Consumers 'Taken for a Ride' by C-Band Plan, Doyle Aide Says

The C-band auction and compensating satellite operators for leaving the spectrum are things the FCC could come to regret as a negative template for future spectrum auctions, said Philip Murphy, legislative director to House Communications Subcommittee Chairman Mike Doyle, D-Pa. The auction starts Dec. 8.

The auction is based on “a terrible model,” Murphy told the Competitive Carriers Association’s virtual conference Wednesday. It gives “foreign satellite providers” $10 billion for leaving those frequencies quickly, he said. “That money could have been used for a whole host of things,” including “closing the digital divide” or upgrading to next-generation 911, he said: “These are all things my boss and House Democrats were interested in wanting to advance.”

Chairman Ajit Pai “let the American people get taken for a ride,” Murphy said. The amount of money in play “sets a really bad precedent for the future,” he said. “The satellite providers’ behavior incentivizes others to demand similar payments,” he said. “This is going to be a real impediment in the future,” he said: “People are going to say, ‘I want $10 billion to move.’”

“Everyone acknowledges” the growing need for midband for 5G, said Sean Spivey, a Pai aide. “You have to take steps to make incumbent users whole.” The order was “very clear that we’re not allowing for gold plating or things like that,” he said. “This is payment of reasonable relocation costs.” Congress can still act if it chooses, Spivey said.

The auction is based on a “fine model” that "certainly passes legal muster,” said Evan Viau, a Republican aide to the House Commerce Committee. Congress always likes to legislate where possible on auctions, he said. “It’s great that the FCC put in the work and is ensuring that this auction moves forward,” he said. Moving quickly will “create a huge, trusted market for vendors,” he said.

This is similar to a “very successful” model used in the TV incentive auction, said Steve Sharkey, T-Mobile vice president-government affairs, technology and engineering policy. “You’ll have an auction, and then the relocation costs are actually going to be paid on a pro rata basis by the auction winners to make sure that their services and facilities are kept whole.”

Work remains, Spivey said. “We’re trying to nail down as many of the remaining open items as possible, as quickly as possible, going into that auction start date,” he said: “We are all working very hard" so the auction "stays on target.”

T-Mobile's “very happy” the FCC is seeking comment on a 3.45-3.55 GHz auction, Sharkey said. “There’s no question that that’s a need for midband spectrum,” and the swath is “globally harmonized” for broadband, he said. There will be “limited sharing” with DOD, but the proposed rules also allow licensees to negotiate with the government, he said. “It would be great to be moving more on this band,” which extends to 3.1 GHz, he said.

The DOD request for information that includes the band is “an elephant in the room,” Murphy said. It includes a question about a nationalized 5G network, potentially operated by DOD (see 2010190057). “It’s a little unclear exactly what they’re proposing or the legal authority under which they would do so,” he said. There appears to be “a bizarre sort of palace intrigue” within the White House on the band (see 2009210056), he said. “There’s no sort of real proposal on the table.” The White House didn’t comment.

On a second panel, carrier executives said they're coping with the pandemic and have expanded their networks. Choice NTUA Wireless expected surprises and network challenges, said General Manager Clyde Casciato. The FCC gave the carrier, which serves the Navajo Nation, access to additional spectrum that doubled its capacity, but “we knew we would be challenged even at that,” he said. NTUA used its 600 MHz licenses to deploy an “overlay” over its 700 MHz network, he said.

NTUA is deploying on citizens broadband radio service and 2.5 GHz spectrum, Casciato said: “We’re out in front of it, but we have to get this construction done because demands on our network are pretty significant.”

Alaska’s GCI had a little more time to prepare because COVID-19 hit there later, said Kara Azocar, regulatory counsel-federal affairs. GCI sped up its 5G build, with more than 50 cellsites completed. “That enabled us to keep up with wireless demand,” she said. “Our network has performed well. It’s exactly as we expected,” said Chris Champion, C Spire director-government relations. The carrier decided to speed already-planned investments in its network, he said: “We haven’t skipped a beat.”