**DA 02-1147**

**May 15, 2002**

**AUCTION OF LICENSES FOR**

**CELLULAR RURAL SERVICE AREAS**

**6 Qualified Bidders**

Report No. AUC-02-45-D (Auction No. 45)

In this *Public Notice,* the Federal Communications Commission ("FCC" or
"Commission") identifies 6 applicants found to be qualified to bid in
the upcoming auction of three cellular Rural Service Area (RSA) licenses
("Auction No. 45"). Auction No. 45 is scheduled to begin on Wednesday,
May 29, 2002. In addition, this *Public Notice* contains bidding
instructions and other important information regarding Auction No. 45.

**Attachment A** lists each of the 6 qualified bidders, their upfront
payments, and maximum eligibility in bidding units.

**Attachment B** lists the licenses selected on each qualified bidder's
FCC Form 175.

**Attachment C** lists the applicants that submitted FCC Form 175
applications, but did not qualify to bid in this auction.[^1]

**Attachment D** describes how to participate in the mock auction.

**Attachment E** provides information on "How to Monitor the FCC
Auctions On-line," and round results file formats for use during the
auction.

In order to participate effectively in the auction, qualified bidders
should again familiarize themselves with the auction rules and other
information contained in the *Auction No. 45 Procedures Public Notice*
and subsequent public notices.[^2] This *Public Notice* and other
documents related to Auction No. 45 are available on the Commission's
auctions website,
[[http://wireless.fcc.gov/auctions](http://www.fcc.gov/wtb/auctions)/]{.underline}.
The following information provides additional guidance.

***Registration**.* Qualified bidders have been automatically registered
for the auction. For security reasons, the Commission will confirm
registration through two separate mailings of registration materials.
Both mailings will be sent to the bidder's contact person at the contact
address identified in the bidder\'s FCC Form 175. Upon receipt of both
mailings, each bidder should be in possession of the following
information:

-   Bidder Identification Number

-   At least two SecurID cards

-   Bidding System User Manual

-   FCC Telephonic Bidding phone number

Qualified bidders are solely responsible for ensuring the security of
their computer systems, security of their registration materials, and
that only authorized bidders place bids on their behalf. The FCC assumes
no responsibility or liability for these matters.

WARNING: Any unauthorized entity accessing or tampering with an FCC or
other government computer will be prosecuted to the full extent of the
law.

Any qualified bidder listed in Attachment A of this *Public Notice* that
has not received both registration mailings **by noon on Wednesday, May
22, 2002**, must contact the Auctions Hotline directly at (717)
338-2888. Receipt of both registration mailings is critical to
participating in both the mock auction and the actual auction event, and
it is the responsibility of each qualified bidder to ensure that all
registration information has been received.

***Registration Material Replacement**.* Lost bidder identification
numbers or SecurID cards can be replaced only by appearing [in
person]{.underline} at the FCC Headquarters, located at 445 12^th^
Street, SW, Washington, DC. Only an authorized bidder, the contact
person or the certifying official, as designated on the applicant\'s FCC
Form 175, may appear in person with two forms of identification (one of
which must be a photo identification) in order to receive replacements.
Qualified bidders requiring replacements must call technical support
prior to arriving at the FCC.

If a bidder receives a damaged card(s), the bidder's contact person
should call Technical Support to request a replacement. Technical
Support will verify that the card is unusable, and a new card will be
sent by Federal Express along with a self-addressed stamped envelope for
returning the damaged card(s).

***Bidding**.* The Commission will conduct this auction over the
Internet. Telephonic bidding will also be available. As a contingency,
the FCC Wide Area Network, which requires access to a 900 number
telephone service, will be available as well.

Qualified bidders are permitted to bid telephonically or electronically.
In either case, **each authorized bidder** must have its own Remote
Security Access SecurID card, which the FCC will provide at no charge.
Each applicant with less than three authorized bidders will be issued
two SecurID cards, while applicants with three authorized bidders will
be issued three cards. For security purposes, the SecurID cards and the
instructions for using them are only mailed to the contact person at the
contact address listed on the FCC Form 175. Please note that each
SecurID card is tailored to a specific auction. SecurID cards issued for
other auctions or obtained from a source other than the FCC will not
work for Auction No. 45. The telephonic bidding phone number will be
supplied in the first mailing along with the confidential bidder
identification number.

Please note that the SecurID cards can be recycled, and we encourage
bidders to return the cards to the FCC. We will provide pre-addressed
envelopes that bidders may use to return the cards once the auction is
over.

***Bidding Contingency Plan**.* Bidders should develop comprehensive
contingency plans that can be quickly implemented if bidders experience
difficulty participating in the auction. While the FCC will correct any
problems within Commission‑controlled facilities, bidders are solely
responsible for anticipating and overcoming problems such as bidder
technical failures, local telephone service interruptions, adverse local
weather conditions, unavailability of authorized bidders, or the loss or
breach of confidential security codes.

In their registration materials, all qualified bidders will be supplied
with a telephone number for telephonic bidding. Bidders choosing to bid
telephonically are required to use this telephone number to place bids.
Electronic bidders may use this telephone number as an alternate method
of bidding in the event they are unable to submit their bids
electronically. **Telephonic bidders are reminded to allow sufficient
time to bid by placing their calls well in advance of the close of a
round.**

***Minimum Opening Bids**.* There will be a minimum opening bid for each
license in Auction No. 45, calculated in accordance with the formulas
previously announced.[^3] The minimum opening bid amount is subject to
reduction at the discretion of the Commission. However, bidders should
be aware that the Commission will not entertain requests to lower
minimum opening bids. The agency will exercise its discretion, if at
all, independent of any communications from bidders.

***Messages and Announcements**.* The FCC will post pertinent auction
information as messages and announcements. Bidders should routinely
check for messages and announcements each time they enter the FCC
Bidding System, and should read this information carefully.

***Bidding Schedule**.* The bidding schedule for Wednesday, May 29,
2002, and continuing until further notice, will be:

[]{.mark}

Bidding Period 9:00 a.m. - 10:00 a.m. ET

Bidding Period 11:00 a.m. - 12:00 p.m. ET

Bidding Period 1:30 p.m. - 2:30 p.m. ET

Bidding Period 3:30 p.m. - 4:30 p.m. ET

Round results will be provided approximately 10 to 15 minutes after the
close of each round. The FCC will set the pace of the auction based upon
its monitoring of the bidding and its assessment of the auction\'s
progress. All schedule changes will be made by announcement during the
course of the auction.

***Bidder Questions during the Auction.*** FCC auction officials and
technical support staff will be available during the course of the
auction to answer questions from authorized bidders. Bidders should
identify themselves as a bidder with time sensitive auction questions
when calling any number. Help can be obtained through the following
telephone numbers:

+-----------------------------------+-----------------------------------+
| FCC Bidder Line                   | Use telephonic bid number         |
|                                   | supplied in registration mailing  |
| (telephonic bidding, auction      |                                   |
| conduct questions)                |                                   |
+-----------------------------------+-----------------------------------+
| FCC Technical Support Hotline     | \(202\) 414-1250                  |
|                                   |                                   |
| (all technical questions,         |                                   |
| software and hardware)            |                                   |
+-----------------------------------+-----------------------------------+
| FCC Auctions Division (legal      | \(202\) 418-0660                  |
| questions)                        |                                   |
+-----------------------------------+-----------------------------------+

***Monitoring Round Results.*** Attachment E (How to Monitor the FCC
Auctions On-Line) of this *Public Notice* provides instructions for
reviewing and downloading round results, as well as other material
related to Auction No. 45, that will be released by the Commission
during the course of the auction.

***Amendments to FCC Form 175s**.* Applicants are responsible for
maintaining the accuracy and completeness of information furnished in
their FCC Form 175 and exhibits.[^4] Applicants should amend their
applications within ten business days from the occurrence of a
reportable change. Filers should make modifications to their FCC Form
175 electronically and submit a letter, briefly summarizing the changes,
by electronic mail to the attention of Margaret Wiener, Chief, Auctions
and Industry Analysis Division, at the following address:
[auction45@fcc.gov](mailto:auction43@fcc.gov). A separate copy of the
letter should be faxed to Denise Coca, Auctions and Industry Analysis
Division, (202) 418-2923. Questions about other changes should be
directed to Denise Coca at (202) 418-0660.

As described in the Commission\'s rules, applicants may make only minor
corrections to their FCC Form 175 applications (*e.g*., authorized
bidder, fax number).[^5] Major modifications (*e.g.*, changing the
markets applied for, changing control of the applicant, changing the
certifying official) will not be accepted.[^6]

***Due Diligence***. Bidders are reminded that they should continue to
conduct due diligence examinations regarding incumbents and other legal
developments with respect to the licenses for which they may bid during
the course of the auction.[^7] Bidders should be aware that certain
applications (including those for modification), petitions for
rulemaking, requests for special temporary authority (\"STA\"), waiver
requests, petitions to deny, petitions for reconsideration, and
applications for review may be pending before the Commission and relate
to particular applicants or incumbent licensees. In addition, certain
judicial proceedings that may relate to particular applicants or the
licenses available in Auction No. 45 may be pending or subject to
further review. We note that resolution of these matters could have an
impact on the availability of spectrum in Auction No. 45. Some of these
matters (whether before the Commission or the courts) may not be
resolved by the time of the auction. In the event that a final
determination reached in a pending proceeding requires a winning bidder
to surrender a license(s) won in Auction No. 45, the Commission will
return payments relating to such license(s) to the payer of record. The
Commission, however, will not pay interest on the returned payment(s) as
it lacks legal authority to do so.

Bidders are solely responsible for identifying associated risks and for
investigating and evaluating the degree to which such matters may affect
their ability to bid on, otherwise acquire, or make use of licenses
available in Auction No. 45.

***Mock Auction***. The FCC will conduct a mock auction on Thursday, May
23, 2002, which will allow qualified bidders to familiarize themselves
with the Internet bidding system. Only qualified bidders will be
permitted to participate in the mock auction. Telephonic bidding will
also be available. As a contingency, the FCC Wide Area Network, which
requires access to a 900 number telephone service, will be available as
well. Qualified bidders that wish to place bids telephonically, should
use the telephone number supplied in the Auction No. 45 registration
materials.

The mock auction will include all Auction No. 45 licenses, and will
follow the rules governing the actual auction. **The mock auction will
be identified as Auction No. 74. The program will assume that each
bidder applied for all three cellular RSA licenses. The program will
also assume that each bidder submitted upfront payments of \$62,000,
which corresponds to 62,000 bidding units.** The mock auction will
simulate the start of the auction and all bidders will be required to be
active on 100 percent of their bidding units, or risk having a waiver
automatically applied. If there are no waivers remaining, the current
eligibility will be permanently reduced, possibly eliminating the bidder
from the auction.

Electronic bidders participating in the mock auction are advised to
review the Bidding System User Manual provided in the second mailing.
Attachment D of this *Public Notice* provides instructions for accessing
the FCC Mock Auction site.

The mock auction bidding schedule for Thursday, May 23, 2002, will be:

  --------------------------- -------------------------------------------
  [Round 1 Bidding            9:00 a.m. ‑ 10:00 a.m. ET
  Period]{.underline}         

                              

  [Round 2 Bidding            11:00 a.m. ‑ 12:00 p.m. ET
  Period]{.underline}         

                              

  [Round 3 Bidding            1:30 p.m. - 2:00 p.m. ET
  Period]{.underline}         

                              

  [Round 4 Bidding            3:00 p.m. - 3:15 p.m. ET
  Period]{.underline}         
  --------------------------- -------------------------------------------

**OTHER IMPORTANT INFORMATION**

***Prohibition of Collusion*.** Bidders are reminded that Section
1.2105(c) of the Commission\'s Rules prohibits applicants for the same
geographic license area from communicating with each other during the
auction about bids, bidding strategies, or settlements unless they have
identified each other as parties with whom they have entered into
agreements under Section 1.2105(a)(2)(viii). For Auction No. 45, this
prohibition became effective at the filing deadline of short-form
applications on Wednesday, April 17, 2002, and will end on the
post-auction down payment deadline. The post-auction down payment
deadline will be announced in a future public notice. If parties had
agreed in principle on all material terms, those parties must have been
identified on the short-form application under Section 1.2105(c), even
if the agreement had not been reduced to writing. If parties had not
agreed in principle by the filing deadline, an applicant should not have
included the names of those parties on its application, and must not
have continued negotiations with other applicants for licenses in the
same geographic area.[^8]

In addition, Section 1.65 of the Commission's rules requires an
applicant to *maintain* the accuracy and completeness of information
furnished in its pending application and to notify the Commission within
30 days of any substantial change that may be of decisional importance
to that application.[^9] Thus, Section 1.65 requires an auction
applicant to notify the Commission of any violation of the
anti-collusion rules upon learning of such violation. Bidders therefore
are required to make such notification to the Commission immediately
upon discovery.[^10] For further details regarding the prohibition
against collusion refer to the *Auction No. 45 Procedures Public
Notice*.[^11]

Winning bidders will be required to disclose in their long-form
applications the specific terms, conditions, and parties involved in all
bidding consortia, joint ventures, partnerships, and other arrangements
entered into relating to the competitive bidding process. Bidders found
to have violated the anti-collusion rule may be subject to
sanctions.[^12] In addition, applicants are reminded that they are
subject to the antitrust laws, which are designed to prevent
anti-competitive behavior in the marketplace. If a bidder is found to
have violated the antitrust laws in connection with its participation in
the competitive bidding process, it may be subject to forfeiture of its
upfront payment, down payment, or full bid amount and may be prohibited
from participating in future auctions.[^13]

***Long-Form Applications.*** Applicants that claim status as a small
business should be aware that at the long-form application stage, they
will be subject to more extensive reporting requirements contained in
the Commission\'s Part 1 ownership disclosure rule.[^14] In addition,
applicants with foreign ownership interests will be required to comply
with 47 U.S.C. Section 310(b) at the long-form application stage.

For additional information regarding this *Public Notice*, please
contact Barbara Sibert, Auctions Project Manager at (717) 338-2888, Jeff
Crooks, Auctions Analyst, or Denise Coca, Auctions Attorney, at (202)
418-0660.

Technical questions about software or hardware should be directed to
Technical Support at (202) 414-1250 (V) or (202) 414-1255 (TTY).

> **[- FCC -]{.smallcaps}**

[^1]: Paris Tower, Inc., which is listed as a non-qualified bidder,
    submitted a waiver request on May 7, 2002. By order adopted today,
    the waiver request is denied for failure to meet the standards for
    granting waivers in section 1.925 of the Commission's rules, 47
    C.F.R. § 1.925. The order addressing Paris Tower's waiver request
    will be released separately.

[^2]: *See* Auction No. 45 Cellular Rural Service Areas Auction
    Scheduled for May 29, 2002, Notice and Filing Requirements, Minimum
    Opening Bids, Upfront Payments and Other Auction *Public Notice*, DA
    02-470 (rel. March 4, 2002), 67 Fed. Reg. 16383 (rel. April 5, 2002)
    ("*Auction No. 45 Procedures Public Notice*").

[^3]: *Auction No. 45 Procedures Public Notice* at 23-24. Attachment A
    of the *Auction No. 45 Procedures Public Notice* sets forth the
    minimum opening bids for each license offered in Auction No. 45.

[^4]: 47 C.F.R § 1.65.

[^5]: 47 C.F.R. § 1.2105(b).

[^6]: *Id*.

[^7]: *See* *Auction No. 45 Procedures Public Notice* at 4-5. Ranger
    Cellular and Miller Communications, Inc. ("Ranger and Miller") have
    filed a petition for review of the *Cellular RSA Report and Order*
    in the United States Court of Appeals for the District of Columbia
    Circuit*. Ranger Cellular and Miller Communications, Inc. v. FCC,*
    No. 02-1093 (D.C. Cir. filed Mar. 18, 2002); Implementation of
    Competitive Bidding Rules to License Certain Rural Service Areas,
    *Report and Order*, 17 FCC Rcd 1960 (2002) ("*Cellular RSA Report
    and Order*"). Ranger and Miller have also filed with the Commission
    a request to delay Auction No. 45 pending the disposition by the
    court of appeals of their petition for review. In the Matter of
    Public Notice entitled, "Implementation of Competitive Bidding Rule
    to License Certain Rural Service Areas," Motion to Stay Auction
    Rules Pending Judicial Review, filed by Ranger and Miller (March 26,
    2002).

[^8]: Wireless Telecommunications Bureau Clarifies Spectrum Auction
    Anti-Collusion Rules, *Public Notice*, 11 FCC Rcd 9645 (1995).

[^9]: 47 C.F.R. § 1.65.

[^10]: The Commission amended Section 1.2105 to require auction
    applicants to report prohibited communications in writing to the
    Commission immediately, but in no case later than five business days
    after the communication occurs. Amendment of Part 1 of the
    Commission's Rules -- Competitive Bidding Procedures, *Seventh
    Report and Orde*r, 16 FCC Rcd 17546, 17555, ¶ 17 (2001).

[^11]: *Auction No. 45 Procedures Public Notice* at 3-4 and Attachment
    G.

[^12]: 47 C.F.R. §§ 1.2105(c), 1.2107(d), and 1.2109(d).

[^13]: 47 C.F.R. §1.2109(d).

[^14]: 47 C.F.R. § 1.2112(b)(2).