to contain no surprises, didn’t make any decisions on potential relocation spectrum for MDS, but said it would be taken up in future proceeding.

Bell companies’ claims that open-access regulations are eliminating incentives to upgrade their networks are “misleading and unsubstantiated,” CompTel Pres. Russell Frisby said in letter to FCC. Letter said RBOCs are attempting to “extort relaxed regulation in return for the promise of broadband deployment” but “in reality, the RBOCs have a long track record of breaking promises to deploy broadband infrastructure in return for regulatory concessions.” Bell companies want reduction of unbundled network elements (UNEs) and changes in total element long run incremental cost (TELRIC)-based pricing, letter said. “RBOCs reneged on promises to deploy broadband facilities long before the Federal Communications Commission implemented rules that enabled competitors to use the incumbents existing infrastructure,” letter said. Examples included: (1) 1995 promise Ameritech Indiana (now SBC) made to Ind. Utility Regulatory Commission (IURC) in exchange for dropping certain aspects of jurisdictional oversight. Ameritech Indiana promised to spend more than $120 million on infrastructure improvements for schools, hospitals and major govt. centers. But 1999 IURC report said SBC had invested only $18 million in infrastructure improvements, well short of the $80 million it had promised at that time. Report also said SBC counted infrastructure provided to customers that were not schools, hospitals or major govt. centers toward its plan. (2) In 1993, Bell Atlantic Pa. (now Verizon) used Pa. public utility code provision to promise universal bandwidth of at least 45 Mbps in exchange for alternative regulation. In 2000, Verizon said it would meet promise by deploying DSL throughout Pa. DSL can only achieve speeds of 1.5 Mbps, slower than 45 Mbps speed Verizon promised, letter said. Pa. PUC expressed concerns that Verizon wouldn’t meet goal of deployment to 50% of rural customers by 2004 and that residential DSL deployment lagged behind deployment to business customers. Letter said FCC line-sharing order dramatically increased broadband deployment. “Without line sharing, there would be no competition in this market,” letter said.

With Sen. McCain (R-Ariz.) poised to take reins of Senate Commerce Committee, industry observers are expecting deregulatory agenda. Leadership change also appears to give FCC Chmn. Powell powerful ally on Capitol Hill. Broadcasters may have biggest interest in McCain’s agenda, especially as some observers believe he will use position to push for free air time for political candidates, 2nd phase of his campaign finance reform agenda. Media ownership also will be prominent and digital TV issues probably will receive more attention, we're told.

Despite funding uncertainty for fiscal 2003, National Communications System (NCS) still plans to begin national rollout of initial operating capability of wireless priority service by year-end, Govt. Emergency Telephone Service (GETS) Dir. John Graves said Wed. He told Telecom Service Priority (TSP) Oversight Committee meeting at NCS hq in Arlington, Va., that 2003 capability for service designed to give priority to national security personnel and responders in emergencies still was on track because $208 million set aside to get program running was “any-year” money. Uncertainty involves $73 million sought by Bush Administration after Sept. 11 attacks that House and Senate conferees recently zeroed out of defense appropriations bill (CD Oct 15 p1). For initial capability, NCS is close to signing contract with T-Mobile USA and with Cingular Wireless, Graves said.

As clock ticks nearer to 180-day mark on proposed merger of AT&T Broadband and Comcast, coalition of consumer groups is challenging FCC’s standard in determining subscriber numbers. “Recent disclosures of questionable subscriber counts and even outright fraud by multichannel video programming distributors (MVPDs) demonstrates that the Commission cannot reasonably rely on ‘generally accepted industry data,'” said Consumer Federation of America (CFA), Consumers Union (CU), Center for Digital Democracy (CDD) and Media Access Project in filing last week at FCC. Groups were referring to revelations that Adelphia had fudged its subscriber counts, that Charter counted cable modem customers as subscribers of basic video service even if they didn’t actually get TV service, and that DirecTV had counted people who were interested in service but hadn’t actually signed contract. FCC spokeswoman declined comment. NCTA spokesman said group wouldn’t comment until it reviewed filing.

Report on testing that FCC has undertaken in wake of ultra-wideband (UWB) order adopted in Feb. is expected to be released shortly, Office of Engineering & Technology (OET) Chief Edmond Thomas told us in interview. Thomas said testing was examining areas such as ambient noise levels in different environments rather than actual UWB-based communications devices, which weren’t available in commercial quantities for such analysis. Lack of significant body of data about noise floor levels has been concern in UWB proceeding when opponents and advocates of technology disagreed on interference potential of UWB. “There’s a profound lack of data” on noise floor levels, Thomas said. “It’s profoundly difficult data collection, but it should be done as far as I'm concerned.”

LAS VEGAS -- FCC is moving forward on 3G spectrum allocation and should have it on meeting agenda by year-end, speakers said at CTIA Wireless IT & Internet 2002 conference here late Wed. Julius Knapp, deputy chief of Office of Engineering & Technology (OET), indicated Commission would have rulemaking lined up for agenda meeting by then on service rules for 90 MHz being made available for 3G and other advanced wireless services. Two items are expected to be lined up for Commission approval: (1) Allocation report and order. (2) Notice of proposed rulemaking covering service rules. Bush Administration had released report earlier this year that outlined way to clear total of 90 MHz for advanced wireless services, including 1710-1755 MHz used by military incumbents and 45 MHz of 2110-2170 MHz occupied by nongovt. users.