**Before the**

**Federal Communications Commission**

Washington, D.C. 20554

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| In the Matter of                 | * | WT Docket No. 07-16          |
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| Applications for License and     | ) | WT Docket No. 07-30          |
| Authority to Operate\            | * |                              |
| in the 2155-2175 MHz Band        | * |                              |
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| Petitions for Forbearance Under  | * |                              |
| 47 U.S.C. § 160                  | * |                              |
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[]{.mark}

[]{.mark}

**ORDER**

**Adopted:** August 31, 2007 **Released:** August 31, 2007

By the Commission: Chairman Martin and Commissioner Copps issuing
separate statements; Commissioner Adelstein concurring and issuing a
statement.

Table of Contents

Heading Paragraph \#

I. Introduction 1

II\. Forbearance Petitions 2

A. Background 2

B. Discussion 8

III\. Applications to Provide Service in the 2155-2175 MHz Band and
Related Petitions to Deny 19

A. Background 19

B. Discussion 28

IV\. Conclusion 32

V. Ordering Clauses 33

# Introduction

1.  In this Order, we dismiss without prejudice the above-captioned
    applications to provide service in the 2155-2175 MHz band, which has
    been allocated for fixed and mobile services, including Advanced
    Wireless Services (AWS).[^1] We also deny petitions for forbearance
    associated with two of the above-captioned applications, and we
    dismiss related petitions to deny and a petition for reconsideration
    as moot. We find that the petitions for forbearance are not in the
    public interest. In addition, we find that the public interest is
    best served by first seeking public comment on how the band should
    be used and licensed. We therefore dismiss all pending applications
    and related pleadings, without prejudice, in recognition of our plan
    set out below to expeditiously initiate a rulemaking process to
    consider service rules for the 2155-2175 MHz band (also referenced
    herein as the "AWS-3" band).

# Forbearance Petitions

## Background 

2.  On May 5, 2006, M2Z Networks, Inc. (M2Z) filed an application
    seeking an exclusive, nationwide 15-year license in the 2155-2175
    MHz band to operate a wireless broadband network using Time Division
    Duplexing (TDD), Orthogonal Frequency Division Multiple Access
    (OFDMA), and Advanced Antenna System (AAS) technology.[^2] M2Z
    proposed that this spectrum be licensed to it free of charge, with a
    portion of certain receipts based on its services paid to the U.S.
    Treasury.[^3] On September 1, 2006, M2Z filed a related forbearance
    petition, under Section 10(c) of the Communications Act of 1934, as
    amended (the Act), and Section 1.53 of the Commission's rules,[^4]
    in connection with its application.[^5] On March 2, 2007, NetfreeUS,
    LLC (NetfreeUS) filed a similar forbearance petition in connection
    with its application to provide service in the same band.[^6]

3.  In seeking forbearance, M2Z states that it is not asking the
    Commission to abdicate its responsibility to determine whether "the
    public interest, convenience, and necessity will be served" by
    accepting and granting M2Z's application.[^7] Rather, M2Z avers that
    the forbearance process itself provides a specific public interest
    standard of review for its petition and, by reference, M2Z's
    application.[^8] M2Z also notes that Section 7 of the Act, 47 U.S.C.
    § 157, provides that the Commission "shall determine whether any new
    technology or service proposed in a petition or application is in
    the public interest within one year after such petition or
    application is filed."[^9] M2Z asserts that the Commission
    repeatedly has invoked Section 7 to promote "innovative polices and
    licensing models that seek to increase communications capacity and
    efficiency of spectrum use, and make spectrum available to new uses
    and users."[^10]

4.  M2Z seeks forbearance from Sections 1.945(b) and (c) of the
    Commission's rules, to the extent that the enforcement of any
    provision of these rules would block the acceptance and grant of
    M2Z's application. Section 1.945(b) provides that "\[n\]o
    application that is not subject to competitive bidding under Section
    309(j) of the Communications Act will be granted by the Commission
    prior to the 31st day following the issuance of a Public Notice of
    the acceptance for filing of such application or of any substantial
    amendment thereof, unless the application is not subject to Section
    309(b) of the Communications Act."[^11] Section 1.945(c) sets forth
    the standard for granting wireless license applications and provides
    that the Commission will grant a wireless license application
    without a hearing if the application is proper on its face and if
    the Commission finds that the following five criteria are met: (1)
    there are no substantial and material questions of fact; (2) the
    applicant is legally, technically, financially, and otherwise
    qualified; (3) a grant of the application would not involve
    modification, revocation, or non-renewal of any other existing
    license; (4) a grant of the application would not preclude the grant
    of any mutually exclusive application; and (5) a grant of the
    application would serve the public interest, convenience, and
    necessity.[^12]

5.  M2Z contends that enforcement of these rules in the context of M2Z's
    application is not necessary to protect consumers or to ensure that
    M2Z's charges, practices, classifications, and regulations are just
    and reasonable and are not unjustly or unreasonably
    discriminatory.[^13] Moreover, M2Z contends that forbearance from
    Sections 1.945(b) and (c) in this instance satisfies Section 10's
    public interest test, which requires us to consider whether
    forbearance will promote competitive market conditions,[^14] because
    it will increase the level of competition in the broadband and
    telecommunications market by allowing new entry by M2Z as a
    Commercial Mobile Radio Service (CMRS) provider.[^15] According to
    M2Z, a grant also will deliver additional public interest benefits
    by spurring innovation in the consumer electronics market,
    augmenting universal service, and promoting economic growth through
    broadband deployment.[^16] For these reasons, M2Z contends that the
    Commission must forbear from applying any provision of Sections
    1.945(b) and (c) that would block the acceptance and grant of M2Z's
    application.

6.  NetfreeUS's forbearance petition is premised upon many of the same
    arguments as M2Z's petition.[^17] Like M2Z, NetfreeUS proposes to
    provide free, nationwide broadband service, although NetfreeUS
    proposes to provide this service "under a unique plan for nationwide
    secondary-market licensing that allows entrepreneurs, new entrants
    and municipalities to participate in providing services on a
    'private commons' basis."[^18] While agreeing with M2Z that the
    Commission must forbear from applying Section 1.945 to avoid a
    determination of mutual exclusivity, NetfreeUS also argues that "no
    determination of nonexclusivity should be construed to give M2Z the
    right to foreclose Commission consideration of competing
    applications."[^19] Rather, NetfreeUS contends that we should
    exercise forbearance by using regulatory tools other than
    competitive bidding to license the 2155-2175 MHz band. Specifically,
    NetfreeUS proposes that we establish a May 1, 2007 cutoff date for
    applications to use the 2155-2175 MHz band. If there are multiple
    applications, NetfreeUS states that the Commission should announce a
    60-day deadline by which applicants may jointly propose a settlement
    to remove any conflicts that would otherwise result in all or some
    of the applications being declared mutually exclusive.[^20] If no
    joint settlement is filed and accepted by the Commission, NetfreeUS
    states that the Commission can then proceed without delay to auction
    or use other means of assignment.

7.  Many parties filed comments regarding M2Z's forbearance
    petition.[^21] At the same time, M2Z filed additional comments,
    supporting its original forbearance petition.[^22] M2Z argues that
    under both Sections 7 and 10 of the Act, the Commission should grant
    M2Z's application, asserting that the public interest in granting
    this application is paramount over unnecessary regulation.[^23] M2Z
    contends that the "public interest is best served when beneficial
    technologies are made available without undue delay."[^24] They
    argue that deploying new services to the public in a rapid manner is
    a key feature of both Sections 7 and 10.[^25]

## Discussion 

8.  Section 10(a) of the Act requires the Commission to forbear from
    applying any regulation or provision of the Act to
    telecommunications carriers or telecommunications services, or
    classes thereof, if the Commission determines that the following
    three criteria are satisfied:

> \(1\) Enforcement of such regulation or provision is not necessary to
> ensure that the charges, practices, classifications, or regulations
> by, for, or in connection with that telecommunications carrier or
> telecommunications service are just and reasonable and are not
> unjustly or unreasonably discriminatory;
>
> \(2\) Enforcement of such regulation or provision is not necessary for
> the protection of consumers; and
>
> \(3\) Forbearance from applying such provision or regulation is
> consistent with the public interest.[^26]

Section 10(b) of the Act specifies that, in making the public interest
determination under the third prong of the three-part forbearance
standard, "the Commission shall consider whether forbearance from
enforcing the provision or regulation will promote competitive market
conditions, including the extent to which such forbearance will enhance
competition among providers of telecommunications services."[^27]
Section 10(b) further specifies that, "\[i\]f the Commission determines
that such forbearance will promote competition among providers of
telecommunications services, that determination may be the basis for a
Commission finding that forbearance is in the public interest."[^28]
Section 10(c) provides that "\[a\]ny telecommunications carrier, or
class of telecommunications carriers, may submit a petition to the
Commission requesting that the Commission exercise the authority granted
under this section with respect to that carrier or those carriers, or
any service offered by that carrier or carriers."[^29]

9.  As noted above, a petition under Section 10 must demonstrate that
    forbearance from applying a provision or regulation is consistent
    with the public interest. We find that the petitions of M2Z and
    NetfreeUS for forbearance from Sections 1.945(b) and 1.945(c) fail
    to demonstrate that such action is in the public interest.[^30]
    These provisions are designed, in large part, to ensure that the
    Commission has a sufficient basis upon which to determine whether
    the grant of a given license application will best serve the public
    interest. For example, under Section 1.945(b), the Commission
    provides opportunities for challenging an application in order to
    develop a full public record upon which to evaluate the application,
    while Section 1.945(c) ensures that the Commission considers such
    relevant factors as the applicant's technical, financial, and other
    qualifications.[^31] Neither M2Z nor NetfreeUS has provided any
    convincing reasons to conclude that their proposed licensing
    approaches have advantages that would outweigh the public interest
    benefits of these rules. While their proposed approaches may result
    in the issuance of a license sooner than conforming to established
    processes, such licensing would come at the expense of establishing
    a complete record that enables the Commission to consider all of the
    relevant factors in determining whether to grant a license without a
    hearing. In short, a potentially speedy but ill-considered licensing
    process does not serve the public interest. Moreover, as set out in
    detail below, the various filings made in this proceeding that
    oppose M2Z's and NetfreeUS's applications or propose competing uses
    of the band support our conclusion that a grant of either of these
    two applications without adhering to the requirements of Section
    1.945 would disserve the public interest.

10. Moreover, we find that a grant of M2Z's request that we forbear from
    applying the Section 309(j) competitive bidding requirements to its
    application,[^32] as well as its generalized request for forbearance
    from applying "any other rule, provision of the \[Communications\]
    Act, or Commission policy" to the extent they would "impede" our
    acceptance and grant of its application,[^33] should also be denied
    as inconsistent with the public interest.[^34] As discussed in
    detail below in connection with our disposition of the pending
    applications, before authorizing spectrum uses, we typically first
    conduct a rulemaking proceeding to obtain public comment on how the
    band should be used and licensed.[^35] Beginning with the
    promulgation of Section 309(j), we have most commonly determined,
    after consideration of the public comment filed in the applicable
    rule making, that a licensing framework that permits the filing and
    acceptance of mutually exclusive applications, which are then
    required by statute to be resolved through competitive bidding,
    would best serve the public interest for the types of spectrum use
    proposed by M2Z and NetfreeUS. Indeed, we have concluded in the past
    that this type of framework best serves the public interest because
    it is the one most likely to result in the selection of licensees
    that will value the spectrum the most and put it to its highest and
    most efficient use.[^36]

11. Based on the record compiled in this proceeding thus far, we
    conclude that the benefits of considering such a licensing regime
    (benefits not refuted by M2Z or NetfreeUS), even given the
    potentially longer timeline to the provision of actual service,
    outweigh the value of any purported public interest benefits of
    providing M2Z or NetfreeUS with a route to licensing that, by its
    very nature, precludes even the possibility of an auction and would
    simply give either company spectrum for free.[^37] Neither M2Z nor
    NetfreeUS have convinced us that their proposals are more likely to
    result in service that will better serve the public interest than
    the spectrum use that would be made by a licensee who has obtained
    its license through the competitive bidding process. While it is
    possible that we may conclude, after compiling a more complete
    record through the APA notice-and-comment rulemaking process, that
    the public interest would be better served by employing an
    alternative licensing framework, at this point, the record does not
    justify such a conclusion. For the foregoing reasons, granting the
    forbearance petitions of M2Z and NetfreeUS in order to license the
    band as they propose would be inconsistent with the public interest.

12. We note that, in its petition for forbearance, M2Z also argues that
    its application proposes a new technology and service under Section
    7 of the Act, which creates a presumption in favor of granting its
    application.[^38] Moreover, in its opposition to petitions to deny
    its application, M2Z further argues that Section 7 compels the
    Commission to act on M2Z's application by May 5, 2007, one year from
    the date M2Z filed its initial application.[^39] We do not agree
    with these assertions.

13. First, we disagree with M2Z's assertion that its application
    proposes a "new service" or "new technology" falling within the
    scope of Section 7. Opponents contend that M2Z's proposed wireless
    broadband service is not a new service, and uses technologies that
    other service providers are already using.[^40] In its application,
    M2Z proposes to provide wireless broadband internet access
    service,[^41] a service that currently is being offered by other
    service providers to consumers using both licensed and unlicensed
    spectrum.[^42] Moreover, as M2Z recognizes in its application, the
    technologies that M2Z proposes to use in the provision of wireless
    broadband internet access service -- TDD, OFDMA, and AAT -- are all
    proven technologies that have been deployed in other bands.[^43]

14. Further, we find that the relatively slow speed of M2Z's proposed
    broadband service does not support its Section 7 claim that is
    proposing to provide a "new" technology or service. In its
    application, M2Z proposes to provide "a robust level of broadband
    service..., with asymmetric engineered data rates of at least 384
    kbps down\[stream\] and 128 kbps up\[stream\]." It touts this
    service as faster than dial up Internet access and as meeting "the
    Commission's definition of high speed broadband."[^44] While M2Z
    asserts that its proposal constitutes an "innovative service . . .
    using new technologies" under Section 7 of the Act,[^45] we note
    that the transmission speeds proposed by M2Z are unremarkable
    compared to other broadband services currently being deployed.[^46]
    Indeed, we are currently considering whether to revise the
    definition of broadband service to increase the minimum threshold
    for reporting broadband speed information, and to establish a system
    whereby the "speed tiers" would be automatically adjusted upwards
    over time to reflect technological advances.[^47] For all these
    reasons, we conclude that M2Z's proposed service does not exemplify
    a "new technology or service" contemplated by Section 7, and thus
    that its application does not fall within the scope of that
    section.[^48] Moreover, in light of the relatively slow speed
    proposed and the evolving nature of broadband internet access
    service, the grant of such an application would not serve the public
    interest.

15. In addition, we also note that the construction benchmarks proposed
    by M2Z are not particularly aggressive and are misleading as far as
    the actual extent of their coverage. As a result, we find that M2Z's
    proposal does not serve the public interest, and in fact, that
    granting its application would prevent, rather than facilitate,
    widespread broadband deployment. M2Z proposes conditioning its
    license on compliance with the following benchmarks: (1)
    construction and operation of one base station in one Standard
    Metropolitan Statistical Area (SMSA) within 24 months; as well
    as (2) construction and operation of sufficient base stations to
    provide service to 33 percent of the U.S. population (as measured by
    counties) within three years of the grant, 66 percent of the
    population within five years, and 95 percent of the population
    within 10 years.[^49] M2Z's build-out proposal is substantially less
    aggressive than the build-out requirements we have established for
    other services.[^50] In particular, M2Z's proposal suggests
    measurement of its coverage of the U.S. population "by
    counties,"[^51] which results in an overstatement of its coverage in
    a manner that fails to realize the full deployment required under a
    number of our construction standards in other bands. In this
    respect, M2Z's proposal falls short of the build out standards that
    we have imposed in other contexts such as 700 MHz band, and which we
    have found to be appropriate to spur the deployment of advanced
    services to rural and underserved populations.[^52] In short, we
    conclude that M2Z's proposed construction benchmarks do not support
    grant of its application under Section 7, and would not serve the
    public interest.[^53]

16. Even if we found that M2Z's application does fall within the scope
    of Section 7, shifting the burden to those opposing its application
    does not alter our analysis of the public interest. To the extent
    that M2Z's application proposes a new service or technology, the
    applications filed by other parties similarly propose new services
    and technologies.[^54] Accordingly, these applications would be
    entitled to the same presumption as M2Z, thus imposing on each
    applicant, including M2Z, the burden of demonstrating that every
    other application is inconsistent with the public interest. In
    either event, Section 7 does not establish that the Commission
    itself has the burden to demonstrate that M2Z's proposal, or any
    other proposal, is inconsistent with the public interest. Section
    7(a) expressly excludes the Commission from the burden of
    demonstrating that a Section 7 proposal is not in the public
    interest.[^55] In any case, by filing their own, similar
    applications in which they propose to provide the same or similar
    services, we consider the six applicants for competing
    authorizations in this spectrum to have met the burden required
    under Section 7 to demonstrate that M2Z's proposal is inconsistent
    with the public interest.[^56]

17. Lastly, although we need not reach the issue of the relevant time
    frame to act on M2Z's Section 7 claim, we do not believe that the
    one-year timeframe specified in Section 7(b) can be triggered by the
    filing of an application that does not purport to offer a new
    technology or service under section 7. Specifically, in its initial
    application filed on May 5, 2006, M2Z did not assert that it was
    proposing a new service or technology that, pursuant to Section 7,
    required the Commission to act within a one-year time frame. Rather,
    M2Z first mentioned its Section 7 claim as part of its petition for
    forbearance on September 1, 2006 -- almost four months after its
    initial application was filed -- and even then M2Z only appeared to
    invoke that provision to argue that grant of its application would
    be consistent with the congressional goals specified in Section
    7.[^57] It was not until March 29, 2007, in its opposition to
    petitions to deny its application, that M2Z expressly asserted that
    its Section 7 claim required the Commission to act within one year
    of the filing of its application.[^58] As a result, the one-year
    period set forth in Section 7 could not have begun to run until
    September 1, 2006 at the earliest, and we are acting here within one
    year of that date. M2Z cannot retroactively trigger the Section 7
    one-year time frame by engaging in procedural gamesmanship and later
    claiming that Section 7 applies to a prior-filed application.[^59]
    Further, NetfreeUS and CTIA dispute whether the Commission is even
    required to act on the M2Z Application within one year under Section
    7.[^60]

18. For the foregoing reasons, we deny M2Z's and NetfreeUS's petitions
    for forbearance. Also, based on the above, we have concluded that
    the technology and services proposed in M2Z's application are
    insufficient to fall within the scope of Section 7 of the
    Communications Act or, in the alternative, to warrant a
    determination under Section 7 that they are in the public interest.

# Applications to Provide Service in the 2155-2175 MHz Band and Related Petitions to Deny

## Background

19. [M2Z's Application]{.underline}. As noted above, on May 5, 2006, M2Z
    filed an application seeking a free, exclusive, nationwide 15-year
    license in the 2155-2175 MHz band to operate a wireless broadband
    network.[^61] In lieu of service rules and licensing by competitive
    bidding, M2Z proposes that we grant it a license with ten
    public-interest conditions that include the provision of fixed and
    portable broadband data services "at engineered data rates" of 384
    kbps downstream and 128 kbps upstream "free of airtime or service
    charges" to ninety-five percent of the U.S. population "measured by
    counties" within ten years of license grant and "commencement of
    operations;"[^62] blocking of access to indecent or obscene
    material; and payment to the U.S. Treasury of a "voluntary usage
    fee" of five percent of gross revenues derived from "Premium
    Service" offered on a subscription basis.[^63] According to M2Z, the
    2155-2175 MHz band is unpaired, is not yet the subject of a
    long-term plan for use, and will likely remain underused or fallow
    for many years due to the limited number of carriers with the
    ability to operate in unpaired spectrum.[^64] M2Z further argues
    that the Commission has the authority to grant its application
    without allowing competing applications and assigning the licenses
    by competitive bidding.[^65]

20. On January 31, 2007, the Wireless Telecommunications Bureau (WTB or
    Bureau) accepted the M2Z application for filing under the
    Commission's general statutory authority of 47 U.S.C. § 309 (rather
    than pursuant to an established framework of processing rules).[^66]
    The Bureau noted that its action did not imply any judgment or view
    about the merits of the M2Z application, nor did it preclude a
    subsequent dismissal of the M2Z application as defective under
    existing rules or under future rules that the Commission may
    promulgate by notice and comment rulemaking.[^67] The Bureau also
    noted that additional applications for spectrum in the 2155-2175 MHz
    band may be filed while the M2Z application is pending.[^68]

21. [Additional Applications to Provide Service in the 2155-2175 MHz
    Band]{.underline}. On March 2, 2007, five additional applications
    for license and authority to operate in the 2155-2175 MHz band were
    filed in WT Docket No. 07-16; one additional application was filed
    on March 15, 2007. Commnet Wireless, LLC (Commnet) and McElroy
    Electronics Corp. (MEC) each seek a nationwide, exclusive license
    for all twenty megahertz, while TowerStream Corporation
    (TowerStream) seeks an exclusive license for all twenty megahertz in
    the top 200 MSAs.[^69] All three of these applicants emphasize that,
    if there are mutually exclusive applications, the Commission should
    assign licenses for this band by competitive bidding.[^70] MEC and
    TowerStream do not propose an annual payment to the U.S. Treasury
    based on gross revenues, explaining that one of the primary
    objectives of the Commission's auction rules is to ensure that only
    financially qualified applicants receive licenses so that the
    provision of service to the public is expedited.[^71] MEC states
    that it will establish its financial qualifications by paying its
    auction obligation in a timely manner.[^72]

22. NetfreeUS also seeks a nationwide authorization to use the entire
    2155-2175 MHz band subject to conditions including an annual "usage
    fee" to the U.S. Treasury of five percent of its gross
    revenues.[^73] NetfreeUS proposes a "license-and-lease" secondary
    market licensing regime under which it would hold a nationwide
    license and be obligated to offer to entrepreneurs, new entrants,
    municipalities and other members of the public the opportunity to
    lease the spectrum for Wireless Access Points (WAP) that would have
    a range of approximately one mile.[^74] NetfreeUS's Wireless Public
    Broadband (WPB) network would be advertiser supported[^75] and lease
    payments would be limited to NetfreeUS' costs.[^76] No lessee (or
    NetfreeUS itself) could lease or operate more than fifty WAPs,
    consumers would not pay monthly fees, and existing Wi-Fi equipment
    could operate on the WPB after a free software upgrade.[^77]
    NextWave Broadband, Inc. seeks a shared, nonexclusive, nationwide
    license modeled after the licensing approach that the Commission
    adopted for the 3650-3700 MHz band.[^78] Finally, Open Range
    Communications, Inc. seeks an exclusive license for "rural"
    "regional anchor communities" that have populations between 50,000
    and 150,000.[^79]

23. [Petitions to Deny]{.underline}. On March 2, 2007, a number of
    parties also filed petitions asking the Commission to deny M2Z's
    application.[^80] These petitioners assert that it would be
    inconsistent with the law and the public interest to grant the
    license to M2Z. They argue that there are substantial and material
    questions of fact as to whether granting the application would be in
    the public interest, would create harmful interference, and would
    result in an anticompetitive windfall.[^81] These petitioners urge
    the Commission to conduct a rulemaking proceeding regarding the
    service rules, as the Commission indicated it would when it
    allocated the spectrum.[^82] In addition, they maintain that Section
    309(j) of the Communications Act requires that this spectrum be
    awarded by competitive bidding.[^83] They believe that the
    Commission should auction this spectrum to ensure that a portion of
    the value of the spectrum is put to its best and highest use, no
    party is unjustly enriched, and a portion of the value of the
    spectrum is recovered for the benefit of the public.[^84]

24. [M2Z's Responses]{.underline}. On March 29, 2007, M2Z filed an
    opposition to the petitions to deny, a motion to dismiss alternative
    proposals submitted in the docket, as well as subsequent *ex parte*
    responses to replies and oppositions to its own submissions opposing
    alternative proposals.[^85] In its opposition, M2Z urges the
    Commission to determine the best use of the 2155-2175 MHz band by
    granting the license it seeks.[^86] M2Z argues that nothing in the
    Communications Act or the Commission's rules or policies prevents
    the Commission from licensing the band without opening a formal
    rulemaking.[^87] M2Z disputes that Section 309(j) of the Act
    requires the Commission to assign licenses through competitive
    bidding, and instead argues that the Commission must avoid mutual
    exclusivity when doing so would be in the public interest.[^88] M2Z
    contends that, because the Communications Act prohibits the
    Commission from considering potential revenues in determining
    spectrum use decisions, Petitioners' estimates of potential auction
    revenues for the spectrum band are irrelevant and flawed.[^89] M2Z
    contends that its proposed system will not cause harmful
    interference to existing 2155-2175 MHz licensees or licensees
    operating in adjacent bands, and that additional technical study is
    unnecessary to develop service rules for the band.[^90] Furthermore,
    M2Z maintains that the petitioners have not raised any substantial
    or material questions regarding the benefits of M2Z's proposal or
    its legal validity.[^91] Reply commenters dispute M2Z's
    assertions.[^92] M2Z also filed two letters, under requests for
    confidential treatment that M2Z states are relevant to our review of
    its financial qualifications[^93] and described a plan to provide
    matching funds to non-profit organizations for the purchase and
    distribution of modems to access M2Z's proposed network.[^94]

25. In its Motion to Dismiss Alternative Proposals, M2Z asks the
    Commission to dismiss six applications filed in this proceeding that
    offer alternatives to M2Z's proposal for use of the 2155-2175 MHz
    Band.[^95] M2Z asserts that the alternative proposals are "mere
    shadow alternatives" compared to its own proposal,[^96] and that the
    other applicants fail to demonstrate that grant of the M2Z
    application is inconsistent with the public interest, which M2Z
    asserts is the applicable burden of proof required under Section 7
    of the Act.[^97] Because of these alleged defects in each
    alternative proposal,[^98] M2Z contends that the Commission should
    dismiss them all and decline to accept additional applications for
    licenses in the 2155-2175 MHz band until it has ruled on M2Z's
    forbearance petition.[^99]

26. In its Consolidated Motion to Strike and Dismiss Petitions to Deny
    and Alternative Proposals,[^100] M2Z contends that, regardless of
    how the other petitioners and applicants have stylized their
    respective filings, these pleadings and proposals are technically
    petitions to deny[^101] because they attack the merits and request
    denial of M2Z's application and forbearance petition. As such, M2Z
    contends all of these pleadings and proposals are subject to and
    fail to meet the minimum requirements for petitions to deny under
    Section 309(d) of the Act.[^102] M2Z argues that these pleadings and
    proposals fail to present a substantial and material question of
    fact and do not specifically allege facts sufficient to show the
    granting of M2Z's application would be inconsistent with the public
    interest.[^103]

27. M2Z also argues that the parties opposing its application failed to
    follow the procedural steps necessary for the proper filing of
    petitions to deny set forth in 47 U.S.C. § 309(d)(1) and Section
    1.939(d) of the Commission Rules.[^104] Specifically, M2Z argues
    that that the Commission should dismiss all opposing petitions
    because M2Z did not receive proper service.[^105] M2Z also suggests
    the opposing petitions should be dismissed for lack of
    standing.[^106] CTIA asserts that M2Z's allegations of procedural
    defects in opposing pleadings are overstated, and the opposing
    pleadings do not warrant dismissal.[^107] NetfreeUS, Nextwave, and
    MEC filed responses challenging on procedural and substantive
    grounds M2Z's Motion to Strike and M2Z's other submissions
    challenging the opposing petitions.[^108]

## Discussion 

28. As an initial matter, we are not persuaded that assignment of this
    spectrum without first conducting a rule making proceeding to
    consider service and licensing rules would serve the public
    interest. Although the Commission has wide latitude to choose
    whether it will proceed by adjudication (*e.g.*, waiver proceedings)
    or by rulemaking,[^109] it is nevertheless the case that guidance
    from the courts indicates that issues of general applicability are
    more suited to rulemaking than to adjudication.[^110] In this case,
    we find that public interest is best served by full consideration of
    the service rules and licensing mechanisms that would best promote
    the efficient and effective use of this spectrum for the benefit of
    the public, rather than attempting to act upon these applications in
    an *ad hoc* adjudicatory proceeding.[^111] We therefore plan to
    issue a Notice of Proposed Rule Making to seek comment on service
    rules for the AWS-3 band.

29. Prior to accepting applications and granting licenses for Wireless
    Radio Services,[^112] the Commission typically establishes service
    rules addressing technical, operational, regulatory, and licensing
    issues. These issues include whether spectrum should be licensed on
    an exclusive basis and the processes by which such licenses should
    be assigned. They also include spectrum block size and geographic
    area coverage; technical issues such as emission and power limits,
    protection of incumbents, and interference standards; and other
    regulatory issues such as permitted uses, license term, renewal
    criteria, performance requirements, and, assignment and transfer
    (including disaggregation and partitioning).[^113] It does not serve
    the public interest to silence debate on these issues by considering
    only those proposals presented in license applications filed
    pursuant to our general statutory authority. Rather, giving all
    interested parties the opportunity to comment on these types of
    important issues in a rulemaking proceeding -- rather than an *ad
    hoc* adjudicatory proceeding as proposed by M2Z -- is the most
    effective, fairest and efficient way to arrive at a result that will
    best serve the public interest.[^114] Moreover, as detailed
    above,[^115] we find that other flaws in the M2Z and NetfreeUS
    proposals render their proposals contrary to the public interest,
    and accordingly denied their petitions for forbearance.

30. Although we find the other applications are acceptable for
    filing,[^116] we conclude that processing the applications before us
    without considering and adopting service and licensing rules would
    be inconsistent with the principles cited above and therefore
    contrary to the public interest. Accordingly, we are dismissing each
    application, including M2Z's application, in view of our plan to
    issue a Notice of Proposed Rule Making to consider service rules,
    including how best to assign licenses for this band.[^117]
    Similarly, because we are dismissing all applications for the
    2155-2175 MHz band, all related petitions to deny are now moot. To
    the extent that parties believe that any of the proposals or
    conditions set forth in the applications should be considered as
    service rules for this band, however, they may propose such rules in
    response to the Notice of Proposed Rule Making.

31. Further, while we are not convinced by M2Z's argument in its
    Opposition and Motion to Strike and Dismiss that the alternative
    proposals are veiled petitions to deny, we need not decide that
    issue here. Because we are dismissing all applications for the
    2155-2175 MHz band and, as a result, are dismissing all petitions to
    deny as moot, we need not address the merits of M2Z's claims. As to
    the failure of process argument, however, we note that M2Z had
    actual notice of the other applications as evidenced by its response
    to these applications in its filings and therefore we see no
    evidence that M2Z was harmed by the alleged failure to receive
    proper service.

# Conclusion

32. Therefore, we deny M2Z's and NetfreeUS's petitions for forbearance
    because we find it is not in the public interest to grant them for
    the reasons outlined above. Further, because we plan to issue a
    Notice of Proposed Rule Making to seek comment on service rules for
    the AWS-3 band, we dismiss all applications to provide service in
    the 2155-2175 MHz band, without prejudice, and dismiss as moot all
    related petitions to deny and subsequent motions filed in WT Dockets
    07-16 and 07-30.

# Ordering Clauses

33. Accordingly, IT IS ORDERED that the Petition for Forbearance Under
    47 U.S.C. § 160, filed by M2Z Networks, Inc., on September 1, 2006,
    is DENIED.

34. IT IS FURTHER ORDERED that the Petition for Forbearance Under 47
    U.S.C. § 160 filed by NetfreeUS, LLC, on March 2, 2007, is DENIED.

35. IT IS FURTHER ORDERED that the Petition for Reconsideration filed by
    McElroy Electronics Corp., on March 30, 2007, is DISMISSED AS MOOT.

36. IT IS FURTHER ORDERED that the applications for license and
    authority to operate in the 2155-2175 MHz band filed by M2Z
    Networks, Inc., on May 5, 2006, and by Commnet Wireless, LLC,
    McElroy Electronics Corp.; NetfreeUS, LLC; NextWave Broadband, Inc.;
    and Open Range Communications, Inc., each on March 2, 2007, and by
    TowerStream Corporation on March 15, 2007, ARE DISMISSED without
    prejudice.

37. IT IS FURTHER ORDERED that the Petitions to Deny filed by AT&T,
    CTIA, Motorola, Nextwave, T-Mobile, Verizon, and WCA, on March 2,
    2007, and the Petitions to Deny filed by Rural Carriers and
    TowerStream on March 15, and March 16, 2007, respectively, as well
    as subsequent motions filed in WT Dockets 07-16 and 07-30, are
    DISMISSED AS MOOT.

> Federal Communications Commission
>
> Marlene H. Dortch
>
> Secretary

**STATEMENT OF**

**CHAIRMAN KEVIN J. MARTIN**

> *Re:* *Applications for License and Authority to Operate in the
> 2155-2175 MHz Band, WT Docket No. 07-16; Petitions for Forbearance
> Under 47 U.S.C. § 160; WT Docket No. 07-30*
>
> Promoting broadband deployment and increasing penetration has been,
> and continues to be, one of my highest priorities. This spectrum has
> the potential to encourage the provision of a variety of broadband
> services and by a variety of different competitors in support of this
> goal. As several commenters have urged in recent days, the public
> interest is best served by considering fully the best use of this
> spectrum in a Notice of Proposed Rulemaking, rather than through
> forbearance petitions seeking exclusive use for a single entity filed
> by M2Z and NetfreeUS. The Commission received multiple proposals for
> innovative use of this spectrum apart from those proposed by M2Z and
> NetfreeUS, and they deserve due consideration as well. For example,
> many have suggested that we should auction this spectrum, while still
> others suggest that due to the high demand for this spectrum we should
> consider unlicensed use of the band. Each of these proposals has
> merit, and consideration of either would be inappropriately foreclosed
> by granting forbearance in this instance. We plan to issue this Notice
> of Proposed Rulemaking shortly to address these issues and adopt
> flexible rules that will encourage the innovative use of this unique
> piece of spectrum.

**STATEMENT OF\
COMMISSIONER MICHAEL J. COPPS**

> *Re: Applications for License and Authority to Operate in the
> 2155-2175 MHz Band; Petitions for Forbearance Under 47 U.S.C. § 160,*
> Order
>
> I support today's *Order* denying the application and petition for
> forbearance seeking a direct grant of the AWS-3 spectrum. I believe
> that the proper way to allocate this spectrum---in the manner that
> best serves the public interest---is to conduct a general rulemaking,
> which the Commission will initiate shortly. Such a rulemaking should
> consider the following options: (1) opening this band to unlicensed
> use, as has proved so productive in other bands; (2) designating it
> for an open access model that would combine wholesale broadband access
> and a *Carterfone* mandate; (3) using it to provide free,
> advertiser-supported broadband service (as initially proposed by M2Z
> and one other applicant) as well as a fee-based premium broadband
> service; or (4) allocating it through a traditional, largely
> unconditioned auction.
>
> Conducting this inquiry in the context of a general rulemaking will
> provide the broadest opportunity for interested parties from industry
> and the public interest community---as well as members of the
> public---to weigh in on these important choices. I look forward to
> working with my colleagues to make sure that we can complete this
> rulemaking in an expeditious fashion.
>
> I am also mindful of the issues raised in this proceeding by Section 7
> of the Communications Act, which requires the Commission to act within
> one year on petitions for a new service or technology. While I have
> serious doubts that a direct grant of a license for a valuable portion
> of the people's airwaves is what Congress meant by the phrase "new
> technology or service," I certainly agree that the Commission must act
> quickly on all matters brought before it---that is why I have
> consistently encouraged the Commission to put innovative proposals out
> for comment. Indeed, I am a firm believer that the public interest
> requires regulators to allow companies to bring new and valuable
> products to market as soon as possible. While today's
> decision---rendered one year after the Section 7 claim was first
> raised in this proceeding---complies with the plain language of the
> statute, I believe it has been clear for some time that opening a
> general rulemaking is the right procedural path to allocating this
> spectrum band. Nevertheless, even if the decision we announce today
> comes considerably later than I would have preferred, I fully support
> this item as well as the NPRM we will release shortly.

**CONCURRING STATEMENT OF**

**COMMISSIONER JONATHAN ADELSTEIN**

> *Re: Applications for License and Authority to Operate in the
> 2155-2175 MHz Band; Petitions for Forbearance Under 47 U.S.C. § 160,
> WT Docket Nos. 07-16, 07-30.*

> There has continued to be keen interest over the past years in the
> 2155-2175 MHz band which holds great promise for operators to
> introduce new offerings of innovative wireless broadband services to
> American consumers. This spectrum has inexcusably remained fallow
> since the Commission first determined that it was ideally suited for
> fixed and mobile services, including advanced wireless systems. It
> continues to be critical that we make vibrant, spectrum-based
> communications opportunities available to more consumers and
> companies. We need to promote opportunities to expand wireless
> connectivity, and move faster to ensure available and desired spectrum
> is put to its highest valued use.
>
> So I'm disappointed that despite the aggressive interest in and
> availability of this spectrum, the Commission is only now expressing
> its intent to seek comment on service rules for this band. I am also
> concerned that we have not considered more seriously M2Z's proposal as
> offering a new technology or service under Section 7 of the
> Communications Act. The directive under Section 7 is clear. That is --
> the Commission should be encouraging the development of new
> technologies and services for the benefit of consumers. Our job at the
> FCC is to do whatever we can to promote spectrum-based opportunities
> and I am not convinced that we have done so adequately here. We must
> continually evaluate whether our actions, or lack of action, undercut
> the ability of wireless innovators to get access to new or unused
> spectrum.
>
> And while I am pleased that this Commission has indicated that it will
> finally move forward with plans to put into place a mechanism for
> allocating the spectrum and requirements for offering service in the
> 2155-2175 band, I urge my colleagues not to wait for months until we
> issue an order allowing for the innovative use of this spectrum. The
> Commission has already accumulated a substantial record in this
> proceeding on the best uses of this spectrum. It is high time for the
> Commission to seek comment on these issues and it is regrettable that
> we have not already done so. I encourage the Commission to move
> expeditiously to issue a Notice on the services rules in the band. We
> simply cannot afford to waste any more time. For all of these reasons,
> I must concur in this item.

[^1]: Advanced Wireless Services is the collective term we use for new
    and innovative fixed and mobile terrestrial wireless applications
    using bandwidth that is sufficient for the provision of a variety of
    applications, including those using voice and data (such as Internet
    browsing, message services, and full-motion video) content. Although
    AWS is commonly associated with so-called third generation (3G)
    applications and has been predicted to build on the successes of
    such current-generation commercial wireless services as cellular
    services and Broadband Personal Communications Services (PCS), the
    services ultimately provided by AWS licensees are limited only by
    the fixed and mobile designation of the spectrum that we allocate
    for AWS and the service rules that we ultimately adopt for the
    bands. With regard to the 20-megahertz block at 2155-2175 MHz, the
    2160-2165 MHz band was already allocated for non-Federal Government
    fixed services and mobile services. *See* 47 C.F.R. Parts 21, 22,
    and 101. In the *AWS Allocation Third Report and Order*, the
    2165-2180 MHz band was reallocated for fixed and mobile services,
    including AWS. *See* Amendment of Part 2 of the Commission\'s Rules
    to Allocate Spectrum Below 3 GHz for Mobile and Fixed Services to
    Support the Introduction of New Advanced Wireless Services,
    including Third Generation Wireless Systems, ET Docket No. 00-258,
    *Third Report and Order, Third Notice of Proposed Rulemaking and
    Second Memorandum Opinion and Order,* 18 FCC Rcd 2223, 2238 ¶ 28
    (2002) (*AWS* *Allocation* *Third Report and Order & NPRM*). In the
    *AWS Allocation Eighth Report and Order*, the Commission allocated
    2155-2160 MHz for fixed and mobile services, including AWS, and
    designated the entire 2155-2175 MHz band as AWS spectrum. *See AWS
    Allocation Eighth Report and Order*, 20 FCC Rcd at 15872 ¶ 9.

[^2]: *See* Application of M2Z Networks, Inc. for License and Authority
    to Provide a National Broadband Radio Service in the 2155-2175 MHz
    Band (filed May 5, 2006) (M2Z Application). On September 1, 2006,
    M2Z amended the Application to incorporate by reference a separately
    filed forbearance petition. *See* Letter from W. Kenneth Ferree,
    Esq., to Marlene Dortch, Secretary, FCC (Amendment to Pending
    Application, filed Sept. 1, 2006). *See also infra* note Error:
    Reference source not found; Wireless Telecommunications Bureau Sets
    Pleading Cycle for Application by M2Z Networks, Inc. to be Licensed
    in the 2155-2175 MHz Band, WT Docket No. 07-16, *Public Notice*, 22
    FCC Rcd 4442 (2007) (*PN Setting Pleading Cycle on M2Z
    Application*).

[^3]: M2Z proposes as a license condition that it "may make available
    'Premium Service' on a subscription basis, in which event it shall
    pay to the U.S. Treasury, on an annual basis, a voluntary usage fee
    of 5% of the gross revenues derived from such Premium Service."
    *See* M2Z Application at Appendix 2, Section 10(c).

[^4]: *See* 47 U.S.C. § 160(c); 47 C.F.R. § 1.53.

[^5]: *See* Petition of M2Z Networks, Inc. for Forbearance under 47
    U.S.C. § 160(c) Concerning Application of Sections 1.945(b) and (c)
    of the Commission's Rules and Other Regulatory and Statutory
    Provisions, filed Sept. 1, 2006 (M2Z Petition); On February 16,
    2007, the Bureau invited public comment on the M2Z Petition. *See*
    Pleading Cycle Established for Comments on Petition of M2Z Networks,
    Inc. for Forbearance under 47 U.S.C. § 160(c) to Permit Acceptance
    and Grant of Its Application for a License to Provide Radio Service
    in the 2155-2175 MHz Band, WT Docket No. 07-30, *Public Notice*, 22
    FCC Rcd. 3351 (2007). As set forth in the February 16, 2007, Public
    Notice, given the issuance of the *PN Setting Pleading Cycle on M2Z
    Application*, to the extent that M2Z has asked for forbearance to
    accept its application for filing, that portion of the Forbearance
    Petition is moot. *See id.*

[^6]: Petition for Forbearance under 47 U.S.C. § 160(c) Concerning
    Application of Sections 1.945(b) and (c) of the Commission's Rules
    and Other Regulatory and Statutory Provisions, filed by NetfreeUS,
    LLC, on March 2, 2007 (NetfreeUS Petition).

[^7]: 47 U.S.C. § 309(a).

[^8]: *See* 47 U.S.C. § 160(a)(3).

[^9]: M2Z Petition at 16 *citing* 47 U.S.C. § 157(b).

[^10]: M2Z Petition at 16 n.55 (quoting Promoting Efficient Use of
    Spectrum Through Elimination of Barriers to the Development of
    Secondary Markets, *Report and Order and Further Notice of Proposed
    Rulemaking*, 18 FCC Rcd 20604, ¶ 57 (2003), and citing Application
    of Hye Crest Management, Inc. for License Authorization in the
    Point-to-Point Microwave Radio Service in the 27.5 to 29.5 GHz Band
    and Request for Waiver of the Rules, *Memorandum Opinion and Order*,
    6 FCC Rcd 332, ¶ 28 (1991), which granted an exclusive license for
    1,000 megahertz of underutilized spectrum in the 28 GHz band for an
    innovative video distribution service comprised of multiple low
    power transmitters because the proposed service was "imaginative,
    technically feasible, and consistent with the statutory mandate of
    Section 7 of the Communications Act, which charges the Commission to
    encourage the provision of new technologies and service to the
    public"). *See also* NetfreeUS Petition at 15 (noting that Hye Crest
    Management was a predecessor-in-interest to Speedus Corp., which
    owns NetfreeUS).

[^11]: 47 C.F.R. § 1.945(b).

[^12]: *See* 47 C.F.R. § 1.945(c).

[^13]: *See* M2Z Petition at 21-24.

[^14]: *See* 47 U.S.C. § 160(b) (quoted in paragraph B, *infra*).

[^15]: *See* M2Z Petition at 24-32 (claiming that forbearance will
    promote competitive entry into multiple product markets, that a free
    service will promote service and price competition, and that
    forbearance will speed M2Z's delivery of the many public interest
    benefits of its proposal).

[^16]: *Id.*

[^17]: *See* NetfreeUS Petition at 5-17. *See also* NetfreeUS Reply to
    M2Z Consolidated Opposition to Petitions to Deny at 6-8.

[^18]: NetfreeUS Petition at 11.

[^19]: NetfreeUS Reply to M2Z Consolidated Opposition to Petitions to
    Deny at 17.

[^20]: *Id.* at 18-20.

[^21]: *See, e.g.,* AT&T Comments in Opposition to M2Z Petition for
    Forbearance, WT Docket No. 07-30 (filed March 2, 2007); CTIA
    Opposition to M2Z Petition for Forbearance, WT Docket No. 07-30
    (filed March 19, 2007); NATOA Comments on M2Z Application and
    Petition for Forbearance, WT Docket No. 07-30 (filed March 19,
    2007); NASUCA Comments on M2Z Application and Petition for
    Forbearance, WT Docket No. 07-30 (filed March 19, 2007); and WCA
    Opposition to M2Z Petition for Forbearance, WT Docket No. 07-30
    (filed March 19, 2007). *See also* MetroPCS Reply to M2Z
    Consolidated Opposition to Petitions to Deny at 11-14; Verizon
    Wireless Reply to M2Z Consolidated Opposition to Petitions to Deny
    at 2-5. Some reply commenters challenge M2Z's assertion that it
    proposes a new service using new technology under Section 7 of the
    Act. *See, e.g.,* CTIA Reply to M2Z Consolidated Opposition to
    Petitions to Deny at 12-15; Verizon Wireless Reply to M2Z
    Consolidated Opposition to Petitions to Deny at 4-5.

[^22]: *See* M2Z Comments (filed March 19, 2007); M2Z Consolidated
    Opposition to Petitions to Deny (filed March 29, 2007) (M2Z
    Consolidated Opposition to Petitions to Deny); M2Z Consolidated
    Motion to Strike and Dismiss Petitions to Deny and Alternative
    Proposals (filed March 29, 2007); Supplement to M2Z Consolidated
    Opposition to Petitions to Deny (filed March 28, 2007); M2Z
    Consolidated Motion to Dismiss Alternative Proposals (filed March
    29, 2007).

[^23]: *See* M2Z Comments at 3-7. *See also* M2Z April 3, 2007 Reply
    Comments. M2Z also asserts that its forbearance petition is not
    rendered moot by the existence of alternative proposals. *Id.* at
    13-16.

[^24]: *See* M2Z Comments at 12.

[^25]: *See* M2Z Comments at 12.

[^26]: 47 U.S.C. § 160(a).

[^27]: 47 U.S.C. § 160(b).

[^28]: *Id.*

[^29]: 47 U.S.C. § 160(c).

[^30]: In addition, we note that even if we granted the petitions for
    forbearance, this would not result in an automatic grant of the
    license. Indeed, all M2Z and NetfreeUS are seeking is relief from
    imposition of certain Commission rules relating to how and when the
    Commission could consider their applications for license in the
    2155-2175 MHz band.

[^31]: *See* 47 C.F.R. § 1.945(b)-(c). M2Z argues that compiling a
    complete public record would enable incumbent broadband providers to
    propose "the adoption of technical standards and service rules that
    fit their own business plans while creating barriers to truly new
    potential market entrants." M2Z Petition at 29. We believe the
    public interest would be better served if the Commission received
    the considered views of all interested parties, including incumbent
    providers. Once we have a complete public record, we can make a
    determination about the technical standards and service rules that
    best serve the public interest and do not unduly impede competitive
    entry into the broadband market.

[^32]: M2Z Petition at 33-34 (to the extent necessary, M2Z asks for
    forbearance from Section 309(j)(1) of the Act, which requires the
    Commission to grant mutually exclusive applications through a system
    of competitive bidding). *See also* NetfreeUS Petition at 12-13
    (similarly seeking forbearance from Section 309(j)(1), asserting
    that NetfreeUS's proposal is consistent with 309(j)(3)(c) because it
    provides a revenue stream to the U.S. government).

[^33]: M2Z Petition at 1.

[^34]: *See* 47 U.S.C. § 160(a)(3). We observe that the grant of any of
    the pending applications, by cutting off consideration of a
    competitive bidding licensing framework and precluding consideration
    of other potential applicants for this spectrum, would appear to
    compromise the development of competitive market conditions. Because
    M2Z and NetfreeUS fail the third prong of the forbearance test, we
    need not consider the first two prongs. *See CTIA v. FCC*, 330 F.3d
    502, 509 (D.C. Cir. 2003). That said, compromising the development
    of competitive market conditions would have adverse effects on the
    matters covered by the first two prongs of the forbearance test --
    ensuring that a carrier's rates and practices are just, reasonable,
    and nondiscriminatory, and the protection of consumers.

[^35]: *See* para. 29, *infra*.

[^36]: *See, e.g.,* Amendment of the Commission's Rules Regarding
    Multiple Address Systems, WT Docket No. 97-81, *Report and Order*,
    15 FCC Rcd. 11956, 11974 ¶ 47 (2000) (concluding that geographic
    area licensing of the 928.85-929 MHz and 959.85-960 MHz bands would
    encourage efficient spectrum use, expeditious licensing, and the
    rapid delivery of new technologies to the public); Amendment of the
    Commission\'s Rules Regarding the 37.0-38.6 GHz and 38.6-40.0 GHz
    Bands, ET Docket No. 95-183, *Report and Order and Second Notice of
    Further Rule Making*, 12 FCC Rcd 18600, 18647 ¶ 101 (1997)
    (predetermined service areas provide a more orderly structure for
    the licensing process and foster efficient utilization of the
    spectrum in an expeditious manner). *See also* Revision of Part 22
    and Part 90 of the Commission's Rules to Facilitate Future
    Development of Paging Systems, WT Docket No. 96‑18, *Second Report
    and Order and Further Notice of Proposed Rulemaking*, 12 FCC Rcd
    2732, 2744 ¶ 15 (1997); Amendment of Part 90 of the Commission's
    Rules to Facilitate Future Development of SMR Systems in the 800 MHz
    Frequency Band, PR Docket No. 93-144, *Second Report and Order*, 12
    FCC Rcd 19079, 19087 ¶ 10 (1997); Implementation of Section 309(j)
    of the Communications Act -- Competitive Bidding*,* PP Docket No.
    93-253, *Third Report and Order*, 9 FCC Rcd 2941, 2944 ¶ 6 (1994)
    (Narrowband Personal Communications Services). *See generally*
    Implementation of Section 309(j) of the Communications Act --
    Competitive Bidding, PP Docket No. 93-253, *Second Report and
    Order*, 9 FCC Rcd 2348, 2350 ¶¶ 4-5 (1994) (competitive bidding
    should place licenses in the hands of the parties able to use them
    most efficiently).

[^37]: *See also* H.R. Rep. No. 103-111, 103^rd^ Cong., 1^st^ Sess. , at
    253 (1993) (stating, in findings in support of legislation that
    first authorized the Commission to license spectrum through a
    competitive bidding process, that "a carefully designed system to
    obtain competitive bids from competing qualified applicants can
    speed delivery of services, promote efficient and intensive use of
    the electromagnetic spectrum, prevent unjust enrichment, and produce
    revenues to compensate the public for the use of the airwaves").
    Moreover, we note that in withdrawing the Commission's authority to
    award "pioneer preferences" to license applicants, Congress has also
    recognized a license applicant's "significant contributions to the
    development of a new service or to the development of new
    technologies that substantially enhance an existing service," are an
    insufficient public interest basis upon which to bypass the auctions
    process and thereby forego the public interest benefits of
    recovering for the public a portion of the value of the spectrum and
    of avoiding the unjust enrichment of the commercial users of that
    spectrum. 47 U.S.C. § 309(j)(13)(F) (withdrawing Commission
    authority "to provide preferential treatment in licensing procedures
    (by precluding the filing of mutually exclusive applications) to
    persons who make \[such\] significant contributions"); *see also*
    H.R. Rep. 103-826(II), 103^rd^ Cong., 2d Sess., at 8-9 (1994)
    (explaining that legislation altering Commission's authority to
    award free licenses to holders of pioneer preferences was designed
    to ensure that such licensees "pay an equitable amount for use of
    their spectrum"); *Qualcomm Inc. v. FCC*, 181 F. 3d 1370, 1380-81
    (D.C. Cir. 1999) (stating that "\[w\]hen Congress in 1994 set the
    date for withdrawal of the FCC's authority to grant new pioneer's
    preferences, its focus was on increasing federal revenues \[by
    requiring the FCC to recover for the public a portion of the value
    of the spectrum from pioneers\] and not upsetting settled
    expectations \[by making provision for pending cases\]); 47 U.S.C. §
    309(j)(3)(C) (listing, among the objectives that the Commission is
    required to promote in implementing its auctions mandate, the
    "recovery for the public of a portion of the value of the public
    spectrum resource made available for commercial use and avoidance of
    unjust enrichment through the methods employed to award uses of that
    resource"). In sum, it appears that Congress's public interest
    assessment of the Commission's pioneer preference program (*i.e.*,
    the assessment that the public interest is not served by granting a
    free license to an applicant on the basis of that applicant's
    significant contributions to the development of a new service or
    technology) casts substantial doubt on M2Z's contention that the
    public interest would be best served by granting it a free,
    nationwide license on the strength of the purported significance of
    the service that it proposes to provide.

[^38]: M2Z Petition at 16-18. Section 7(a) provides that "\[i\]t shall
    be the policy of the United States to encourage the provision of new
    technologies and services to the public.  Any person or party (other
    than the Commission) who opposes a new technology or service
    proposed to be permitted under this chapter shall have the burden to
    demonstrate that such proposal is inconsistent with the public
    interest." 47 U.S.C. § 157(a).

[^39]: M2Z Consolidated Opposition to Petitions to Deny at 23-27. *See
    also* M2Z April 16, 2007 *Ex Parte* Response at 18-23 (stating that
    M2Z's application is subject to Section 7 of the Act because the
    proposal constitutes a "new technology or service" that is
    distinguishable from the broadband services currently being
    offered). Section 7(b) provides that "\[t\]he Commission shall
    determine whether any new technology or service proposed in a
    petition of application is in the public interest within one year
    after such petition or application is filed." 47 U.S.C. § 157(b).

[^40]: *See* NetfreeUS Reply to M2Z Consolidated Opposition to Petitions
    to Deny at 3-4 ("Service providers are offering wireless broadband
    services through licensed spectrum using \[OFDMA\] technology - for
    example, operators in the Wireless Communications Service, the
    Educational Broadband Service and the Broadband Radio Service are
    providing these services today. Moreover, these services use many
    new technologies. . . . and . . . providers . . . already are
    providing service using technologies such as WiMax, OFDM and TDD,
    the same technologies M2Z characterizes as novel. To the extent that
    M2Z proposes technology that is already deployed elsewhere or is
    merely a variation of deployed technologies, M2Z does not propose a
    \"new\" technology for purposes of Section 7(b) . . . and the
    Commission is not compelled to render a decision on the M2Z
    Application \[within one year\]."); CTIA Reply to M2Z Consolidated
    Opposition to Petitions to Deny at 13 ("M2Z's proposed service and
    technology are clearly not new or novel in any way, and certainly do
    not ride to the level of new services and technologies contemplated
    by Section 7."). *See also* Verizon Wireless Reply to M2Z
    Consolidated Opposition to Petitions to Deny at 4-5.

[^41]: M2Z Application at 13-15.

[^42]: For example, mobile wireless carriers Verizon Wireless, Sprint
    Nextel, and Cingular are currently offering wireless broadband
    internet access services across the United States using network
    technologies such as CDMA 1xEV-DO and WCDMA/HSDPA and licensed
    Cellular and Broadband PCS spectrum. Implementation of Section
    6002(b) of the Omnibus Budget Reconciliation Act of 1993, Annual
    Report and Analysis of Competitive Market Conditions With Respect to
    Commercial Mobile Services, *Eleventh Report*, 21 FCC Rcd 10947,
    ¶¶ 110-113 (2006) (*11^th^ CMRS Report*). In addition, Clearwire is
    using licensed spectrum in the 2.5 GHz BRS/EBS band to provide
    portable wireless broadband Internet access services in 36 U.S.
    markets. *Id.*, at ¶ 30; *Clearwire Launches Wireless High-Speed
    Internet Service in Yakima,* News Release, Clearwire, Mar. 27, 2007.
    Thousands of small wireless Internet service providers (WISPs) use
    802.11 Wi-Fi equipment that operates in the unlicensed spectrum
    bands to provide fixed, line-of-sight wireless broadband services,
    often in rural areas where landline broadband services are
    unavailable. Wireless Broadband Access Task Force Report, GN Docket
    No. 04-163, at 31-32 (Feb. 2005)

[^43]: *See, e.g.*, M2Z Application at 14 (while AAS technology is
    advanced, it is at the same time neither untested nor unfamiliar to
    industry experts \[and is\] based on optional modes that are
    compatible with the 802.16e standard, often referred to as
    Wi-Max."); *id*. at 21 ("\[t\]he Commission has already approved the
    operation of TDD and FDD in close spectral proximity"); M2Z
    Consolidated Opposition to Petitions to Deny at 70 ("M2Z's proposal
    is *pioneering* in economic terms, but the Application seeks no
    preferential treatment on the basis of the technology that M2Z
    proposes to deploy.")

[^44]: *See* M2Z Application at 22-23 (citing Commission's 2004
    definition of "high speed" and "broadband" services as those
    providing transmission rates greater than 200 kbps in at least one
    direction; Local Telephone Competition and Broadband Reporting*,
    Report and Order*, 19 FCC Rcd 22340 (2004)).

[^45]: *See* M2Z Petition at 17 (also citing note to Section 7, added by
    Section 706 of the Telecommunications Act of 1996, § 706, Pub. L.
    No. 104-104, codified at 47 U.S.C. § 157 nt).

[^46]: Indeed, M2Z also acknowledges that actual deployed speeds for its
    proposed network may be below the promised 384 kbps downstream, but
    urges the Commission to nevertheless grant its application because
    its proposed speeds are in excess of dial-up services. *See, e.g.,*
    M2Z Consolidated Opposition to Petitions to Deny at 100 (stating
    that regardless of the "actual rates" provided by M2Z, the
    Commission should "take comfort in the fact" that the speeds
    proposed would be more than what dial-up currently provides).

[^47]: *See* Development of Nationwide Broadband Data to Evaluate
    Reasonable and Timely Deployment of Advanced Services to All
    Americans, Improvement of Wireless Broadband Subscribership Data,
    and Development of Data on Interconnected Voice over Internet
    Protocol (VoIP) Subscribership, *Notice of Proposed Rulemaking*, 22
    FCC Rcd 7760, 7769-70 (2007) (asking, *inter alia,* whether to
    modify the broadband service speed information collected by the
    Commission to reflect the increased transmission speeds resulting
    from technological developments).

[^48]: *See, e.g.,* Southwestern Bell Telephone Company Revisions to
    Tariff F.C.C. No. 6, FCC 91-173, *Memorandum Opinion and Order*, 6
    FCC Rcd 3760 (1991) (finding that a service proposed by US West in
    its tariff "new technology or service" and cannot be interpreted to
    endorse methods for the provision of existing services at alternate
    locations, or the continued use of older, outmoded technologies).
    For example, Clearwire offers wireless broadband Internet access
    services in the United States using OFDM and TDD technologies, and
    spectrum in the 2.5 GHz BRS/EBS spectrum band. *11^th^ CMRS Report*,
    21 FCC Rcd 10947 at ¶ 119. *See also* Intelligent Antenna Solution
    Unveiled by Alcatel-Lucent, TelecomWorldWire (March 28, 2007)
    (reporting that Alcatel-Lucent has announced the availability of its
    intelligent, beamforming antenna, which transmits dedicated beams to
    each active user, which follows them as they move through the base
    station's coverage area, making more efficient use of spectrum and
    reducing interference, resulting in capacity gains).

[^49]: *See* M2Z Application at Appendix 2 at 2.

[^50]: *See, e.g.,* 47 C.F.R. § 27.14(e)(1) (Broadband Radio Service
    (BRS) construction requirements and safe harbors); Service Rules for
    the 698-746, 747-762 and 777-792 MHz Bands, WT Docket No. 06-150,
    Revision of the Commission's Rules to Ensure Compatibility with
    Enhanced 911 Emergency Calling Systems, CC Docket No. 94-102,
    Section 68.4(a) of the Commission's Rules Governing Hearing
    Aid-Compatible Telephones, WT Docket No. 01-309, Biennial Regulatory
    Review -- Amendment of Parts 1, 22, 24, 27, and 90 to Streamline and
    Harmonize Various Rules Affecting Wireless Radio Services, WT Docket
    03-264, Former Nextel Communications, Inc. Upper 700 MHz Guard Band
    Licenses and Revisions to Part 27 of the Commission's Rules, WT
    Docket No. 06-169, Implementing a Nationwide, Broadband,
    Interoperable Public Safety Network in the 700 MHz Band, PS Docket
    No. 06-229, Development of Operational, Technical and Spectrum
    Requirements for Meeting Federal, State and Local Public Safety
    Communications Requirements Through the Year 2010, WT Docket No.
    96-86, *Second Report and Order*, FCC 07-132 at paras. 153-177
    (2007) (*700 MHz Second Report and Order*) (adopting performance
    requirements applicable to 700 MHz Band licenses).

[^51]: *See* M2Z Application, Appendix 2 at 2.

[^52]: *See 700 MHz Second Report and Order* at paras. 153-177. In
    particular, we note that M2Z's proposal that we measure its
    population coverage "by counties" does not specify what level of
    coverage, either on a geographic or population basis, would result
    in a particular county being included for purposes of meeting its
    proposed benchmark. Further, M2Z acknowledges that measurement "by
    counties" would not result in coverage of 95% of the population.
    Rather, it could result in service to "as much as 95%" of the
    population, but no penalty would result in failing actually to serve
    this number. *See, e.g.*, M2Z Consolidated Opposition to Petitions
    to Deny at 102. In contrast, in our recent *700 MHz Second Report
    and Order* we imposed strict and specific geographic and
    population-based benchmarks -- the most stringent ever imposed by
    the Commission -- designed to encourage prompt deployment of
    services. These benchmarks included specified levels of service
    (either to 70% of the geography or 75% of the population, depending
    on the block) and a keep-what-you-use provision for those areas that
    a licensee fails to build out. *700 MHz Second Report and Order* at
    paras. 153-177.

[^53]: For these reasons, we also conclude that grant of the forbearance
    petition and application would not be consistent with the goals set
    forth in Section 706 of the Telecommunications Act of 1996.

[^54]: *See, e.g*., Commnet Application, Exhibit 2 at 1 (proposing to
    "construct a state-of-the art wireless broadband system utilizing
    \[OFDM\] Non-Line-of-Site WiMax technology ('802.26e') similar to
    that which already has been proven in the field \[by other
    companies\]."); TowerStream Application, Exhibit A at 1-2,
    (proposing to use TDD and AAS in the band); McElroy Electronics
    (MEC) Application, Exhibit 1 at 6-7 (proposing to use TDD, OFDMA,
    and AAS).

[^55]: 47 U.S.C. § 157(a). Section 7(a) states: "Any person or party
    (*other than the Commission*) who opposes a new technology or
    service proposed to be permitted under this Act shall have the
    burden to demonstrate that such proposal is inconsistent with the
    public interest." *Id*. (emphasis added).

[^56]: *See* 47 U.S.C. § 157(a) (providing, in pertinent part, "Any
    person or party . . . who opposes a new technology or service
    proposed to be permitted under this Act shall have the burden to
    demonstrate that such proposal is inconsistent with the public
    interest"). *See also* Application of Open Range Communications,
    Inc. for License to Construct and Operate Facilities for the
    Provision of Rural Broadband Radio Services in the 2155-2175 MHz
    Band (filed March 2, 2007); Application of NextWave Broadband Inc.
    for License and Authority to Provide Nationwide Broadband Service in
    the 2155-2175 MHz Band License (filed March 2, 2007); Application of
    Commnet Wireless, LLC for License and Authority to Construct and
    Operate a System to Provide Nationwide Broadband Radio Service in
    the 2155-2175 MHz Band (filed March 2, 2007); Application of
    NetfreeUS, LLC for License and Authority to Provide Wireless Public
    Broadband Service in the 2155-2175 MHz Band (filed March 2, 2007);
    Application of McElroy Electronics Corporation for a Nationwide
    2155-2175 MHz Band Authorization (filed March 2, 2007); and
    Application of TowerStream Corporation for a Nationwide 2155-2175
    MHz Band Authorization (filed March 15, 2007).

[^57]: *See* M2Z Petition at 16-18. Although M2Z asserts, in its April
    16, 2007 *Ex Parte* Response, that it first claimed its application
    was subject to Section 7 when it filed its September 1, 2006,
    Forbearance Petition (*see Ex Parte* Response at 23), in fact the
    Forbearance Petition does not expressly request Section 7 treatment
    for the application.

[^58]: *See* M2Z Consolidated Opposition to Petitions to Deny at 23-27.

[^59]: *Cf. In re Tennant*, 359 F.3d 523, 529 (D.C. Cir. 2004) (holding
    that the Commission was not required to act in response to a letter
    because, among other reasons, the letter did not specify "the
    statutory and/or regulatory provisions . . . on which a request for
    FCC review might have been based") (internal quotations omitted).

[^60]: *See* NetfreeUS Reply to M2Z Consolidated Opposition to Petitions
    to Deny at 2-6; CTIA Reply to M2Z Consolidated Opposition to
    Petitions to Deny at 12-15 (noting that the courts have
    characterized Section 7 as a "broad policy statement, rather than an
    affirmative obligation with which the Commission must comply").

[^61]: *See* para. 2 *supra*.

[^62]: M2Z states that its service will commence within 24 months of
    license grant. M2Z proposes that it "will have constructed
    sufficient base stations to provide service to: 33% of the U.S.
    population measured by counties within 3 years of license grant and
    commencement of operations; 66% of the U.S. population measured by
    counties within 5 years; and 95% of the U.S. population measured by
    counties in 10 years. M2Z Application at Appendix 2 at 2.

[^63]: M2Z Application at Appendix 2. *See also*, M2Z August 24, 2007 Ex
    Parte at Exhibit 1 ("M2Z's Commitment to Free and Wholesale Services
    Using An Open Device Platform") at 1-2 (M2Z "commit\[s\] to provide
    subscription based wholesale broadband services" and reaffirms that
    it will "publish and make openly available a certification process
    so that devices built to the M2Z standards will be able to register
    and interoperate on the M2Z network"); M2Z August 29, 2007 Ex Parte
    at 2-3 ("reiterate\[s\] \[M2Z's\] commitment to a meaningful,
    nondiscriminatory wholesale offering . . . and to operate the
    network on an 'open devices' platform.").

[^64]: *See* M2Z Application at 16.

[^65]: *See, e.g*., M2Z Application at 36, 38-39 *citing* 47 U.S.C. §
    309(j)(6)(E) (grant of competitive bidding authority does not
    \"relieve the Commission of the obligation in the public interest to
    continue to use engineering solutions, negotiation, threshold
    qualifications, service regulations, and other means in order to
    avoid mutual exclusivity in application and licensing"); Improving
    Public Safety Communications in the 800 MHz Band, *Report and
    Order*, 19 FCC Rcd 14969, 15013-15 ¶¶ 69, 71-74 (2004) (*Public
    Safety Order*); Flexibility for Delivery of Communications by Mobile
    Satellite Service Providers in the 2 GHz Band, the L Band, and the
    1.6/2.4 GHz Band, *Report and Order and Notice of Proposed
    Rulemaking*, 18 FCC Rcd 1962, 2071-72 ¶ 228 (2003) (*MSS/ATC
    Order*).

[^66]: *See* "Wireless Telecommunications Bureau Announces that M2Z
    Networks, Inc.'s Application for License and Authority to Provide a
    National Broadband Radio Service in the 2155-2175 MHz Band is
    Accepted for Filing," WT Docket No. 07-16, *Public Notice*, DA
    07-492 (rel. Jan. 31, 2007) (*M2Z Application* *Public Notice*).
    *See also* *PN Setting Pleading Cycle on M2Z Application,* 22 FCC
    Rcd 4442.

[^67]: *See id.* at 1.

[^68]: *Id.* at 2.

[^69]: TowerStream Application, Exhibit A at 1-2. TowerStream states
    that it supports licensing of the 2.1 GHz band in rural areas to
    rural operators. *Id*. at 3, n.2.

[^70]: Acknowledging that its proposal does not include a free basic
    service and has construction benchmarks set less aggressively than
    M2Z's, Commnet states that its thresholds are potentially achievable
    and are not being proffered with the intention of renegotiating with
    the Commission post-licensing. *See* Commnet Application, Exhibit 2
    at 2. *See also* TowerStream Application, Exhibit A at 8.

[^71]: MEC Application, Exhibit 1 at 5, *citing, e.g.,* Implementation
    of the Commercial Spectrum Enhancement Act and Modernization of the
    Commission's Competitive Bidding Rules and procedures, 20 FCC Rcd
    11268, 11287 (2005); TowerStream Application, Exhibit A at 3.

[^72]: *See* MEC Application, Exhibit 1 at 5.

[^73]: *See* NetfreeUS Application at 13.

[^74]: *Id.* at 5. NetfreeUS states that it would ensure that half of
    the nation's 734 cellular market areas had substantial service
    within four years, which would reach 75% within six years, and 95%
    within 10 years. *Id*. at 12.

[^75]: *Id.* at 7.

[^76]: NetfreeUS notes that the WPB network that it proposes would
    follow the "private commons" model (peer-to-peer, relatively
    low-power devices that form ad hoc, "mesh" communications between
    devices in a non-hierarchical network arrangement that does not
    utilize the network infrastructure of the licensee or spectrum
    lessee). *Id.* at 13-14 (*quoting* Promotion of Efficient Use of
    Spectrum Through Elimination of Barriers to the Development of
    Secondary Markets, *Second Report and Order, Order on
    Reconsideration and Second Further Notice of Proposed Rulemaking*,
    19 FCC Rcd 17503 (2004) at ¶¶ 91-92. *See also* 47 C.F.R. § 1.9080).

[^77]: *Id.* As an exception to this limit, NetfreeUS could operate more
    than 50 WAPs if necessary to facilitate compliance with construction
    milestones that would be conditions of the license. Also, public
    safety representatives would have a software code that would give
    them priority access during emergencies.

[^78]: Nextwave Application at 3-4 (*citing* 47 C.F.R. Part 90, Subpart
    Z, and Wireless Operations in the 3650-3700 MHz Band, ET Docket No.
    04-151, Rules for Wireless Broadband Services in the 3650-3700 MHz
    Band, WT Docket No. 05-96, *Report and Order and Memorandum Opinion
    and Order,* 20 FCC Rcd 6502 (2004)) (*recon. granted in part*,
    *Memorandum Opinion and Order*, FCC 07-99 (rel. June 7 2007).

[^79]: *See* Open Range Application at Annex A (lists the 553 rural
    communities that Open Range will serve through its initial build
    out), Annex B (lists the Commission-designated BTAs where those
    communities are located as well as additional rural areas of the
    United States that Open Range will serve following the initial build
    out) and Annex C (lists the Commission-designated BEAs where the
    communities in Annex A are located as well as additional rural areas
    of the United States that Open Range will serve following the
    initial build out). Open Range notes that it seeks licensed service
    areas consistent with the market designations that the Commission
    ultimately selects for this frequency band. *See* Open Range
    Application at 1, n.2.

[^80]: *See* Petitions to Deny filed by AT&T, CTIA; Motorola, Nextwave,
    T-Mobile, Verizon, and WCA. Rural Carriers and TowerStream also
    filed Petitions to Deny on March 15 and 16, 2007, respectively. *See
    also* NextWave Reply to M2Z Consolidated Opposition to Petitions to
    Deny at 3-8.

[^81]: *See, e.g.,* Motorola Petition to Deny at 2-3; CTIA Petition to
    Deny at 3-4, 6; AT&T Petition to Deny at 10-16. *See also* CTIA
    Reply to M2Z Consolidated Opposition to Petitions to Deny at 11-12;
    MetroPCS Reply to M2Z Consolidated Opposition to Petitions to Deny
    at 9; Verizon Wireless Reply to M2Z Consolidated Opposition to
    Petitions to Deny at 5-8.

[^82]: *See, e.g.,* AT&T Petition to Deny at 25-28; CTIA Petition to
    Deny at 6; Motorola Petition to Deny at 1; Rural Carriers Petition
    to Deny and Comments at 3-5; T-Mobile Petition to Deny at 2-3;
    TowerStream Petition to Deny at 3-5; WCA Petition to Deny at 7. *See
    also* CTIA Reply to M2Z Consolidated Opposition to Petitions to Deny
    at 3-8; MetroPCS Reply to M2Z Consolidated Opposition to Petitions
    to Deny at 3-9; Verizon Wireless Reply to M2Z Consolidated
    Opposition to Petitions to Deny at 2-5.

[^83]: *See, e.g.,* AT&T Petition to Deny at 4-9; CTIA Petition to Deny
    at 4-6; Rural Carriers Petition to Deny and Comments at 5-6;
    T-Mobile Petition to Deny at 3-5; TowerStream Petition to Deny at
    5-6; Verizon Petition to Deny at 2-6. *See also* CTIA Reply to M2Z
    Consolidated Opposition to Petitions to Deny at 3-8; MetroPCS Reply
    to M2Z Consolidated Opposition to Petitions to Deny at 3-9; NextWave
    Reply to M2Z Consolidated Opposition to Petitions to Deny at 8.

[^84]: *See, e.g.,* AT&T Petition to Deny at 4-9; CTIA Petition to Deny
    at 4-5; Rural Carriers Petition to Deny and Comments at 5-7;
    T-Mobile Petition to Deny at 3-5; TowerStream Petition to Deny at
    5-7; WCA Petition to Deny at 3-4.

[^85]: *See* M2Z Consolidated Opposition to Petitions to Deny;
    Consolidated Motion of M2Z Networks, Inc. to Dismiss Alternative
    Proposals; M2Z Networks, Inc. *Ex Parte* Response to Replies and
    Oppositions, WT Docket Nos. 07-16 and 07-30 (filed April 16, 2007)
    (M2Z April 16, 2007 *Ex Parte* Response); Letter from Christopher
    Tygh, Counsel for M2Z Networks, Inc., to Marlene H. Dortch,
    Secretary, FCC, WT Docket Nos. 07-16 and 07-30 (filed April 19,
    2007) (M2Z April 19, 2007 *Ex Parte*). M2Z asserts that, under the
    Act, the Commission must consider its forbearance petition before it
    can dismiss the Application. *See* M2Z Consolidated Opposition to
    Petitions to Deny at 27-31 (citing Section 10(a) of the
    Communications Act, 47 U.S.C. § 160(a)). *See also* M2Z April 3,
    2007 Reply at 17-31.

[^86]: *See* M2Z Opposition at 10-11. *See also id.* At 13-23 (asserting
    that grant of the application would benefit the public interest,
    consumers, public safety, and the federal treasury).

[^87]: See *id.* at 11-13. *See also id.* at 75-87 (stating that the
    Commission has the authority to grant M2Z a license without a formal
    rulemaking, and it should not delay deployment of services in the
    under-utilized band by conducting further proceedings). M2Z also
    argues that Section 7 of the Act compels the Commission to grant its
    Application because no party has rebutted its showing that the
    Application proposes a new service using new technology that would
    serve the public interest. *See id.* at 23-27 (citing Section 7(b)
    of the Communications Act, 47 U.S.C. § 157(b)).

[^88]: *See* M2Z Opposition at 31-53. M2Z cites other instances in which
    the Commission has granted initial spectrum authorizations without
    the use of competitive bidding. *See id.* at 54-60. *See also* M2Z
    April 16, 2007 *Ex Parte* Response at 5-14 (asserting that Section
    309(j)(6)(E) requires the Commission to grant M2Z's application due
    to the public interest benefits that would result).

[^89]: *See* M2Z Opposition at 64-69. M2Z also denies that its proposal
    seeks to revive the Pioneer's Preference Program, nor does it
    resemble the Commission's installment payment program. *See id.* at
    69-74.

[^90]: *See id.* at 87-99. *See also* M2Z April 16, 2007 *Ex Parte*
    Response at 23-27.

[^91]: *See* M2Z Opposition at 99-114. M2Z asserts that petitioners'
    arguments against its proposed voluntary spectrum usage fee are
    meritless, and the Commission's acceptance of the proposal would not
    violate the Act or other applicable laws or precedent. *See id.* at
    103-111. *See also* M2Z April 16, 2007 *Ex Parte* Response at 27-37.

[^92]: *See, e.g.,* CTIA Reply to M2Z Consolidated Opposition to
    Petitions to Deny (claiming, *inter alia,* that M2Z's public
    interest claims are based on flawed assumptions); MetroPCS Reply to
    M2Z Consolidated Opposition to Petitions to Deny (asserting that
    public safety would not be aided by M2Z's proposal); NextWave Reply
    to M2Z Consolidated Opposition to Petitions to Deny (noting
    anti-competitive nature of M2Z's proposal); Verizon Wireless Reply
    to M2Z Consolidated Opposition to Petitions to Deny (questioning,
    *inter alia,* M2Z's financial showing). *See also* Letter from
    Stephen E. Coran, Counsel to NetfreeUS, LLC, to Marlene H. Dortch,
    Secretary, FCC, in WT Docket Nos. 07-16 and 07-30 (filed May 9,
    2007) (commenting on M2Z April 16, 2007 *Ex Parte* Response and M2Z
    April 19, 2007 *Ex Parte*) (NetfreeUS May 9, 2007 *Ex Parte*); Reply
    to Motion to Strike and Motion to Dismiss filed by NextWave, WT
    Docket No. 07-16 (filed April 27, 2007) (NextWave Reply to Motion to
    Strike); Reply to Opposition to Petition for Reconsideration filed
    by MEC, WT Docket No. 07-16 (filed April 23, 2007) (MEC Reply to
    Opposition to Petition for Reconsideration).

[^93]: *See* Request for Confidential Treatment filed March 26, 2007
    (uploaded to ECFS on May 8, 2007) and Request for Confidential
    Treatment filed June 4, 2007 (Confidentiality Requests). On June 20,
    2007, AT&T filed a Response to the Confidentiality Requests, to
    which M2Z filed a Motion to Strike on July 16, 2007; AT&T's
    Opposition to Motion to Strike followed on July 16, 2007. *See also*
    Freedom of Information Act Request of NetfreeUS (FOIA Control No.
    2007-258) and Freedom of Information Act Request of AT&T, Inc. (FOIA
    Control No. 2007-414).

[^94]: *See, e.g*., Letter from Uzoma C. Onyeije, Esq., to Marlene H.
    Dortch, Secretary, FCC, WT Docket Nos. 07-16 and 07-30 (filed July
    19, 2007).

[^95]: M2Z Motion to Dismiss at 2-3. M2Z seeks dismissal of the
    following applications filed in Docket 07-16: Application of Open
    Range Communications, Inc. for License to Construct and Operate
    Facilities for the Provision of Rural Broadband Radio Services in
    the 2155-2175 MHz Band (filed March 2, 2007) ("Open Range
    Proposal"); Application of NextWave Broadband Inc. for License and
    Authority to Provide Nationwide Broadband Service in the 2155-2175
    MHz Band License (filed March 2, 2007) ("NextWave Proposal");
    Application of Commnet Wireless, LLC for License and Authority to
    Construct and Operate a System to Provide Nationwide Broadband Radio
    Service in the 2155-2175 MHz Band (filed March 2, 2007) ("Commnet
    Proposal"); Application of NetfreeUS, LLC for License and Authority
    to Provide Wireless Public Broadband Service in the 2155-2175 MHz
    Band (filed March 2, 2007) ("NetfreeUS Proposal"); Application of
    McElroy Electronics Corporation for a Nationwide 2155-2175 MHz Band
    Authorization (filed March 2, 2007)("McElroy Proposal"); and
    Application of TowerStream Corporation for a Nationwide 2155-2175
    MHz Band Authorization (filed March 2, 2007) ("TowerStream
    Proposal").

[^96]: *See* M2Z Motion to Dismiss at 5-18. M2Z asserts that the parties
    submitting the other applications would not provide free nationwide
    broadband service, adhere to specific build-out obligations, enhance
    universal service, offer a "family-friendly" service, make
    comparable commitments to serving public safety entities, offer
    comparable spectrum usage fees, promote new entry, or produce
    comparable consumer welfare benefits. *Id.* at 18-39. M2Z also
    argues that the alternative proposals are not spectrally efficient,
    nor do they purport to meet interference protection and other
    standards applicable under Part 27 of the Commission's rules. *Id.*
    at 39-45. M2Z also claims that the alternative proposals do not
    contain meaningful showings of the applicants' financial
    qualifications, nor have they specified the regulatory status of
    their respective proposals. *Id.* at 45-52.

[^97]: *See id.* at 18 (citing 47 U.S.C. § 157).

[^98]: M2Z argues that the Open Range Proposal lacks technical
    information and fails to support its waiver request. *Id.* at 52-57.
    M2Z describes NextWave's Proposal as "unnecessary and redundant" to
    its spectrum holdings in the 3.65 GHz band. *Id.* at 58-61. M2Z
    claims Commnet has not provided sufficient evidence of its financial
    qualifications. *Id.* at 61-64. M2Z suggests that NetfreeUS presents
    an unstable business model, and has an affiliate which is an LMDS
    licensee but has failed to meet build-out requirements, a
    performance history which may be repeated in this band. *Id.* at
    64-70. M2Z asserts that the McElroy and TowerStream Proposals are
    "copy-cat" applications which fail to demonstrate the same level of
    service or public interest commitments proposed by M2Z. *Id.* at
    70-72.

[^99]: *Id. at* 75-78. M2Z also claims that we should dismiss the
    NextWave, Open Range, and Tower Stream, applications because these
    applicants made filings in the Commission's proceeding governing the
    3650-3700 MHz band, *see supra* note Error: Reference source not
    found, supporting the nationwide, nonexclusive licensing rules that
    we recently affirmed. According to M2Z, this action provides these
    companies with the regulatory certainty needed to move forward with
    plans for the 3650-3700 MHz band. *See* Letter from Erin L. Dozier,
    Esq., to Marlene H. Dortch, Secretary, FCC, WT Docket Nos. 07-16 and
    07-30 (filed June 11, 2007).

[^100]: Consolidated Motion of M2Z Networks, Inc. to Strike and Dismiss
    Petitions to Deny and Alternative Proposals, In the Matter of M2Z
    Networks, Inc.. Application for License and Authority to Provide
    National Broadband Radio Service In the 2155-2175 MHz Band and
    Petition for Forbearance Under 47 U.S.C § 160(c) Concerning
    Application of Sections 1.945(b) and (c) of the Commission's Rules
    and Other Regulatory and Statutory Provisions, WT Docket No. 07-16,
    WT Docket No. 07-30, filed Mar. 26, 2007 (M2Z's *Consolidated Motion
    to Strike and Dismiss*).

[^101]: *M2Z's Consolidated Motion to Strike and Dismiss* at 6.

[^102]: *Id*. at 8. *See* 47 U.S.C. § 309(d)(1).

[^103]: Consolidated Motion at 8. *See also* M2Z April 16, 2007 *Ex
    Parte* Response at 27-37.

[^104]: Consolidated Motion at 9. For instance, Section 309(d)(1)
    mandates a petitioner serve a copy of its petition on the party it
    opposes, and M2Z asserts that the parties currently opposing its
    application, except for NetfreeUS and Nextwave, failed to meet this
    rule. *See* Erratum to Consolidated Motion of M2Z Networks, Inc. to
    Strike and Dismiss Petitions to Deny and Alternative Proposals,
    filed by M2Z on March 28, 2007.

[^105]: *Id*. at 13.

[^106]: *Id*. at 15. According to M2Z, only AT&T and NextWave submitted
    the requisite affidavits with their petitions. *Id*. at 16.

[^107]: *See* CTIA Reply to M2Z Consolidated Opposition to Petitions to
    Deny at 20-23.

[^108]: *See* NetfreeUS May 9, 2007 *Ex Parte*; NextWave Reply to Motion
    to Strike; MEC Reply to Opposition to Petition for Reconsideration.

[^109]: *See* *SEC v. Chenery Corp.*, 332 U.S. 194, 203 (1947) (\"the
    choice made between proceeding by general rule or by individual, ad
    hoc litigation is one that lies primarily in the informed discretion
    of the administrative agency.\"). *See also* *Telocator Network of
    America v. FCC*, 691 F.2d 525, 551 (D.C. Cir. 1982) (\"It is
    well-settled that the Commission may elect to utilize its rulemaking
    power in lieu of adjudication when the pertinent issues involve
    legislative rather than adjudicative facts, and have prospective
    effect and classwide applicability.")

[^110]: *See National Small Shipment Traffic Conf. v. I.C.C.*, 725 F.2d
    1442, 1447-48 (D.C. Cir. 1984) ("Trial-like procedures are
    particularly appropriate for retrospective determination of specific
    facts \... \[while\] \[n\]otice-and-comment procedures \... are
    especially suited to determining legislative facts and policy of
    general, prospective applicability.").

[^111]: *See* 47 C.F.R. § 1.2102(a) ("mutually exclusive initial
    applications are subject to competitive bidding), (b), (c)
    (applications for public safety radio services, initial applications
    for certain DTV licenses, and noncommercial educational, certain
    public broadcast stations, and applications in certain services or
    classes of service are not subject to competitive bidding).

[^112]: *See, e.g.,* 47 U.S.C. §§ 1. 907, 1.911, 1.913.

[^113]: Parties who filed Petitions to Deny argue that M2Z's application
    fails to adequately address these licensing elements which should be
    addressed through the rulemaking process. *See, e.g.,* AT&T Petition
    to Deny at 10-14, 27-28; CTIA Petition to Deny at 6; Motorola
    Petition to Deny at 1; Rural Carriers Petition to Deny and Comments
    at 3-5; T-Mobile Petition to Deny at 2-3, 6-7; Verizon Petition to
    Deny at 16, 19; WCA Petition to Deny at 4, 10. *See also*
    Information Technology Industry Council (ITTI) Letter at 2 (filed
    March 16, 2007); Commnet Application Exhibit. 7.

[^114]: *See* AT&T Forbearance Comments at 4.

[^115]: *See, e.g., supra* paras. Error: Reference source not found,
    Error: Reference source not found, Error: Reference source not
    found.

[^116]: In addition to filing their applications electronically on ECFS,
    as described in the *M2Z Application* *Public Notice*, several
    applicants also submitted original hard copies with fee remittances
    that were returned by the Commission's Financial Operations office
    in Gettysburg, Pennsylvania, for reasons such as an invalid radio
    service code or a failure to file electronically. *See, e.g*.,
    Petition for Reconsideration filed by McElroy Electronics, Corp. on
    March 30, 2007. Ordinarily, application packages that are
    immediately returned by the Financial Operations office are not
    considered to be pending. However, the applications filed in WT
    Docket No. 07-16 were not filed pursuant to any particular service
    rules and the Bureau specifically instructed interested parties to
    file their applications electronically using ECFS. Accordingly,
    given these unique circumstances, the filing date and status of each
    application filed in WT Docket no. 07-16 is governed by the date of
    electronic filing on ECFS, except for the M2Z application, which
    pre-dated Bureau's instructions. We emphasize, however, that this is
    an exceptional case---ordinarily, license applications are not filed
    on ECFS and applications returned by the Financial Operations office
    are not considered to be pending.

[^117]: *See Bachow Communications v. FCC*, 257 F.3d 683 (D.C. Cir.
    2001).