**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | * | WT Docket No. 03-66          |
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| Amendment of Parts 1, 21, 73, 74 | ) | RM-10586                     |
| and 101 of the Commission's      | * |                              |
| Rules to Facilitate the          | * | WT Docket No. 03-67          |
| Provision of Fixed and Mobile    |   |                              |
| Broadband Access, Educational    | * | MM Docket No. 97-217         |
| and Other Advanced Services in   | * |                              |
| the 2150-2162 and 2500-2690 MHz  | ) | WT Docket No. 02-68          |
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| Rules - Further Competitive      | * | WT Docket No. 00-230         |
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+----------------------------------+---+------------------------------+

**REPORT AND ORDER AND FURTHER NOTICE OF PROPOSED RULEMAKING**

**Adopted: June 10, 2004 Released: July 29, 2004**

**Comment Date:** 30 days after publication in the Federal Register

**Reply Comment Date:** 60 days after publication in the Federal
Register

By the Commission: Chairman Powell and Commissioners Abernathy, Copps,
Martin, and Adelstein issuing separate statements.

Table of Contents

Heading Paragraph **\#**

[I. INTRODUCTION](#discussion) 1

[II. EXECUTIVE SUMMARY](#discussion) 6

[III. BACKGROUND](#discussion) 9

[A. Establishment and Evolution of the
Services](#changes-to-2500-2690-mhz-band-plan) 9

[B. Current Uses of the Band](#changes-to-2500-2690-mhz-band-plan) 15

[C. The Coalition Proposal](#changes-to-2500-2690-mhz-band-plan) 16

[IV. Discussion](#discussion) 21

[A. Changes to 2500-2690 MHz Band
Plan](#changes-to-2500-2690-mhz-band-plan) 21

[1. Addition of the 2495-2500 MHz
band](#addition-of-the-2495-2500-mhz-band) 25

[2. Band Plan Alternatives](#band-plan-alternatives) 30

[3. Border Regions](#border-regions) 50

[4. Geographic Area Licensing for Current
Licensees](#geographic-area-licensing-for-current-licensees) 52

[5. Transition to New Band Plan](#transition-to-new-band-plan) 68

[B. Technical Issues](#technical-issues) 104

[1. Signal Strength Limits at Geographic Service Area
Boundaries](#signal-strength-limits-at-geographic-service-area-boundaries)
105

[2. Authorization of Mobile
Operation](#authorization-of-mobile-operation) 111

[3. Power and Antenna Height Limits](#power-and-antenna-height-limits)
113

[4. Emission Limits](#emission-limits) 124

[5. Technology](#technology) 131

[6. Unlicensed "Underlay" Operation](#unlicensed-underlay-operation) 135

[7. RF Safety](#rf-safety) 140

[8. North American Datum (NAD) 83 Coordinate
Data](#north-american-datum-nad-83-coordinate-data) 141

[9. BRS Response Station Hubs](#brs-response-station-hubs) 142

[10. Radiation from Stations that are not Engaged in
Communications](#radiation-from-stations-that-are-not-engaged-in-communications)
143

[C. Eligibility Restrictions](#eligibility-restrictions) 149

[1. ITFS Eligibility Restrictions](#itfs-eligibility-restrictions) 149

[2. MDS/ITFS Cross Ownership
Restrictions](#mdsitfs-cross-ownership-restrictions) 165

[3. Leasing and Secondary Markets](#leasing-and-secondary-markets) 177

[D. Standardization of Practices and
Procedures](#standardization-of-practices-and-procedures) 182

[1. Consolidation of Procedural Rules in Part
1](#consolidation-of-procedural-rules-in-part-1) 182

[2. Consolidation of Service Specific Rules in Part
27](#consolidation-of-service-specific-rules-in-part-27) 184

[3. Standardization of Major and Minor Filing
Requirements](#standardization-of-major-and-minor-filing-requirements)
191

[4. Amendments to New and Modification
Applications](#amendments-to-new-and-modification-applications) 197

[5. Assignments of Authorization and Transfers of
Control](#assignments-of-authorization-and-transfers-of-control) 200

[6. Partitioning and Disaggregation](#partitioning-and-disaggregation)
207

[7. License Renewal](#license-renewal) 211

[8. Special Temporary Authority](#special-temporary-authority) 221

[9. Ownership Information](#ownership-information) 224

[10. Regulatory Status](#regulatory-status) 226

[11. Discontinuance, Reduction or Impairment of
Service](#discontinuance-reduction-or-impairment-of-service) 229

[12. Foreign Ownership Restrictions](#foreign-ownership-restrictions)
240

[13. Annual Reports](#annual-reports) 242

[14. Application Processing](#application-processing) 244

[15. Returns and Dismissals of Incomplete or Defective
Applications](#returns-and-dismissals-of-incomplete-or-defective-applications)
250

[16. ULS Forms](#uls-forms) 254

17\. Transition Periods 259

[18. Suspension of Acceptance and Processing of
Applications](#suspension-of-acceptance-and-processing-of-applications)
261

[V. FURTHER NOTICE OF PROPOSED
RULEMAKING](#further-notice-of-proposed-rulemaking) 264

[A. Licensing All Available Spectrum Pursuant to the New Band
Plan](#licensing-all-available-spectrum-pursuant-to-the-new-band-plan)
264

[1. New Licenses to be Assigned by
Auction](#transitions-to-the-new-band-plan-when-no-proponent-files-a-timely-initiation-plan)
266

[2. Transitions to the New Band Plan When No Proponent Files a Timely
Initiation
Plan](#transitions-to-the-new-band-plan-when-no-proponent-files-a-timely-initiation-plan)
289

[B. Performance Requirements](#performance-requirements) 320

[C. Grandfathered E and F Channel ITFS
Stations](#grandfathered-e-and-f-channel-itfs-stations) 333

[D. Limitation on Channel Assignments for EBS
Licensees](#limitation-on-channel-assignments-for-ebs-licensees) 344

[E. Wireless Cable Exception to EBS Eligibility
Restrictions](#wireless-cable-exception-to-ebs-eligibility-restrictions)
347

[F. Regulatory Fee Issues](#regulatory-fee-issues) 351

[G. Gulf of Mexico Proceeding](#gulf-of-mexico-proceeding) 360

[H. Streamlining FCC Review of
Transactions](#streamlining-fcc-review-of-transactions) 368

[I. Continuing Review of Progress Towards Policy
Goals](#continuing-review-of-progress-towards-policy-goals) 370

[VI. Procedural matters](#procedural-matters) 375

[A. *Ex Parte* Rules --
Permit-But-Disclose](#ex-parte-rules-permit-but-disclose) 375

[B. Comment Period and Procedures](#comment-period-and-procedures) 376

[C. Final Regulatory Flexibility
Analysis](#final-regulatory-flexibility-analysis) 381

[D. Initial Regulatory Flexibility
Analysis](#initial-regulatory-flexibility-analysis) 382

[E. Paperwork Reduction Analysis](#further-information) 383

[F. Further Information](#further-information) 385

[VII. ORDERING CLAUSES](#ordering-clauses) 386

[APPENDIX A - INITIAL REGULATORY FLEXIBILITY
ANALYSIS](#initial-regulatory-flexibility-analysis-1) A-1

[APPENDIX B - FINAL REGULATORY FLEXIBILITY ANALYSIS
B-[1](#final-regulatory-flexibility-analysis-1)](#final-regulatory-flexibility-analysis-1)

[APPENDIX C - FINAL RULES C-[1](#final-rules)](#final-rules)

[APPENDIX D - LIST OF COMMENTERS
D-[1](#list-of-commenters)](#list-of-commenters)

[APPENDIX E - DISMISSED MUTUALLY EXCLUSIVE ITFS APPLICATIONS
E-[1](#dismissed-mutually-exclusive-itfs-applications)](#dismissed-mutually-exclusive-itfs-applications)

[APPENDIX F -- DISMISSED PLEADINGS RELATING TO MUTUALLY EXCLUSIVE ITFS
APPLICATIONS
F-[1](#dismissed-pleadings-relating-to-mutually-exclusive-itfs-applications)](#dismissed-pleadings-relating-to-mutually-exclusive-itfs-applications)

# INTRODUCTION

1.  In this *Report and Order (R&O)*, we take important steps to
    transform our rules and policies governing the licensing of the
    Instructional Television Fixed Service (ITFS), the Multipoint
    Distribution Service (MDS), and the Multichannel Multipoint
    Distribution Service (MMDS) (collectively, the Services) in the
    2500-2690 MHz band.[^1] The actions taken in this order initiate a
    fundamental restructuring of the band that will provide both
    existing ITFS and MDS licensees and potential new entrants with
    greatly enhanced flexibility in order to encourage the highest and
    best use of spectrum domestically and internationally, and the
    growth and rapid deployment of innovative and efficient
    communications technologies and services.[^2] By these actions, we
    make significant progress towards the goal of providing all
    Americans with access to ubiquitous wireless broadband connections,
    regardless of their location.[^3]

2.  A hallmark of our national communications policy is to encourage the
    provision of new technologies and services to the public.[^4] The
    actions taken herein will foster the development of the 2500-2690
    MHz band by enabling licensees to migrate to more technologically
    and economically efficient uses of the spectrum. The record in this
    proceeding overwhelmingly supports our tentative conclusion that
    providing 2500-2690 MHz licensees with additional flexibility of use
    serves the public interest and allows licensees to provide new and
    innovative services, consistent with the requirements of Section
    303(y) of the Communications Act.[^5]

3.  In recent years, there has been steadily increasing demand for
    mobile telephone and mobile data services. In 2002, the mobile
    telephony sector generated more than \$76 billion in revenues,
    increased subscribership from 128.5 million to 141.8 million (from
    the prior year), and produced a nationwide penetration rate of
    roughly forty-nine percent.[^6] Estimates of the number of mobile
    Internet users at the end of 2001 ranged from approximately eight to
    ten million, up from 2 to 2.5 million at the end of 2000.[^7] Also
    in recent years, the MDS industry has invested several billion
    dollars to develop broadband fixed wireless data systems in this
    band, including high-speed access to the Internet for residential
    customers, small and medium businesses, and educational
    institutions.[^8] Such systems offer a significant opportunity to
    provide competition to cable and digital subscriber line (DSL)
    services in the provision of broadband services in all areas.[^9]
    Additionally, these spectrum-based services will improve the ability
    of educators to serve America's students thereby facilitating
    educators' use of our national spectrum resource. This accomplishes
    our goal of ensuring that educational and medical institutions
    continue to have access to spectrum.

4.  Our actions today also respond to proposals from the ITFS and MDS
    industries for major revision of current regulations so that these
    services will no longer be hindered by outdated and overly
    restrictive regulation. The restructured band plan we adopt will
    provide ITFS and MDS licensees with contiguous spectrum to deploy
    both existing and emerging technologies, and provides for both high
    and low-power operations in the band, thereby preserving the
    opportunity for incumbents to maintain existing operations. We also
    adopt a transition mechanism that will enable incumbents on a
    region-by-region basis to negotiate the transition to new spectrum
    assignments in the restructured band plan, with safeguards to ensure
    that all relocating incumbents are treated equitably. We also
    propose an alternative market-based transition mechanism that would
    take effect after three years for any areas where a negotiated
    transition has not occurred. We will be monitoring the transition
    closely through the proponents\' filing of Initiation Plans with the
    Commission and notifications of the completion of the transition in
    given markets, as well as through reports prepared by the Wireless
    Telecommunications Bureau (Bureau) for the Commission.

5.  In addition to the broader objectives described above, our decisions
    in this proceeding have also been guided by the desire to accomplish
    these additional spectrum management objectives: (1) promoting
    availability of broadband to all Americans, including broadband
    technologies for educators; (2) encouraging increased competition in
    wireless broadband through the creation of new opportunities for new
    entrants; (3) promotion of the economic viability of services in
    this band by ensuring that the spectrum is as fungible, tradable,
    and marketable as possible; (4) facilitating the highest valued use
    of radio licenses; (5) facilitating speed of transition and
    deployment in the band; (6) providing incumbents with a reasonable
    opportunity to continue their current uses of the spectrum; and (7)
    the continued promotion of spectrum-based education services.

# executive summary

6.  In this *Report and Order*, we:

-   Adopt a band plan that restructures the 2500-2690 MHz band into
    upper and lower-band segments for low-power operations (UBS and LBS,
    respectively), and a mid-band segment (MBS) for high-power
    operations. By grouping high and low-power spectrum uses into
    separate portions of the band, this band plan creates opportunities
    for spectrum-based systems or devices to migrate to compatible bands
    based on marketplace forces, and reduces the likelihood of
    interference caused by incompatible uses. The new band plan also
    provides new incentives for the development of low-power
    cellularized broadband uses of the 2500-2690 MHz band, which have
    been thwarted by the legacy band structure.

-   Designate the 2495-2500 MHz band for use in connection with the
    2500-2690 MHz band.

-   Rename the MDS service as the "Broadband Radio Service" (BRS). This
    new designation connotes a more accurate description of the services
    we anticipate will develop in the band.

-   Rename the ITFS service as the "Educational Broadband Service"
    (EBS), which more accurately describes the kinds of the services
    that we anticipate will develop in the band.

-   Implement geographic area licensing for all licensees in the band.
    This will give licensees increased flexibility while greatly
    reducing administrative burdens on both licensees and the Commission

-   Adopt a transition mechanism that enables incumbent licensees to
    develop regional plans for moving to new spectrum assignments in the
    restructured band plan. Under this mechanism, licensees have a
    three-year period during which they can initiate the transition
    process in their regional area and negotiate a transition plan with
    other regional licensees. Transition plans must conform to certain
    safeguards to ensure a smooth transition and equitable treatment of
    incumbents.

-   Consolidate licensing and service rules for the Educational
    Broadband Service and Broadband Radio Services. This action promotes
    regulatory parity, and clarifies and stabilizes the regulatory
    treatment of similar spectrum-based services.

-   Allow spectrum leasing for BRS and EBS under our secondary market
    spectrum leasing policies and procedures.

-   Retain eligibility restrictions for licensing in the EBS band, while
    removing all non-statutory eligibility restrictions applicable to
    cable and DSL operators for the BRS.

-   Set the signal strength limits for the low-power bands at the
    boundaries of the geographic service areas to 47 dBV/m.

-   Restrict the transmitter output power of response stations to 2.0
    watts.

-   Modify emission limits for stations that would operate on the LBS
    and UBS channels and measure out-of-band emissions.

-   Provide licensees with the flexibility to employ the technologies of
    their choice in the band.

-   Refrain from allowing high-power unlicensed operations in the
    2500-2690 MHz band, but allow unlicensed operation under our
    existing Part 15 rules in the 2655-2690 MHz band.

-   Apply the Part 1 Wireless Telecommunications Bureau rules to the
    BRS/EBS spectrum.

-   Dismiss pending mutually exclusive applications for new ITFS
    stations.

-   Consolidate the new rules for the band into Part 27.

-   Take other actions to streamline the rules and eliminate unnecessary
    regulatory burdens.

7.  In MM Docket No. 97-217, we address a minor issue concerning
    response stations that are not engaged in communications with their
    associated hubs to restrict their field strengths.[^10]

8.  In the Further *Notice of Proposed Rulemaking* (*FNPRM*), we seek
    comment on alternative methods to transition licensees to the extent
    that licensee-negotiated transitions do not occur within the
    three-year transition period. Specifically, we seek comment on
    utilizing a system whereby existing licenses would be exchanged for
    a tradable instrument. Upon completion of such exchange, the entire
    band will be auctioned, and entities can utilize these tradable
    instruments in this or any other Commission auction. We seek comment
    on other transition methods that can be utilized to transition
    licensees to the new band plan. We also seek further comment on
    issues relating to the Gulf of Mexico service area, performance
    requirements for licensees in the band, grandfathered ITFS stations
    on the E and F channel groups, limitations on the holdings of ITFS
    stations, the "wireless cable" exception to the ITFS eligibility
    rules, issues relating to regulatory fees, methods of streamlining
    our review of transactions involving these services, and continuing
    our review of rules relating to these services.

# BACKGROUND

## Establishment and Evolution of the Services

9.  The Commission has sought for several decades to develop regulatory
    policies in the 2500-2690 MHz band that would tap this band's great
    potential to host a variety of services. As discussed more fully
    below, however, the regulatory history of the band has been marked
    by changing and sometimes conflicting policy goals, which have
    tended to suppress investment, innovation, and responsiveness to
    changes in wireless technology and demand for services. In light of
    this history, our actions today represent a major step towards
    unleashing the unrealized potential of this spectrum. Below, we
    summarize the history of the establishment and evolution of this
    band.

10. In 1963, the Commission established ITFS in the 2500-2690 MHz
    band,[^11] envisioning that it would be used for transmission of
    instructional material to accredited public and private schools,
    colleges, and universities for the formal education of
    students.[^12] The Commission also permitted ITFS licensees to use
    the channels to transmit cultural and entertainment material to
    educational institutions, and to transmit instructional material to
    non-educational institutions such as hospitals, nursing homes,
    training centers, clinics, rehabilitation centers, commercial and
    industrial establishments, and professional groups. ITFS licensees
    were also allowed to use their systems to perform related services
    directly concerned with formal or informal instruction and training,
    and to carry administrative traffic when not being used for
    educational purposes.[^13]

11. In 1974, the Commission established MDS as a new common carrier
    service and allotted the 2150-2160 MHz band for such use.[^14] The
    Commission anticipated that the MDS spectrum would be used for
    wireless cable, a common carrier service for distribution of
    television programming from a central location to fixed points
    selected by the common carrier's subscribers.[^15] The Commission
    allotted two 6 megahertz channels (2150-2162 MHz) in fifty of the
    largest metropolitan areas (referred to as MDS Channel Nos. 1 and
    2).[^16] In the rest of the country, only 10 megahertz of spectrum
    was allotted to MDS in this band ---namely, Channel No. 1 (2150-2156
    MHz) and Channel No. 2A (2156-2160 MHz).[^17]

12. In 1983, in response to the demand for additional spectrum for
    delivery of video entertainment programming to subscribers, the
    Commission re-allotted eight ITFS channels (the E and F channel
    blocks) and associated response channels for use by MDS.[^18] The
    Commission determined that the ITFS spectrum was underutilized given
    that there were a substantial number of unused ITFS channels in many
    areas of the country, with several states having no ITFS licensees
    whatsoever.[^19] At the same time, in an effort to encourage more
    intensive use of the spectrum and to help ITFS licensees generate
    needed revenue, the Commission began to relax use restrictions on
    ITFS licensees so that they could lease excess capacity on their
    facilities to commercial entities.[^20] Following that decision,
    there was a significant increase in the number of applications filed
    for new ITFS facilities.[^21] In 1985, the Commission further
    relaxed restrictions governing the leasing of excess capacity to
    commercial providers,[^22] allowing ITFS operators to lease up to 95
    percent of their capacity for non-educational purposes.[^23] In
    1987, the Commission allowed MDS operators to elect non-common
    carrier (and non-broadcast) status, leaving them subject to
    regulation pursuant to Part 21 of the Commission's Rules and the
    general provisions of Title III of the Communications Act of 1934,
    which apply to all radio station licensees.[^24] That same year, the
    Commission eliminated the time-of-day restrictions on leasing ITFS
    spectrum and authorized operators to use automatic switching
    equipment.[^25] In this same general timeframe, the Commission
    continued to relax requirements concerning ITFS licensees leasing
    spectrum for MDS operations.[^26]

13. In 1991, in an effort to provide more spectrum for multichannel
    video operations, the Commission re-allotted three additional
    channels in the 2500-2690 MHz band (the H channel block) from the
    Private Operational-Fixed Microwave Service[^27] (OFS) to MDS.[^28]
    This resulted in the current division of spectrum in the 2500-2690
    MHz band between ITFS and MDS. Of the 190 megahertz of total
    spectrum, 122.5 megahertz is allocated to ITFS, including 20
    6-megahertz main station video channels, while 66.5 megahertz is
    allocated to MDS, including 11 main station video channels.

14. Over the past decade, the Commission has taken a number of steps to
    increase the technical flexibility afforded to both ITFS and MDS
    licensees in the 2500-2690 MHz band. In 1993, the Commission granted
    ITFS licensees flexibility to use channel loading to shift their
    required educational programming onto a subset of their authorized
    number of channels by channel loading, e.g.., an ITFS licensee could
    move all of its ITFS programming on to one of its four channels and
    lease the remaining three channels on a twenty-four-hour basis to a
    wireless cable operator.[^29] In 1996, the Commission permitted MDS
    and ITFS licensees to employ digital technologies,[^30] and in 1998,
    it expanded the existing allocation for one-way video service to
    allow MDS and ITFS licensees to construct digital two-way systems
    capable of providing high-speed, high-capacity broadband service,
    including two-way Internet service via cellularized communication
    systems.[^31] Finally, in 2001, the Commission added a mobile
    allocation to the 2500-2690 MHz band (excluding aeronautical mobile)
    to make it potentially available for advanced mobile wireless
    services, including IMT-2000 and future generations of wireless
    systems.[^32]

## Current Uses of the Band

15. System operators in the 2500-2690 MHz band (both licensees and
    lessees) are generally providing four categories of service
    offerings today: (1) downstream analog video; (2) downstream digital
    video; (3) downstream digital data; and (4) downstream/upstream
    digital data.[^33] Licensees and lessees have deployed or sought to
    deploy these services via three types of system configuration:
    high-power video stations, high-power fixed two-way systems and
    low-power, cellularized two-way systems.[^34] We noted in the *NPRM*
    that most MDS operators and a substantial proportion of ITFS
    operators are particularly interested in using low-power,
    cellularized two-way systems, because they are more spectrally
    efficient than high-power systems, can support provision of
    high-data-rate services to a large number of subscribers, can help
    overcome obstacles to line-of-sight service, and can more readily
    support mobile or portable services.[^35] We also noted our concern
    that interference issues created by the distribution of high-power
    systems throughout the existing band plan have severely limited the
    ability of licensees and lessees to deploy low- power services.

## The Coalition Proposal

16. On October 7, 2002, the Coalition submitted a paper entitled "A
    Proposal for Revising the MDS and ITFS Regulatory Regime"
    ("Coalition Proposal" or "White Paper"), which recommended
    fundamentally changing the rules governing the 2500-2690 MHz
    band.[^36] In general, the Coalition argued that the band was not
    being used to the fullest extent possible[^37] and that rule changes
    were necessary to allow new services to develop. The Coalition
    envisioned this band being used to provide new wireless two-way
    broadband services (e.g., provide commercial service to portable,
    nomadic and mobile laptops, Personal Digital Assistants (PDAs), and
    other non-stationary devices) where the network architecture is
    based on a low-power cellular concept. The Coalition contended that
    the explosive growth of 802.11b-compliant "hot spots" demonstrated
    the demand for this sort of service and that this band could be used
    to provide ubiquitous service, not just at hot spots. It pointed out
    that several MDS licensees were currently test marketing this new
    two-way broadband service.[^38] It asserted, however, that a
    "radical reworking of the MDS and ITFS regulatory structure \[wa\]s
    needed" for such new services to develop and flourish in this
    band.[^39] The Coalition focused primarily on engineering issues --
    accommodating the needs of two incompatible types of users that
    presently share a single band: one-way, relatively high-powered
    stations and operators that seek to maximize spectral efficiency by
    deploying low-powered cellular systems.

17. To this end, the Coalition proposed establishing a new band plan to
    facilitate advanced low- power two-way broadband systems while at
    the same time protecting existing high-power systems (e.g., video
    operations). The Coalition proposed dividing the band into three
    segments, consisting of the LBS, MBS, and UBS.[^40] Low-power
    operations would utilize the LBS and UBS while high-power video
    operations would operate in the MBS. The Coalition also proposed (1)
    eliminating unnecessary regulatory burdens imposed by site-by-site
    licensing,[^41] (2) simplifying the technical rules to facilitate
    operations in the band,[^42] (3) establishing a market-by-market
    mechanism for transitioning to the new band plan and (4) eliminating
    outdated regulations. On October 17, 2002, the Commission released a
    Public Notice detailing the Coalition's proposal.[^43]

18. On April 2, 2003, we released the Notice of Proposed Rule Making
    (*NPRM*) in this proceeding.[^44] In the Notice, we sought comment
    on the Coalition Proposal as well as other potential alternatives
    for restructuring the 2500-2690 MHz band. We noted that this
    proceeding provided an opportunity to help meet our statutory duty
    to \"encourage the deployment on a reasonable and timely basis of
    advanced telecommunications capability to all Americans (including,
    in particular, elementary and secondary schools and classrooms). .
    .\"[^45] We also noted the potential for this band to be used for
    broadband technologies, including high-speed digital technologies
    that provide consumers integrated access to voice, high-speed data,
    video-on-demand, and interactive delivery services. We sought
    comment on how best to further our goal of promoting competition,
    innovation, and investment in broadband services and facilities
    while monitoring progress toward the deployment of broadband
    services in the United States and abroad.[^46]

19.  We noted in the *NPRM* that both the Coalition's analysis of the
    problems in the 2500-2690 MHz band and its proposed solutions were
    broadly consistent with the conclusions articulated in the
    Commission's 2001 3G Final Report.[^47] Of particular importance is
    the Commission's conclusion therein that traditional MDS/ITFS
    stations and third generation (3G) cellular systems are not
    compatible with each other when they are operating on the same
    frequencies. Their service area borders must be separated by
    distances exceeding 100 miles to ensure that MDS/ITFS transmitters
    will not cause harmful interference to 3G receivers.[^48] We further
    noted the report's conclusion that existing MDS/ITFS systems
    preclude operation of 3G systems in forty-nine of the fifty largest
    cities in the U.S., because all thirty-one of the MDS and ITFS
    channels in the 2500-2690 MHz band are licensed within 100 miles of
    those forty-nine cities.[^49] In the 3G Final Report, the Commission
    concluded that it would not be feasible to move the incumbent
    licensees to a different band. Instead, it recommended segmenting
    the band into separate high- and low-power segments and requiring
    both incumbents and new applicants to conform with the new technical
    rules.[^50] While the 3G Final Report focused on one particular type
    of new technology, its conclusions may apply with respect to any
    low-powered two-way service that seeks to achieve spectral
    efficiencies through a cellular-style configuration.

20. In the *NPRM*, we acknowledged that the Coalition's proposal was a
    major step forward to examination of this band. However, we also
    believed that significant progress would also require a discussion
    of ownership and eligibility issues, transition timetables, and,
    perhaps, a more thorough resolution of engineering issues as well.
    In this regard, we sought comment on the possibility of eliminating
    eligibility and use criteria for ITFS spectrum and the possibility
    of merging MDS and ITFS into a single Broadband Communications
    Service. We also sought comment on the best manner in which to
    accomplish the transition process, and whether we should establish a
    timetable for conversion of the entire 2500-2690 MHz band to
    low-power operations compatible with two-way, broadband cellular
    services. We emphasized that we did not propose to reclaim licenses
    from any incumbent operators that have complied with our existing
    rules and continue to comply with our new rules.

# Discussion

## Changes to 2500-2690 MHz Band Plan

21. *Background.* The 2500--2690 MHz band is currently comprised of
    twenty 6 megahertz ITFS channels and eleven 6 megahertz MDS
    channels. The channels in this band are licensed in groups of four
    (except for the MDS H block, consisting of three channels), but the
    channels in each group are interleaved rather than contiguous. As
    discussed in detail in the *NPRM*, this band plan, designed
    primarily to promote wireless cable and educational television
    services, was established in the early 1960s when television
    technology precluded the use of adjacent channels.[^51] This
    channelization framework, which has remained essentially unchanged
    since that time, was appropriate for when the Commission created
    ITFS and MDS, but is not optimal for digital two-way services.
    Additionally, there is no longer a technical rationale for the
    interleaved band plan, because MDS and ITFS systems have been
    technically able to use adjacent channels for the past 20 years.
    Moreover, the interleaved channelization scheme is particularly
    problematic when one licensee seeks to operate at low-power while
    the adjacent licensee operates at high power, because low-power
    services are especially susceptible to interference from high-power
    transmissions on adjacent channels.

22. The current interleaved band plan, coupled with the current adjacent
    channel interference protection rules, effectively precludes any
    licensee from providing broadband service unless consent is received
    from the licensee of the interleaved channel group (e.g., the
    licensee of the A Group cannot deploy two-way services without
    consent from the licensee of the B Group, and vice versa). This
    hampers the ability of individual MDS and ITFS licensees to deploy
    broadband services by giving adjacent channel licensees veto power
    over any such offering. Another consideration is that when using
    spread-spectrum techniques to avoid interference, service providers
    can operate more efficiently when they have access to large blocks
    of contiguous spectrum. Thus, we noted in the *NPRM* that any plan
    we adopt should address the need to provide a means by which
    licensees could consolidate their channels into contiguous blocks
    while resolving the incompatibility between high-power one-way
    services and low-power cellular services.

23. Additionally, MDS Channels 1 and 2 were allotted the 2150-2160 MHz
    band and operated with corresponding channels in the 2500-2690 MHz
    band.[^52] In fifty of the largest metropolitan areas, the
    Commission allotted an extra megahertz for MDS Channels 1 and 2 to
    create two 6 MHz channels (2150-2162 MHz).[^53] Because of their
    frequency separation from the rest of the MDS spectrum, these
    channels were not as extensively used. Therefore, in order to
    accommodate a new 90 megahertz allocation for advanced wireless
    services (AWS), the Commission, in ET Docket No. 00-258, reallocated
    the 1710-1755 MHz and 2110-2155 MHz bands to the fixed and mobile
    services for AWS.[^54] That action, however, deferred on the
    relocation of MDS Channels that were impacted to a later proceeding.

24. Contemporaneously with the adoption of this item, we have, in IB
    Docket No. 02-364 (Big Leo Spectrum Sharing R&O proceeding) added a
    co-primary fixed and mobile (except aeronautical mobile) service
    allocation to the 2495-2500 MHz band.[^55] That allocation is
    intended to facilitate the relocation of MDS Channels 1 and 2 to
    spectrum embedded with other MDS operations that we address herein.
    The actions within the Big Leo Spectrum Sharing R&O proceeding
    combined with the new band plan for the band will increase the
    efficient utilization of the 2496-2690 MHz spectrum and resolves the
    relocation of MDS Channels 1 and 2 by integrating these licensees
    with similar operations.[^56] The details of the new band plan will
    be discussed below.

### Addition of the 2495-2500 MHz band

25. As indicated above, in the Big Leo Spectrum Sharing R&O proceeding,
    we allocated the 2495-2500 MHz band to the fixed and mobile, except
    aeronautical mobile, services in order to provide additional
    spectrum to the 2500-2690 MHz band to accommodate the relocation of
    MDS Channels 1 and 2. We note that in the AWS *2^nd^ Report and
    Order*, parties suggested a variety of potential relocation options
    for MDS Channels 1 and 2, including: 1) shifting the MDS channels up
    in frequency by five megahertz to the 2155-2165 MHz band;[^57] 2)
    moving the MDS channels to spectrum within or adjacent to the MDS
    spectrum at 2500-2690 MHz;[^58] 3) moving the channels to share the
    mobile satellite service (MSS) spectrum at 2010-2025 MHz;[^59]
    and 4) considering whether replacement spectrum for MDS is even
    needed considering market forces, and if so, considering spectrum in
    the 2385-2400 MHz band, abandoned MSS spectrum below 2025 MHz, or
    700 MHz spectrum bands.[^60]

26. WCA, however, argues that each of these options poses difficulties
    for MDS operations. With respect to moving MDS to the 2155-2165 MHz
    band, it notes that in 50 markets, MDS licensees may use up to 12
    megahertz which must be accommodated, that such relocation would
    eliminate the *de facto* guard band between MDS and MSS,[^61] and
    that such a transition would have to be accomplished without
    disrupting service to customers and all costs must be
    reimbursed.[^62] WCA further states that moving MDS into the MSS
    bands is problematic because it would reduce the size of the MSS
    spectrum.[^63] Additionally, WCA states that the 2385-2400 MHz band
    is not suitable for MDS relocation because the 2385-2390 MHz band is
    not readily available and there is a likelihood of adjacent channel
    interference from Federal Government airborne telemetry operations
    and co-channel interference to amateur operations in the 2390-2400
    MHz band.[^64] WCA does, however, offer a relocation solution,
    stating that in the event the Commission deems relocation necessary,
    an acceptable compromise would be to relocate MDS Channels 1 and
    2/2A to the 1910-1916/1990-1996 MHz bands and allow fixed or mobile
    use.[^65]

27. We find that spectrum within the 2500 MHz band is the optimal
    location to relocate existing MDS licensees because it will allow
    the creation of an optimal band plan with contiguous spectrum, and
    integrate these licenses into the new BRS instead of orphaning MDS
    operations such that they would be part of a different service.
    Therefore, we find the allocation actions taken in the Big Leo
    Spectrum Sharing R&O proceeding produce the optimal situation for
    the relocation of MDS Channels 1 and 2. In order to promote sharing
    in the 2495-2500 MHz portion, we took the following actions in the
    Big Leo Spectrum Sharing R&O proceeding: 1) shifted mobile satellite
    service (MSS) ancillary terrestrial component (ATC) operations down
    from the 2492.5-2498 MHz band to the 2487.5-2493 MHz band;[^66] 2)
    dictated that MSS receive operations in the 2495-2500 MHz portion
    will not be able to claim interference protection from new fixed and
    mobile operations;[^67] and 3) designated the 2495-2496 MHz portion
    as a guard band to separate new BRS operations and incumbent
    operations below 2495 MHz. While these actions will allow the
    licensing of new terrestrial operations in the 2496-2500 MHz band,
    certain sharing constraints will be required.

28. We note that currently, there are 108 grandfathered terrestrial
    licenses for broadcast auxiliary service (BAS) and private radio
    services that are protected by primary status.[^68] New licensees in
    this spectrum could share the spectrum through coordination efforts,
    which should be successful given the limited number of licensees.
    Nevertheless, we will explore in a future proceeding possible
    relocation steps for these operations. Indeed, because we are
    establishing a low-power BRS, we believe it would be appropriate to
    consider moving BAS at this time. Further, the entire 2400-2500 MHz
    band is available for Industrial, Scientific, and Medical (ISM)
    operations which use electromagnetic energy to perform a function
    other than communications, such as heating substances in a microwave
    oven.[^69] We anticipate that BRS operations will be able to coexist
    with ISM operations because ISM operations use frequencies closer to
    the center of the band and in a controlled environment.

29. We also note that non-geostationary MSS space station downlink
    operations in the 2495-2500 MHz portion have a downlink power flux
    density (pfd) limit of -144 dBW/m^2^ per 4 kilohertz or -126
    dBW/m^2^ per 1 megahertz reference bandwidth, depending on the angle
    of arrival.[^70] This limit was designed to accommodate multiple MSS
    systems using code division multiple access (CDMA) techniques which
    is a form of spread spectrum modulation that can facilitate spectrum
    sharing. The limit was specifically designed to protect analog fixed
    relay systems and the ITU radio regulations indicate that they
    should be adequate to protect most digital fixed systems. These
    limits were not designed to protect mobile services. However, we
    believe there are some factors that could enable mobile services in
    this band should licensees take this approach. For example, the ITU
    limits were designed under conservative assumptions and were
    designed for multiple MSS systems overlapping in the same spectrum.
    Currently, however, the MSS in this band is only being used by one
    licensee, so the actual interference potential from satellite
    operations is much lower than the limit would indicate. Furthermore,
    mobile systems, such as cellular telephone and PCS systems, often
    utilize fairly strong signals throughout their coverage area in
    order to provide adequate capacity within each cell. Therefore, we
    conclude that the pfd limit does allow sharing with various
    terrestrial operations. New terrestrial entrants in the band should
    be aware of the MSS downlink emissions in the design of their
    systems.

### Band Plan Alternatives

30. In the *NPRM*, we sought comment on several band plans that could
    potentially resolve the incompatibility between high-power one-way
    services and low-power cellular services. As previously noted, the
    Coalition's approach involved dividing the 2500-2690 MHz into three
    larger and three smaller segments, with the MBS reserved for
    high-power MDS and ITFS stations and the UBS and LBS reserved for
    low-power operations. The LBS would be designated as the mobile
    station transmit band while the UBS would be designated as the base
    station transmit band. The three minor segments would consist of the
    I band at 2686-2690 (narrowband auxiliary channels) and two
    transition or guard bands, the J band, located between the LBS and
    MBS at 2566-2572 MHz, and the K band located between the MBS and the
    UBS at 2614-2620 MHz. Under the Coalition's proposed band plan, a
    licensee that currently has four interleaved 6-megahertz channels
    and four interleaved 0.125 megahertz channels would be assigned 16.5
    megahertz of contiguous spectrum in either the LBS or UBS, 6
    megahertz of spectrum in the MBS, .5 megahertz of contiguous
    spectrum in the I band, and 1.5 megahertz of contiguous spectrum in
    bands that the Coalition refers to as the J and K bands after
    transitioning to the new band plan. Because there is no pairing of
    bands pursuant to this approach, a licensee who wishes to deploy
    Frequency Division Duplex (FDD) technology must assemble paired
    blocks through a white space auction or secondary market
    transactions.[^71] Assuming that paired blocks can be acquired,
    however, this band plan allows for either FDD or Time Division
    Duplex (TDD) technology.[^72] Pursuant to the Coalition's proposal,
    every MDS and ITFS licensee would be assigned a geographic service
    area (GSA).[^73] Existing circular protected service areas (PSAs)
    would be converted to GSAs with signal strength limits applied at
    their boundaries.[^74]

31. In the *NPRM*, we also sought comment on two other types of band
    segmentation plans.[^75] The first type, outlined in the 3G Final
    Report, involves alternating bands for low and high-power services,
    respectively, with guard bands in between the two 45 megahertz
    frequency blocks for low-power services. The *NPRM* noted that this
    approach might be beneficial because it would allow both types of
    operations to provide frequency separation between paired channel
    blocks for 3G and ITFS/MDS operations and would permit both FDD and
    TDD operations. Another band plan option proposed in the *NPRM*
    involved separating the band into one block for low-power operations
    and one block for high-power operations, separated by a guard band.
    We noted that such a band plan would provide a large block of
    contiguous spectrum for both types of operations and is particularly
    well suited to TDD technology.[^76]

32. The other basic approach presented in the *NPRM* involved avoiding
    any segmentation of the band by applying an across-the-board limit
    on signal strengths sufficient to accommodate low-power cellularized
    operations on all channels throughout the 2500-2690 MHz band. We
    noted that the Coalition Proposal, or any other band segmentation
    plan, would require extensive, mandatory re-shuffling of channel
    assignments to avoid leaving high-power channels adjacent to
    low-power channels, in order to avoid adjacent channel
    interference.[^77] By contrast, applying an across-the-board
    limitation on signal strengths could make de-interleaving a less
    urgent necessity and, perhaps, make it possible for acquisitions,
    channel trades, and other voluntary market processes to effectuate
    any needed consolidation of channels. We sought comment on the
    extent to which such a rule would reduce the need to apply mandatory
    channel reassignments or whether it would interfere with future uses
    of this spectrum by educators.

33. From a broader perspective, the *NPRM* stated that Coalition members
    appear to believe that the predominant future use of this band will
    be low-power mobile services. On that basis, we sought comment on
    whether it would be necessary to reserve a portion of this band in
    the long term to accommodate high-power services. We expressed
    particular interest in hearing from licensees who are engaging in
    high-power operations as to their long-term plans for the spectrum.
    We sought comment on the technical feasibility of this approach and
    the cost involved in complying with technical rules that may require
    licensees to substantially lower their signal strength outside their
    PSAs.

34. We note that the Coalition's band plan received support from a
    majority of commenters.[^78] For example, Alvarion supports the plan
    because it allows flexible use of the band, supports both TDD and
    FDD technologies, permits both current commercial and ITFS licensees
    to continue operations using the MBS, maintains the location of the
    I channels, and permits the band to lend itself to mass production
    of equipment, thereby serving as a catalyst to launch the wireless
    broadband market into the same realm served by cable modem and DSL
    broadband solutions today.[^79]

35. Not all commenters, however, support the Coalition's band plan. Some
    commenters maintain that the Coalition's band plan, with only seven
    high-power channels, has too few high-power channels to support
    their needs. MDS providers further maintain that it would be too
    expensive for them to serve their customers using low-power network
    configurations.[^80] ITFS providers argue that one MBS channel will
    not be able to accommodate their current or planned systems.[^81]
    For instance, Stanford and Northeastern indicate that they have
    tested 5:1 compression and found it is not adequate for
    instructional programming because the quality is unsatisfactory and
    the delay unacceptable. Consequently, they contend, the loss of
    high-power channels would prevent them from expanding their systems
    from the present four channels to eight or even sixteen video
    programming channels and could[^82] result in significant costs for
    purchasing new equipment for low-power operations, if these costs
    are not covered by the transition process. NAF urges that the
    2500-2590 MHz portion of the band be redesignated for primary
    unlicensed use.[^83]

36. *Discussion.* As previously noted, our main goals in this proceeding
    include: (1) promoting availability of broadband to all Americans,
    including broadband technologies for educators; (2) promoting
    innovation by maximizing flexibility in the service rules; (3)
    facilitating speed of transition and deployment in the band; and (4)
    providing incumbents with a reasonable opportunity to continue their
    current uses of the spectrum. In order to accomplish these goals, we
    believe that the optimal band plan must: (1) provide for low-power
    operations while maintaining some spectrum for high-power
    services; (2) promote consistent regulatory treatment with similar
    wireless broadband services;[^84] and (3) offer flexibility through
    technological neutrality. We conclude that it is in the public
    interest to adopt the band plan described below because it best
    accomplishes the goals of this proceeding.

37. The following chart shows the band plan we are adopting:

  -------------- ------------ ------------ -------------------- -------------
  **Commission                                                  
  Band Plan**                                                   

  Channel        Lower        Upper                             
  Designation    Frequency    Frequency                         

  N/A            2495         2496          Guard Band           

  BRS 1          2496         2502                               

  A1             2502         2507.5                             

  A2             2507.5       2513                               

  A3             2513         2518.5                             

  B1             2518.5       2524                               

  B2             2524         2529.5                             

  B3             2529.5       2535                               

  C1             2535         2540.5                             LBS

  C2             2540.5       2546                               

  C3             2546         2551.5                             

  D1             2551.5       2557                               

  D2             2557         2562.5                             

  D3             2562.5       2568                               

  J              2568         2572          Guard Band           

  A4             2572         2578                               

  B4             2578         2584                               

  C4             2584         2590                               

  D4             2590         2596                               MBS

  G4             2596         2602                               

  F4             2602         2608                               

  E4             2608         2614                               

  K              2614         2618          Guard Band           

  BRS 2          2618         2624                               

  E1             2624         2629.5                             

  E2             2629.5       2635                               

  E3             2635         2640.5                             

  F1             2640.5       2646                               

  F2             2646         2651.5                             

  F3             2651.5       2657                               UBS

  H1             2657         2662.5                             

  H2             2662.5       2668                               

  H3             2668         2673.5                             

  G1             2673.5       2679                               

  G2             2679         2684.5                             

  G3             2684.5       2690                               
  -------------- ------------ ------------ -------------------- -------------

38. Specifically, we adopt a three segment band plan, consisting of: the
    LBS, extending from 2496-2572 MHz, and comprised of twelve
    5.5-megahertz-wide channels, one 6-megahertz-wide channel, and one
    4-megahertz-wide guard band; the MBS, extending from 2572-2614 MHz,
    and comprised of seven 6-megahertz wide channels; and the UBS,
    extending from 2614-2690 MHz, and comprised of twelve 5.5-megahertz
    wide channels, one 6-megahertz-wide channel, and one
    4-megahertz-wide guard band. MDS channel 1 will be relocated from
    2150-2156 MHz to 2496-2502 MHz, the LBS, and MDS channel 2 will be
    relocated from 2156-2162 MHz to 2618-2624 MHz, the Upper Band
    Segment.

39. The plan we adopt today incorporates a number of key elements from
    the Coalition proposal that received broad support from commenters.
    Dividing the band into high and low-power segments resolves the
    problems created by the current interleaved configuration of the
    band which inhibits the development of low-power cellularized
    broadband uses of the band.[^85] In addition to creating an
    environment for development of low-power systems, the plan reserves
    some spectrum for high-powered use for both EBS and rural licensees
    who have a continued need to deploy high-power systems. Like the
    Coalition proposal, the plan we adopt is also technologically
    neutral, affording licensees the flexibility to deploy either FDD or
    TDD technology anywhere in the 2.5 GHz band.

40. However, the band plan we adopt departs in some respects from the
    Coalition's proposed band plan. As noted above, we have expanded the
    overall bandwidth of the existing BRS-EBS band by reallocating
    2495-2500 MHz to fixed and mobile except aeronautical mobile
    services. Moreover, the Commission band plan will make full use of
    the 4 megahertz of spectrum (I band) located at the end of the band
    at 2686-2690 MHz.[^86] Finally, whereas the Coalition proposes to
    create 6-megahertz-wide guard bands in the low-power LBS and UBS
    (referred to as the J and K bands, respectively) the Commission's
    plan designates the J and K bands as 4-megahertz-wide bands. The use
    of 4-megahertz J and K bands is consistent with conclusions in the
    *3G Final Report* that 4 megahertz was sufficient to separate
    low-power and high-power uses.[^87] Furthermore, reducing the guard
    band increases the amount of spectrum available for low-power and
    high-power use. As discussed below, these changes will accommodate
    the relocation of incumbents to new spectrum assignments in the band
    that will give them substantially greater flexibility than the
    current band plan, while also facilitating the relocation of MDS
    Channels 1 and 2.

41. Adoption of the Coalition's proposed 16.5 megahertz-wide LBS and UBS
    blocks provides ample capacity for existing MDS and ITFS licensees
    to develop low-power broadband services of the type contemplated by
    the Coalition. These blocks will enable licensees to deploy any
    possible combination of the most current FDD and TDD standard
    channel sizes, which are based on channelizing in 5 megahertz
    increments.[^88] Basing the LBS and UBS band plan on a minimum
    channel width of 5 megahertz is also consistent with our band plans
    for other wireless services such as broadband PCS and the
    1710-1755/2110-2155 MHz AWS band, which utilize 5 megahertz
    multiples as the basis for their frequency blocks. In addition, the
    assignment of 5.5 megahertz-wide channels throughout the band
    promotes consistency between commercial wireless services and
    provides licensees the opportunity to take advantage of existing and
    future technologies thereby substantially lowering the cost of
    deployment. Furthermore, as discussed later in this text, the
    BRS/EBS technical rules we are adopting for the low-power bands are
    similar to those of both the PCS and AWS rules, thus making all
    three services similar.[^89]

42. The LBS and UBS will also contain two smaller segments, the J and K
    bands, which will serve primarily as guard bands. The J band will be
    located between the LBS and MBS at 2568-2572 MHz, and the K band
    will be located between the MBS and UBS at 2614-2618 MHz. The new
    channel assignments will be assigned on a pro rata basis to existing
    licensees in the other channel groups.

43. Under the band plan we adopt in this order, a licensee that
    presently has four interleaved 6 megahertz channels and four
    associated 0.125 megahertz response channels will receive 16.5
    megahertz of contiguous spectrum in either the LBS or UBS, a 6
    megahertz channel in the MBS, and 1 megahertz of contiguous spectrum
    in either the J or K guard bands after the transition. A licensee
    presently assigned one channel in the band, will receive one 5.5
    megahertz channel in either the LBS or UBS or one 6 megahertz
    channel in the MBS.[^90] The provision of contiguous spectrum,
    combined with the deployment of compressed digital signals, will
    provide incumbents with the opportunity to maintain their current
    level of analog operations. At the same time, the relocation of MDS
    Channels 1 and 2 to the band will make these channels more useful as
    part of a contiguous broadband service band and may foster
    competition and new service options. These additional competitive
    opportunities will, in turn, promote the public interest. Incumbents
    will enjoy the benefit of spectrum with increased flexibility and
    utility while the public benefits from the likely innovation and
    cost savings that will result from increased competition.

44. The MBS portion of the band plan also addresses concerns of
    commenters who seek to continue providing high-power video services.
    The MBS will continue to be divided into 6 megahertz channels,
    consistent with the existing band plan. Through use of digital
    technology, this should provide ample capacity for most EBS
    incumbents to continue providing existing instructional programming
    if they wish to do so. In addition, to the extent that EBS
    incumbents must find funding for new equipment to make up for the
    loss of additional high-power channels, we note that under the
    transition plan we adopt today, EBS licensees' conversions will be
    fully funded.[^91] Thus, this does not prohibit channel expansion at
    a later date. Although MDS licensees currently providing competitive
    video services in rural areas will most likely have to alter their
    systems, they will be afforded ample opportunity to do so.[^92]
    Hence, although the new band plan may result in some inconveniences,
    the long term benefits of the new band plan will ultimately benefit
    most licensees and the public. We also note that conversion of the
    band to provide for low-power operations will allow for more
    diversity in services that can be offered.[^93]

45. Commenters, such as Grand Alliance, FWH, and Spectrum Market favor
    across-the-board power reductions in signal strength limits to
    resolve the issue of the incompatibility between high and low-power
    systems.[^94] Grand Alliance states that uniform low-power
    operations are the most efficient way to use the spectrum,
    permitting the provision of new, advanced services in order to keep
    the United States at the forefront of technology development. Grand
    Alliance further states that "despite billions of dollars of
    investment, the existing high-power services have failed to
    establish any clear value."[^95] FWH adds that this approach would
    be consistent with the approach the Commission has taken with
    respect to the other bands allocated for flexible use.[^96]
    Similarly, Spectrum Market suggests that both public and private
    interest, short and long term, will be served if the Commission
    requires conversion of the entire MDS/ITFS band for low-power
    two-way services, and that it is essential for educators to
    transition ITFS use to broadband, interactive educational
    technologies.[^97]

46. While we see merit to the arguments presented by commenters who
    support across-the-board power reductions, we are nonetheless
    persuaded by commenters such as IIT, IPWireless, BellSouth, OWTC and
    Teton Wireless Television (Teton), who convincingly argue that there
    remains a continued need for high-power operations in the band.
    Furthermore, commenters such as Teton convincingly argue that
    high-power operations allow use of spectrum in rural areas where
    low-power systems are not as effective. Teton and other rural MDS
    commenters have also expressed concern that the inability to engage
    in high-power operations will effectively shut down their
    operations. Moreover, we are concerned by comments presented by the
    Diocese of Brooklyn, the Archdiocese of New York and Region 10 who
    argue that an across-the-board reduction in power would jeopardize
    and disrupt the important services they offer via high-powered
    operations.[^98] Similarly, MDS operators such as Digital TV One
    assert that commenters such as FWH do not take into account the
    spectrally efficient digital MDS/ITFS multi-channel video systems
    operated by entities such as itself and WATCH TV.[^99] Likewise,
    Digital TV One criticizes Spectrum Market for not discussing how its
    suggestions will benefit customers who rely on Digital TV One and
    other MDS/ITFS operators as a source of multi-channel video
    programming.[^100] Similar arguments have also been convincingly
    presented by Teton, which argues that those who advocate this
    approach have no regard to what these important services mean to
    rural families, and no appreciation for the technical reality of
    providing service in such rural areas, because a low-power cellular
    architecture is not financially feasible in rural markets.[^101] We
    agree with Teton that the expenses involved in deploying multiple
    cell sites to serve sparse populations may make it impractical to
    continue most services offered over high-power systems.[^102]
    Finally, we agree with BellSouth's assertions that the former
    regulatory regime, ill equipped to accommodate nationwide deployment
    of TDD and FDD technologies, is largely responsible for the slowed
    deployment of low-power systems.[^103] For these reasons, we
    conclude that we should not adopt across-the-board power reductions
    in the band. We note that the question of whether high-power
    operations are still needed in this band can be reassessed in the
    future when low-power BRS/EBS systems provide substantial service
    over large areas.

47. We also reject NAF's proposal to reallocate 2500-2590 MHz to
    unlicensed use and leave 2590-2690 MHz for licensed use. NAF argues
    that creating a primary unlicensed band would offer an opportunity
    to expand on existing Wi-Fi technology and provide an incentive for
    others to develop new communications technologies.[^104] The NAF
    proposal, however, would not leave sufficient room for viable
    high-power and low-power licensed operations. The record does not
    demonstrate that there is a need for the 2500-2590 MHz band to be
    designated for unlicensed use. We note that the Commission is
    considering authorizing unlicensed use in several other bands.[^105]
    Indeed, we believe that authorizing licensed spectrum for wireless
    broadband access is a strong complement to our existing and proposed
    unlicensed allocations. The volume of comments we have received in
    this proceeding demonstrates that there is a strong interest in
    having licensed spectrum available for use in wireless broadband
    applications.

#### Response Channels

48. In 1991, we allocated the seven 125 kHz response channels (part of
    the R channels under the Coalition band plan) associated with MDS
    channels E3, E4, F3, F4, H1, H2, and H3 to the OFS.[^106] The
    Coalition proposed to return these channels for MDS use.[^107] In
    the *NPRM*, we stated that we believed the Coalition's proposal was
    meritorious because there are no OFS licensees currently on these
    channels, probably because they are too narrow to be usable by
    themselves. We sought comment on this proposal. We also sought
    comment on whether we should automatically give the channels to the
    geographic area licensee of the corresponding 6-megahertz main
    channel, or implement some other method of assignment such as
    licensing the channels on a geographic area basis and allowing any
    eligible entity to apply for these channels. Inasmuch as there were
    no objections to the Coalition's proposal, we conclude that we will
    return the 2686-2690 MHz response channel band to BRS/EBS use as
    described in the adopted band plan.

49. In the *NPRM*, we sought comment on the Coalition's recommendation
    that operation on the response channels be secondary to operation on
    the LBS, MBS, and UBS channels. The MMDS Licensee Coalition opposes
    this recommendation and states that response channels should receive
    equal status.[^108] We believe affording 2686-2690 MHz spectrum
    secondary status to the LBS, MBS, and UBS is a moot issue at this
    point because we are adopting a band plan that absorbs the I band
    into the BRS/EBS spectrum in order to allow for 5.5-megahertz-wide
    channels as well as the reallocation of MDS 1 and 2 to the lower and
    upper bands. With proper planning, these types of operations should
    be able to operate adjacent channel to other operations and there is
    no justifiable reason to relegate licensed services in the 2686-2690
    MHz spectrum to secondary status relative to the LBS, MBS and UBS
    operations. In a related matter, we believe that the recently
    revised footnote US269 in the Table of Frequency Allocations affords
    sufficient protection of the passive services in the 2690-2700 MHz
    band.[^109] Thus, with proper coordination, operations on channel G3
    will be reasonably possible while sufficiently protecting the
    2690-2700 MHz band.

### Border Regions 

50. On June 25, 2002, the Commission and Industry Canada entered into an
    interim sharing arrangement concerning the use of the frequency
    bands 2150 -- 2162 MHz and 2500 -- 2690 MHz near the Canada/United
    States of America border.[^110] That interim sharing arrangement
    replaced the General FCC/Industry Canada Understanding.[^111] The
    interim sharing arrangement requires licensees to coordinate their
    operations with each other for their respective service areas on
    both sides of the border and does not apply to stations in the
    mobile service.[^112] The current agreement with Mexico generally
    requires coordination of facilities within 80 km of the United
    States/Mexico border along with consideration of other technical
    criteria such as power flux density at the border and antenna
    polarization, and does not take into account the use of stations in
    the mobile service.[^113]

51. We are in the process of reviewing our existing agreements with
    Canada and Mexico in order to ensure that we can fully implement the
    band plan and other provisions we have adopted today. To the extent
    necessary, we will engage in negotiations to effect appropriate
    revisions to those agreements with the Mexican and Canadian
    governments. Our principal goal of these discussions will be to
    allow full implementation of our new rules in the border regions and
    full utilization of the 2495-2690 MHz band in all three countries.
    Until revised border agreements are reached, however, BRS and EBS
    licenses in the border area will be conditioned on compliance with
    existing international agreements.

### Geographic Area Licensing for Current Licensees

#### Adoption of Geographic Service Areas based on existing service areas

52. *Background.* Under current Commission rules, MDS auction winners
    are granted licenses for Basic Trading Areas (BTAs), but do not have
    the same flexibility to operate under those licenses as geographic
    licensees in other services. Under the current rules, a BTA
    authorization holder may not provide service within those portions
    of its BTA that encompass the PSA of incumbent stations and
    previously proposed MDS and ITFS facilities.[^114] In addition, a
    BTA authorization holder must apply for an individual station
    license for each transmitter within its BTA.[^115]

53. In the *NPRM*, we proposed the full implementation of geographic
    area licensing for MDS and ITFS licensees, noting that such
    licensing could increase the intensity and efficiency of use of this
    spectrum.[^116] We noted that in other bands where we contemplated
    the development of mobile or other wide-area services, we concluded
    that geographic licensing based on predefined service areas has
    significant advantages over site-based licensing because of the
    greater operational flexibility it gives licensees and the greater
    ease of administration for consumers, licensees, and
    regulators.[^117] We also noted that geographic area licensing
    reduces administrative burdens and operating costs by allowing
    licensees to modify, move, and add to their facilities within
    specified geographic areas without prior Commission approval. Our
    experience has been that such licensing affords licensees
    substantial flexibility to respond to market demand and may hence
    result in significant improvements in spectrum utilization. Based
    upon these observations, we sought comment on our proposal to
    implement geographic area licensing in the band, while protecting
    incumbent operations.

54. *Discussion.* We conclude that all BRS and EBS licensees will be
    licensed on a geographic area basis.[^118] Accordingly, BRS and EBS
    authorization holders will be allowed to place transmitters anywhere
    within their defined service area without prior authorization so
    long as the licensee's operations comply with the applicable service
    rules, do not affect radio-frequency quiet zones, or require
    environmental review or international coordination. Implementing
    geographic area licensing will allow licensees to rapidly deploy and
    modify facilities within their geographic licensing areas to provide
    ubiquitous service without the regulatory burdens of notifying and
    securing Commission approval. Geographic area licensing for BRS and
    EBS will also have the benefit of eliminating inefficient,
    administratively burdensome site-by-site licensing rules, the
    transaction costs of which are too high to permit competitive
    businesses to flourish using next generation technology. As part and
    parcel of geographic area licensing, we also adopt our tentative
    conclusion, stated in the *NPRM*, that where an existing license is
    canceled or forfeited, the right to operate in that area
    automatically reverts to the licensee that holds the corresponding
    BTA license,[^119] which is consistent with the approach we have
    taken in other wireless services.[^120]

55. In addition, as proposed in the *NPRM*, we will require geographic
    area licensees to protect the operations of both EBS
    incumbents[^121] and BRS site-based incumbents within the
    incumbent's GSA as defined by this order.[^122] For incumbent BRS
    and EBS site-based licensees, the GSA will be based upon the
    licensee's current PSA as provided in Sections 21.902(d)[^123] or
    74.903(d)[^124] of the Commission's rules. For BRS BTA authorization
    holders, the boundaries of the GSA will be exactly the same as the
    current PSA pursuant to Section 21.933(a).[^125] Except with respect
    to situations where MDS and ITFS PSAs overlap (discussed below), we
    did not receive many significant expressions of concern over
    interference resulting from this approach. Indeed, we note that many
    commenters such as BellSouth and SCETV support the implementation of
    geographic area licensing in the band.[^126] Additionally, AHMLC and
    IMLC also support establishing the new GSAs by reference to the
    present transmitter location, reasoning that new filers and
    incumbents alike can make interference analyses by reference to
    present site data.[^127] Moreover, Teton,[^128] the Rural
    Commenters, and VCI[^129] support the proposal to allow BTA holders
    to place transmitters anywhere within their service area without
    prior authorization so long as the operation complies with the
    applicable service rules, does not affect radiofrequency quiet zones
    or require environmental review or international coordination.[^130]
    We agree with these commenters and will thus provide incumbents with
    a GSA based on their existing PSAs, subject to the exceptions
    discussed below.

56. In apparent misunderstanding of the geographic licensing proposal,
    Grand Wireless argues that expanding the current service areas for
    incumbent MDS and ITFS licensees to conform to the BTA system of
    geographical allocation intrudes upon the rights of successful MDS
    BTA authorization holders who obtained rights in the band through
    the auction process.[^131] We disagree with Grand Wireless.
    Permitting BRS and EBS incumbents who were previously licensed using
    a site-by-site scheme to now use a geographic area licensing scheme
    which is based on the current PSA, neither extends an incumbent's
    service area nor impacts BTA authorization holders.

57. We note that the Coalition only advocates geographic area licensing
    for the low-power LBS and UBS and proposes to keep site-based
    licensing for high-power operations in the MBS.[^132] The only
    justification that the Coalition offers for imposing site-based
    licensing requirements in the MBS channels is the "belief" that a
    site-based licensing requirement affords protection to site-based
    systems and that the protection is worth the costs of site-based
    licensing.[^133] However, the Coalition fails to point to any unique
    feature of the MBS that would make geographic area licensing
    unworkable in that band. Furthermore, we conclude that adopting
    geographic area licensing would provide MBS operators with
    additional flexibility to coordinate spectrum usage, and allow
    operators to quickly adjust and react to market changes
    independently without Commission action. Accordingly, we adopt
    geographic area licensing for all operations in, and all segments of
    the band.

58. In light of our decision to institute geographic area licensing for
    BRS and EBS, we direct the Wireless Telecommunications Bureau to
    dismiss all pending applications to modify MDS or ITFS stations,
    except for modification applications that could change an
    applicant's PSA, or applications for facilities that would have to
    be separately applied for under the rules we adopt today. In light
    of the fact that we are initiating geographic area licensing
    immediately, we see no public interest in processing modification
    applications that are no longer necessary. We note WCA's concern
    that the Commission should not freeze the processing of modification
    applications because of possible delays in instituting service, but
    we believe that WCA's concern, premised on the possibility of the
    rules we adopt today not becoming effective until early 2005, is
    misguided.[^134] We will entertain requests for special temporary
    authority in instances where operators make the necessary showing
    and require authority to operate prior to the effective date of the
    new rules.

#### Splitting of Overlapping GSAs and Out of GSA Receive Sites 

59. *Background.* In recent years, the rules defining protected areas
    have changed or otherwise been modified in a manner that has
    resulted in overlapping PSAs being assigned to co-channel incumbent
    BRS and EBS licensees.[^135] The Coalition argues that these overlap
    areas result in a major operational barrier to anyone operating in
    these areas because none of the licensees with service areas that
    overlap can satisfy the interference protection criteria in the
    overlap area.[^136] According to the Coalition, the MDS and ITFS
    industry developed an informal method for handling this problem by
    drawing a boundary line through a "football"-shaped area where the
    PSAs intersect, with each licensee agreeing to limit the
    interference it generates across the boundary.[^137] The Coalition
    urged that if we adopted the proposal to base GSAs under the new
    rules on licensees' existing PSAs, we formally adopt this method of
    handling potential interference issues where GSAs would overlap. We
    sought comment on the Coalition's proposal.

60. *Discussion\-- Receive sites within a PSA but outside a GSA.* We
    conclude that the Coalition's proposed "splitting the football"
    approach is the best compromise to remedying the difficulties
    associated with overlapping GSAs. This approach is supported by many
    commenters in the record. HITN supports geographic area licensing
    and bifurcation of overlapping areas between current incumbent PSAs
    in order to create new, discrete geographical service areas.[^138]
    Likewise, IMWED argues that the region within overlapping PSAs has
    become a "no man's land" where neither licensee is able to secure
    authorizations without the other's consent and this creates a
    prescription for gridlock and spectrum inefficiency that is cured by
    the GSA concept.[^139] The IMLC agrees that splitting the football
    is an appropriate way to handle overlapping PSAs, stating that there
    is a real value in establishing clearly who has the rights to
    operate in which territories. Both AHMLC and IMLC take the pragmatic
    view that splitting the difference, while not ideal, provides a
    rough-justice solution.[^140] We concur.

61. Some commenters point out that adopting the Coalition's approach
    could result in some incumbent facilities in overlap areas being
    "marooned" without protection because they are on the wrong side of
    the dividing line. Region 10 asserts that many incumbent ITFS
    licensees, including itself, will have marooned receive sites.
    [^141] The Rural Commenters and NTCA argue that both existing
    transmit and receive sites must be protected against harmful
    interference.[^142] Similarly, Stanford and Northeastern believe
    that "splitting the football" does not necessarily take into account
    the service base that a station might have developed for its
    programming business.[^143] Additionally, SCETV believes that while
    the Coalition approach could apply prospectively, existing receivers
    within the current PSAs that would not be protected under the new
    rules should be grandfathered to allow continued service by the
    original license holder.[^144]

62. On balance, we conclude that reception sites that fall on the
    "wrong" side of the boundary as described above should not be
    protected. Generally, we have not protected sites outside
    established PSAs in other services where we have implemented
    geographic area licensing.[^145] Moreover, mandating protection of
    these sites could be unduly disruptive to those licensees who have a
    GSA that encompasses an out-of-area receive site. Given the
    increasing use of low-power cellularized systems that will be
    serving a broader area, we believe that requiring protection of
    out-of-area receive sites will inhibit the development of broadband
    service and could make it more difficult for licensees to deploy
    systems. Nonetheless, we agree with IPWireless's suggestion that
    licensed facilities may continue to serve receive sites lying
    outside the GSA boundary as of the effective date of the rules on a
    secondary non-interference basis.[^146] We further agree with AMHLC
    and IMLC that the Commission should also recognize voluntary
    agreements among parties to be protected in defining their
    GSAs.[^147] Accordingly, we will allow marooned receive sites to be
    served on a secondary non-interference basis.

63. Furthermore, as explained above, we believe this is the best
    compromise to remedy the difficulties associated with overlapping
    GSAs and receive sites that fall outside a GSA. The Coalition argues
    that its proposal merely sustains the status quo with respect to the
    protection of receive sites either outside the GSA or caught on the
    wrong side of the chord when the football is split and the adoption
    of a rule that does not protect these sites will result in the loss
    of existing service to operators.[^148]

64. To avoid future conflicts between licensees as to the actual
    location of the overlap area dividing line, Comspec recommends that
    the Commission either define the method to be utilized when
    calculating such boundaries, or provide a public database of the
    boundaries for all incumbent PSAs.[^149] We conclude that neither
    approach is necessary. As noted above, the industry has informally
    resolved these boundary issues on its own for years without federal
    regulation. Indeed, as the Coalition explains, "the contemplated
    protections are merely a continuation of existing protection
    relationships between licensees \[that\] the MDS/ITFS industry has
    been living for two decades with rules requiring protection to both
    GSAs and to individual receive sites, and has done so without any of
    the confusion feared by the *NPRM*."[^150] Comspec fails to explain
    why it is necessary for the Commission to micromanage this process
    when the record indicates that parties will continue to be able to
    resolve these issues on a voluntary basis.

65. We recognize that splitting the football is not a perfect solution.
    Rather, we agree with the Coalition that it is the best available
    alternative where parties are unable to reach voluntary agreements.
    Indeed, as noted above, we strongly encourage parties to work
    together on a voluntary basis and believe that such participation
    will ultimately result in receive site protection outside the GSA in
    many cases. In this regard, if incumbent licensees can reach
    agreements with operators on the other side of the chord, they will
    be permitted to provide service on the outside of their respective
    chords after the operating lines have been drawn. We strongly
    encourage such participation and are optimistic that the cooperation
    the MDS and ITFS industries have shared for years will persist and
    serve to facilitate amicable solutions to any potential
    difficulties.

66. *Discussion -- Grandfathered receive sites outside a PSA.* Although
    the Coalition's states that "\[t\]here is no current ITFS receive
    site protection outside of the current PSA,"[^151] we disagree.
    Under our current rules, all receive sites registered as of
    September 17, 1998 are entitled to interference protection,
    including registered receive sites located outside existing
    thirty-five mile PSAs.[^152] Accordingly, we believe that we must
    address the issue of whether we will continue to grant interference
    protection to grandfathered receive sites located outside the PSA.

67. We conclude that we should not continue to provide interference
    protection to receive sites located outside the PSAs. As noted
    above, we believe that providing interference protection to receive
    sites outside the new GSAs could be unduly disruptive to those
    licensees who have a GSA that encompasses an out-of-area receive
    site and could hinder the deployment of new services. However, as
    with receive sites located inside the former PSA but outside the new
    GSA, we will allow continued service of such receive sites on a
    secondary, non-interference basis.

### Transition to New Band Plan

#### Background

68. Generally, the Coalition recommends that we adopt a rather complex
    market-by-market four-phased transition approach. Although the
    Coalition's transition plan is described in detail in the *NPRM* of
    this proceeding, a brief overview of the Coalition's transition plan
    follows.[^153] Under the Coalition's plan, the first phase of the
    transition involves identifying the parties that must participate in
    the transition.[^154] To determine whether a licensee is a required
    party,[^155] the proponent[^156] seeks information by serving a
    "pre-transition data request" on licensees.[^157] Under the second
    phase, planning the transition, the proponent starts the 90-day
    transition planning period by serving "transition notices" on
    licensees that are required to transition.[^158] After serving the
    transition notice, the proponent must provide the required
    participants with a written plan for transitioning a given market no
    later than 30 days before the end of the transition planning
    period.[^159] In response to the proponent's offer, the required
    participants may submit a counter proposal no later than 10 days
    before the end of the transition planning period.[^160] Under the
    third phase, the proponent physically shifts educational ITFS
    programming tracks to spectrum in the MBS and outfits eligible ITFS
    receive sites with improved downconverters designed to limit the
    reception of signals from outside the MBS.[^161] Under the fourth
    phase, licensees terminate existing operations in transitioned
    markets that do not comply with the new rules.[^162] The Coalition's
    Plan further provides for dispute resolution procedures should the
    parties fail to agree on the terms of the transition.[^163] In
    addition, the Coalition's plan contains nine safe harbors; if a
    proponent's offer falls into one of those nine safe harbors, it
    would be deemed "reasonable" in the event of a dispute between the
    proponent and a required participant.[^164] The Coalition's plan
    also allows certain MVPD providers to "opt-out" of the
    transition.[^165] Under the Coalition's plan the proponent would pay
    the costs for replacement downconverters for eligible ITFS receive
    sites, the relocation costs of ITFS licensees that wish to continue
    to operate downstream high-power, high-site educational video
    programming,[^166] and the expenses of MVPD providers that elect not
    to participate in the transition, but whose facilities must be
    modified to prevent interference to licensees that are
    transitioning.[^167] MDS licensees pay their own costs of
    transitioning under the Coalition's plan.[^168]

69. The Coalition's plan received both favorable and unfavorable
    comments. Commenters who favored the Coalition's transition plan
    stated that it would enable the transition to occur quickly,[^169]
    permit multichannel video programming distributors to "opt-out" of
    the transition process,[^170] fund the migration of ITFS licensees
    to the MBS,[^171] and prevent "unscrupulous licensees from green
    mailing system operators."[^172]

70. Commenters who opposed the Coalition's transition plan argue that
    the Coalition's transition plan would be too lengthy, too
    regulatory, and would invite litigation.[^173] Moreover, they state
    that the Coalition's plan does not specify the requisite financial
    ability of the proponent and does not address what would happen if
    the proponent withdraws.[^174] One commenter maintains that the
    Coalition's plan potentially puts in the hands of one entity the
    potential power to dictate to all other entities in a market how
    their operations must be structured.[^175] One of the most
    significant issues, according to some commenters, is that the
    Coalition's transition plan would lead to "daisy chains."[^176] In
    this connection, Spectrum Market indicates that it has performed a
    case study which analyzes all GSAs, the center coordinates of which
    are in the 28 BTAs in the Washington, D.C.-New York City Corridor.
    Spectrum Market's study finds, based on GSA overlap, that under the
    Coalition's transition plan, any proponent that desires to
    transition any GSA in this corridor will have to transition all of
    them.[^177] This would be particularly difficult, Spectrum Market
    notes, because this corridor has a population of approximately 43
    million people and 96 separate licensees with a total of 172
    stations.[^178] Spectrum Market asserts that its case study
    demonstrates that a proponent would be required to follow the
    Coalition's complicated procedure of obtaining information from each
    licensee concerning their respective facilities, developing and
    submitting a transition plan to all licensees, waiting, then
    responding to any objections, and if all objections are rectified,
    implementing the plan and paying the transition costs of all ITFS
    licensees.[^179] Spectrum Market adds that if a proponent withdraws
    from the plan, the conversion process will be stalled. Other
    commenters agree with Spectrum Market. MMDS Licensees, an ad hoc
    coalition of MDS licensees, views the Coalition's transition plan as
    requiring complex reimbursement schemes, 150-mile daisy chains and
    other complications resulting from the voluntary market-by-market
    approach.[^180] They assert that the net result of adopting the
    Coalition Plan would be to delay the transition rather than to
    expedite it because the parties would be embroiled in constant
    bickering over the terms of transition and who should be responsible
    for what costs.[^181]

71. Other commenters supported other options mentioned in the *NPRM*.
    For instance, several commenters supported the adoption of a
    three-phase transition plan, which involves a voluntary negotiation
    period, a mandatory negotiation period, and a mandatory
    relocation.[^182] IP Wireless supports either the three-phase
    transition plan or mandatory negotiation with a two-year deadline to
    complete the transition.[^183] IMLC recommended that the transition
    plan should be based on the top 30-markets, with a deadline
    imposed.[^184] Intel stressed the need for the transition process to
    be predictable to create an attractive environment for innovation
    and investment, thus offsetting the long lead times that are needed
    for research and development of new technologies.[^185]

#### Discussion

72. We adopt the Transition Plan, detailed below, which we believe will
    enable us to achieve our goal of transitioning the band quickly and
    will be fair and equitable to all parties concerned. In this regard,
    we emphasize that under the plan we adopt today, EBS licensees will
    receive spectrum in the new band plan that is comparable to the
    spectrum they currently hold in terms of throughput and therefore we
    believe that they will not be negatively affected by reduced
    capacity. Moreover, we further emphasize that licensees that have
    four interleaved 6-MHz channels and four interleaved 125 kHz "I"
    channels will, under the new band plan, receive 16.5 MHz of
    contiguous spectrum in either the LBS or UBS, a 6-MHz channel in the
    MBS, and 1 MHz of contiguous spectrum in either the "J" or "K"
    bands. Thus, for instance, a licensee on the interleaved "A" group
    channels will receive 16.5 MHz of spectrum from 2502 to 2518.5 in
    the LBS and a 6-MHz channel in the MBS, whereas a licensee on the
    interleaved "E" group channels will receive 16.5 MHz of contiguous
    spectrum from 2624 to 2640.5 MHz in the UBS and a 6-MHz channel in
    the MBS. We further note that the new band plan provides space for
    MDS 1 and MDS 2 licensees, thus co-locating all MDS licensees. The
    spectrum assignments for the remaining channels are detailed
    above.[^186] We recognize that during the transition process, in
    addition to being relocated from their current channel locations to
    their new spectrum blocks, licensees may, for a variety of reasons,
    wish to transfer, assign, partition, disaggregate, or lease their
    spectrum to meet the needs of their customers and/or to facilitate
    the transition of a particular Major Economic Area (MEA).[^187] In
    the *FNPRM* attached to this *Report and Order*, we seek comment on
    ways to streamline our administrative processes to further
    facilitate the transition of the 2.5 GHz band in an effective and
    efficient manner. Also in connection with the transition, we
    emphasize that there is a relationship between the transition, the
    new band plan, and the technical rules for EBS and BRS licensees.
    Generally, the LBS and the UBS will be used for low-power
    cellularized services whereas the MBS will be used for high-powered
    services. The rules provide, however, that licensees may offer
    low-power service in the MBS and high-power service in the LBS and
    UBS if the licensee can reach an agreement with neighboring
    licensees. For instance, in a particular market where an MVPD
    provider uses the entire BRS/EBS spectrum, it may seek consent
    agreements with licensees in neighboring Major Economic Areas (MEAs)
    to continue their high-powered operation in the LBS and UBS.
    Similarly, the rules allow low-power operations in the MBS if the
    licensee can reach an agreement with other licensees concerning
    interference from high-powered operations. Thus, the rules we adopt
    today permit licensees the flexibility to meet the demands of a
    particular market. The Transition Plan we adopt also requires the
    proponent to ensure that incumbents occupying the spectrum
    designated for MDS 1 and 2 in the 2.5 GHz band be relocated to
    provide space for MDS 1 and 2 licensees in the 2.5 GHz band. Lastly,
    the Transition Plan provides for the replacement of comparable
    facilities for EBS licensees.

73. In light of the comments that the Coalition's plan would be too
    lengthy, too regulatory, and would invite litigation if
    adopted,[^188] we adopt the Transition Plan that we believe, retains
    the essential framework of the Coalition's proposal and provides
    flexibility to both the proponent and incumbent licensee.
    Ultimately, we conclude that the Transition Plan we adopt is in the
    public interest because it will create an attractive environment for
    innovation and investment in the 2496-2690 MHz band. We also believe
    that the transition represents an efficient means of managing the
    transition and managing the spectrum.

74. The Transition Plan we adopt has five phases, as follows: (1)
    initiating the transition process by filing a Initiation Plan with
    the Commission; (2) planning the transition; (3) reimbursing the
    costs of the transition; (4) terminating existing operations in
    transitioned markets; and (5) filing the post-transition
    notification. In the first phase, initiating the transition, a
    proponent, through a pre-transition data request, gathers
    information from BRS and EBS licensees in a given MEA, which the
    proponent uses to draft a Transition Plan. Under the first phase, a
    proponent initiates a transition by filing specified information in
    a document called an Initiation Plan with the Commission. Also
    during the first phase, a proponent notifies the BRS and EBS
    licensees in the MEA that the proponent will initiate a transition.
    During the second phase, planning the transition, the proponent
    sends each BRS and EBS licensee a proposal, called the Transition
    Plan, which not only identifies all of the licensees that will be
    transitioned and explains the details of the transition, but also
    marks the start of the phase of the transition where the proponent
    and the individual licensees negotiate over the details of the
    transition. Because disputes may arise during this phase, we have
    adopted two safe harbors in which we indicate that we believe that
    the proponent's offer is reasonable. After the proponent has reached
    an agreement with individual licensees, the third phase begins.
    During this phase, the proponent physically shifts the EBS
    programming tracks to new channels and outfits eligible EBS
    reception sites with improved downconverters. During the fourth
    phase, the licensees cease their current service offerings. During
    the fifth phase, the proponent and affected BRS and EBS licensees
    file a notification with the Commission that the transition has been
    completed. These phases are further discussed in detail below. We
    note that licensees may continue to operate under the current rules
    until the transition occurs.

75. *Exclusions.* Before addressing the particulars of our Transition
    Plan, however, we note that we have concluded not to adopt the
    Coalition's recommendation to allow certain licensees to "opt-out"
    of the transition.[^189] Under the Coalition's Plan, an MVPD
    licensee is permitted to "opt-out" of the transition if it certifies
    within 30 days of the effective date of the rules that it or its
    affiliate is a multichannel video programming distributor ("MVPD")
    as defined in Section 522 of the Act and, as of the date of its
    certification, it provides MVPD service to five percent or more of
    the households within its GSA, and must certify again at the start
    of the transition that it still provides service to five percent or
    more of the households within its GSA. The Coalition's plan also
    allows any MDS or ITFS licensee that is collocated with any
    qualified MVPD licensee that elects to opt-out may also opt-out the
    transition.

76. While we note the successful deployment of MVPD service by licensees
    such as W.A.T.C.H. T.V.[^190]and Sioux Valley Wireless,[^191] we
    believe that adopting the Coalition's proposal to allow MVPD
    licensees that meet the requirements detailed above to "opt-out" of
    the transition needlessly complicates the transition process and is
    unnecessary to protect MVPD licensees, especially those that are
    currently using the entire BRS/EBS spectrum. We are particularly
    concerned, moreover, that the adoption of a blanket "opt-out" for
    high-powered MVPD licensees may result in interference to licensees
    in neighboring population centers, which would prevent these
    neighboring locales from receiving wireless broadband services under
    the rules adopted today. Moreover, we believe that existing MVPD
    providers could be accommodated under the Transition Plan we have
    adopted today. An MVPD provider would be free to be a proponent in
    its MEA. To the extent an MVPD provider was only interested in
    transitioning a portion of an MEA, it could become a joint proponent
    with other entities that were interested in transitioning other
    portions of the MEA.

77. Notwithstanding our decision not to adopt the Coalition's proposed
    opt-out for MVPD providers, we are sympathetic to the predicament of
    those MVPD licensees that developed successful businesses under the
    old rules, and to their customers that receive both video and
    broadband services from those MVPD licensees. We are also
    sympathetic to those BRS licensees that have a viable business for
    high-powered operations, but who need more that seven digitized MBS
    channels to deliver service to their customers, which would
    constitute all of the high-power spectrum in the 2.5 GHz band.
    Therefore, we find that it is in the public interest to consider
    waivers on a case-by-case basis for those operators or their
    affiliates that meet the definition of a multichannel video
    programming distributor as defined in Section 522 of the
    Communications Act of 1934, as amended and that provide MVPD service
    to five percent or more of the households within their respective
    GSAs, the calculation made in accordance with the requirements
    Section 76.905(c) of the Commission's Rules.[^192] We further find
    that it is in the public interest to consider waivers for any BRS or
    EBS licensee that is co-located with any qualified MVPD licensee
    that elects to opt-out may also opt-out the transition. We further
    find that it is in the public interest to consider waivers for those
    BRS licensees that have a viable business for high-powered
    operations, but who need more than seven digitized high-powered MBS
    channels to deliver their service to their customers. In reviewing
    requests to waive the rules adopted today, we will consider the
    actions taken by MVPD or BRS licensees to minimize the affect of
    interference on neighboring markets, as well as the licensee's
    explanation as to why it cannot work within the transition rules we
    have adopted. Waivers will be granted if it is shown that: (i) the
    underlying purpose of the rules(s) would not be served or would be
    frustrated by application to the instant case, and that a grant of
    the requested waiver would be in the public interest; or (ii) in
    view of the unique or unusual factual circumstances of the instant
    case, application of the rule(s) would be inequitable, unduly
    burdensome or contrary to the public interest, or the applicant has
    no reasonable alternative.[^193]

##### Initiating the Transition Process

78. Under the rules we adopt today, the first phase of the transition
    consists of initiating the transition process. This phase begins on
    the effective date of the rules adopted in this *Report and Order*
    and lasts for a maximum of three years. During this three-year
    period, a proponent or multiple proponents, BRS or EBS licensees or
    EBS lessees, initiate a transition by filing an Initiation Plan with
    the Commission. Furthermore, the proponent or multiple proponents
    must transition the 2.5 GHz band by MEA. During this phase of the
    transition and before filing the Initiation Plan with the
    Commission, the proponent or multiple proponents must send a
    pre-transition data request and a transition notice to all affected
    licensees in a given MEA. We emphasize that the three-year deadline
    is a maximum deadline and that a proponent or joint proponents may
    shorten the duration of this phase of the transition process. These
    requirements are explained in more detail below.

79. As mentioned above, a transition is initiated by a proponent, which
    will generally be either a current BRS or EBS licensee or EBS
    lessee. To enable the 2500-2690 MHz band to be transitioned in an
    efficient manner and to give flexibility to proponents, however, we
    have concluded to permit more than one proponent to initiate a
    transition in a given MEA. Moreover, when a BTA-holder is a
    proponent and the BTA is in more than one MEA, the BTA-holder may
    elect to be the proponent of only one MEA or may elect to transition
    two or more MEAs that overlap the proponent's BTA.

80. We stress that more than one proponent may transition a particular
    MEA. Thus we do not believe that our decision to transition by MEA
    would be burdensome to proponents. On the contrary, we believe our
    decision strikes a balance between the goals of a proponent to
    transition by GSA or Transition Impact Area (TIA) (defined as a
    station's GSA, plus in the case of ITFS licensees, the specific
    location of ITFS reception sites that are certified as eligible to
    receive a new downconverter under the transition rules)[^194] and
    our goals to ensure the efficient utilization of spectrum and the
    development of new and innovative wireless services throughout the
    United States. Moreover, we believe that our decision to allow
    multiple proponents to transition a given MEA promotes flexibility
    by allowing proponents to team up to transition a given MEA. We note
    that BRS and EBS licensees and EBS lessees have several options.
    Under the first option, they can become a proponent and take primary
    control of transitioning the MEA. Under the second option, they can
    become a proponent and seek other proponents to assist in
    transitioning a particular MEA, which will reduce costs to each
    individual proponent. Under the second option, the multiple
    proponents must agree on how they will transition a particular MEA
    and this agreement must occur before the proponents file the
    Initiation Plan with the Commission. Multiple proponents may divide
    the MEA in any manner that suits their needs. At the end of the
    transition, however, the entire MEA must be transitioned to the new
    band plan or consents received from neighboring licensees. Under the
    third option, the BRS or EBS licensee or EBS lessee may wait for
    another licensee to step forward as the proponent. A licensee that
    selects the third option would wait to receive the Transition Plan
    from the proponent and then either accept the Transition Plan or
    make a counteroffer.

81. Licensees operating in MEAs for which an Initiation Plan has not
    been filed with the Commission within three years, may continue to
    operate until they are transitioned by another method determined as
    a result of the *FNPRM* attached to this *R&O*. In markets where no
    transition plan is filed, we will not require licensees to cease
    existing operations until at least eighteen months after the
    deadline for proponents to file initiation plans. Under any
    alternative transition scenario we adopt, we contemplate that it
    would take most or all of the 18-month period to institute the
    transition mechanism we adopt, conduct any necessary auctions, and
    have any new licensee ready to offer service. We believe that
    establishing this date will provide a measure of certainty to
    licensees and allow licensees to plan for the future. Beyond that
    date, licensees will know that they face the possibility of having
    to discontinue operations.

82. We believe that transitioning the band by MEA, instead of by market
    area, will enable a proponent or proponents to transition large
    areas of the country at once, which will ensure that the 2500-2690
    MHz band is transitioned quickly and will enable the provision of
    new and innovative services for all Americans, including those in
    rural areas. We therefore decline to adopt the first phase of the
    Coalition's plan, which they called "identifying the parties to the
    transition process." We believe that the adoption of the first phase
    of the Coalition's plan where a single proponent would transition an
    area based on a station's GSA and/or TIA, would result in a
    haphazard transition on a nationwide basis. Under the Coalition's
    plan, which does not propose a time frame for initiating a
    transition, some areas of the country might not be transitioned for
    many years. We conclude that transitioning the band by MEA instead
    of on a market-by-market basis selected by the proponent will result
    in a quicker and more even transition of the band throughout the
    nation and enable the development of new and innovative wireless
    services. We further conclude that transitioning the band by MEA
    will lead to the development of a rational market for spectrum in
    the 2500-2690 MHz band, thus allowing prospective licensees and
    lessees to develop a predictable business strategy. We note that
    there are fifty-two MEAs, which are comprised of one or more
    Economic Areas. Additionally, there are three EA-like areas: Guam
    and Northern Mariana Islands; Puerto Rico and the U.S. Virgin
    Islands; and American Samoa, which will also be transitioned to the
    band plan. We further note that we incorporated the docket of an
    ongoing Commission proceeding regarding possible BRS and EBS service
    in the Gulf of Mexico.[^195] At this time, we have concluded to
    defer any consideration of transitioning the MEA associated with the
    Gulf of Mexico, because we are seeking comment on a variety of
    issues concerning the Gulf of Mexico service area in the *Further
    Notice of Proposed Rulemaking* attached to the *Report and Order*.

83. Thus, in light of the record on this point, and in conjunction with
    our decisions to transition the 2500-2690 MHz band by MEA and to
    allow more than one proponent to transition a given MEA, we further
    conclude to require a proponent(s) to initiate a transition within
    three years of the effective date the rules adopted in the *Report
    and Order*. We believe that three years is an adequate amount of
    time to distribute a pre-transition data request and a transition
    notice and to determine whether to transition a particular MEA.
    Although we believe that three years is ample time for a
    proponent(s) to initiate a transition, we believe that a transition
    will not be initiated for all MEAs within this time frame.
    Consequently, if a transition is not initiated within three years of
    the effective date of the rules, we conclude that we will use
    another method of transitioning an MEA. We note that we are seeking
    comment on alternative methods in the *NPRM* attached to this
    *Report and Order* for transitioning these MEA(s).

84. *The Pre-Transition Data Request.* To assist potential proponents in
    assessing whether to transition an MEA, and in light of the fact
    that all of the necessary information is not publicly available in
    the Commission's records, we believe that it is necessary for
    licensees within an MEA to provide certain information to a
    potential proponent(s). In this connection, we conclude that prior
    to commencing a transition, a potential proponent(s) of a given MEA
    may request information from EBS and BRS licensees. Before
    requesting this information from BRS and EBS licensees, the
    proponent(s) must provide the following information to the
    recipients of the Pre-Transition Data Request: the proponent(s)'s
    full name, postal mailing address, contact person, e-mail address,
    and phone and fax number. A recipient of a Pre-Transition Data
    Request must provide the following information to the potential
    proponent(s): (1) a listing that identifies the location (by street
    address and geographic coordinates) of every constructed EBS receive
    site that, as of the date of receipt of the Pre-Transition Data
    Request is entitled to a replacement downconverter upon transition
    (see discussion of eligibility for a replacement downconverter
    below); (2) whether the downconverter is mounted on a structure
    attached to the building or on a free-standing structure; (3) the
    approximate height above ground level of the downconverter; (4) the
    adjacent channel D/U ratio that can be tolerated by any receiver(s)
    at the receive site, if known; and (5) the number of EBS video
    programming or data transmission tracks the EBS licensee is entitled
    to receive in the MBS and whether the EBS licensee will accept fewer
    tracks in the MBS. A proponent(s) must file an Initiation Plan after
    it has assessed the information in the pre-transition data request
    and decides to transition an MEA.

85. *The Transition Notice.* The next step in the transition for a given
    MEA occurs when the proponent(s) serves Transition Notices to all
    BRS/EBS licensees within a given MEA. Accordingly, the proponent(s)
    must serve Transition Notices on EBS licensees before the proponent
    files the Initiation Plan with the Commission. The proponent(s) must
    include in the Transition Notice, the proponent(s)'s full name,
    postal mailing address, contact person, e-mail address, and phone
    and fax numbers, identify the other BRS/EBS licensees that will be
    transitioned, and provide copies of the most recent response to a
    Pre-Transition Data Request for each participant in the process. The
    Transition Notice must contain a certification by the proponent(s)
    to the recipient and to the Commission that it has the funds
    available to pay the reasonably expected costs of the transition
    based on the information contained in the Pre-Transition Data
    Request responses. These requirements are consistent with the
    Coalition's recommendations and we believe are necessary to ensure
    the orderly and rapid transition of the 2500-2690 MHz band in a
    given MEA.

86. *Initiation Plan*. To determine when a transition has been initiated
    and to determine if it has been initiated within three years of the
    effective date of the rules, we have concluded to require a
    proponent(s) to file an Initiation Plan with the Commission. An
    Initiation Plan consists of the following information. First, the
    proponent(s) must identify the MEA or MEAs that will be
    transitioned. Second, the proponent(s) must identify, by call sign,
    all of the BRS and EBS licensees that are being transitioned. Third,
    the proponent(s) must have concluded an engineering analysis on
    transitioning all BRS and EBS licensees in a given MEA. Fourth, the
    proponent(s) must indicate when the transition will be completed.
    Fifth, if the engineering analysis indicates that licensees in an
    adjoining or adjacent MEA must be transitioned to avoid interference
    with licensees being transitioned, the proponent(s) must indicate
    that an agreement with the proponent(s) of the adjoining or adjacent
    MEA has been reached on transitioning those licensees. Instead of
    reaching an agreement with the proponent(s) of the adjacent or
    adjoining MEA, the proponent(s) may indicate an alternative means of
    transitioning these licensees in the adjoining or adjacent
    MEA.[^196] Sixth, when there are two or more proponents that are
    transitioning the same MEA, the proponent(s) must indicate that they
    have reached an agreement on how a given MEA will be transitioned.
    Seventh, the proponent(s) must certify that it has the funds to pay
    the reasonably expected costs of the transition based on the
    information contained in the Pre-Transition Data Request (see below
    for a discussion of the Pre-Transition Data Request). Eighth, the
    proponent(s) must indicate that it has sent Transition Notices to
    all of the BRS and EBS licensees in the MEA (See discussion below or
    Transition Notices.) Once all of this information is filed, the
    proponent(s) or proponents have initiated a transition in a given
    MEA on the date the information is filed with the Commission.

87. As mentioned above, the Initiation Plan must be filed with the
    Commission within three years of the effective date of the *Report
    and Order*. A proponent or proponents may withdraw from the
    Initiation Plan by formally informing all of the BRS and EBS
    licensees that were included in the Initiation Plan that the
    proponent(s) will no longer transition the MEA, and by amending the
    Initiation Plan filed with the Commission. A proponent(s) that
    decides to withdraw an Initiation Plan may not then seek to
    transition that MEA at a future time. Should a proponent(s) withdraw
    from the Initiation Plan and there is no other proponent(s) to take
    its place or no proponent(s) seeks to transition a given MEA within
    the three-year initiation period, the Commission may use another
    method to transition a given MEA. In the *Further Notice of Proposed
    Rulemaking* attached to this *Report and Order*, the Commission
    seeks comment on other methods to transition a given MEA.

##### The Transition Plan

88. *The Transition Plan.* The Transition Planning Period is the
    ninety-day period that commences on the day after the proponent(s)
    files the Initiation Plan with the Commission. No later than thirty
    days prior to the conclusion of the Transition Planning Period, the
    proponent(s) must provide a Transition Plan to all the licensees in
    a given MEA. The Transition Plan must identify the call signs of the
    stations that will transition to the new band plan, the specific
    channels that each will receive following the transition,[^197] the
    receive sites at which replacement downconverters will be installed,
    the video programming and data transmission tracks that will be
    migrated to the MBS, the technical configuration of the MBS
    facilities, and the approximate time line for effectuating the
    transition and ceasing operations pursuant to the current band plan.
    The Transition Plan must include plans for relocating the EBS and
    BRS incumbents from spectrum that has been redesignated for MDS 1
    and 2 under the rules adopted today. We note that the Transition
    Plan may provide for interruptions of EBS transmissions, so long as
    those interruptions are limited to a period of less than seven days
    at any reception site and that the proponent must coordinate with
    each EBS licensee to minimize the extent of any disruption. The
    timeline for completing the transition may not exceed 18 months from
    the conclusion of the Transition Planning Period or, in the event
    that the transition is delayed pending dispute resolution, the
    resolution of any dispute. The Transition Plan must also provide for
    the establishment of an escrow or other appropriate mechanism for
    ensuring completion of the transition in accordance with the
    Transition Plan. These requirements are generally consistent with
    the recommendations of the Coalition and will enable the parties to
    the transition be to fully informed of the overall effect of the
    transition on their operations and on the operations of their
    neighbors.

89. *Counterproposals to the Transition Plan.* No later than ten days
    before the conclusion of the Transition Planning Period, affected
    licensees may submit a counterproposal to the proponent(s) if they
    believe that the Transition Plan is unreasonable. If a timely filed
    counterproposal is received, the proponent(s) may accept the
    counterproposal and modify the Transition Plan accordingly or invoke
    dispute resolution procedures for a determination of whether the
    Transition Plan is reasonable. We note that the proponent would have
    two options should it decide to seek dispute resolution. First, the
    proponent(s) could take no action to transition the MEA until the
    dispute is resolved. Second, the proponent(s) could continue to
    transition the MEA while it awaits the results of the dispute
    resolution process. If a proponent(s) modifies a Transition Plan
    based on the counterproposal of a BRS or EBS licensee, the
    proponent(s) must send the modified Transition Plan to all affected
    BRS and EBS licensees in the MEA. In this connection, we encourage
    the use of Alternative Dispute Resolution procedures to resolve
    disputes that may arise in an equitable and fair manner. While we
    expect that parties will be able to work out disputes amongst
    themselves, we reserve the right to determine whether transition
    plans comply with our rules.

90. *Safe harbors.* To establish an orderly and quick transition of the
    2500-2690 MHz band, we adopt two safe harbors. If a proponent(s)'s
    offer falls under either of these safe harbors it shall be deemed
    reasonable in the event of a dispute. We decline, however, to adopt
    all nine safe harbors[^198] that were recommended by the Coalition.
    Several of the proposed safe harbors proposed by the Coalition are
    designed to meet the conditions of specific markets. Because these
    safe harbors would not be generally applicable throughout the
    nation, we conclude that they are inappropriate to be included in
    our rules. We have limited the adoption of safe harbors to those
    that we believe are of general applicability, which are the
    Coalition's safe harbors numbers 1 and 2. Rather than adopt safe
    harbors numbers 6 and 7, we have incorporated the key principle of
    these safe harbors into the Transition Plan (see Transition Plan
    discussion above) and subject to negotiation between the
    proponent(s) and the licensees being transitioned. We, however, do
    not adopt, whether explicitly or implicitly, the Coalition plan's
    safe harbors numbers 3, 4, 5, 8, and 9, because they are not of
    general applicability.

91. *Safe Harbor \# 1.* This safe harbor may apply when the default
    high-power channel assigned each channel group is authorized to
    operate after the transition with the same transmission parameters
    (coordinates, antenna pattern, height of center of radiation, EIRP,
    etc.) as the current downstream facilities authorized for the
    channel group. We agree with the Coalition that there may be
    situations that arise where minor changes to the operating
    parameters are necessary to accomplish the transition. Thus a
    neighboring co-channel or adjacent channel licensee may not object
    to any change from the default configuration if: (1) the change is
    not a major modification; or (2) the change is a major modification
    and the Transition Plan calls for the appropriate application for
    Commission consent to be filed, for it to be processed in accordance
    with the procedures assuring public notice and an opportunity to
    object, and for it to be granted prior to implementation. The EBS
    licensee being migrated may not object to a Transition Plan that
    proposes affording the EBS licensee with post-transition operating
    equipment that is as good as or better than that used before the
    transition. Provided that the proponent(s) is not proposing a change
    in the geographic coordinates of the facilities (other than as
    necessary to conform the actual location with the Commission's
    Antenna Survey Branch database) and provided further that the
    minimum D/U benchmarks discussed above will be achieved, the
    proponent(s) may in the Transition Plan propose:

-   An increase in the height of the center of radiation of the
    transmission antenna or a decrease in such height of no more than 8
    meters (provided that such change does not result in an increase in
    antenna support structure lease costs to the EBS licensee and the
    consent of the owner of the antenna support structure is obtained).

-   A change in the EIRP of the transmission system of up to 1.5 dB in
    any direction.

-   Digitization, precision frequency offset, or other upgrades to the
    EBS transmission or reception systems that allow the proponent(s) to
    invoke more advantageous interference protection requirements
    applicable to upgraded systems.[^199]

92. *Safe Harbor \# 2.* This safe harbor may apply when an EBS licensee
    has channel-shifted its single video programming or data
    transmission track to spectrum licensed to another licensee. Under
    the transition rules, that track must be on the high-power channel
    licensed to the EBS licensee upon completion of the transition. For
    example, the A Group licensee might have shifted its EBS video
    programming to channel C1. If one of the A Group channels is
    currently licensed with technical parameters substantially similar
    to those of channel C1, we should allow a Transition Plan to call
    for high-power channel A4 to be licensed with the same technical
    parameters as current channel C1. However, if the current A Group
    channels are licensed to operate with technical parameters
    materially different from those of channel C1, the proponent(s) has
    two options. First, it may arrange a channel swap with the licensee
    of the C Group so that the A Group licensee will receive high-power
    channel C4 (which will automatically be licensed with the same
    transmission parameters as current channel C1) in exchange for
    channel A4. Second, the proponent(s) may arrange for high-power
    channel A4 to operate with transmission parameters substantially
    similar to those of current channel C1 (see Safe Harbor \# 1).[^200]

##### Reimbursement Costs of Transitioning

93. Although several commenters recommend that both MDS and EBS
    incumbents should pay their own transition costs, we conclude that
    given the difficulties EBS licensees face in obtaining funding to
    transition their services, it is in the public interest for a
    proponent(s) to pay the costs of transitioning EBS licensees and
    providing comparable facilities.[^201] Thus, we agree with the
    Coalition that the proponent(s) must bear the costs of protecting
    EBS licensees that choose to continue to operate high-power
    high-site downstream video and data distribution systems against
    interference from LBS and UBS cellularized operations. In this
    connection, we note that there are two responsibilities toward these
    licensees, which are discussed below. We further conclude that BRS
    licensees must bear their own expenses in transitioning to the new
    band plan and complying with the new rules. We disagree with the
    Coalition, however, that the proponent(s) should pay the costs to
    modify the facilities of MVPD providers that opt-out[^202] because
    we have not adopted the Coalition's proposal to allow MVPD providers
    to opt-out of the transition.

###### Replacement Downconverters for former ITFS licensees

94. To protect against interference from cellularized services in the
    LBS and UBS, the proponent(s) must install at every eligible EBS
    receive site a downconverter designed to minimize the reception
    signals from outside the MBS. As part of the transition process, a
    proponent(s) must replace an EBS receive site if (1) a reception
    system was installed at that site on or before the date the EBS
    licensee receives its Pre-Transition Data Request (see discussion
    above); (2) the reception system was installed by or at the
    direction of the EBS licensee; and (3) that reception system is
    either actually used to receive EBS programming that comports with
    former Section 74.931(a)(1) of the Rules or is located at a cable
    television system headend and the cable system relays such EBS
    programming. Only EBS receive sites within the licensee's
    thirty-five mile radius PSA circle are eligible to receive
    replacement downconverters. The details of the replacement of the
    downconverters will occur during the Transition Planning Period,
    which is discussed above.

95. The replacement downconverters must satisfy the following minimum
    technical characteristics:

-   The downconverter's input frequency range (the "in-band
    frequencies") must be 2572 MHz to 2614 MHz and output frequency
    range must be 294 MHz to 336 MHz;

-   The downconversion process must not invert frequencies;

-   The nominal gain of the downconverter must be 32 dB, or greater;

-   The downconverter must include filtering prior to the first
    amplifier that attenuates frequencies below 2500 MHz and above 2705
    MHz by at least 25 dB;

-   The downconverter must have an out-of-band input 3^rd^ order
    intercept point (input IP3) of at least +9 dBm, where out-of-band is
    defined as all frequencies below 2566 MHz and all frequencies above
    2620 MHz;

-   The downconverter must have a typical noise figure of no greater
    than 3.5 dB and a worst case noise figure of no greater than 4.5 dB
    cross all in-band frequencies and across its entire intended
    operating temperature range;

-   The downconverter must not introduce a delta group delay of more
    than 20 nanoseconds for digital operations or 100 nanoseconds for
    analog operations over any individual six megahertz MBS channel.

###### Migration of Video Programming and Data Transmission Track for former ITFS licensees

96. The proponent(s) must provide, at its cost, to each former EBS
    licensee that intends to continue downstream high-power, high-site
    educational video programming or data transmission services with one
    programming track on the MBS channels for each EBS video programming
    or data transmission track the licensee is currently transmitting on
    a simultaneous basis. To be eligible for migration, a program track
    must contain EBS programming that complies with former Section
    74.931(a)(1) of the Commission's Rules. Only programming tracks
    being transmitted on December 31, 2002 or within six months prior
    thereto should be migrated at the proponent(s)'s cost. Each eligible
    programming track must be migrated to spectrum in the MBS that will
    be licensed to the affected EBS licensee at the conclusion of the
    transition. The proponent(s)'s Transition Plan must provide for the
    MBS channels to be authorized to operate with transmission
    parameters that are substantially similar to those of the licensee's
    current operation. In addition, after the transition, the
    desired-to-undesired signal level ratio at each of the receive sites
    securing a replacement downconverter must satisfy the following
    criteria:

97. *Co-channel D/U Ratio.* In cases where the post-transition desired
    signal is transmitted using analog modulation, the actual co-channel
    D/U ratio measured at the output of the reception antenna must be at
    least the lesser of (i) 45 dB; or (ii) the actual pre-transmission
    D/U ratio less 1.5 dB. In cases where the post-transition desired
    signal will be transmitted using digital modulation, the actual
    co-channel D/U ratio measured at the output of the reception antenna
    must be at least the lesser of (i) 32 dB; or (ii) the pre-transition
    D/U ratio less 1.5 dB. Where in implementing the Transition Plan the
    proponent(s) deploys precise frequency offset in an analog system,
    the minimum co-channel D/U ratio is reduced to 38 dB, provided that
    the transmitters have, or are upgraded pursuant to the Transition
    Plan to have, the appropriate "plus," "zero," or "minus" 10,010
    Hertz precision frequency offset with a ± 3 Hz (or better)
    stability.

98. *Adjacent Channel D/U Ratio.* The actual adjacent channel D/U must
    equal or exceed the lesser of 0 dB or the actual pre-transmission
    D/U ratio. However, in the event that the receive site uses
    receivers, or is upgraded by the proponent(s) as part of the
    Transition Plan to use receivers, that can tolerate negative
    adjacent channel D/U ratios, the actual adjacent channel D/U ratio
    at such receive site must equal or exceed such negative adjacent
    channel D/U ratio.

###### BRS Costs

99. To prevent a proponent(s) from incurring all of the costs associated
    with transitioning an MEA, we conclude that former MDS licensees
    must pay the costs of their own transition. We believe that the
    cost-sharing rules we adopt are not only equitable but will promote
    the rapid transition of the 2500-2690 MHz band.

###### MVPD Costs

100. As we noted above, we do not require the proponent(s) to pay the
     expenses of MVPD providers.

##### Terminating existing operations in transitioned markets.

101. In the process of transitioning from the old band plan to the new
     band plan, licensees will be required to cease their current
     service offerings before they are in a position to begin new
     services under the new band plan. In light of our decision to
     eliminate the discontinuance of service rules, licensees that are
     subject to transition will not be in jeopardy of losing their
     licenses during the transition period. We note that in the *Further
     Notice of Proposed Rulemaking* attached to this *Report and Order*,
     we seek comment on the performance requirements that we should
     adopt for the 2500-2690 MHz band once it is transitioned. We
     emphasize, however, the licensees should minimize disruption of
     service to their customers and should notify their customers when
     service will be disrupted and for how long.

##### Filing the post-transition notification.

102. The proponent(s) and the affected licensees must jointly file a
     notification with the Commission providing information that the
     transition has been completed and that the licensees are operating
     according to the rules adopted today. Specifically, the
     notification must provide the identification of the licensees that
     have transitioned to the band plan adopted today and the specific
     frequencies on which each licensee is operating. In addition, for
     each MBS station, the notification must provide the following
     information: the station coordinates, the make and model of each
     antenna, the horizontal and vertical pattern of the antenna, the
     EIRP of the main lobe, orientation and height of antenna center of
     radiation, transmitter output power, and all line and combiner
     losses. The proponent(s) must provide copies of the post-transition
     notice to all parties to the transition. As mentioned above,
     consistent with the eligibility restrictions on EBS spectrum, we
     believe that licensees operating in the same geographic area may
     wish to "swap" or "trade" spectrum with another licensee to be able
     to create paired spectrum or for some other reason. In essence, we
     believe that many licensees will seek to transfer, assign,
     partition, disaggregate, or lease their spectrum to meet the needs
     of a particular area. In order for the Commission to facilitate
     these transactions and the transition of the 2.5 GHz band to the
     new band plan, we seek comment on ways to streamline administrative
     procedures in the *FNPRM* attached to this *Report and Order*.

##### Bureau Reports

103. As noted above, our goal is a swift transition to the new band plan
     so that consumers can receive the benefits of new and modified
     wireless broadband services to be offered in the revised band. We
     will monitor closely the transition of this band and will take
     additional action if the rules and procedures set forth in this
     *Report and Order* are not sufficient to facilitate this
     transition. To that end, we direct the Bureau to report to the
     Commission on the status of the transition of the 2.5 GHz band at
     eighteen months, three years and five years after the effective
     date of the rules adopted in this *Report and Order*. The reports
     at this timeframe will take into account the Initiation Plans filed
     by the proponents with the Commission, up to the three-year
     deadline for proponents to initiate the transition process, and we
     look forward to the initiation of transition plans in a substantial
     number of markets. The five year report will take into account the
     notification information filed by affected licenses after the
     transitions are complete.

## Technical Issues

104. In this section, we address technical proposals to enhance the
     Services. We sought comments on these issues as well as suggestions
     concerning other technical rule changes that may be of benefit to
     the Services.

### Signal Strength Limits at Geographic Service Area Boundaries

#### Power Limits in the LBS and UBS

105. In the *NPRM*, we sought comment on the signal strength limits to
     apply at geographic area boundaries. We noted that we recently
     reallocated forty-eight megahertz in the lower 700 MHz band
     (broadcast television channels 52-59) to fixed and mobile services
     while allowing continued provision of broadcast services in the
     band on a secondary basis, and limited the permissible signal
     strength at service area boundaries to 40 dBμV/m, the same signal
     strength limit that we adopted earlier for the upper 700 MHz band
     and the 800-MHz EA-based and 900-MHz MTA-based SMR services.[^203]
     By comparison, our rules apply a somewhat higher 47 dBμV/m limit at
     the GSA boundaries for broadband PCS,[^204] and for Part 27
     services in the 1390-1395, 1432-1435, 2305-2320 and 2345-2360 MHz
     bands.[^205] In all of those cases, the allowed signal strengths
     are compatible with the provision of low-powered cellular services
     in adjacent service areas. We tentatively concluded to follow the
     same general standard in this proceeding but sought comments on any
     unique characteristics of the 2500-2690 MHz band that might warrant
     a different approach.

106. After reviewing the comments in this proceeding, we adopt our
     tentative conclusion to limit signal strengths to 47 dBμV/m in the
     LBS and UBS, at the geographical service area boundaries. Imposing
     a signal strength maximum at a licensee's service area boundary is
     a tried and true mechanism for managing and limiting co-channel
     interference as well as defining rights, obligations and
     expectations of all licensees in the band. This boundary signal
     strength will also facilitate coordination between co-channel
     licensees in adjacent areas. Furthermore, as discussed above, this
     limit is consistent with other signal limits for other similar
     services.

107. Fixed Wireless Holdings and Nextnet Wireless oppose the 47 dBμV/m
     limit and suggest that we retain the current -73.0 dBW/m² limit at
     the PSA. FWH argues that the incompatibility between high-power and
     low-power, cellular type systems, sharing the same EBS and BRS
     frequencies is undisputed. Therefore the Commission should resolve
     this issue by adopting a uniform signal strength limit for all
     stations across-the-spectrum. They further argue that retaining the
     -73.0 dBW/m² limit would offer licensees the needed flexibility to
     deploy high-speed services, and further suggest that licensees can
     coordinate and agree on alternative signal strengths at the
     boundaries of the licensee's GSA. With regard to the LBS and UBS,
     we are not persuaded by FWH and Nextnet's arguments because they
     have not demonstrated that low-power stations in these band
     segments could not provide an adequate service with the proposed 47
     dBμV/m signal.

108. However, we do agree that we should retain the -73.0 dBW/m² limit
     for operations in the MBS where we expect high-power operations to
     continue. Accordingly, the -73.0 dBW/m² limit in the MBS will be
     retained because it provides adequate service for high-power
     stations operating in the MBS.[^206] Therefore, we will adopt the
     47 dBμV/m limit at the boundaries of the licensee's GSA for the LBS
     and UBS as proposed by the Coalition, and we will retain the -73.0
     dBW/m² limit at the PSA boundaries for stations operating in the
     MBS.

109. We are, however, sensitive to FWH and Nextnet's concerns about
     providing adequate service to customers and students near a GSA
     border. In certain circumstances, a licensee may need to exceed the
     prescribed power levels at its GSA boundary in order to efficiently
     serve customers or students near the border. Given the importance
     of ensuring the ubiquitous availability of broadband services, and
     the fact that many licensees will want to be able to provide
     service as soon as possible in order to gain a competitive
     advantage, we will grant limited relief of the power limits at the
     GSA border. Specifically, in those instances where there is no
     neighbor licensee that is constructed and providing service to
     customers or students,[^207] we will allow a licensee to exceed the
     prescribed power limit at the GSA boundary until there is a
     licensee providing service that would be affected by the higher
     power level. Once an affected licensee is providing service, the
     original licensee will be required to take whatever steps are
     necessary to comply with the applicable power level at its GSA
     boundary. Licensees taking advantage of this provision are placed
     on notice that once an affected licensee is providing service, they
     will be required to promptly do whatever is necessary to comply
     with the power limit at the GSA boundary. Of course, if a license
     obtains the consent of all affected licensees, it may continue to
     exceed the applicable power limit.

110. In a related matter, the Coalition suggests that the 47 dBμV/m
     limit be measured 1.5 meters above the ground over 5.5 MHz
     bandwidth (i.e., the bandwidth of the LBS/UBS channels as proposed
     by the Coalition). The Coalition states that 1.5 meters above
     ground is appropriate because this height represents the
     approximate height at which handheld devices and other likely
     customer equipment would be located. We agree. Therefore, in view
     of the band plan that we are adopting, we will require that the
     signal strength, when measured, shall be taken over the channel
     bandwidth (i.e., each 5.5 MHz channel in the LBS and UBS for
     licensees that hold a full channel block, and for the 5.5 MHz
     channel in the LBS and UBS for licensees that only hold individual
     channels) at 1.5 meters above ground where most handheld devices
     are likely to be operated.

### Authorization of Mobile Operation

111. Although we have applied both fixed and mobile allocations to the
     2500-2690 MHz band, we have required MDS and ITFS licensees to
     obtain separate authorizations before commencing mobile service. In
     the *NPRM*, we proposed to authorize MDS and ITFS licensees to
     engage in mobile operation by blanket-licensing such operation
     under licensees' GSA authorizations.[^208] We sought comment on
     this proposal and any other requirements we should implement,
     including but not limited to those discussed throughout the
     proceeding.

112. The record supports our proposal to blanket license mobile
     operations in the band pursuant to licensees' GSA authorizations.
     The Coalition is supportive of this proposal, noting that portable
     and mobile units will operate at low-power levels and generally
     will be utilized at relatively low heights above ground level, thus
     making it unlikely that they will be a source of interference. The
     Coalition recognizes that a portable unit can be operated at
     elevated heights (e.g. atop a skyscraper), but believes such
     instances will be relatively infrequent and should not pose a
     substantial problem. We agree and adopt our proposal to authorize
     licensees to engage in mobile operation by blanket licensing such
     operations under the licensees' geographical service area
     authorization.

### Power and Antenna Height Limits

113. *Response Stations*. Our current rules limit response stations
     operating in the 2500-2690 MHz band to a transmitter output power
     of 2 watts.[^209] The maximum transmitting power for broadband PCS
     mobile/portable operations in the 1.9 GHz band is 2 watts
     EIRP.[^210] Noting that we adopted the 2-watt limit in the Two-Way
     Order without any explanation, the Coalition urged in its Proposal
     that we delete this power limit, arguing that it unduly restricts
     the flexibility of equipment designers to make the most efficient
     use of the 2.1 and 2.5 GHz bands.[^211] The Coalition emphasized,
     however, that it was not advocating any change in the restrictions
     on power contained in Parts 1 and 2 that are designed to assure the
     protection of human health and safety; in fact, it recommended that
     we clarify that those limits apply to MDS and ITFS by adding those
     services to the list of services specifically shown as being
     subject to the rules.[^212]

114. In the *NPRM*, we noted that while the 2-watt EIRP limit on PCS
     response stations appeared to be a reasonable model to follow when
     we adopted a similar rule for MDS and ITFS, the record of the PCS
     proceeding indicates that the 2-watt EIRP limit was originally
     designed to reduce the likelihood of interference with fixed
     microwave stations in the PCS bands.[^213] We sought comment on the
     extent to which similar concerns should apply for MDS and ITFS,
     bearing in mind the differences between the incumbent licensees in
     the MDS/ITFS bands -- and their circumstances -- as compared with
     the incumbent licensees in the PCS band. We further pointed out
     that while compliance with our safety rules may by itself
     necessitate compliance with a 2-watt limit for portable devices
     that are normally held close to the user's body, those rules allow
     higher power levels in circumstances where the response station's
     transmission antenna is designed to be used at least twenty
     centimeters away from the body of the user or any nearby persons.

115. In response to our proposal regarding the transmitter output power
     limitation of 2-watts for response stations, the Coalition
     commented that it rejects the PCS approach. It notes that the PCS
     approach was adopted to address a very different sort of problem
     than is facing MDS and ITFS and should not be considered as a
     precedent here.

116. We disagree with the Coalition that the PCS approach should be
     rejected here and the 2-watt limitation should be deleted. We
     believe that like PCS, BRS and EBS response stations should be
     designed to reduce the likelihood of interference with BRS and EBS
     stations and mobile services in the band. Moreover, compliance with
     our safety rule necessitates compliance with a 2-watt limit for
     devices that are normally held close to the user's body. The rules
     allow higher power levels in circumstances where the response
     station's transmission antenna is designed to be used at least
     twenty centimeters away from the body of the user or any nearby
     persons.

117. IPWireless states that the 2-watt limit should be specified on a
     per channel basis, as is currently done in Parts 21 and 74, so that
     when partial or multiple channels are employed, the allowable power
     level is adjusted as per the main station. Moreover, in regards to
     customer premises equipment (CPE), IPWireless proposes that the
     Rule be amended to 2-watts EIRP, which is more restrictive than our
     current Rules for fixed response stations. IPWireless' proposal
     would require that all subscriber equipment conform to the power
     limit established for PCS mobile stations. We agree with IPWireless
     that the 2-watt EIRP level advocated for CPE is appropriate for
     mobile and portable station operation in these services.
     Accordingly, all mobile and portable response stations, including
     CPE devices, will be limited to 2-watts EIRP assuring compliance
     with our rules. However, we will not amend our rules regarding BRS
     and EBS fixed response stations.

118. Finally, in the *NPRM*, we sought comment on whether we should
     establish a maximum antenna height for response stations in view of
     our proposal to blanket-license such stations. While mobile or
     portable stations would typically be close enough to the ground
     that they would be shielded by nearby structures, we noted in the
     *NPRM* that the rules we were contemplating adopting for these
     services would also permit the deployment of response stations at
     fixed locations, where they could be attached to antennas at high
     elevations. Such transmitters would have a greater potential for
     generating unwanted electromagnetic interference. We sought comment
     on whether the signal strength limits that we propose to apply at
     GSA boundaries would obviate the need for antenna height limits.

119. Upon reflection, we conclude that we will not establish a maximum
     antenna height for fixed response stations in this band. IPWireless
     does not believe that a maximum antenna height for response
     stations can be enforced, given that response stations are
     permitted to operate in an uncoordinated fashion under a blanket
     license. However, in the event that antenna heights and power
     height limitations are imposed, IPWireless suggests that the PCS
     antenna height and power limits contained in Section 24.232 should
     apply.

120. Our current Rules do not limit the height of fixed response
     stations, which are typically mounted to the roof-top of most
     buildings for BRS and EBS stations, and we see no reason to change
     these rules at this time. Mounting response antennas to the
     roof-tops of existing buildings or side-mounted to an antenna mask
     (i.e., FAA approved structures) would be more practical and
     economical than building a supporting tower structure. Therefore,
     we believe the vast majority of response antennas will be mounted
     to the roof-top of typical buildings for economic reasons which
     would restrict the overall height of the antennas. Moreover, our
     current Rules have not presented any problems, and we agree with
     IPWireless that such limits may not be enforceable. Accordingly, we
     will not establish a maximum antenna height for fixed response
     stations in this band.

121. *Base/Main Stations.* In the *NPRM*, we noted that there is no
     specific power limit for low-power base stations, nor are there
     base station transmitting antenna height limits for operations in
     this band. In view of our proposal to limit signal strength at the
     borders of licensees' GSAs, we sought comment on whether there
     would be any benefit to establishing base station power and antenna
     height limits. In particular, we sought comment on a Coalition
     proposal to create incentives, but not an absolute requirement, for
     licensees to limit the height of low-power base stations near their
     GSA borders.[^214] The Coalition proposal stemmed from its concern
     that a 47 dBμV/m signal strength limit at GSA boundaries might not
     provide sufficient protection against interference to base station
     receivers. The Coalition expressed that the most troublesome
     scenario would arise when the interfering licensee is using a
     channel for downstream communications from its base stations, and
     the interfered-with licensee in a contiguous GSA is using the same
     channel for upstream communications to its base stations. Under
     these circumstances, the Coalition recommended a safe-harbor
     requirement that both licensees limit their antenna heights to
     D²/17, where D is the distance in kilometers between the base
     station causing the interference and the point where a line
     connecting the transmitting base station with the neighboring
     receiving base station intersects the boundary between their
     respective GSAs. Pursuant to this approach, antenna height would be
     defined as the height in meters of the antenna's centerline above
     the average elevation along the line between the two base
     stations.[^215] If a transmitting licensee's antenna is not within
     the safe-harbor height limit and the receiving licensee's antenna
     is within the safe harbor, the transmitting operator would be
     required to take such measures as are necessary to limit the level
     of the undesired signal at the receiving base station to -107 dBm
     or less.[^216]

122. In contrast to the Coalition's recommendations, our Broadband PCS
     rules do not impose any direct limit on antenna heights, but they
     apply a graduated reduction in permissible EIRP output for base
     station antennas that are more than 300 meters in height.[^217] We
     noted in the *NPRM* that, on first impression, the Coalition's
     proposal appeared to lack certainty, insofar as the requirements
     imposed upon a licensee would be dependent upon actions taken by a
     neighboring licensee. However, we noted that a licensee could
     ensure its compliance with the recommended safe harbor, regardless
     of any future actions taken by the neighboring licensee, by drawing
     a line intersecting the nearest point on the GSA boundary and
     assuming that the other licensee might someday site a base station
     somewhere on that line. The recommended formula could then be
     applied to determine the maximum safe-harbor height for any given
     distance from the boundary. We concluded that the safe harbor
     distance formula proposed by the Coalition would not adversely
     affect the typical 2-5 mile antenna service distance and 150 to 300
     feet height above average terrain (HAAT) of base stations in
     low-power cellular networks. We also concluded that it would have a
     minimal effect on typical base station design.

123. We believe that it is premature to impose a limit on antenna
     heights for low-power base stations given that base stations must
     comply with the 47 dBμV/m signal strength limit at its GSA
     boundaries as adopted herein. However, we concur with the Coalition
     that in line-of-sight situations, it is possible for a station to
     comply with the 47 dBμV/m signal strength limit at its GSA boundary
     and cause objectionable interference in an adjacent area at the
     same time. The Coalition has provided a vehicle for licensees to
     determine if the heights of their transmitting antennas would cause
     objectionable interference to a receiver in an adjacent GSA. Its
     proposal, D²/17, mentioned above, would be a voluntary coordination
     threshold showing with regards to the heights of base station
     transmitters that would be located near the GSA boundary of an
     adjacent licensee. There will be no restrictions on the heights of
     base station antennas, but in certain situations, interference
     protection will be required. A base station receive antenna less
     than or equal to the threshold showing will be protected from a
     transmitting antenna that exceeds the threshold showing. A base
     station transmitting antenna equal to or less than the threshold
     showing is unlikely to cause interference; therefore no protection
     to any base station receive site will be required from such base
     stations. Finally, a base station transmitting antenna greater than
     the threshold would not need to protect a base station receive
     antenna that exceeds the threshold showing. In view of the fact
     that the ideal location for a base station antenna is in the center
     of the geographical area in which it provides service, we believe
     that the 47 dBμV/m signal strength limitation at the geographical
     service area boundaries is adequate provided the antenna height of
     the base station does not exceed the above threshold showing.
     Accordingly, we will not impose a limitation on the antenna heights
     of base stations located near the GSA border provided they do not
     cause impermissible interference.

### Emission Limits 

124. The purpose of emission limits, also known as emission masks, is to
     provide protection against adjacent channel interference (e.g.,
     restrict transmitter emissions on a range of frequencies removed
     from the licensee's assigned frequency or frequency band). The
     current rules governing emission limits for MDS and ITFS are set
     forth in Sections 21.905 and 74.936, respectively. The current
     rules are based, however, on high-power video operation and vary
     slightly between the services.

125. In the *NPRM*, we stated that modification of the rules governing
     out of band emissions was necessitated by our intention to provide
     for mobile operation in the band. Consequently, we sought comment
     on the Coalition's recommendation that we require equipment
     operating on the LBS and UBS channels (both base stations and
     stations at a customer's premises) to attenuate the power below the
     transmitter power (P) by at least 43 + 10log~10~(P) dB on any
     frequency outside a licensee's authorized spectrum.[^218] This
     recommendation is the same as the general emission mask the
     Commission adopted for operations in both the upper and lower 700
     MHz band.[^219] For the Response (R) channels the Coalition
     suggested requiring an attenuation of at least 80 + 10log~10~(P)
     dB. The Coalition also asserted that additional attenuation may be
     required in special circumstances. For example, the Coalition
     stated that the rules should be changed to require a licensee to
     take steps to attenuate out of band emissions by at least 67 +
     10log~10~(P) dB upon written request from an adjacent channel
     licensee.[^220] In response to this suggestion, we noted that we
     had never required a licensee to reduce its out of band emissions
     at the request of an adjacent channel licensee. The Coalition also
     outlined a more restrictive mask for protecting operations on the
     MBS channels[^221] and for licensees of MBS channels to protect
     operations on LBS and UBS channels.[^222] We observed that adopting
     all the Coalition's recommendations would be inconsistent with our
     stated goal of simplifying the rules governing this band (e.g.,
     minimize harmful interference without establishing overly
     burdensome requirements). Nevertheless, we sought comment on
     whether we should adopt the Coalition's recommendations concerning
     out of band emissions or different criteria and details on
     measurement procedures to determine compliance.[^223] Further, we
     sought comment on the appropriate emission mask for mobile
     operations. In that regard, we noted that we recently adopted
     out-of-band emission requirements to ancillary terrestrial
     component (ATC) mobile units in the 2000-2020 MHz band in order to
     protect adjacent channel PCS operations.[^224] Because Mobile
     Satellite Service (MSS) and ATC units will be operating in the band
     immediately below 2500 MHz, we sought comment on whether similar
     limits should apply. We also sought comment on whether any special
     rules were needed to protect the Earth Exploration Satellite
     (passive), Radio Astronomy, and Space Research allocations in the
     2690-2700 MHz band.[^225] Finally, we requested comment on whether
     we should specify a frequency tolerance or require equipment to
     maintain its operations fully within the emission mask at all
     times.

126. After reviewing the record in this proceeding, we now believe that
     the emission mask proposed by the Coalition for the LBS and UBS
     reasonably limits adjacent channel interference and maximizes
     spectral efficiency while remaining technology neutral.[^226] We
     agree with the Coalition which notes that loose out -of-band
     emission limits provide perfectly acceptable adjacent channel
     interference protection when adjacent channel licensees are
     operating compatible systems, but when adjacent channel systems are
     not compatible, a more stringent out of band emission limit is
     necessary to provide an appropriate level of interference
     protection. The Telecommunications Industry Association (TIA) also
     supports the Coalition's out-of-band emission limits, which are
     also imposed in the PCS band. TIA asserts that if flexibility is
     provided to the licensee to utilize either FDD or TDD, out of band
     emissions will have to be reduced to a level that will provide
     reasonable protection to an adjacent channel licensee. TIA further
     argues that the dual mask approach proposed by the Coalition
     restricts out-of-band emissions and mitigates potential adjacent
     channel interference where non-synchronized technologies are
     deployed.

127. We also agree with the Coalition that equipment on the LBS and UBS
     channels (both base stations and stations at a customer's premise)
     should be required to attenuate the power on any frequency outside
     a licensee's authorized spectrum.[^227] Accordingly, we are
     adopting the Coalition's recommendation that all LBS and UBS
     channels emissions be attenuated below the transmitter power by at
     least 43 + 10log(P) dB on any channel outside a licensee's
     spectrum. We note that this is the same as the general emission
     mask the Commission adopted for operations on PCS, the 700 MHz band
     and other services.

128. We note TIA's concerns that requesting more stringent out of band
     emissions from an adjacent channel licensee, upon written request,
     is an unworkable solution for further reduction in out-of-band
     emissions. However, we believe that is appropriate to allow
     licensees to request stricter out-of-band emission limitations when
     there is a documented case of interference caused by out-of-band
     emissions between base stations. We believe that requiring the
     requesting licensee to document its interference claims will ensure
     that such requests will address real problems and avoid specious
     requests. Therefore, the Commission will require a licensee, upon
     receiving a documented interference complaint from an adjacent
     channel licensee, to further reduce its out-of-band emissions by at
     least 67 + 10log(P) dB. We also agree with the Coalition that
     additional attenuation should be required where base stations are
     located in close proximity. So we will require additional
     attenuation when distances between base station are less than 1.5
     km. Finally, we also agree with the Coalition's mobile station
     emission mask which extends the attenuation from 43 + 10lop(P) at
     the channel's edge to 55 +10log(P) at 5.5 MHz away from the
     channel's edge.

129. With respect to BRS channel 1, we clarify that adjacent-channel
     Mobile Satellite Service (MSS) licensees can seek tighter
     out-of-band emissions limitations on licensees operating on Channel
     1 in cases of documented interference. There may be situations
     where a tighter out-of-band emissions limit is necessary to protect
     MSS operations below 2495 MHz. MSS licensees operating in the
     adjacent band will be able to request such additional protection
     under the same circumstances as adjacent-channel BRS and EBS
     licensees.[^228]

130. With respect to the MBS, we will allow analog television operations
     to operate pursuant to the existing out-of-band emission
     limitations currently in our rules. With respect to other
     operations, we will apply the same rules we are adopting for the
     LBS and UBS. We note that the Coalition requested no changes in the
     out-of-band emission limits for the MBS.[^229] However, we believe
     that the rules we are adopting are more workable than the current
     rules and will provide sufficient protection to existing
     operations. Moreover, applying the same emission limitations for
     digital operations throughout the band will encourage the use of
     common equipment throughout the band, particularly in those areas
     where cellularized networks can operate in the MBS without
     interference from high-power operations.

### Technology

131. In the *NPRM*, we sought comment on the Coalition's request that we
     not restrict operation in this band to a particular technology and
     its assertion that our rules should remain technology-neutral to
     the maximum extent possible.[^230] We noted that the Coalition also
     raised the issue that second-generation equipment employs two
     different technologies -- FDD and TDD \-- and that FDD technology
     requires a separation between the highest frequency used in one
     direction and the lowest frequency used in the other
     direction.[^231] Thus, to allow for FDD technology, the Coalition
     proposed that when this technology is employed by a licensee, the
     LBS be restricted to subscriber-to-base (upstream) communications
     and the UBS be restricted to base-to-subscriber (downstream
     communications). According to the Coalition, this framework would
     simplify adjacent channel coordination and provide the vendor
     community with a degree of certainty as to the band usage that will
     translate into lower equipment costs and smaller equipment. We
     sought comment on whether we should establish formal channel
     pairings in the form of fixed channel assignments (FCA) to
     standardize the separation between channels used upstream and
     downstream.

132. We agree with the Coalition and the overwhelming majority of
     Commenters who argue that the band should be technology neutral.
     Allowing the band to be technology neutral is consistent with our
     goal to make the spectrum as flexible as possible as it permits
     licensees and the marketplace to determine which technologies
     should be utilized. As noted by Gryphon, Earthlink, Sprint, and
     Twedt and Dudeck, not restricting the band to a particular
     technology allows licensees and systems operators to deploy either
     FDD or TDD technology, and freely switch between the two as the
     technology develops and the marketplace demands evolve. Moreover,
     as noted by Alvarion, technologies such as next generation FDD and
     TDD would not thrive in a regulatory environment that restricts
     flexibility and mandates one technology over another.

133. We disagree with Fixed Wireless Holdings' approach which locks in
     the technology choice made at the time of licensing. To support its
     position, Fixed Wireless Holdings points to the Coalition's
     acknowledgement that both FDD and TDD systems on the same
     frequencies "creates a heightened risk of co-channel interference."
     However, we agree with Twedt and Dudeck that the current Rules
     would allow ITFS or MDS operators to safely use either FDD or TDD
     technology. Providing users with the flexibility to deploy the
     technologies of their choice is consistent with the Commission's
     goal of allowing licensees to operate technology independent.
     Accordingly, we will not mandate any particular technology in the
     band.

134. Additionally, we conclude that in order to allow the spectrum to be
     technology-neutral to the maximum extent possible, channels
     utilized for FDD in this spectrum will not be paired by fixed
     channel assignments. Rather, upstream FDD operations will be
     permitted in the LBS, and paired with channels in the UBS for
     downstream communications by dynamic channel assignment (DCA).
     Channels that are DCA paired select any unused channel in the LBS
     for upstream operation, which eliminate manual channel pairing,
     thus promoting more flexibility and an efficient use of the
     spectrum. We are not, therefore, adopting a requirement for the LBS
     to be used only for remote, response or mobile station
     transmissions or for the UBS to be used only for base or main
     station transmissions. However, this does not preclude the industry
     from adopting its own standard.[^232] An operator is free to use
     TDD in either the LBS or the UBS. Thus, FDD technology will be used
     in this spectrum without a priori pairing.

### Unlicensed "Underlay" Operation

135. As we have consistently noted, one of the underlying goals of this
     proceeding is to promote increased access to spectrum. In this
     regard, we noted in the *NPRM* that Intel and Microsoft advocated
     that we create, or at least preserve, the opportunity to create
     unlicensed "underlay" rights for very low-powered devices on these
     channels.[^233] Recently, we issued a Notice of Inquiry concerning
     making additional spectrum available for use by unlicensed devices
     in the television bands and in the 3650-3700 MHz band.[^234] In the
     Unlicensed NOI, we noted that there have been significant advances
     in technology that may make it feasible to design new types of
     unlicensed equipment that would not cause interference to existing
     services.[^235] For example, equipment could be designed that could
     monitor spectrum before transmitting to avoid interference, or
     equipment could be designed that could use the Global Positioning
     System to determine its location and whether there are licensed
     operators in the area.[^236] We also noted that allowing unlicensed
     operation with minimal technical requirements could potentially
     permit the development of new and innovative types of devices, such
     as new wireless data networks.[^237]

136. In the *NPRM*, we stated that the proximity of the 2500-2690 MHz
     band to successful unlicensed technologies in the 2.4 GHz band, and
     our goal of increasing the intensiveness and efficiency of use of
     the 2500-2655 MHz band, suggests that it may be appropriate to
     consider enhancing unlicensed use in the band on a secondary,
     non-interference basis. While we recognized that unlicensed
     operations under our Part 15 rules are subject to the condition
     that the transmitter does not cause interference to authorized
     services, we stated that we were nonetheless mindful in this
     context that additional measures may be necessary to ensure that
     unlicensed operations would not cause interference to existing,
     licensed operations. In that regard, we noted WCA's belief that
     Microsoft and Intel's proposals were premature. WCA contended that
     the necessary technology for mass producing affordable devices
     capable of measuring and reliably adapting to the presence of
     background noise or "interference temperature" had not been
     demonstrated.[^238]

137. Based on our discussions in the Unlicensed NOI and the advent of
     emerging technologies enhancing the feasibility of unlicensed
     operations, we sought in the *NPRM* comment on the possibility of
     allowing enhanced unlicensed operations in the 2500-2690 MHz band.
     Additionally, we sought comment on technical rules that would
     permit such operations without interfering with primary operations,
     such as any restrictions on antenna gain or directivity that might
     be necessary.[^239] Furthermore, we sought comment on whether it is
     feasible to manufacture affordable transceivers that are capable of
     using underlay rights where, and only where, such access is offered
     if some but not all licensees on a given channel allow underlay
     access. Noting that Part 15 transmitters may not operate in certain
     restricted bands, including 2655-2690 MHz,[^240] we asked whether
     there were any circumstances under which unlicensed operation could
     be allowed in the 2655-2690 MHz band without adversely affecting
     passive sensing operations in the 2655-2700 MHz band.

138. Based upon our review of the record, we decline to permit
     high-power unlicensed operations in the spectrum at this time. We
     are not necessarily convinced by Motorola's and Sprint's arguments
     that high-power unlicensed operations would introduce new sources
     of interference and create a more uncertain interference
     environment at the expense of licensees in the band seeking to
     deploy new services.[^241] However, given the complex transition we
     are undertaking in this band, we believe that allowing high-power
     unlicensed operations in this band could add an additional layer of
     complexity that could delay deployment in this band by licensed
     operators. We are also concerned by the Coalition's assertion that
     allowing unlicensed use of this spectrum could undermine the
     evolution of the modified band plan, and BellSouth's related
     comment that because the current state of unlicensed technology
     does not permit responsible implementation of unlicensed devices in
     the spectrum, the uncertainty and novelty of unlicensed use would
     trouble investors, making them less likely to invest in the
     band.[^242] We note that NAF and a series of other Commenters in
     favor of allowing unlicensed operations did not provide sufficient
     scientific evidence in support of their position. Moreover, NAF did
     not submit sufficient evidence to support its claim that unlicensed
     underlay operations can be operated on a primary basis without
     causing interference within the spectrum. Furthermore, we believe
     that the issue of high-power unlicensed operation can and should be
     considered in the broader context of other proceedings addressing
     unlicensed operation. Therefore, we decline to permit unlicensed
     operations in the band except as indicated above and to the extent
     already permitted by Part 15 of our Rules.

139. However, we will lift the restriction on unlicensed operation in
     Section 15.205 of our Rules and permit low-power unlicensed devices
     to operate on frequencies 2655-2690 MHz under our current Part 15
     rules. Given the existence of licensed services in this frequency
     band, and given the ability of licensed operation to co-exist with
     unlicensed operations in the 2500-2655 MHz band, we see no reason
     to maintain this restriction in this band.

### RF Safety

140. The Coalition's proposal for revisions to the 2500-2690 MHz band
     includes a recommendation that we amend our RF Safety rules. More
     specifically, the Coalition contends that we should amend Sections
     1.1307(b)(2), 2.1091(c) and 2.1093(c)[^243] to include MDS and ITFS
     services.[^244] These Rules were enacted pursuant to the National
     Environmental Policy Act in order to assure the protection of human
     health and safety from radio frequency radiation exposure. The
     Commission considers RF safety procedures to be essential in
     protecting human beings from excessive exposure to RF energy.[^245]
     Accordingly, we sought comment on whether and how we should amend
     the RF safety rules but received little comments on this issue. We
     agree with the Coalition that Sections 1.1307(b)(2), 2.1091(c) and
     2.1093(c) of our Rules should be amended to include MDS and ITFS
     services. We believe that equipment in this spectrum as in other
     areas of the spectrum should provide RF safety to consumers.
     Therefore, applications for equipment operating under this service
     must contain a statement confirming compliance with these
     requirements for both fundamental emissions and unwanted emissions.
     Accordingly, we are amending those sections of the Rules to allow
     mobile/portable devices in the band.

### North American Datum (NAD) 83 Coordinate Data

141. Our rules require the submission of different coordinate data for
     licensing actions. Applicants submit coordinate data using NAD83
     protocol for applications filed on FCC Form 331 but in NAD27 for
     all other MDS/ITFS forms. In the *NPRM*, we sought comment on the
     Coalition's proposal that we require applicants to use NAD83
     coordinate data and update or convert the current database.[^246]
     We further noted that applications filed through ULS are required
     to provide NAD83 coordinate data. Inasmuch as applications for this
     service will be processed through ULS, we conclude that these
     applications should likewise provide NAD83 coordinate data. We
     agree with the Coalition that the coordinate information in our ULS
     database should be consistent. Accordingly, we adopt the
     Coalition's proposal and will require all future applicants filing
     BRS/EBS applications to submit coordinate data based on NAD83
     coordinate data to facilitate ULS processing. Therefore, all
     applications filed after the effective date of these rules are
     required to contain coordinate data based on NAD83 coordinate data.

### BRS Response Station Hubs

142. Our existing rules regard hubs in the same manner as main stations
     for application processing purposes. For instance, whereas 47
     C.F.R. Section 1.1104 contains a special section on the application
     fee for signal booster applications and for signal booster
     certification of completion of construction applications (\$70.00
     in each instance), the rules do not differentiate between
     requirements for main station applications and certifications and
     response station hub applications and certifications. At present,
     the fee for a response station hub on a Form 331 is \$210.00, and
     the fee for the Form 304A is \$610.00.[^247] Section 21.909 states
     that an MDS response station hub application must be filed on a
     Form 331. Licensees of MDS response station hubs must also file a
     certification of completion of construction application.[^248]
     Response station hubs, signal booster stations and R channels are
     considered stand-alone stations, and thus have unique facility ID
     numbers separate from the associated main stations.[^249] However,
     at this time, only signal booster stations are designated for
     special treatment in the application fee schedule. We do not
     believe that certifications of completion of construction of
     two-way hubs will be necessary under the GSA licensing approach
     that we adopt herein, and accordingly eliminate such filing
     requirements.

### Radiation from Stations that are not Engaged in Communications

143. On September 25, 1998, the Commission amended its rules to allow
     MDS and ITFS licensees to provide a wide range of high-speed,
     two-way services to a variety of users.[^250] On July 29, 1999, the
     Commission made some additional rule modifications to facilitate
     the provision of these services.[^251] On December 22, 1999,
     IPWireless requested reconsideration of the Commission's out of
     band emission limitations.[^252] On February 10, 2000, a group of
     over 100 wireless communications system operators, Commission
     licensees, equipment manufacturers and consultants who were parties
     to the Petition for Rulemaking that commenced the Two-Way
     Proceeding (collectively, Petitioners) did not oppose IPWireless'
     petition, but sought clarification of Sections 21.909(m) and
     74.939(o) of our Rules.[^253] The Petitioners indicated that there
     was some uncertainty within the industry as to the meaning of the
     language, \"Radiation of an un-modulated carrier and other
     unnecessary transmissions are forbidden.\"[^254]

144. The Petitioners requested clarification that this language requires
     a response station\'s transmitter to be biased off so that no RF
     Gaussian noise is emitted when the station is not engaged in
     communications.[^255] The Petitioners argued that this
     interpretation assures the protection of the noise floor of
     adjacent channel and adjacent market licensees against unnecessary
     emissions from transceivers.[^256] On May 11, 2000, the Petitioners
     and IPWireless notified the Commission that they had reached a
     compromise concerning the appropriate level of emissions that a
     response station may generate when not directly engaged in
     communications with a response hub.

145. The Petitioners and IPWireless requested amendment of Sections
     21.909(m) and 74.939(o) of our Rules to provide that when a
     response station is not in communications with its associated hub,
     it must restrict its field strength.[^257] First, they proposed to
     set the permissible level of RF Gaussian noise at 10
     microvolts/meter per 1 MHz bandwidth at a distance of 3 meters for
     response stations utilizing antennas with 6 dB or less gain over
     isotropic. Second, they proposed to set the permissible level of RF
     Gaussian noise at 10 microvolts/meter x 10exp\[(antenna gain - 6
     dB) / 20\] per 1 MHz bandwidth at a distance of 3 meters for
     stations utilizing antennas with more than 6 dB gain over
     isotropic.[^258]

146. In the *NPRM*, the Commission agreed to clarify this issue and
     sought comment[^259] on specific issues relating to this
     matter.[^260] Additionally, we sought comment on comprehensive
     changes to the interference rules that would apply in these
     services. Noting that other services do not have similar
     requirements, we asked Commenters who supported imposition of such
     a requirement to explain the need for such a requirement in light
     of other changes we proposed to our technical rules.

147. IPWireless now states that its original proposal to amend Sections
     21.909(m) and 74.739(o) of the Rules is no longer appropriate.
     IPWireless explains that its proposal stemmed from the fact that
     MDS/ITFS licensees were concerned that TDD devices might be prone
     to transmitting energy during periods of reception. The Coalition
     supported IPWireless' proposal arguing that absent the adoption of
     the restrictions on emissions by subscriber units when not engaged
     in communications with their base stations, interference may
     result. Subsequently, however, IPWireless has completed more than
     two years of field trials and commercial deployment of TDD
     equipment and has obtained FCC certification for several types of
     base stations and CPE devices. IPWireless' studies led it to
     conclude that TDD devices are not a potential source of
     interference as envisioned by MDS and ITFS Petitioners at the time
     its petition was filed. We are persuaded by IPWireless' extensive
     studies and findings on this issue, which are further buttressed by
     the fact that IPWireless has obtained FCC certification for several
     types of base stations and CPE devices. Thus, we agree with
     IPWireless that amending Sections 21.909(m) and 74.739(o) of the
     Rules is not necessary, and the applicable rules will not be
     amended.

148. In a related matter, we also sought comment on whether we should
     prohibit subscriber handsets (CPE) from transmitting unless a base
     station pilot is present, and whether such a rule was necessary in
     order to avoid interference to existing operations. IPWireless
     supports our proposal prohibiting CPEs from transmitting unless a
     base station pilot is present. Moreover, IPWireless states that CPE
     transmissions must be restricted to locations where the
     blanket-license devices are operating under the active control and
     supervision of a licensed base station. We agree with IPWireless
     that handsets should not transmit unless a base station pilot is
     present, and that such transmissions must be restricted to
     locations under the active control and supervision of a licensed
     base station. Moreover, we believe that handsets should not
     transmit unless a base station pilot tone is present to preclude
     any unnecessary radiation "noise" in the spectrum. Accordingly, we
     will prohibit subscriber handsets from transmitting unless a base
     station pilot is present.

## Eligibility Restrictions

### ITFS Eligibility Restrictions

149. *Background.* The ITFS service was established to provide formal
     educational and cultural development in aural and visual form to
     students enrolled in accredited public and private schools,
     colleges and universities.[^261] Our current rules limit
     eligibility for the 114 megahertz of ITFS spectrum in the 2500-2690
     MHz band to: (1) accredited educational institutions, (2)
     governmental organizations engaged in the formal education of
     enrolled students, and (3) nonprofit organizations whose purposes
     are organizational and include providing educational and
     educational television materials to accredited institutions and
     governmental organizations.[^262]

150. In the *NPRM*, we included a detailed discussion and history
     demonstrating how, over a fifteen year period, the Commission has
     progressively relaxed the educational content obligations of ITFS
     licensees to accommodate the flexibility needs of ITFS providers
     who have increasingly relied on the leasing revenues provided by
     commercial spectrum users. As a result, the Commission's ITFS
     leasing policies now allow ITFS licensees to lease all but a small
     fraction of their capacity to commercial operators. From 1983
     through 1998, the Commission progressively reduced the educational
     content required of ITFS licensees while expanding the
     opportunities for ITFS licensees to generate income by leasing out
     their channels, and substantially increased MDS operators' access
     to ITFS spectrum. These actions were taken in an effort to
     encourage more intensive use of the spectrum and to facilitate the
     generation of revenue for ITFS licensees.

151. In the *NPRM*, we stated that recent events warranted
     re-examination of the ITFS eligibility restrictions. We noted, for
     example, that in recent years, the Commission has pursued a general
     policy of eliminating use restrictions in radio licenses except in
     circumstances where there are clear and compelling reasons for
     retaining them.[^263] We also noted the increased use of ITFS
     spectrum capacity by MDS systems as a result of the Commission's
     liberalization of leasing rules and relaxation of educational
     content requirements.[^264] We also noted the increasing use of the
     Internet for educational purposes, which appeared to offer
     comparable and perhaps superior means of delivering educational
     programming.[^265] Moreover, we expressed concern that retention of
     the ITFS eligibility restrictions could be detrimental to the
     growth of services on ITFS channels, because the complexity of the
     contractual relationships that our rules require in the ITFS
     service might discourage investment and impair the ability of
     service providers to modify their operations in response to
     changing technology and market conditions. We further noted that
     innovation could proceed more smoothly if commercial operators were
     able to aggregate spectrum in the 2500-2690 MHz band and purchase
     ITFS facilities, which would allow them to exercise direct
     ownership control. We suggested that providing existing ITFS
     licensees with greater flexibility might permit such licensees to
     capture the increased value of their spectrum, which would yield
     resources that could be used to enhance their educational programs
     in the manner that best suited their individual needs. In light of
     all these concerns, we sought comment on whether we should retain
     the ITFS eligibility restrictions. Additionally, we sought comment
     on maintaining ITFS as a separate service requiring educational
     programming but modifying the eligibility requirements to allow
     for-profit companies to be eligible licensees. Finally, we invited
     comment on whether we should eliminate or otherwise change our
     existing ITFS instructional content origination rules.

152. *Discussion.* After considerable deliberation, we conclude that it
     is in the public interest to retain EBS eligibility and content
     restrictions. We believe that the public interest favors preserving
     this spectrum for licensing to ITFS-eligible entities and that
     doing so will further the educational objectives that led to the
     establishment of ITFS. The record demonstrates that the EBS service
     provides critical educational services such as web-based and
     streaming video for instruction in adult literacy and basic skills,
     emergency medical and fire services, law enforcement, and
     corrections. These services are often provided by community
     colleges at a variety of locations across the state where such
     instruction would generally be unavailable.[^266] The record also
     demonstrates that ITFS is used to provide training for citizens
     whose employment opportunities are limited by the closing of
     manufacturing plants and continued reduction in agricultural
     employment. Some EBS services, such as Mississippi Ednet's project
     with the Mississippi State Department of Health that will connect
     two hundred hospitals and health departments will even contribute
     to homeland security.[^267]

153. Some commenters argue that important public interest objectives
     would be fulfilled if ITFS eligibility restrictions were
     eliminated. For example, BellSouth asserts that under a flexible
     use approach, licensees of ITFS spectrum may offer services other
     than fixed broadband and innovators can develop new, spectrally
     efficient technologies and offer new services in competition with
     fixed and portable operators.[^268] BellSouth further asserts that
     open eligibility rules would facilitate development of Secondary
     Markets when DSL providers like it introduce advanced services to
     areas where wired DSL and cable modem services are not available,
     and provide facilities-based competition and competitive choice in
     areas where service is available.[^269] Similarly, Network for
     Instructional Television (NITV) contends that open eligibility will
     stimulate private investment in new technologies that the education
     community has neither the budget nor the expertise to bring to the
     market unilaterally.[^270]

154. We agree with BellSouth and NITV that these are all very important
     public interest objectives, and in particular, that leveraging the
     potential for wireless technology in the 2496-2690 MHz band to
     benefit education requires the private sector's investments and
     expertise. Nonetheless, we also believe that these goals can be
     attained notwithstanding existing eligibility restrictions. In this
     regard, we note that investment in the band is not solely dependent
     on an open eligibility scheme, and our restructuring of the band
     will go a long way towards encouraging the necessary investments.
     For example, as discussed earlier, the interleaved band plan has
     played a significant role in discouraging investment and hampering
     service. Inasmuch as licensees will now enjoy a band plan that
     provides contiguous spectrum, a significant obstacle to innovation
     in broadband deployment has now been rectified, and this
     enhancement alone will lead to significant changes in the
     utilization of this spectrum. Of particular importance is that the
     record does not demonstrate that commercial ownership of ITFS
     spectrum is a prerequisite to stimulating investment in the band.
     Indeed, as IMWED points out, that the bulk of commercial entities
     submitting comments to the *NPRM* did not take a position on ITFS
     eligibility demonstrates that lifting eligibility restrictions
     would not have a significant impact on commercial development of
     the band.[^271] Moreover, over the course of this proceeding,
     several large commercial providers such as Clearwire and Nextel
     have acquired rights to spectrum and developed plans to establish
     broadband services in this spectrum, even notwithstanding the
     possibility that ITFS eligibility restrictions would be
     retained.[^272] Therefore, we are not convinced that innovation in
     the band will be stifled by the continued retention of ITFS
     eligibility restrictions.

155. A number of ITFS licensees, such as IIT, disagree with assertions
     made by some commenters that actual educational use of the ITFS
     band is minimal.[^273] IIT states that there are active ITFS
     operations in all of the top 50 TV markets, its use is robust, and
     educational institutions have deployed these frequencies for their
     intended use.[^274] Furthermore, IIT asserts that notwithstanding
     the five percent minimum capacity rule, the majority of ITFS
     licensees who lease excess capacity retain at least 20 hours per
     week per channel and regularly reserve at least 25% of "total"
     capacity for ITFS use.[^275] The Catholic Television Network (CTN)
     and the National ITFS Association (NIA) likewise assert that many
     ITFS licensees reserve amounts greater than the requisite 5% for
     their own use, while some do not lease any capacity on their ITFS
     stations.[^276] During the course of this proceeding, a number of
     EBS licensees have submitted filings or made ex parte presentations
     to the Commission detailing the robust and critical educational
     applications they deliver to the public via their EBS
     spectrum.[^277]

156. We recognize that there are a number of ITFS licensees, including
     some major educational institutions, who use the band more
     intensively for educational purposes than the rules require, and
     than other ITFS licensees in general. Because these commenters
     represent a small proportion of actual ITFS licensees, we must also
     acknowledge that overall utilization of the EBS spectrum is not
     optimal at this time. Our records indicate that there are 2,760
     active, unexpired EBS licenses and permits (including hub and
     booster stations), or an average of approximately fifty-five
     facilities in each state. Given the large number of ITFS licensees,
     the record does not demonstrate that the ITFS community as a whole
     is making extensive use of the 114 megahertz allocated to them for
     educational programming. Nonetheless, we are reluctant to penalize
     the ITFS licensees who make extensive use of this spectrum and find
     that such action would be inconsistent with our conclusions on the
     importance of ITFS to the educational mission. Moreover, we
     recognize that ITFS entities could legitimately argue that they
     should have an opportunity to operate under the rules we have
     adopted today. For years, the band has been plagued by instability,
     uncertainty, filing freezes and burdensome rules, all of which have
     played substantial roles in fostering uncertainty and stagnation in
     the band. Ending the ITFS service without having given licensees
     the benefit of a stable regulatory environment would neither be
     fair nor in the public interest. We believe the better approach,
     and one which has been long overdue, is to provide licensees with a
     stable regulatory scheme thereby providing them the opportunity for
     their operations to flourish. We are optimistic that the sweeping
     changes we make today will ultimately result in significant
     improvements in the utilization of ITFS spectrum. We encourage ITFS
     licensees to make the most of these improvements by efficiently
     utilizing this spectrum, and intend to monitor the progress in this
     spectrum by means of the Bureau's periodic transition
     reports.[^278]

157. In a related matter, we agree with CTN and NIA's argument that
     trends such as increased leasing of ITFS capacity to commercial
     entities do not justify eliminating ITFS eligibility
     restrictions.[^279] As these commenters correctly point out, EBS is
     the only spectrum specifically set aside by the Commission for use
     by educators. [^280] Furthermore, it is well established that
     revenue from leasing to commercial interests has, in many
     instances, effectively funded and financed ITFS buildout and
     operations. The Commission has always considered the leasing of
     excess capacity a legitimate source of funding for the educational
     mission, and has taken numerous steps over the years to facilitate
     and encourage these secondary market transactions.[^281]

158. We recognize that educational programming is now available over the
     Internet, and the public is increasingly using the Internet to
     receive college courses or services of for-profit corporations that
     provide educational programming.[^282] Indeed, the internet offers
     interesting educational possibilities in light of the fact that its
     ability to deliver media-rich content is improving rapidly.[^283]
     In response to this data, some ITFS providers such as IIT, state
     the nature and quality of Internet education programming, which
     includes streamed-video windows typically covering only a quarter
     of the PC screen, is vastly different from ITFS programming, which
     includes full motion video of the instructor, screens of detailed
     materials, demonstrations in video, graphics and animation in
     real-time.[^284] IIT and other ITFS licensees ultimately concede
     that the Internet offers interesting potential as an alternate
     delivery means, but stand firm in their belief that the time for
     internet conversion has not yet or may never arrive. As time
     progresses, we expect that many ITFS services will convert to
     internet or other low-power cellular means of delivery. However,
     regardless of whether the internet can technologically replace ITFS
     operations at this time, we agree with IIT and other ITFS
     commenters who assert that administrative issues such as planning
     and infrastructure purchases preclude a complete shift from ITFS as
     the primary mode of delivery at this time.[^285] Moreover, other
     commenters point out that the Internet is an adjunct to, as opposed
     to a replacement for, their ITFS operations.[^286] Inasmuch as
     relying on internet or other low-power conversion to deliver ITFS
     services at this time could result in the immediate immobilization
     of critical ITFS programming, we find it is not in the public
     interest to remove eligibility restrictions in reliance on internet
     replacement of ITFS at this time.

159. We recognize that our decision today may, at the outset, appear to
     digress from the Commission's policy goal, as expressed in the
     Spectrum Policy Statement, of eliminating eligibility restrictions.
     However, we believe that a public interest exception to our general
     trend is warranted in the instant case. Of particular importance is
     the fact that ITFS is the only spectrum specifically reserved for
     educators. In an open market, we are concerned that educators could
     not effectively compete against broader commercial interests.
     Indeed, pursuant to an open eligibility scheme, the inability to
     bid against commercial operators for this spectrum would
     effectively deny educators any future entry strategy into the band.
     This reality, coupled with the importance of ITFS to the
     educational mission, creates a strong justification for retaining
     eligibility restrictions in the ITFS band.

160. Additionally, we believe that the objectives accomplished by
     eliminating eligibility restrictions can still be attained
     notwithstanding ITFS eligibility restrictions. In this connection,
     we note that the Commission's trend towards eliminating eligibility
     restrictions is driven by its general belief that market forces
     should generally be allowed to operate without being restricted by
     government because they will tend to push the use of radio licenses
     to their highest valued applications.[^287] Here, we reject the
     view that the Commission's public interest goal of moving spectrum
     to its highest-valued use conflicts with the goal of promoting
     education. We believe that our actions today will instead promote
     both goals because the restrictions on eligibility here will not
     impede market forces. That is, our ITFS leasing and secondary
     market rules for spectrum leasing arrangements are sufficiently
     flexible to allow market forces to push the ITFS spectrum towards
     its highest valued use, and educators will continue to enjoy
     considerable flexibility to lease their excess capacity spectrum.
     Further, educators can enter into partnerships with commercial
     interests to improve the capacity and efficiency of their systems,
     which in turn could free up more spectrum for commercial operators
     to work towards the development of ubiquitous broadband.

161. In the *NPRM*, we expressed concern that the complexity of the
     contractual relationships that our current ITFS rules require may
     discourage investment and impair the ability of service providers
     to modify their operations in response to changing technology and
     market conditions.[^288] We noted, for example, that an MDS
     operator who wants to change from providing one-way, high-powered
     television transmission operations from a single tower to providing
     two-way Internet access from multiple low-powered base stations
     must gain the consent of the ITFS operators in the market, even
     though the MDS operator may already have a leasing agreement with
     the ITFS licensee. While we must acknowledge that regulatory
     hurdles to innovation generally remain a prime concern, we do not
     believe that the eligibility rules will hinder the development of
     the band. Indeed, the additional flexibility we have provided with
     respect to spectrum leasing, and the other steps we have taken
     herein to maximize flexibility, should allow ITFS licensees to
     develop innovative educational systems and enter into partnerships
     with commercial carriers.

162. We agree with commenters that ITFS licensees who do not wish to use
     their facilities should be limited to selling their facilities to
     other educational organizations or non-profit educational
     organizations.[^289] Although some commenters expressed concern
     that retaining eligibility restrictions would result in having
     spectrum lie fallow, as previously indicated, we believe that the
     sweeping changes made herein will promote the full utilization of
     the spectrum. Of particular concern to the Commission is the fact
     that open eligibility would mean that educational institutions and
     not-for-profit educational organizations that are interested in
     obtaining licenses will have to compete with a broader range of
     entities, including for-profit corporations, for future access to
     spectrum in the band. The challenges that educational institutions
     and organizations would face in obtaining access to the remaining
     ITFS white space would have been likely to serve as permanent
     barriers to their ability to acquire spectrum in this band.

163. In the *NPRM*, we sought comment on maintaining ITFS as a separate
     service requiring educational programming but modifying the
     eligibility requirements to allow for-profit companies to be
     eligible licensees. We noted, for example, that one possible change
     could be to apply to ITFS channels public interest obligations
     comparable to those that apply to DBS under Section 100.5 of our
     rules.[^290] NTCA favors this approach, asserting that commercial
     operators should be permitted to acquire the spectrum, meet any
     educational requirements and use the excess capacity to meet the
     needs of the rural consumers.[^291] Similarly, NITV urges that the
     Commission require that 5% of the capacity of a digital system be
     made available by commercial ITFS spectrum holders free to
     non-profit educational organizations and institutions for use in
     fulfilling their educational mission. With the exception of these
     two commenters, however, other commenters generally did not express
     interest in this approach. Rather, the comments largely focused on
     whether for-profit companies should be eligible licensees
     generally. Furthermore, in an ex parte presentation, ITFS licensees
     expressed their belief that it was in the best interest of
     education for educators to actually retain control of their ITFS
     spectrum. The lack of support for this approach generally coupled
     with the fact that this model already exists in the context of DBS
     persuades us that this approach is neither desirable nor necessary.

164. We take this opportunity to rename the Instructional Television
     Fixed Service as the Educational Broadband Service. In light of the
     fact that the service is not limited to either video or fixed
     services, we believe that it is appropriate to update the name of
     the service. While we understand that video-based services will
     continue to operate in the new EBS, we believe that the EBS name
     better describes the contemplated future use of the band. The
     change in the name of the service does not affect the substantive
     rights of current ITFS licensees, permittees, and applicants.

### MDS/ITFS Cross Ownership Restrictions

165. *Background.* Section 613 of the Communications Act forbids cable
     operators from holding a MMDS license in any portion of the
     franchise area served by that cable operator's cable system. In the
     *NPRM*, the Commission sought comment on how Section 613's cable
     cross-ownership restriction applies to broadband internet access
     service, particularly in light of the legislative history of
     Section 613 and the fundamental change to the nature of MDS service
     caused when MDS licensees were permitted to construct systems
     capable of providing such broadband service.[^292] We asked whether
     allowing cable operators to acquire MDS/ITFS licenses would have a
     significant effect on concentration in video markets,[^293] and
     also whether allowing cable operators or DSL providers to acquire
     MDS/ITFS spectrum would have a negative impact on broadband
     internet markets.[^294] We also sought comment on our preliminary
     conclusion that broadband markets are "very highly concentrated,"
     and requested comment to the contrary.[^295]

166. In 1990, the Commission sought comment on whether it should
     prohibit or limit licensing or leasing of MDS and ITFS channels by
     a cable system within its franchised area.[^296] The Commission
     determined that the issue required evaluation of the relative
     merits of two "mutually exclusive" benefits---cable systems'
     ability to expand service, particularly into less populated areas,
     and potential competitors' ability to provide significant
     competition to incumbent cable systems.[^297] The Commission
     concluded that although the enhancement of existing multi-channel
     services was a significant and desirable benefit, a greater benefit
     was to be found in the introduction of competition to then-existing
     multi-channel services (essentially, incumbent cable
     systems).[^298] Accordingly, based on its observation that wireless
     cable service ranked among the "most imminent" sources of
     competition to incumbent cable systems, the Commission decided to
     generally prohibit a cable operator, either directly or indirectly,
     from acquiring a license (either through an application for a new
     station, assignment of a license, or transfer of control) or lease
     for an MDS station whose PSA overlaps its franchise area, or a
     lease for use of an ITFS station whose transmitter was within 20
     miles of any part of its franchise area, unless there was another
     cable system in that franchise area operating in a substantial
     portion of the PSA of the proposed MDS station.[^299]

167. The 1990 cable cross-ownership restrictions contained an exemption
     that allowed cable operators to acquire MDS spectrum in rural areas
     that would otherwise remain unserved by wireless cable.[^300] The
     rural exemption was modeled after the cable/telco cross-ownership
     prohibition, which the Commission expected to "speed the
     introduction of multichannel service to customers in sparsely
     populated areas without appreciably reducing realistic and desired
     opportunities for wireless cable operators to introduce service
     competitive with existing cable service."[^301] The *1990* *R&O*
     also grandfathered existing cable/wireless operations and
     contracts, rather than forcing divestiture, on the ground that
     divestiture would be a hardship to cable operators and their
     customers and would be unnecessary given the limited number of
     systems operated by cable companies.[^302] Finally, the *1990 R&O*
     created a local programming exception to the licensing and leasing
     prohibitions of Sections 21.912 and 74.931(e), and created a
     "limited exception" to the 1990 prohibitions for "MDS and ITFS
     channels used in the delivery to multiple cable headends or locally
     produced programming, that is, programming produced in or near the
     cable operator's franchise area and not broadcast on a television
     station available within that franchise area."[^303] Under this
     exception, which the Commission expected to permit and promote an
     additional outlet for locally originated programming, a cable
     operator was permitted "one MDS channel, or its equivalent in ITFS
     excess capacity, in an MDS PSA."[^304] This local programming
     exception, together with the restrictions on that exception, also
     applied to leases executed to facilitate the provision of local
     programming.[^305] If local programming was terminated, any MDS
     license granted under the exception was to be automatically
     forfeited on the day after the local programming was
     discontinued.[^306]

168. In 1992, Section 613(a)'s restrictions on cable cross-ownership
     were enacted as part of legislation that generally directed the
     Commission to set "horizontal" limits on cable operators' scale
     (i.e., the number of cable subscribers an operator could reach
     through its cable systems, or systems in which it had an
     attributable interest) and "vertical" limits on cable operators'
     integration with video programmers (i.e., suppliers of video
     programs to be carried over the cable operators' systems).[^307] In
     1993, the Commission determined that its 1990 cable cross-ownership
     rules, albeit with some modification, "effectively implement\[ed\]"
     the cable cross-ownership restrictions of Section 613(a).[^308]
     Those preexisting rules generally prohibited cable systems that are
     the sole providers in their franchise areas from holding MDS
     licenses and from leasing time on MDS or ITFS stations within their
     franchise areas.[^309] The *1993 Cable* *R&O* sought to allow cable
     operators greater flexibility in providing MDS in unserved portions
     of their franchise areas by prohibiting cable/MDS cross-ownership
     only if a cable operator's actual service area overlapped with the
     MDS PSA.[^310] This was more lenient than the 1990 rules, which
     prohibited cable cross-ownership throughout the franchise area and
     the MDS protected area if there was any overlap between the
     two.[^311]

169. In the decade following the *1993 Cable* *R&O*, MDS service
     initially gained market share but then peaked in mid-1998, with MDS
     representing only 1.3% of the MVPD market.[^312] In January 2004,
     we observed that the wireless cable industry provides competition
     to the cable industry in only limited areas and that subscribership
     to MDS has been steadily declining over the last several years,
     notwithstanding that the deployment and use of MDS services
     (together with large dish satellite services) has contributed
     significantly to the early acceptance of non-wireline alternatives
     to traditional MVPD service.[^313] While cable served almost 100%
     of the nation's MVPD subscribers in 1993, in 2003, that share had
     fallen to approximately 75%, with DBS providing the most
     significant competitive alternative with a 21.6% share of the
     national MVPD market.[^314]

170. In 1998, the Commission released the *Two-Way Order* permitting
     MDS/ITFS licensees to construct digital two-way Internet service
     via cellularized communication systems.[^315] As a result, MDS/ITFS
     licensees began to turn away from offering video service and began
     to focus on data delivery service.[^316] In the *NPRM*, we observed
     that the typical broadband internet market is highly
     concentrated.[^317] Despite this concentration, we noted that in
     some circumstances there could be substantial benefits to allowing
     the incumbent cable or DSL operator to have more access to MDS/ITFS
     spectrum.[^318] We noted that such cable or DSL operator access may
     benefit rural areas where expensive upgrades to cable or DSL plants
     were not feasible.[^319] We sought comment as to whether allowing
     incumbent cable operators and/or DSL providers to be eligible to
     obtain MDS/ITFS licenses could have a negative impact on some
     broadband interest markets.

171. *Discussion.* Section 613(a) of the Act states:[^320]

> It shall be unlawful for a cable operator to hold a license for
> multichannel multipoint distribution service, or to offer satellite
> master antenna television service separate and apart from any
> franchised cable service, in any portion of the franchise area served
> by that cable operator\'s cable system.
>
> The Commission may waive the requirements of this paragraph to the
> extent the Commission determines is necessary to ensure that all
> significant portions of a franchise area are able to obtain video
> programming.[^321]

172. The purposes behind the cable/MMDS cross-ownership restrictions
     were to address a concern "that common ownership of different means
     of video distribution may reduce competition and limit the
     diversity of voices available to the public" and to prevent a cable
     operator from warehousing potential competition.[^322] Since
     channels in the new BRS and EBS bands may continue to be used for
     video distribution, these concerns are still potentially relevant
     in the BRS/EBS band. Moreover, since MMDS licensees will become
     licensees in the BRS/EBS band, we do not believe that it would be
     consistent with Congressional intent to allow cable operators to
     hold BRS/EBS licenses for the purpose of distributing multichannel
     video service. Accordingly, subject to the present exceptions in
     our rules, we will continue to prohibit cable operators from
     holding BRS/EBS licenses and using those licenses to offer
     multichannel video programming service.

173. On the other hand, we do not believe that the statute requires us
     to prohibit cable operators from holding BRS/ITFS licenses for the
     purpose of providing broadband data services or voice. We conclude
     that Section 613(a) does not apply to broadband services. The
     Commission did not allow MMDS licensees to provide such services
     until the Digital Declaratory Ruling was released in 1996, which
     was four years after the statute was enacted. Today, we create a
     new radio service designed to allow licensees to offer services
     that were not even contemplated when the statute was passed. We do
     not see any basis in the statutory language or legislative history
     for interpreting the statute so as to prohibit cable operators from
     providing services that did not exist when the prohibition was
     enacted. We note that Earthlink argues that Section 613 bars cable
     operators from acquiring MDS spectrum to offer non-video services,
     and that waiving Section 613's restrictions for cable operators
     would thwart broadband competition.[^323] We reject that argument
     because the statute was clearly designed to address competition in
     the multi-channel video programming market, not broadband
     competition. We also reject as speculative and unsupported
     Earthlink's argument that Section 613 was left in place when
     Congress passed the 1996 Act because that provision is necessary to
     prevent the anti-competitive effects that would occur if a cable
     operator were able to purchase or control alternative facilities
     that a competitor might use to compete with the incumbent cable
     operator.[^324]

174. With respect to DSL providers, there is no statutory prohibition
     similar to Section 613 that would require us to consider
     cross-ownership restrictions and, in any event, ILECs already have
     access to MDS/ITFS spectrum and this existing eligibility has
     caused no apparent problems. We also reject as inapposite
     Earthlink's argument that Section 652 of the Act, which prohibits
     cross-ownership of an ILEC and a cable television system, should be
     interpreted to support a general ban on common ownership of
     alternative broadband facilities.[^325] Nothing in Section 652
     addresses eligibility restrictions on radio spectrum.

175. Despite these bases for declining to impose cross-ownership
     restrictions on broadband services, Earthlink, Teton and NAF favor
     imposing such restrictions, arguing that the high broadband
     internet market share that cable operators and DSL providers enjoy
     gives those parties the incentive to acquire BRS/ITFS spectrum in
     order to thwart competition in that market.[^326] When assessing
     the need to restrict the opportunity of any class of service
     provider to obtain spectrum for the provision of communications
     services, our overall goal has been to determine whether the
     restriction is necessary to ensure that consumers will receive
     communications services in a spectrum-efficient manner and at
     reasonable prices. Under our precedent, eligibility restrictions
     are imposed only when (1) there is a significant likelihood of
     substantial competitive harm in specific markets, and (2)
     eligibility restrictions will be effective in addressing such harm.
     Under this standard, the Commission relies on market forces to
     guide license assignment absent a compelling showing that
     regulatory intervention to exclude potential participants is
     necessary.[^327] Those in favor of restricting the eligibility of
     cable operators and DSL providers to acquire BRS/ITFS licenses have
     not shown that this standard is met. They have not cited relevant
     market facts and circumstances sufficient to demonstrate that the
     eligibility of such service providers is likely to result in
     substantial competitive harm or that, even if specific markets
     experienced harm to competition, the eligibility restrictions they
     advocate would be effective in eliminating that harm.[^328]

176. We conclude therefore that cable operators and ILECs alike should
     be allowed to acquire or lease BRS/ITFS spectrum in order to
     provide non-video services like broadband internet access. In light
     of Section 613(a)'s language and context we do, however, prohibit
     cable operators from acquiring BRS/ITFS licenses outright for the
     purpose of providing MVPD service. We also retain the related ban
     on cable operators leasing BRS/ITFS spectrum within their franchise
     areas for the purpose of providing MVPD service, but allow leasing
     for other purposes.

### Leasing and Secondary Markets

177.  In 2003, we took significant steps to facilitate the development
     of Secondary Markets in spectrum usage rights involving our
     wireless radio services when we adopted our *Secondary Markets*
     *Report and Order* and *Further Notice of Proposed
     Rulemaking*.[^329] In the *Report and Order*, we established
     policies and rules to enable spectrum users to gain access to
     licensed spectrum by entering into different types of spectrum
     leasing arrangements with licensees in most wireless radio
     services.[^330] In addition, we streamlined the Commission's
     approval procedures for license assignments and transfers of
     control in most wireless radio services.[^331] In the *Further
     Notice*, we proposed several additional steps we could take to
     facilitate the development of these Secondary Markets.[^332] We
     also sought comment on whether the spectrum leasing policies should
     be extended to, inter alia, MDS and ITFS.[^333] Given that we are
     undertaking a comprehensive examination of the rules relating to
     these services in this *Report and Order*, and given the close
     relationship between the leasing rules and other issues raised in
     this proceeding, we will address in this *Report and Order* the
     question raised in the *FNPRM* of whether the rules adopted in the
     *Secondary Markets* *Report and Order* should apply to the BRS/EBS
     spectrum.

178. Commenters generally supported extending the spectrum leasing
     policies adopted in the *Report and Order* to ITFS and MDS
     leasing.[^334] Commenters also recommended grandfathering existing
     leasing arrangements that have evolved under the distinct leasing
     model historically applicable to ITFS.[^335] NIA/CTN also argue
     that the substantive requirements currently applicable to ITFS
     leasing should continue to apply to leases entered into under the
     Secondary Markets spectrum leasing framework.[^336]

179. We agree with the commenters that we should extend the rules and
     policies adopted in the *Secondary Markets* *Report and Order* to
     the BRS/EBS spectrum. In the *Secondary Markets* *Report and
     Order*, we took important first steps to facilitate significantly
     broader access to valuable spectrum resources by enabling a wide
     array of facilities-based providers of broadband and other
     communications services to enter into spectrum leasing arrangements
     with Wireless Radio Service licensees. These flexible policies
     continue our evolution toward greater reliance on the marketplace
     to expand the scope of available wireless services and devices,
     leading to more efficient and dynamic use of the important spectrum
     resource to the ultimate benefit of consumers throughout the
     country. Facilitating the development of these Secondary Markets
     enhances and complements several of the Commission's major policy
     initiatives and public interest objectives, including our efforts
     to encourage the development of broadband services for all
     Americans, promote increased facilities-based competition among
     service providers, enhance economic opportunities and access for
     the provision of communications services, and enable development of
     additional and innovative services in rural areas.[^337] We agree
     with the commenters that there is no reason to deprive licensees in
     the BRS/EBS spectrum of the benefits of these rules and policies.
     We also agree with WCA that extending those rules and policies to
     the BRS/EBS spectrum will establish regulatory parity with other
     services that may be used to provide broadband services.[^338]

180. We also agree with commenters that existing leases entered into
     under our existing ITFS leasing framework should be grandfathered,
     so long as the leases remain in effect and are not materially
     changed. We agree with NIA/CTN that it would be unduly burdensome
     to force licensees that wish to have their existing leases remain
     in effect to renegotiate those leases to comply with our Secondary
     Markets policies and rules.[^339] Specifically, although our
     Secondary Market rules limit spectrum leasing arrangements to the
     length of the license term, we will allow pre-existing ITFS leases
     to remain in effect for up to fifteen years, consistent with our
     current rules.[^340] With respect to future spectrum leasing
     arrangements entered into pursuant to our Part 27 rules for EBS,
     however, consistent with our treatment of other services, we
     believe it is appropriate to limit the spectrum lease term to the
     length of the license term in question.

181. In addition, we agree with NIA/CTN that the substantive use
     requirements that have historically applied to ITFS must remain in
     effect in the spectrum leasing context.[^341] NIA/CTN describes the
     "most significant" limitations as: "(i) there must be certain
     minimum educational uses of ITFS spectrum (typically, a minimum of
     20 hours per 6 MHz channel per week); (ii) for analog facilities,
     there must be a right to recapture an additional amount of capacity
     for educational purposes (typically, 20 more hours per channel per
     week); for digital facilities, the licensee must reserve at least
     5% of its transmission capacity for educational purposes; (iii) the
     lease term may not exceed 15 years; (iv) the ITFS licensee must
     retain responsibility for compliance with FCC rules regarding
     station construction and operation; (v) only the ITFS licensee can
     file FCC applications for modifications to its station's
     facilities; and (vi) the ITFS licensee must retain some right to
     acquire the ITFS transmission equipment, or comparable equipment,
     upon termination of the lease agreement."[^342] As NIA/CTN notes,
     the purpose behind these limitations was to maintain the
     traditional educational purposes of ITFS.[^343] We believe that the
     continued application of these substantial use limitations, as well
     as the retention of ITFS eligibility requirements in Section C,
     will facilitate the traditional educational purposes of ITFS.
     Accordingly, we will apply the spectrum leasing rules and policies
     adopted in the Secondary Markets proceeding to the BRS/EBS band,
     while grandfathering existing leases entered into under our prior
     leasing policy and retaining EBS substantive use requirements.

## Standardization of Practices and Procedures

### Consolidation of Procedural Rules in Part 1

182. *Background.* In the ULS *R&O*, the Commission consolidated the
     majority of its wireless services procedural rules into Part
     1.[^344] By consolidating the procedural rules in Part 1, the
     Commission improved the consistency of its rules across wireless
     services and provided a single point of reference for applicants,
     licensees, and members of the public seeking information regarding
     our licensing procedures.[^345] Additionally, the consolidation
     reduced confusion among applicants and licensees, accelerated the
     application process, and improved the speed with which wireless
     carriers were able to provide service to the public.[^346] Because
     consolidation of procedural rules into Part 1 has proven beneficial
     to other wireless services, in the *NPRM*, we sought comment on
     consolidating the MDS and ITFS procedural rules into Part 1 of the
     Commission's Rules.[^347]

183. *Discussion.* After reviewing the comments we received on this
     issue, we conclude that we will consolidate the BRS and EBS
     procedural rules into Subpart F of Part 1 of the Commission's
     Rules,[^348] which contains the rules applicable to the processing
     of applications for all services in the Universal Licensing System.
     We agree with commenters that this action will decrease confusion
     concerning the application of our BRS and EBS rules. For example,
     the Coalition recognizes that the Commission's Wireless
     Telecommunications Bureau (WTB) has efficiently processed
     applications under Subpart F of Part 1 of the Commission's Rules
     and believes that, with appropriate consideration of the particular
     needs of MDS and ITFS, Part 1 can be modified to provide for the
     licensing of MDS and ITFS facilities without undue impact on
     processing systems.[^349] Likewise, Bell South supports
     standardizing filing requirements and transition to new forms and
     processing rules through consolidating procedural rules into Part 1
     like the majority of wireless services.[^350] OWTC also approves of
     a consolidation of the MDS and ITFS application procedures and
     explains that since regulation of the MDS service was transferred
     from the former Mass Media Bureau to WTB (and from BLS to ULS), it
     is logical to consolidate the MDS procedural rules into Part 1 as
     is done in the majority of wireless services.[^351] Similarly,
     Teton is in favor of the Commission merging MDS and ITFS into a
     single MDS/ITFS spectrum with streamlined processing rules.[^352]
     Accordingly, in consolidating the BRS and EBS procedural rules into
     Subpart F of Part 1 of the Commission's Rules, we adopt rules that
     benefit applicants, licensees and members of the public, by
     streamlining our processing rules as discussed in the sections that
     follow. By this action, we also realize a key policy objective in
     this rulemaking, which is simplifying the licensing process and
     deleting obsolete or unnecessary regulatory burdens.

### Consolidation of Service Specific Rules in Part 27

184. *Background.* In the *NPRM*, [^353] we noted that our MDS and ITFS
     service specific rules are currently contained in three rule
     parts - Parts 21, 73 and 74.[^354] Part 21 contains our MDS rules
     while Parts 73 and 74 contain our ITFS rules. Although MDS and ITFS
     licensees use their licenses to provide similar services, our rules
     treat these licensees differently. For example, with regard to
     modifications, a major modification in MDS is currently triggered
     by, among other things, a change in the geographic coordinates of a
     station's transmitting antenna of more than ten seconds of latitude
     or longitude or both, or any change which increases the antenna
     height by three meters or more.[^355] In contrast, a major change
     to an ITFS Station is triggered by, among other things, relocating
     a facility\'s transmitter site by 10 miles or more, or increasing
     the transmitting antenna height by 25 feet or more.[^356]

185. In the *NPRM*, we stated that we believe that regulatory parity
     will lead to efficiency in this band and spur the development of
     new and improved services for the public. Additionally, we stated
     that consolidating the MDS and ITFS service specific rules into one
     rule part will reduce confusion and provide a single reference
     point for these similar services. Because we believe that
     consolidation will benefit applicants, licensees and members of the
     public, we proposed to consolidate the MDS and ITFS service
     specific rules into Part 101. However, we also sought comment on
     alternative means of consolidating the rules relating to these
     services, such as incorporating the rules into Parts 21 or 27 of
     our Rules.[^357]

186. *Discussion.* After careful consideration of the comments we
     received on this issue, we conclude that consolidating the service
     specific rules for BRS and EBS into Part 27 of the Commission's
     Rules is the most sensible approach given the flexible use and
     geographically-licensed service areas that are at the heart of our
     Part 27 rules.[^358] As an initial matter, the licensing plan and
     service rules we adopt today are consistent with the fundamental
     goals established in the Commission's November 1999 Spectrum Policy
     Statement, which includes promoting greater efficiency in spectrum
     markets.[^359] The Commission therein recognized that where
     appropriate, greater efficiency can be achieved through
     flexibility, which can be permitted through the use of relaxed
     service rules.[^360] Regarding the encouragement of emerging
     telecommunications technologies, the Commission also recognized
     that there are substantial public interest benefits to harmonizing
     the rules applicable to like services including efficiency in
     spectrum markets and regulatory neutrality, which help create a
     level playing field across technologies and thereby promote more
     effective competition. The Commission in the 1999 Spectrum Policy
     Statement also observed that such a structure would permit reliance
     on the marketplace to achieve the highest-valued use of the
     spectrum, thereby ensuring that the Commission and its processes do
     not become a bottleneck in bringing new radio communications
     services and technologies to the public.[^361]

187. We believe there are substantial public interest benefits to
     harmonizing rules applicable to like services, which is best
     accomplished by placing the service specific rules for BRS/EBS in
     Part 27 of the Commission's Rules. The Coalition asserts that the
     MDS and ITFS services should be regulated pursuant to Part 27 of
     the Commission's Rules, which the Commission originally created for
     the Wireless Communications Service ("WCS") and has since applied
     to other flexible use, geographically licensed wireless
     services.[^362] Likewise, EarthLink supports discarding the
     Commission's broadcast-style regulatory model for MDS and ITFS and
     supports switching to a Part 27-like regulatory scheme.[^363]
     Consistent with our determinations with respect to other wireless
     services, the BRS/EBS spectrum's regulatory structure assumes that
     consumer benefits will be maximized if BRS/EBS licensees are able
     to take advantage of the flexible use standard in Part 27. We
     believe that applying the flexible use standard in Part 27 to BRS
     and EBS licensees will enable licensees to construct and operate
     facilities within their GSAs with the least amount of
     regulation.[^364]

188. We note that BellSouth supported the proposal in the *NPRM* to
     consolidate service-specific rules into Part 101, but did not voice
     any opposition to placing the service specific rules in Part
     27.[^365] On the other hand, OWTC prefers to keep the service rules
     for MDS, ITFS and other fixed wireless services separate. OWTC
     believes that while consolidation of procedural rules is sensible
     and could lead to a streamlining of application and other
     procedures, the service rules for each unique service must be clear
     and unambiguous in order to prevent licensee and market
     confusion.[^366]

189. However, we agree with the Coalition that Part 101 is not best
     suited for the BRS and EBS service specific rules. Part 101 of the
     Commission's rules generally was not created for the flexible use,
     wide-area services that BRS and EBS services will be authorized to
     provide as the BRS/EBS spectrum.[^367] Furthermore, we note that
     the Commission created Part 101 to simplify and conform the rules
     for point-to-point, Part 21 common carrier and Part 94 private
     operational fixed microwave services,[^368] in recognition of the
     fact that those services shared many of the same frequency bands,
     used substantially the same equipment and had converged their
     technical standards over time.[^369] In so doing, the Commission
     specifically excluded MDS and ITFS from Part 101, noting that
     "\[t\]he ITFS and MDS services differ from the services to be
     included in Part 101 in terms of policy considerations, applicable
     rules, and technical standards."[^370] We concur with the Coalition
     that to the extent that the regulatory regimes applicable to MDS
     and ITFS have changed, they have moved further away from those
     imposed on the typical Part 101 service.[^371]

190. While it is true that the Commission regulates LMDS licensees under
     Part 101 and LMDS has some similarities to BRS, the decision to
     regulate LMDS pursuant to Part 101 predated the creation of Part
     27, and the Commission has since recognized that Part 27 is better
     suited for flexible use services.[^372] Although geographically
     licensed wireless services in the 24 GHz and 39 GHz bands are also
     regulated under Part 101, this is attributable to the fact that
     licensees in those bands were regulated under Part 101 prior to the
     Commission's adoption of geographic licensing rules for such
     services.[^373] Accordingly, we adopt service specific rules for
     BRS and EBS in Part 27 of the Commission's Rules, thereby providing
     a single reference point for these similar services, as opposed to
     having the rules for these services in three different rule parts.
     This streamlining will benefit applicants, licensees and the public
     by promoting innovation and maximizing flexibility in the service
     rules.

### Standardization of Major and Minor Filing Requirements*:*

191. *Background.* MDS licensees currently submit FCC Forms 304 or 331
     to modify their licenses pursuant to Sections 21.40 and 21.41 of
     our Rules.[^374] The Commission will not grant a "major
     modification" to an MDS station unless it finds that the
     modification is in the public interest and in compliance with
     Communications Act.[^375] A major modification to an MDS license
     includes amendments that require submission of an environmental
     assessment, result in a substantial and material alteration of the
     proposed service, specify a substantial change in beneficial
     ownership or control, or is deemed substantial by the Commission
     pursuant to section 309 of the Communication Act.[^376]

192. In contrast, EBS licensees currently file a formal application on
     FCC Form 330 for any of the following kinds of changes or
     modifications to its transmission system: adding a new channel;
     changing channels; changing polarization; increasing the EIRP in
     any direction by more than 1.5 dB; increasing the transmitting
     height by twenty-five feet or more; or relocating a facility's
     transmitter site by ten miles or more.[^377] Our current rules
     further provide that applications for "major changes" to existing
     EBS facilities that are mutually exclusive with other such
     applications or with applications for new stations are subject to
     competitive bidding.[^378] EBS minor modification applications may
     be filed at any time and are not be subject to competitive
     bidding.[^379] Subject to Commission approval, our existing rules
     also permit certain parties to involuntarily modify the facilities
     of an existing EBS licensee in certain situations.[^380]

193. In sharp contrast to the policies described above, the Commission
     has adopted one streamlined set of modification rules for services
     license using ULS.[^381] Under ULS, we treat all major
     modifications as new applications.[^382] Licensees may make minor
     modifications as a matter of right without prior Commission
     approval (other than pro forma assignments and transfers) within
     thirty days of implementing such changes.[^383] Where other rule
     parts permit licensees to make permissive changes to technical
     parameters without notifying the Commission (e.g., adding,
     modifying, or deleting internal sites), no notification is required
     when making a modification pursuant to the ULS rules.[^384] This
     consolidation of modification rules has led to efficient processing
     of modification applications in ULS. Therefore, noting that the
     license modification rules for MDS and ITFS are currently spread
     across seven rules, we sought comment in the *NPRM* on
     consolidating these modification rules in one rule part.[^385] In
     this connection, we proposed to consolidate the modification rules
     to determine major and minor modifications for MDS and ITFS
     licenses using the ULS Rules in Part 1 of the Commission's
     Rules.[^386]

194. *Discussion.* After reviewing the limited comments we received on
     this issue, we conclude that there are substantial benefits to
     employing the simplified approach we use in ULS to govern
     modifications for BRS/EBS licensees. BellSouth supports the
     proposed new rules regarding standardizing filing
     requirements.[^387] IMLC supports the Commission's proposals to
     eliminate the various unnecessary and unhelpful filings which MDS
     licensees must make, stating that outdated and unnecessary reports
     and requirements for MDS licensees should be abolished.[^388] The
     Coalition believes that minor revisions to Section 1.929 are
     required to reflect the MBS Licensing Scheme and that with the
     development of appropriate individual standards for determining
     whether MBS filings are "major" or "minor," Section 1.929 can
     readily be amended to consolidate the MDS and ITFS major and minor
     change and major and minor amendment rules.[^389]

195. We believe that using our Part 1 ULS modification rules for BRS and
     EBS modifications will simplify the licensing process by removing
     obsolete or unnecessary regulatory burdens and that no special
     rules are required for modifications to the MBS as suggested by the
     Coalition. The Coalition's belief that special modifications are
     required pursuant to Section 1.929 of our rules is premised on the
     assumption that we would employ site-based licensing for the MBS.
     However, inasmuch as we have adopted geographic area licensing for
     the entire band, including the MBS,[^390] we need not adopt the
     modifications proposed by the Coalition.[^391]

196. Employing the Part 1 ULS approach, as described above, for
     modifications to BRS and EBS licenses will reduce confusion
     regarding the appropriate rules to follow, increase the speed with
     which the Commission staff processes applications and will
     eliminate redundancy in our rules. Accordingly, today we adopt
     rules that consolidate the modification rules to determine major
     and minor modifications for BRS and EBS licenses under our ULS Part
     1 modification rules. Consequently, at the end of the six month
     transition period to ULS, implementation of mandatory electronic
     filing will begin for BRS and EBS licensees.[^392] MDS licensees
     currently submitting FCC Forms 304 or 331 to modify their licenses
     and EBS licensees currently submitting FCC Form 330 must begin
     using FCC Form 601 to report modifications to the Commission.[^393]

### Amendments to New and Modification Applications

197. *Background.* In the *NPRM* we sought comment on whether we should
     adopt the consolidated wireless procedures under Part 1 of the
     Commission's rules for amendments to applications.[^394] Generally,
     pursuant to this consolidated approach for processing wireless
     applications, applicants may file amendments to pending
     applications as a matter of right if we have not designated the
     application for hearing or listed it in a competitive bidding
     public notice as accepted for filing.[^395] Likewise, where an
     amendment to an application constitutes a "major change" as defined
     in Section 1.929, we treat the amendment as a new application for
     determination of filing date, public notice, and petition to deny
     purposes.[^396] Furthermore, under the consolidated wireless
     approach, where an amendment to an application specifies a
     substantial change in beneficial ownership or control (de jure or
     de facto) of an applicant, the applicant must provide an exhibit
     with the amended application containing an affirmative, factual
     showing as set forth in Section 1.948(h)(2).[^397]

198. Our consolidated wireless procedures for amendments to wireless
     applications differ in some respects from our current approach to
     amendments for MDS and ITFS applications.[^398] For example, ITFS
     applicants currently may amend applications to cure defects noted
     in deficiency letters to the applicant. MDS BTA applicants
     currently may amend a long-form application up to the date the
     application has appeared on public notice as accepted for filing or
     by written petition demonstrating good cause if the application is
     already on public notice. MDS operators have recommended that we
     revise our rules to use the same definitions for major and minor
     amendments as for major and minor modifications.[^399]

199. *Discussion.* After reviewing the limited comments we received on
     this issue, we conclude that we will adopt the consolidated
     wireless procedures, contained in Part 1 of the Commission's Rules,
     for amendments to BRS and EBS applications. Consequently, at the
     end of the transition period to mandatory electronic filing under
     ULS,[^400] BRS and EBS licensees will use FCC Form 601 to amend
     their applications.[^401] This is yet another step in achieving a
     key policy objective in this rulemaking by simplifying the
     licensing process and deleting obsolete or unnecessary regulatory
     burdens.

### Assignments of Authorization and Transfers of Control*:*

200. *Background.* In the *NPRM* we sought comment on proposing to
     revise our MDS and ITFS transaction requirements to conform to and
     merge with the ULS requirements in Section 1.948 of our
     rules.[^402] Currently, our MDS licensees use FCC Form 305 to apply
     for voluntary and involuntary assignments, pro forma assignments,
     and FCC Form 306 to apply for voluntary transfers of control and
     pro forma transfers of control.[^403] These licensees use FCC Form
     304A to request a partial assignment.[^404] However, the assignor
     must apply for deletion of the assigned facilities, indicating
     concurrence in an assignee\'s request.[^405] The parties must
     consummate these transactions within forty-five days from the date
     of approval.[^406] If the parties fail to consummate a partial
     assignment, the parties must submit FCC Form 304A to return the
     assignor\'s license to its original condition.[^407] Before the
     Commission will consent to these transactions, the
     assignor/transferor must complete construction of the facility and
     file a certificate of completion of construction.[^408]

201. Our current rules require the assignor/transferor to file the
     certificate of construction within one year from the initial
     license grant date, the consummation date of the transaction; or
     median date of the applicable commencement dates if the transaction
     involves a system of two or more stations. Our current rules also
     require an assignee/transferee to file FCC Form 430 License
     Qualification Report with the appropriate application form (Form
     305 or Form 306) unless the assignee or transferee already has a
     current and substantially accurate report on file with the
     Commission. Finally, the parties of both transactions must notify
     the Commission of the date of consummation, by letter, within ten
     days of the date of consummation.

202. In contrast, ITFS licensees presently use Form 330 to request an
     assignment of license or a transfer of control.[^409] With both
     types of transactions, ITFS licensees must file their applications
     at least forty-five days before the contemplated effective date of
     the transaction.[^410] However, in the case of an involuntary
     transaction, the Commission must be notified in writing, promptly
     after the death or legal disability of a licensee.[^411]
     Additionally, an application for involuntary transaction must be
     filed within thirty days of such occurrence.[^412]

203. Recognizing, however that there would be significant benefits to
     eliminating inconsistencies between similar services, the
     Commission developed FCC Form 603 to process assignment of license
     and transfer of control applications in ULS. Specifically, the
     Commission found that replacing service specific forms with
     consolidated forms would provide the public with a consistent set
     of procedures and filing requirements and would increase the speed
     and accuracy of the assignment and transfer process.[^413]

204. In the *NPRM*, we sought comment on proposing to revise our MDS and
     ITFS transaction requirements to conform to and merge with the ULS
     requirements in Section 1.948 of our rules.[^414] Specifically, we
     proposed to eliminate the prior consent requirement for
     non-substantial, pro forma assignments in MDS, and extend the
     consummation notice period to 180 days for both services. [^415]
     With regard to involuntary assignments, we proposed to integrate
     the MDS rules into our ULS consolidated rules.[^416] Additionally,
     we proposed to revise our channel exchange procedures[^417] to
     conform to our assignment of license procedures.[^418] For example,
     our rules currently require both the filing of a major modification
     application to change a frequency assignment[^419] and each
     licensee seeking to exchange channels must file separate pro forma
     assignment applications.[^420] We found that this channel exchange
     procedure places an undue burden upon licensees and the
     Commission's resources.[^421] As a result, we proposed instead to
     require the licensees involved to treat channel exchanges like any
     other set of license transfers, i.e., to file two or more
     applications showing the transferor and transferee for each channel
     or set of channels being transferred.[^422]

205. *Discussion.* We conclude that there are substantial benefits to
     revising our MDS and ITFS transaction requirements to conform to
     and merge with the ULS requirements in Section 1.948 of our rules
     for BRS/EBS licensees. AMLC and IMLC point out that many
     transactions cannot be consummated in the 45 days presently
     allowed.[^423] The Rural Commenters believe the Section 21.38
     requirement for prior Commission approval of pro forma assignments
     of license and transfers of control can be eliminated. [^424]

206. We generally agree with these commenters and conclude that we will
     adopt our proposals regarding BRS and EBS transaction requirements
     as discussed above. Although there are some differences in the
     information requirements for transfers and assignments, we believe
     there is a sufficient degree of overlap in the information that
     both types of applicants supply that both BRS and EBS applicants
     can use the FCC Form 603 for transfers and assignments.
     Furthermore, the Commission designed Form 603 so that applicants
     only have to answer the questions pertinent to the type of
     transaction involved.[^425] Consequently, at the end of the
     transition period to ULS implementation, BRS and EBS licensees will
     use FCC Form 603 and associated schedules to apply for consent to
     assignment of existing authorizations (including channel swaps), to
     apply for Commission consent to the transfer of control of entities
     holding authorizations, to notify the Commission of the
     consummation of assignments or transfers, and to request extensions
     of time for consummation of assignments or transfers.[^426]
     Accordingly, we adopt transaction rules for BRS and EBS that
     conform to and merge with the ULS requirements in Section 1.948 of
     our rules. Streamlining the filing requirements for transaction
     requirements for BRS and EBS is another milestone in reaching the
     goal of simplifying the licensing process and deleting obsolete or
     unnecessary regulatory burdens.

### Partitioning and Disaggregation 

207. Background. In the *NPRM* we proposed allowing partitioning and
     disaggregation of spectrum for ITFS auction winners.[^427] We noted
     that in other services where we have implemented geographic area
     licensing,[^428] we have allowed licensees to partition their
     service areas and to disaggregate their spectrum.[^429] For
     example, our current rules allow MDS BTA licensees to partition
     their spectrum.[^430]

208. In the *NPRM*, we explained that if we allowed partitioning and
     disaggregation of geographic area licenses of current ITFS
     channels, licensees could file for partial assignment of a license,
     and licensees could apply to partition their licensed GSAs or
     disaggregate their licensed spectrum at any time following grant of
     their geographic area license.[^431] We proposed that the area to
     be partitioned would be defined by the partitioner and partitionee.
     We also proposed that the partitionee or disaggregate would be
     authorized to hold its license for the remainder of the
     partitioner's or disaggregator's license term, and would be
     eligible for renewal expectancy on the same basis as other
     licensees. There would be no restriction on the amount of spectrum
     disaggregated and we would permit combined partitioning and
     disaggregation. Licensees that partition and disaggregate would be
     subject to provisions against unjust enrichment. We also proposed
     to eliminate any separate provisions relating to "channel swapping"
     and rely upon the ability of licensees to partition and
     disaggregate their spectrum.[^432]

209. *Discussion.* After reviewing the comments, we conclude that
     partitioning and disaggregation should be permitted for both ITFS
     and MDS licensees. The Coalition and BellSouth support this
     proposal.[^433] Similarly, Ericsson supports the proposal because
     it allows the market to devise spectrum configurations that meet
     the needs of industry. Ericsson further asserts that freely
     operating market forces would ensure the diversity of services
     offered to consumers, the adequacy of spectrum for flexible uses,
     and the ability of small business to provide niche services. In
     particular, Ericsson encourages the Commission to permit
     aggregation of rural and urban service areas, which would lead to
     service areas that permit nationwide coverage. Ericsson believes
     that aggregation of service areas is especially important for
     ensuring that development of AWS in this band is not hampered,
     especially in rural areas. Ericsson asserts that the ability to
     aggregate licenses or disaggregate service areas (i.e., to permit
     spectrum trading) would allow for a tailored service area without
     sacrificing less populated ones.[^434] OWTC, believes the
     Commission should develop a minimal GSA and allow licensees to
     aggregate multiple service areas on a regional and/or a national
     basis. OWTC states that under this approach, smaller entities with
     local or regional business plans and little interest in providing
     large-area service would not be discriminated against.[^435]

210. We agree with these commenters and believe the same logic applies
     to allowing partitioning and disaggregation for EBS licensees as
     presently applies to partitioning of MDS BTA spectrum under our
     current rules. Allowing partitioning and disaggregation of BRS/EBS
     licenses will provide flexibility to licensees, promote efficient
     spectrum use, and facilitate market entry by small businesses,
     educational, telemedicine or medical institutions, or other parties
     who may lack the financial resources for participation in BRS/EBS
     auctions. Accordingly, we permit partitioning and disaggregation of
     licenses for all services in the band.

### License Renewal

211. *Background.* In the *NPRM* we sought comment on our proposal to
     eliminate reinstatement procedures and adopt the late-filed renewal
     policy for wireless radio services for MDS and ITFS.[^436]
     Additionally, we sought comment on whether we should impose any
     special requirements or limitations on the renewal of ITFS
     licenses.

212. Pursuant to the Commission's Rules, MDS licensees must file FCC
     Form 405 to renew their licenses thirty and sixty days before the
     expiration of such license. [^437] If the renewal application is
     not timely filed, a licensee shall automatically forfeits its
     license without *Further Notice* to the licensee upon the
     expiration of the license period specified therein.[^438] An MDS
     licensee may seek reinstatement of its licenses by filing a
     petition within 30 days of the license's expiration explaining the
     failure to timely file the required notification or application and
     setting out with specificity the procedures that the petitioner has
     established to ensure that such filings will be submitted on time
     in the future.[^439] Generally, a license period is ten years. The
     terms of MDS station licenses granted on the basis of underlying
     BTA service area authorizations obtained by competitive bidding
     extend until the end of the ten-year BTA authorization.[^440]

213. In contrast, ITFS licensees must file FCC Form 330-R to renew a
     license.[^441] Unless otherwise directed by the FCC, ITFS licensees
     must file their renewal applications no later than the first day of
     the fourth full month prior to the expiration date of the license
     to be renewed.[^442] The Commission will reinstate expired ITFS
     licensees if the former licensee files a timely petition with
     adequate justification.[^443]

214. In further contrast, licensees in auctionable services file FCC
     Form 601 no later than the expiration date of the authorization for
     which renewal is sought, and no sooner than ninety days prior to
     expiration. The Commission designed ULS to provide wireless
     licensees with a pre-expiration notification approximately ninety
     days before their licenses expire and thereby avoid situations in
     which licensees allow their licenses to expire inadvertently and
     subsequently seek reinstatement.[^444] We note that while we
     generally provide renewal notices to licensees, the pre-expiration
     notice is not a prerequisite to cancellation should a licensee fail
     to renew its license.

215. In 1999, the Commission adopted a new policy regarding treatment of
     late-filed renewal applications in the Wireless Radio
     Services.[^445] Renewal applications that are filed up to thirty
     days after the expiration date of the license are granted nunc pro
     tunc if the application is otherwise sufficient under our
     Rules.[^446] However, the licensee may be subject to an enforcement
     action for untimely filing and unauthorized operation during the
     time between the expiration of the license and the untimely renewal
     filing.[^447] Applicants who file renewal applications more than
     thirty days after the license expiration date may also request
     renewal of the license nunc pro tunc, but such requests are not
     routinely granted, and are subject to stricter review, and may be
     accompanied by enforcement action, including more significant fines
     or forfeitures.[^448] In determining whether to grant a late-filed
     renewal application, the Commission takes into consideration all of
     the facts and circumstances, including the length of the delay in
     filing, the reasons for the failure to timely file, the potential
     consequences to the public if the license should terminate, and the
     performance record of the licensee.[^449] After the license
     expiration, the previous licensee may file a new application for
     use of those frequencies subject to any service specific rules.
     Once that thirty-day period has elapsed, or the prior holder of the
     license files a new application for that spectrum, the license then
     becomes available for the Commission to reassign by competitive
     bidding or other means according to the rules of the particular
     service.[^450]

216. *Discussion.* After reviewing the comments we received on this
     issue, we conclude that we will adopt the late-filed renewal policy
     utilized for wireless radio services for the BRS/EBS band. The
     Commission's policy regarding treatment of late-filed renewal
     applications in the Wireless Radio Services is as follows: Renewal
     applications that are filed up to thirty days after the expiration
     date of the license will be granted nunc pro tunc[^451] if the
     application is otherwise sufficient under our rules, but the
     licensee may be subject to an enforcement action for untimely
     filing and unauthorized operation during the time between the
     expiration of the license and the untimely renewal filing.[^452]
     Applicants who file renewal applications more than thirty days
     after the license expiration date may also request that the license
     be renewed nunc pro tunc, but such requests will not be routinely
     granted, will be subject to stricter review, and also may be
     accompanied by enforcement action, including more significant fines
     or forfeitures.[^453] In determining whether to grant a late-filed
     application, we take into consideration all of the facts and
     circumstances, including the length of the delay in filing, the
     reasons for the failure to timely file, the potential consequences
     to the public if the license should terminate, and the performance
     record of the licensee.[^454]

217. As an initial matter, the Commission has stated that each licensee
     is fully responsible for knowing the term of its license and for
     filing a timely renewal application.[^455] Even when a licensee
     asserts that no renewal notification regarding the license
     expiration was received, this reason provides no basis for the
     relief requested, because a licensee's obligation to file a timely
     renewal is not dependent on the Commission sending a renewal
     notice.[^456]

218. We have previously held that an inadvertent failure to renew a
     license in a timely manner is not so unique or unusual to warrant a
     waiver of the rules.[^457] The Commission will grant a waiver
     if (a) it is in the public interest and the underlying purpose of
     the rule would be frustrated or not served by application to the
     present case, or (b) in view of unique or unusual factual
     circumstances, application of the rule would be inequitable, unduly
     burdensome, or contrary to the public interest, or the applicant
     has no reasonable alternative.[^458] Even in the case of public
     safety licensees, the Commission has determined that a licensee
     will not be afforded special consideration when the licensee fails
     to file a timely renewal application simply because it engages in
     activities relating to public health or safety.[^459]

219. Bell South supports the proposed new rules regarding license
     renewal policies.[^460] The Coalition asserts that the Commission
     should apply this policy to MDS and ITFS on a prospective basis
     only, and note that until recently, the Commission has consistently
     applied a lenient standard to late-filed Part 74 renewals. The
     Coalition further asserts that the new renewal policy should not be
     applied retroactively to late-filed renewal applications for
     licenses that expire prior to the effective date of the new
     rules.[^461] OWTC supports the Commission's proposal to provide MDS
     licensees with a 90-day pre-expiration notice for renewal
     applications in order to avoid an inadvertent lapse of a license
     and the subsequent reinstatement effort. OWTC believes the
     pre-expiration notice is essential because the Commission proposes
     to eliminate the process of applying for reinstatement of the
     license if the expiration date passes without a proper renewal
     being filed.[^462] Finally, Grand Wireless argues for a distinction
     between licensee/operators servicing the public and those who are
     not.[^463]

220. We conclude that elimination of the reinstatement period will
     benefit all licensees in the band and other entities interested in
     acquiring abandoned spectrum.[^464] Pursuant to the Commission's
     ULS procedures, failure to file for renewal of the license before
     the end of the license term results in automatic cancellation of
     the license.[^465] We believe that eliminating reinstatement of
     expired licenses is prudent because ULS will send licensees a
     notification that their licenses are about to expire and,
     therefore, should be responsible for submitting timely renewal
     applications. Additionally, interactive electronic filing will make
     it easier for all licensees to timely file renewal applications.
     Moreover, we believe elimination of the reinstatement procedures
     will facilitate our ability to efficiently, and quickly perform our
     licensing responsibilities by reducing the amount of late-filed
     renewal applications that must be manually processed and by
     eliminating the processing of reinstatement applications.
     Accordingly, we eliminate our current reinstatement procedures and
     adopt the late-filed renewal policy for BRS and EBS on a
     prospective basis. We acknowledge that our previous handling of
     these matters was considerably lenient. We emphasize, however, that
     these new procedures will be strictly enforced, and licensees
     should take note accordingly.

### Special Temporary Authority

221. *Background.* In the *NPRM*, we sought comment on our proposal to
     include MDS and ITFS special temporary authority (STA) requests
     under the same ULS regulatory regime as other Wireless
     Services.[^466] Currently, for MDS, in circumstances requiring
     immediate or temporary use of facilities, entities may request
     special temporary authority to install and/or operate new or
     modified equipment.[^467] Requests may be submitted as informal
     applications, at least ten days prior to the date of the proposed
     construction or operation (however, in practice an FCC Form 304 is
     attached to the informal request).[^468] We may grant STAs without
     regard to the thirty-day public notice requirement in certain
     instances. First, we may grant an STA when the STA period is not to
     exceed thirty days and the filing of an application to change the
     STA into a permanent situation is not contemplated. Second, we may
     grant an STA when the STA period is not to exceed sixty days,
     pending the filing of an application to change the special
     situation into a regular operation. Third, we may grant an STA to
     permit interim operation to facilitate completion of authorized
     construction or to provide substantially the same service as
     previously authorized. Fourth, we may grant an STA when there are
     extraordinary circumstances requiring operation in the public
     interest. We may grant STAs and extensions of STAs up to 180 days
     pursuant to Section 309(f) of the Communications Act[^469] where
     extraordinary circumstances so require, but the licensee has a
     heavy burden to show it warrants such action. Finally, in times of
     national emergency or war, we may grant special temporary licenses
     (in place of construction permits, station licenses, modifications
     or renewals) for the period of the emergency.[^470]

222. Under our existing rules, we may grant ITFS STAs in extraordinary
     circumstances requiring emergency operation to serve the public
     interest.[^471] As in MDS, only an informal application is
     required. However, ITFS STA applicants must submit the request at
     least ten days before the date of the proposed operation. Pursuant
     to Section 309(f) of the Act,[^472] We may grant ITFS STAs for a
     period not to exceed 180 days with a limited number of extensions
     also granted for up to 180 days.

223. *Discussion.* After reviewing the limited comments we received on
     this issue, we conclude that we will adopt our proposal to include
     BRS and EBS STA requests under the same ULS regulatory regime as
     other Wireless Services. Bell South supports the proposed new rules
     regarding special temporary authority and there were no commenters
     opposed to adopting this approach.[^473] Under the streamlined
     consolidated ULS approach, applicants must file STA requests
     electronically on an FCC Form 601 within ten days before the date
     of the proposed operation (although we may grant requests received
     less than ten days prior to operation) for compelling
     reasons).[^474] Furthermore, because MDS STA requests are informal
     applications, but in practice have an FCC Form 304 attached,
     adoption of the Form 601 for BRS and EBS STA requests as currently
     used in WTB makes good sense. Inasmuch as STAs are an emergency
     measure, mandatory electronic filing as now required in WTB, would
     provide BRS and EBS licensees with quick, responsive service.[^475]
     Accordingly, for the foregoing reasons, we adopt rules that include
     BRS and EBS STA requests under the same ULS regulatory regime as
     the Wireless Services. This action furthers our goals of
     simplifying the licensing process and deleting obsolete or
     unnecessary regulatory burdens.

### Ownership Information

224. *Background.* Currently MDS and ITFS licensees file FCC Form 430 to
     submit ownership information to the Commission. The Communications
     Act mandates the ownership information requested in Form 430.[^476]
     The Form 430 requires the licensee to list its MDS and/or ITFS
     licenses or conditional licenses. Submission of ownership
     information enables the Commission to review whether applicants and
     licensees comply with our real-party-in-interest rules, eligibility
     for treatment as a small business at auction and foreign ownership
     restrictions.[^477] In the *NPRM* we sought comment on whether MDS
     and/or ITFS licenses or conditional licenses should be required to
     submit ownership information on FCC Form 430. Noting that other
     wireless licensees use Form 602 to file ownership information
     electronically in ULS,[^478] and that FCC Forms 602 and 430 request
     the same ownership information,[^479] we proposed to require MDS
     and ITFS licensees to file Form 602, instead of Form 430, to submit
     ownership information.[^480]

225. *Discussion.* After reviewing the limited comments we received on
     this issue, we conclude that we will adopt our proposal to require
     BRS and EBS licensees to file Form 602, in lieu of Form 430, to
     submit ownership information as is done by our other wireless
     licensees under our Part I ULS Rules. We received no comments
     opposed to our proposal. Bell South supports the proposed new rules
     regarding ownership information.[^481] Currently, wireless
     licensees use Form 602 to file ownership information electronically
     in ULS.[^482] FCC Form 602 and FCC Form 430 request the same
     ownership information.[^483] We note that on June 14, 2002, the WTB
     stopped accepting electronically filed Forms 430 temporarily.[^484]
     Therefore, during the transition period, BRS and EBS licensees may
     continue to file the Form 430 manually. We believe that requiring
     BRS and EBS licensees to file Form 602 is one more step in reducing
     the number of forms that BRS and EBS licensees have to deal with
     and will also bring these services under the same licensing
     requirements as our other wireless services. Accordingly, we adopt
     our proposal to require BRS and EBS licensees to file Form 602, in
     lieu of Form 430.[^485]

### Regulatory Status

226. *Background.* Consistent with our goal to maximize flexibility, we
     tentatively concluded in the *NPRM* that MDS and ITFS applicants
     may request more than one regulatory status for authorization in a
     single license. [^486] Under this approach, MDS and ITFS applicants
     could authorize a combination of common carrier and non-common
     carrier services in a single license and licensees in the band
     could render any kind of communications service (e.g., fixed,
     mobile, point-to-multi-point) consistent with that regulatory
     status and the existing rules. This proposal is consistent with the
     approach we have used for other services licensed on a geographic
     area basis.[^487] Applicants would not be required to describe the
     services they seek to provide but would be required to designate
     the regulatory status of services they intend to provide using Form
     601.[^488] We sought comment on what procedures to adopt for
     licensees to change their regulatory status (i.e., notify the
     Commission within a certain timeframe or seek prior
     approval).[^489]

227. *Discussion.* We conclude that we will permit BRS and EBS
     applicants to request more than one regulatory status for
     authorization in a single license. We also conclude that BRS and
     EBS applicants must follow the notification procedures set forth in
     Section 27.10(c) of the Commission's Rules.[^490] Bell South
     supports our proposal.[^491] Similarly, EarthLink supports
     discarding the Commission's broadcast-style regulatory model for
     MDS and ITFS and urges Commission reliance instead on a Part
     27-like regulatory scheme for the LBS and UBS.[^492] Likewise, the
     Coalition agrees, and in response to the *NPRM's* inquiry regarding
     the appropriate procedures for an MDS or ITFS licensee to change
     its regulatory status, the Coalition submits that Section 27.10(c)
     should serve as the model.[^493] CTIA contends the MDS and ITFS
     Bands should be configured to optimize their usability for CMRS
     services.[^494] Likewise, AHMLC and IMLC observe that under the new
     flexible use rules proposed in the *NPRM* for the MDS and ITFS
     bands, licensees could conceivably use the spectrum that falls
     within the statutory definition of a commercial mobile radio
     service.[^495] We agree with AHMLC and IMLC that to the extent MDS
     and ITFS licensees elect common carrier status, they should be
     exempt from tariff obligations under Title II of the Communications
     Act.[^496]

228. Accordingly, licensees in the band will be permitted to request
     more than one regulatory status for authorization in a single
     license pursuant to the notification procedures set forth in
     Section 27.10(c) of the Commission's Rules.[^497] Allowing
     licensees in BRS and EBS to choose from among several regulatory
     status categories furthers our policy goals of: promoting
     innovation by maximizing flexibility in the service rules, and
     simplifying the licensing process and deleting obsolete or
     unnecessary regulatory burdens.

### Discontinuance, Reduction or Impairment of Service

229. *Background.* In the *NPRM*,[^498] we sought comment on
     consolidating forfeitures, cancellation and discontinuance of
     service rules for MDS and ITFS licensees. These service rules are
     currently contained in five separate rule sections for MDS
     licensees, and three separate rule sections for ITFS
     licensees.[^499] Because a system can have both ITFS and MDS
     channels, we believe that consolidating these rules will be
     advantageous to both the industry and the Commission staff. Thus,
     we tentatively concluded in the *NPRM* that consolidating these
     rules would reduce the confusion of the industry as to the
     appropriate rules and increase the efficiency of the Commission
     staff in processing these actions.

230. The Commission implemented its license forfeiture rules to ensure
     station operation and alleviate concerns about spectrum
     warehousing.[^500] We note that presently MDS licensees may
     alternate between providing service as a common carrier or a
     non-common carrier.[^501] However, before alternating, the licensee
     must notify the Commission of the change at least thirty days
     before the change.[^502] Additionally, common carriers who seek to
     alternate or who otherwise intend to reduce or impair service must
     notify all affected customers of the planned discontinuance,
     reduction, or impairment on or before providing notice to the
     Commission.[^503] These provisions concerning licensees alternating
     between common carrier and non-common carrier status are in our
     Part 27 Rules, which we have concluded will contain the BRS and EBS
     rules henceforth.[^504]

231. *Discussion.* After reviewing the comments and taking into
     consideration the fundamental restructuring of the BRS and EBS
     bands, we conclude that we will eliminate our forfeiture,
     cancellation and discontinuance of service rules for certain
     licensees.[^505] We note, however, that BRS and EBS Licensees that
     choose to act as fixed common carriers or fixed carriers will be
     subject to Section 27.66 of the Commission's Rules.[^506]

232. We believe that eliminating our forfeiture, cancellation and
     discontinuance of service rules for certain licensees provides both
     existing EBS and BRS licensees and potential new entrants with
     greatly enhanced flexibility in order to encourage the highest and
     best use of spectrum to provide for the rapid deployment of
     innovative and efficient communications technologies and
     services.[^507] By these actions, we make significant progress
     towards the goal of providing all Americans with access to
     ubiquitous wireless broadband connections, regardless of their
     location.[^508]

233. As part of the fundamental changes to the BRS and EBS band, we seek
     to encourage BRS and EBS licensees to respond to market demands for
     next generation ubiquitous broadband wireless services and make
     investments in the future of such services. We believe this goal
     cannot be readily accomplished if BRS and EBS licensees have to
     focus their resources on preserving legacy services solely because
     renewal approaches and licensees fear losing their authorizations
     if the discontinuance of service and forfeiture rules are not
     eliminated. Furthermore, the move to next generation services for
     BRS and EBS providers also entails a transition period where
     licensees will be forced to go dark and discontinue service during
     the actual transition.[^509] Accordingly, we conclude that it would
     be inappropriate to penalize BRS and EBS licensees while they
     migrate to the new band plan.

234. Finally, we also note that as part of the fundamental restructuring
     of the BRS and EBS band to provide for a more flexible,
     market-based approach, we are replacing the existing site-based
     licensing scheme for the BRS and EBS with geographic area licensing
     for these services.[^510] This is consistent with Commission
     actions over the past decade shifting away from site-based
     licensing for wireless licensees toward more flexible,
     geographic-area based allocations that provide licensees with
     greater freedom to provide different types of services. In making
     this shift, the Commission has adopted performance benchmarks that
     increase licensees' flexibility to offer a variety of services,
     including service that may not require ubiquitous geographic
     coverage. In a related matter, we believe that adopting specific
     safe harbors and performance requirements for the BRS and EBS bands
     will ensure service to customers, while at the same time speeding
     the provision of next generation wireless broadband services.
     Consequently, in the F*NPRM* portion of this document, we seek
     comment on what performance requirements and safe harbors to adopt
     for the BRS and EBS services.[^511]

235. The Coalition argues that consistent with other Part 27 flexible
     use services, the Commission should eliminate the existing MDS and
     ITFS rules subjecting licenses to cancellation if spectrum is not
     used for brief periods of time or if licensed facilities are
     temporarily dismantled.[^512] Specifically, the Coalition explains
     that some licensees will be required to cease their current
     operations pursuant to the transitional process it proposes.[^513]
     The Coalition further asserts that many licensees retain a strong
     interest in discontinuing the provision of wireless cable services
     or first generation broadband service so that they can migrate to
     second generation broadband services once the Commission revises
     its rules and such action should be encouraged. The Coalition
     states that there is no public interest benefit to preserving
     non-viable services solely because renewal approaches. Nonetheless,
     the Coalition asserts, this will be the end result if we take a
     snapshot approach pursuant to our rules.[^514] We concur with the
     Coalition.

236. Bell South supports the proposed new rules regarding
     discontinuance, reduction or impairment of service.[^515] Sprint
     argues the discontinuance provisions set forth at Section 21.303 of
     the Commission's rules should be deleted or modified to account for
     the technology and spectrum transitions contemplated by this
     proceeding. Sprint further asserts the market-driven service goals
     of the Commission will be thwarted if licensees are effectively
     forced to continue the provision of obsolete services merely to
     preserve their authorizations.[^516] Similarly, Nextel agrees that
     these discontinuance rules should be eliminated.[^517]

237. AHMLC and IMLC argue the Commission should simply abolish Section
     21.303,[^518] which requires licensees to offer service to
     customers at least once a year. AHMLC and IMLC note that a licensee
     wanting to deploy an advanced system under the rules now under
     consideration would nonetheless have to continue providing service
     to at least some legacy subscribers or risk forfeiture under
     Section 21.303. Therefore, AHMLC and IMLC assert that it makes no
     sense to compel the provision of uneconomical and inefficient
     service to simply meet Commission rules. [^519] We agree with AHMLC
     and IMLC.

238. Grand Wireless argues providing service to the public should be the
     primary consideration that allows for preservation of licenses and
     spectrum. Grand Wireless and Pace further assert that different
     geographical service areas will grow at different rates with
     additional channels put into service as the operation warrants.
     They note that the transition to advanced wireless services whose
     offerings are still in their infancy will result in a staggered
     usage of spectrum over time particularly in rural areas. Thus Grand
     Wireless and Pace state that as time goes by, additional channels
     will be placed into service as demand grows, and the speed with
     which additional channels are placed into service depends in large
     part on the service area with rural areas being slower than urban
     areas.[^520] We agree that this is yet another reason to eliminate
     our forfeitures, cancellation and discontinuance of service rules
     for BRS and EBS licensees.

239. In sum, we conclude that our decision to eliminate our forfeiture,
     cancellation and discontinuance of service rules for certain
     classes of BRS and EBS licensees is supported by comments in the
     record, as well by consideration for the fact that BRS and EBS
     licensees will be transitioning to new innovative next-generation
     technologies, and may be forced to go dark during transition. Our
     market-driven service goals will not be reached if licensees are
     forced to continue providing obsolete services solely to preserve
     their authorizations. We see no public interest benefit to
     preserving non-viable services solely because renewal approaches.
     We believe that eliminating these rules allows for innovative,
     flexible use of the spectrum.

### Foreign Ownership Restrictions

240. *Background.* In the *NPRM* we sought comment on establishing
     regulatory parity for applicants requesting authorization solely
     for non-common carrier services and applicants requesting
     authorization for common carrier services.[^521] We note that
     Sections 310(a) and 310(b) of the Communications Act, as modified,
     impose foreign ownership and citizenship requirements that restrict
     the issuance of licenses to certain applicants.[^522] An applicant
     requesting authorization only for non-common carrier services would
     be subject to Section 310(a), but not to the additional
     prohibitions of section 310(b). In contrast, an applicant
     requesting authorization for common carrier services would be
     subject to both Sections 310(a) and 310(b). By establishing parity
     in reporting obligations, however, we did not propose a single,
     substantive standard for compliance.[^523]

241. *Discussion.* We conclude that common carriers and non-common
     carriers seeking to operate in BRS and EBS should not be subject to
     varied reporting obligations.[^524] Consistent with our
     determination to regulate services in the band pursuant to Part 27
     of the Commission's Rules, we agree with the Coalition that
     Sections 27.12, 1.913, and 1.919 of the Commission's Rules should
     be utilized to implement this policy.[^525] Accordingly, we adopt
     rules for applicants requesting authorization for either common
     carrier or non-common carrier status to file changes in foreign
     ownership information pursuant to those sections.[^526] This action
     furthers our goal of fostering regulatory parity and transparency
     between like services. We also believe this is yet another step in
     simplifying the licensing process and deleting obsolete or
     unnecessary regulatory burdens.

### Annual Reports

242. *Background.* The Commission's rules require MDS operators to file
     annual reports even if they are in full compliance with all of our
     rules.[^527] Inasmuch as these rules appear to be unnecessary, in
     the *NPRM*, we sought comment on eliminating these
     requirements.[^528]

243. *Discussion.* After reviewing the comments we received on this
     issue, we conclude that we will eliminate the requirement that BRS
     operators file annual reports with the Commission. BellSouth, AHMLC
     and IMLC support the planned elimination of the Section 21.911
     Report.[^529] Similarly, the Rural Commenters believe that the
     Section 21.911 Annual Report can be eliminated at no loss to the
     effectiveness of the Commission's mission.[^530] Likewise, the
     Coalition agrees that the Commission has correctly concluded that
     "these reports do not appear to serve any purpose."[^531] IMLC
     states the annual filing of this report no longer serves a useful
     purpose and notes that as MDS and ITFS usage moves into a digital
     mode, it will become difficult, if not impossible, to report what
     content is being transmitted over "channels" of fluctuating
     definition. Additionally, IMLC believes there is no need for an
     additional EEO Report required by Section 21.920 of the
     Commission's rules,[^532] and this report should either be
     eliminated or made a question on the annual EEO outreach reporting
     form due on September 30 of each year.[^533] Consistent with our
     tentative conclusion in the *NPRM* to eliminate annual
     reports,[^534] as well as our determination today to place the BRS
     and EBS in Part 27 of our rules, we eliminate the EEO annual
     report. Accordingly, we eliminate the requirement that BRS
     operators file annual reports with the Commission. Doing so
     simplifies the licensing process and deletes obsolete or
     unnecessary regulatory burdens.

### **Application Processing**

244. *Background.* In the *NPRM* we sought comment on streamlining our
     application procedures. We tentatively concluded that the
     interactive nature of ULS will enhance the on-line capabilities of
     MDS and ITFS users, and therefore proposed to integrate the
     Services into ULS. [^535] Currently, our MDS and ITFS application
     processing is cumbersome, time-consuming, and resource intensive.
     As noted above,[^536] we are adopting rules herein that replace the
     requirement to separately license individual transmitters with a
     geographic area licensing scheme in which most operations would be
     authorized pursuant to the geographic area license. This change
     will substantially reduce burdens on licensees, expedite the
     initiation of service, and provide greater flexibility.
     Nonetheless, we note that there will continue to be limited
     instances in which transmitters will have to be licensed
     individually. Thus, we believe it is appropriate to review and
     streamline our application procedures.

245. With respect to the processing of ITFS applications, our rules
     currently require several burdensome steps that result in delays to
     the public and hinder the efficient processing of ITFS
     applications.[^537] Although our MDS application processing
     procedures appear quicker then the ITFS procedures, we believe MDS
     application filing procedures should also be stream-lined and
     consolidated.[^538]

246. Previously, applicants could file and view their applications
     on-line using the Broadband Licensing System (BLS).[^539] On
     October 11, 2002, the Wireless Bureau suspended the electronic
     filing capabilities of the BLS in order to improve the integrity of
     data in the BLS, prepare for converting the ITFS and MDS services
     to the ULS, and facilitate future enhancements to electronic
     filing.[^540]

247. *Discussion.* We did not receive any comments opposing streamlining
     our ITFS and MDS application procedures. Thus, we conclude that
     conversion of the data from BLS to ULS will improve the efficiency
     of filing applications, as well as searching for data on these
     services. In this vein, we note that we require the majority of the
     wireless applicants to file their applications electronically using
     ULS. ULS has eliminated the need for wireless carriers to file
     duplicative applications and has increased the accuracy and
     reliability of licensing information for wireless services.
     Additionally, ULS has increased the speed and efficiency of the
     application process because wireless licensees and applicants can
     file all licensing-related applications and other filings
     electronically. Since the implementation of ULS, the public may
     access all publicly available wireless licensing information
     on-line.[^541]

248. We conclude that the interactive nature of ULS will streamline the
     BRS and EBS licensing process,[^542] as well as reduce the present
     lengthy licensing process. For instance, generally, upon filing of
     an application in ULS we place the application on public notice as
     accepted for filing.[^543] The extra step of allowing applicants to
     amend their applications to make corrections is not necessary with
     ULS.

249. By consolidating the BRS and EBS application processing procedural
     rules in Part 1 of the Commission's Rules, we improve the
     consistency of the Commission\'s rules across wireless services and
     provide a single point of reference for applicants, licensees, and
     the public seeking information regarding our licensing procedures.
     We conclude this consolidation will reduce confusion among
     applicants or licensees, increase the probability that filings will
     be done correctly, accelerate the application process, and speed
     wireless service to the public. Accordingly, we adopt rules that
     streamline our application procedures for BRS and EBS by
     integrating the Services into ULS.[^544]

### Returns and Dismissals of Incomplete or Defective Applications

250. *Background.* In the *NPRM*, we proposed to extend our uniform rule
     for dismissal or return of defective applications in the Wireless
     Services to ITFS and MDS applications and adopt the Wireless
     Bureau's procedures for complying with the Commission's uniform
     policy.[^545] As noted above,[^546] in some instances ITFS and MDS
     applicants submitted applications that were incomplete or required
     the submission of additional information before they could be
     placed on public notice as accepted for filing, which resulted in
     inefficient processing of applications.

251. The Commission in the *ULS Report and Order* adopted a uniform
     application dismissal and return rule for all the Wireless
     Services.[^547] Pursuant to the uniform rule articulated therein,
     the Commission has the discretion to return applications for
     correction on minor filing errors, but is also authorized to
     dismiss any incomplete or defective application without
     prejudice.[^548] In this connection, regardless of the manner in
     which applicants submit their applications, ULS will automatically
     dismiss applications that are unsigned, untimely, or not
     fee-compliant.[^549] The Commission explained in the ULS *R&O* that
     in contrast to minor filing errors, such defects were "fatal to the
     consideration of the application."[^550]

252. WTB, however, has announced specific procedures for complying with
     the Commission's uniform policy.[^551] WTB has concluded that,
     "\[g\]enerally, timely filed renewal applications and construction
     notifications that are otherwise defective will be returned to the
     applicants for correction, rather than dismissed by the
     Bureau."[^552] Nonetheless, the Bureau clarified "that renewal
     applications and construction notifications that fail to comply
     with the applicable fee and signature requirements will be
     dismissed by the Bureau as defective, rather than returned to the
     applicants for correction, even if timely filed."[^553]

253. *Discussion.* We received no comments opposing our proposal.
     Accordingly, we adopt the Commission's uniform rule for dismissal
     or return of defective applications in the Wireless Services to EBS
     and BRS applications along with the Bureau's procedures for
     complying with the Commission's uniform policy. These steps will
     ensure efficient processing and equal treatment of all
     applications, while simplifying the licensing process and deleting
     obsolete or unnecessary regulatory burdens.

### ULS Forms

254. *Background.* In the *NPRM*,[^554] we noted that currently our
     rules require MDS and ITFS applicants to use eleven different forms
     to request licensing actions.[^555] We tentatively concluded that
     we would streamline these procedures by replacing the eleven forms
     that MDS and ITFS applicants presently use with the four forms that
     we use to license other wireless services in ULS and sought comment
     on this proposal. The Commission consolidated the ULS application
     forms for wireless services to replace approximately forty-one
     application forms.[^556] The consolidation streamlined the
     processing of applications and reduced the filing burden for
     wireless applicants and licensees.[^557] We use four forms in ULS
     -- Form 601 (Long-Form or FCC Application for Wireless
     Telecommunications Bureau Radio Service Authorization), Form 602
     (FCC Ownership Disclosure Information for the Wireless
     Telecommunications Bureau), Form 603 (FCC Wireless
     Telecommunications Bureau Application for Assignment of
     Authorization or Transfer of Control) and Form 605 (Quick-Form
     Applications for Authorization in the Ship, Aircraft, Amateur,
     Restricted and Commercial Operator, and General Mobile Radio
     Services.[^558]

255. *FCC Form 601.* Under our proposal, this form will replace FCC
     Forms 304, 304A, 330, 330A, 330R, 331, 405, 701 and most informal
     application filings. The FCC Form 601 and associated schedules will
     be used to apply for initial authorizations, modifications (major
     and minor) to existing authorizations, amendments to pending
     applications, renewals of station authorizations, developmental
     authorizations, special temporary authorities (STAs),
     certifications of construction, requests for extension of time,
     cancellations, and administrative updates. The required schedules
     are:

-   New/Modification/Amendment (Regular Authorizations, Developmental

> Authority and

Special Temporary Authority) -- FCC Form 601 Main Form with required
technical

schedule.

-   Renewals/Cancellation/Administrative Updates -- FCC Form 601 Main
    Form and

Schedule A (if requesting multiple call signs).[^559]

-   Certifications of Construction -- FCC Form 601 Main Form and
    Schedule K.

-   Extension of Time to Construct -- FCC Form 601 and Schedule L.

256. *FCC Form 602.* This form will replace the FCC Form 430 for the
     submission of initial and updated ownership information for those
     wireless radio services that require the submission of such
     information.[^560]

257. *FCC Form 603.* This form will replace FCC Forms 305, 306 and 330.
     Applicants use the FCC Form 603 and associated schedules to apply
     for consent to assignment of existing authorizations (including
     channel swaps), to apply for Commission consent to the transfer of
     control of entities holding authorizations, to notify the
     Commission of the consummation of assignments or transfers, and to
     request extensions of time for consummation of assignments or
     transfers. Additionally, applicants use the form to apply for
     partial assignments of authorization, including partitioning and
     disaggregation. The required schedules are:

-   Assignment/Transfer of Control -- FCC Form 603 Main Form and
    Schedule A for

auctionable services.[^561]

-   Partitioning & Disaggregation -- FCC Form 603 Main Form and Schedule
    B or

Schedule D as required.

-   Consummation Notifications -- FCC Form 603 and Schedule D.

-   Extension of Time for Consummation -- FCC Form 603 and Schedule E.

258. *Discussion.* After reviewing the limited comments we received on
     this issue, we conclude that eliminating the current MDS and ITFS
     forms and replacing them with the ULS forms will streamline the
     processing of applications and reduce the filing burden for MDS and
     ITFS applicants and licensees. We received no comments opposing the
     replacement of the forms that MDS and ITFS licenses currently use
     the four ULS forms. AHMLC and IMLC support the planned elimination
     of Form 430 in favor of Form 602.[^562] The Rural Commenters
     believe that the Section 21.11(a) requirement for annual updates of
     the FCC Form 430 Licensee Qualification Report can be eliminated at
     no loss to the effectiveness of the Commission's mission. We find
     this a curious comment in that we are now requiring BRS and EBS
     applicants to update their ownership information pursuant to FCC
     Form 602.[^563] Accordingly, we adopt rules to use the ULS forms
     for BRS and EBS, thereby eliminating the current MDS and ITFS
     forms. We note that by using the ULS Forms, we will eliminate a
     number of obsolete MDS and ITFS forms from our rules.[^564]

### Transition Periods

259. *Background.* In the *NPRM*, we proposed to allow continued use of
     the current ITFS and MDS forms for a transition period of six
     months after the effective date of the release of an *R&O* in this
     proceeding.[^565] This period is consistent with the transition
     period the Commission used with the initial implementation of
     ULS.[^566] At the conclusion of this period, only ULS forms would
     be accepted for these services. We noted that in the ULS *R&O*, the
     Commission provided a transition period for applicants and
     licensees to use ULS voluntarily before implementing mandatory
     electronic filing using the ULS forms.[^567] Generally, the
     Commission determined that permitting a six-month transition period
     was appropriate.[^568] Further, we noted that the six-month
     transition period has worked reasonably well for the other services
     that have transitioned to ULS.[^569]

260. *Discussion.* We conclude that the proposed six month period for
     transitioning to mandatory electronic filing is appropriate. We
     note that we received no comments opposing our proposal. AHMLC and
     IMLC believe establishing a 180-day period for assignments of
     authorization and transfers is consistent with the general ULS
     rule.[^570] Similarly, OWTC believes the 6-month transition period
     will help licensees understand any new or consolidated forms. In
     light of the significant changes proposed to the EBS and BRS forms
     and rules, we agree with OWTC and believe applicants and licensees
     should receive a transition period to familiarize themselves with
     ULS and begin using ULS forms. This period will provide EBS and BRS
     applicants and licensees with sufficient time to familiarize
     themselves with ULS and to plan an orderly transition from using
     existing forms to using the ULS forms. Accordingly, we adopt a
     six-month transition period after the effective date of the rules
     we have adopted today before requiring mandatory electronic filing
     by BRS and EBS applicants and licensees in ULS. Consistent with
     prior actions, WTB will release a public notice announcing the
     relevant commencement date for the processing of applications in
     the Services via ULS.[^571]

### Suspension of Acceptance and Processing of Applications*:*

261. *Background.* In the *NPRM*, we concluded that we would process
     pending ITFS applications filed prior to release of the *NPRM*
     provided that they were not mutually exclusive with other
     applications as of the release date of the *NPRM*.[^572] We stated
     that this approach gives due deference to those applicants who
     filed applications prior to our proposed changes and whose
     applications are not subject to competing applications. We also
     stated that we would not accept settlement agreements relating to
     mutually exclusive ITFS applications filed after the release date
     of the *NPRM*, but that we would act on settlement agreements filed
     prior to release of the *NPRM* that are compliant with our
     rules.[^573] We noted that the Commission has used this approach in
     other services where it proposed a transition to geographic area
     licensing.[^574]

262. We tentatively concluded that upon adoption of this *R&O*, we would
     dismiss, without prejudice, applications for ITFS stations filed
     prior to the adoption of the *NPRM* that do not meet the above
     criteria.[^575] We sought comment from any parties proposing that
     we retain such applications and asked these parties to address how
     such applications should be processed, particularly in the event of
     any auction for spectrum covered by the application.[^576]

263. *Discussion.* After reviewing the comments we received, we conclude
     that we will adopt our tentative conclusion. HITN asserts that
     "only entities whose applications are currently mutually exclusive
     and that have been accepted for filing by the Commission should be
     permitted to participate in an auction against each other for the
     channels that are subject to those applications."[^577] We disagree
     with HITN, and note that with regard to pending applications in
     other services that have been converted to geographic area
     licensing, the Commission has dismissed the pending mutually
     exclusive applications at bar.[^578] Thus, we dismiss all
     applications for ITFS stations that were filed prior to adoption of
     the *NPRM* where: the applications are mutually exclusive, and the
     applicants filed settlement agreements subsequent to the release of
     the *NPRM*, and/or applicants filed settlement agreements prior to
     the release of the *NPRM*, but the settlement agreement did not
     comply with our rules.[^579]

# FURTHER NOTICE OF PROPOSED RULEMAKING

## Licensing All Available Spectrum Pursuant to the New Band Plan

264. We now consider what further actions, if any, may be necessary to
     achieve potential benefits of the new band plan and service rules,
     such as deployment of new broadband services, throughout the entire
     band. In the foregoing *Report and Order*, we adopted a new band
     plan for the 2496-2690 MHz band, *i.e.*, for EBS and BRS spectrum,
     to further various public interest objectives, including the public
     interest in efficient and intensive use of the spectrum. To
     facilitate transition of EBS and BRS incumbents to the new band
     plan, we have established a three-year period during which a
     "proponent," either unilaterally or in combination with other
     proponents, can develop and file an Initiation Plan for moving all
     EBS and BRS licensees within the proponent's MEA to new spectrum
     assignments under the new band plan, subject to certain
     requirements and safeguards. The three-year limit on filing
     Initiation Plans provides an incentive for existing users to
     develop transition proposals in a timely manner. However,
     proponents' Initiation Plans may not be sufficient, without
     additional action, to achieve throughout the entire band all the
     benefits made possible by the *Report and Order*. For example,
     Initiation Plans cannot put to use spectrum currently unassigned to
     any incumbent. Moreover, the filing of Initiation Plans is purely
     voluntary and consequently Initiation Plans may not be filed
     covering all MEAs.

265. Accordingly, in this *Further Notice,* we seek comment on how best
     to license EBS and BRS spectrum that timely-filed Initiation Plans
     would leave either unassigned or un-transitioned. In addition, we
     seek comment on whether an alternative process for transitioning
     areas not governed by Initiation Plans proposed in this *Further
     Notice* should be open to individual licensees that are subject to
     timely-filed Initiation Plans and subsequently would prefer to
     participate in the alternative process. We seek comment on all
     aspects of the proposals set forth below, as well as any comment on
     alternatives that commenters may suggest to address the relevant
     policy objectives.

     **1. New Licenses to Be Assigned by Auction**

266. As a general matter, we propose to assign by auction any new
     licenses for spectrum in the band, with any auction being open to
     all parties, both incumbents and new entrants, potentially eligible
     to hold the licenses offered. Accordingly, licenses with restricted
     eligibility, such as EBS licenses, could be bid on only by parties
     potentially meeting all the restrictions on licensees. An auction
     is most likely to assign the license to the qualified licensee that
     most highly values it if the auction is open to all potentially
     qualified licensees.[^580] The new band plan and service rules,
     together with geographic area licensing, will give licensees
     greater operational flexibility to modify, move, and add to their
     facilities, which may improve spectrum utilization. In addition,
     this greater operational flexibility may result in new and
     competing proposals for utilizing the public spectrum resource from
     new parties. Applicants intending very different uses of the new
     licenses can express the respective values a particular license has
     for their intended use in easy to compare competitive bids. This
     enables the Commission rapidly to assign licenses to parties most
     likely to put them to their highest value use.

267. We previously sought comment on potential auctions in this band in
     the initial *Notice of Proposed Rulemaking*. We now seek comment on
     potential auctions in light of the Commission's decisions in the
     *Report and Order* regarding the new band plan, the new service
     rules, and the process for proponents to prepare Initiation Plans
     to transition MEAs to the new band plan. To the extent that
     commenters believe that previously filed comments remain relevant
     in this new context, we ask that they file new comments explaining
     why their prior positions continue to apply. In order to assure
     that all potential parties have an opportunity to address issues
     relating to potential auctions in this new context, we reiterate
     our requests for comment on some particular details of the auction
     process in this new context. In addition to seeking comment on the
     proposals discussed herein, we seek comment on alternative
     approaches.

268. In MEAs where proponents timely file Initiation Plans, we propose
     to assign by auction new licenses for unassigned spectrum, *i.e.,*
     for spectrum in any unassigned frequency blocks and in geographic
     areas outside incumbent licensees' GSAs. Such unassigned spectrum
     will be composed primarily, if not exclusively, of EBS spectrum,
     given that the Commission exhaustively licensed MDS spectrum by
     assigning overlay MDS licenses following Commission Auction No.
     6.[^581] As discussed below, we seek comment on whether we should
     make licenses for this spectrum available in a particular MEA in
     response to the filing of an Initiation Plan or hold the spectrum
     for a general auction of all potentially available spectrum in the
     band.

269. In MEAs where no proponent timely files an Initiation Plan, we seek
     comment on a proposed process for transitioning to the new band
     plan. As detailed below, we propose to make all spectrum in such
     MEAs available by clearing existing spectrum assignments, issuing
     incumbent EBS and BRS licensees modified licenses to continue
     current operations until new licensees give notice of intent to
     offer incompatible new services and transferable bidding offset
     credits to preserve their ability to access spectrum of comparable
     value. We then would assign by auction new licenses in such MEAs
     pursuant to the new band plan. We seek comment on all aspects of
     this proposal, as well as alternatives.

270. In addition, we also seek comment on whether, in MEAs where
     proponents timely file Initiation Plans, individual licensees
     subject to the Initiation Plan should be given the option of
     participating in the proposed process for transitioning other areas
     to the new band plan. In brief, individual licensees that for any
     reason did not want to accept the new spectrum assignment resulting
     from the Initiation Plan could relinquish their new assignment in
     exchange for a modified license and a transferable bidding offset
     credit. Such action might place all potentially available licenses
     in the band in a single auction. As discussed further below in
     connection with new license areas, this process also may facilitate
     the creation of larger, more functional geographic areas than the
     new licenses created pursuant to the Initiation Plan. We seek
     comment on whether such an option might serve the public interest
     in use of the spectrum generally, and particularly whether such an
     option might facilitate implementation of Initiation Plans by
     giving opponents subject to Initiation Plans a viable alternative.

     **a. When to Assign New Licenses**

271. As an initial matter, we seek comment on whether the timely filing
     of an Initiation Plan should result in licenses for unassigned
     spectrum in the relevant MEA being made available for assignment
     within a specified time period after the filing. Generally, one
     option would be to conduct a single auction of licenses for all
     available spectrum in the band after the close of the three-year
     period for filing Initiation Plans, whether the spectrum was
     unassigned, cleared for purposes of transitioning MEAs to the new
     band plan, or relinquished by incumbents voluntarily clearing
     already transitioned spectrum. This would enable all potentially
     interested parties to participate in a single, simultaneous auction
     offering transparent price information regarding substitutable or
     complementary licenses in the band. However, previously unassigned
     spectrum might be primarily, or even exclusively, of interest to
     incumbent licensees in an area subject to a proponent's
     timely-filed Initiation Plan. In such a case, the benefit of making
     that spectrum available to enhance the Initiation Plan's transition
     to the new band plan might outweigh the benefit of offering that
     spectrum in a potential future auction of all available spectrum in
     the band. Alternatively, however, making unassigned spectrum
     available as a result of the filing of an Initiation Plan could
     delay the development or implementation of Initiation Plans by
     posing unanticipated variables for the proponent.

272. To assist in determining whether one of these or some other
     scenario is likely to occur, we seek comment on when to assign new
     licenses by auction for unassigned spectrum in MEAs subject to
     timely-filed Initiation Plans. Should we wait until the time for
     filing Initiation Plans expires, so that all spectrum potentially
     available for new licenses can be identified? Or should we assign
     licenses for unassigned spectrum in an MEA as soon as possible
     after the timely filing of an Initiation Plan? How quickly should
     auctions for such licenses be held after the timely filing of the
     Initiation Plan? Should there be a minimum amount of time following
     the filing of an Initiation Plan before such an auction should be
     held? Should there be a maximum amount of time? We note that it
     appears impractical to conduct auctions for each MEA as Initiation
     Plans are filed. Is the unassigned spectrum likely to be of
     interest to parties other than incumbent EBS and, to the extent
     such spectrum is available, BRS licensees in the relevant MEA?
     Should we give any consideration to any claims by incumbents that
     assigning such licenses prior to implementation of the Initiation
     Plan may interfere with the transition to the new band plan?

273. We also welcome comment on when to hold an auction of licenses for
     spectrum that is not transitioned pursuant to an Initiation Plan.
     In light of the potential for filing Initiation Plans any time
     within three years of the date of the foregoing *Report and Order,*
     we could not hold any such auction any earlier than three years
     after that date. We seek comment, however, on whether there would
     be any reason, other than the practical considerations of preparing
     to conduct an auction, for the Wireless Telecommunications Bureau
     to refrain from considering such an auction beginning three years
     after the *Report and Order*.

     **b. Geographic Areas for New Licenses**

274. In contrast to new spectrum assignments resulting from proponents'
     Initiation Plans, the Commission will have the flexibility to use
     new geographic area licensing definitions for new licenses. We
     propose to use Major Economic Areas as the basis for new licensing
     in the LBS and Upper Band Segment, and to use Economic Areas as the
     basis for new licensing in the MBS. We believe these proposed area
     definitions provide a better framework for new licensing than GSAs
     derived from the PSA of existing EBS and BRS licensees. The
     geographic limits of existing site-based licenses may limit new low
     or high-power services the new service rules otherwise make
     possible. For example, a licensee seeking to re-site a high-power
     transmitter and make use of the flexibility of geographic area
     licensing may be unable to do so if the new licensing area is
     closely hemmed in by other licenses. Furthermore, licensees seeking
     to deploy new mobile low-power service may be unable to do so if
     they cannot aggregate existing licenses to create a sufficient area
     to satisfy consumer demand for coverage.

275. *License areas for LBS and UBS spectrum.* While useable for many
     purposes, licenses in the Lower and Upper Band Segments authorizing
     low-power use offer particularly significant opportunities for
     providing ubiquitous mobile service. The larger the service area
     is, the more likely the licensee would be able to offer service
     anywhere that a potential customer may need it. Furthermore,
     licensees that choose not to serve the entire geographic area
     covered by the license could, subject to Commission rules,
     partition the license or lease spectrum rights to other parties
     interested in serving those areas. Finally, because the transition
     process adopted in the *Report and Order* is organized by MEA,
     using MEAs to license spectrum in the LBS and UBS may facilitate
     coordination with incumbents who develop MEA-based transition
     plans. We therefore seek comment on using MEAs for new licensing in
     the Upper and Lower Band Segments. We also seek comment on
     alternative proposals for LBS and UBS area definitions.

276. *License areas for MBS spectrum.* Licenses in the MBS authorizing
     high-power uses may be well suited to fixed broadcasting services,
     similar to existing ITFS and MDS services. Furthermore, these
     licenses may be of greatest interest to licensees seeking to expand
     services without discontinuing current service. In light of these
     factors, we believe that potential MBS licensees would be
     interested in areas larger than the PSA of an EBS or BRS license,
     but not necessarily much larger. Given these circumstances, license
     areas smaller than MEAs may meet the needs of potential MBS
     licensees. We therefore propose to use Economic Areas as the basis
     for new licensing in the MBS. We note that EAs can be aggregated
     into MEAs, which may facilitate coordination with incumbents who
     transition into MBS frequency assignments in accordance with
     MEA-based transition plans. We seek comment on this proposal and on
     alternative proposals.

277. *License areas for new licenses for previously unassigned
     spectrum.* Licenses for previously unassigned spectrum could be
     licensed based on the defined frequencies and geographic area that
     previously were unassigned. In addition, we could consider whether
     the public interest would be better served by assigning a single
     new license for multiple areas. Alternatively, we could make
     available new MEA and EA licenses, for low and high-power channels
     respectively, that would overlay existing licenses in MEAs subject
     to an Initiation Plan. These overlay licenses would encompass all
     previously unassigned spectrum in particular frequency blocks in
     the relevant geographic area. The overlay licenses would not
     provide any rights with respect to areas covered by other licenses
     but would simply clarify that any area within the MEA or EA not
     covered by the other licenses was the subject to the MEA or EA
     license. We seek comment on these alternatives, in particular on
     whether issuing overlay licenses as described could inadvertently
     create any uncertainty regarding the rights of other incumbents?

278. *License areas for relinquished spectrum.* As discussed further
     below, we seek comment on whether to offer incumbent licensees
     subject to Initiation Plans the option of relinquishing spectrum
     assignments pursuant to the Initiation Plan in order to participate
     in an alternative transition to the new band plan. Licenses for
     spectrum made available by any incumbents exercising this option
     could be licensed based on the defined geographic area of the
     relinquished license. In the event that incumbents relinquish
     multiple licenses in a single MEA subject to an Initiation Plan, we
     could consider whether the public interest would be better served
     by assigning a single new license for multiple areas.
     Alternatively, we could make available new MEA and EA licenses, for
     low and high-power channels respectively, that would overlay
     existing licenses in MEAs subject to an Initiation Plan. These
     overlay licenses would encompass all spectrum previously subject to
     relinquished licenses in the relevant geographic area. The overlay
     licenses would not provide any rights with respect to areas covered
     by other licenses but would simply clarify that any area within the
     MEA or EA not covered by the other licenses was the subject to the
     MEA or EA license. We seek comment on these alternatives, in
     particular on whether either alternative creates different
     incentives for incumbent licensees that might opt to participate in
     the alternative transition, as well as the different effects, if
     any, each would have on other incumbent licensees in the relevant
     MEA or EA. For example, would defined geographic areas or overlay
     licenses enhance or decrease the value of new licenses made
     available by opt-in licensees, thereby giving those licensees a
     greater incentive to relinquish licenses? Could issuing overlay
     licenses as described inadvertently create any uncertainty
     regarding the rights of other incumbents?

#### Frequency Blocks for New Licenses

279. We seek comment on the proper grouping of frequency blocks in an
     auction of new LBS, MBS, and UBS licenses. One option would be to
     license each block in each band segment separately. Alternatively,
     we could maintain consistency with current channel groupings by
     licensing three LBS or UBS blocks with an MBS block in the same
     groups incumbents are entitled to receive pursuant to a proponent
     initiated transition, *i.e.*, license an "A block" of three LBS
     blocks and one MBS block at the lower end of the respective
     segments. Should we consider grouping any EBS LBS blocks with any
     BRS UBS blocks? We also could group all LBS and UBS spectrum within
     a service as one segment, with a separate segment for all MBS
     spectrum within a service. We seek comment on these and other
     alternatives.

280. We also seek comment on whether parties seeking new licenses may be
     indifferent to the specific frequencies they receive, so long as
     they are authorized to use frequencies with particular
     characteristics, e.g., in particular band segments or on uniform
     frequencies across multiple license areas. If such indifference
     exists, it may be possible to allow bidders to bid within or across
     markets on a non-frequency specific basis. Accepting bids for new
     licenses based on characteristics bidders consider relevant without
     requiring them to specify particular frequencies could make
     coordination of auction bids easier and increase the likelihood of
     assigning the new licenses to parties that value them the most.
     Accordingly, we seek comment on whether potential bidders would
     place different values on different frequencies in the same area
     within the same band segment. We note that the Bureau could
     exercise its delegated authority regarding auction design so that
     bidders could be assigned uniform frequencies across markets by
     taking that constraint into account when the Commission assigns
     licenses, rather than by having the bidders bid on particular
     frequencies. Under this approach, if a bidder is indifferent
     between frequencies in the same area within the same band segment
     but values having the same frequency in adjacent markets, the
     Commission's process of assigning specific frequencies could take
     that into account, perhaps simply by assigning frequencies first to
     bidders winning across adjacent markets. We seek comment on this
     approach.

#### Rules for Auctions with New Licenses

281. We request comment on a number of issues relating to competitive
     bidding procedures that could be used to assign new licenses in
     this band by auction. We propose to conduct any such auction in
     conformity with the general competitive bidding rules set forth in
     Part 1, Subpart Q, of the Commission's rules, and substantially
     consistent with many of the bidding procedures that have been
     employed in previous auctions.[^582] Specifically, we propose to
     employ the Part 1 rules governing, among other things, competitive
     bidding design, designated entities, application and payment
     procedures, collusion issues, and unjust enrichment.[^583] Under
     this proposal, such rules would be subject to any modifications
     that the Commission may adopt in our Part 1 proceeding.[^584] In
     addition, consistent with current practice, matters such as the
     appropriate competitive bidding design, as well as minimum opening
     bids and reserve prices, would be determined by the Wireless
     Telecommunications Bureau pursuant to its delegated
     authority.[^585] We seek comment on whether any of our Part 1 rules
     or other auction procedures would be inappropriate or should be
     modified for an auction of new licenses in this band.

     **e. Bidding Credits for Small Businesses and Designated Entities**

282. In 1997, Congress mandated that the Commission "ensure that small
     businesses, rural telephone companies, and businesses owned by
     members of minority groups and women are given the opportunity to
     participate in the provision of spectrum-based services."[^586] In
     addition, section 309(j)(3)(B) of the Act provides that in
     establishing eligibility criteria and bidding methodologies, the
     Commission shall promote "economic opportunity and competition . .
     . by avoiding excessive concentration of licenses and by
     disseminating licenses among a wide variety of applicants,
     including small businesses, rural telephone companies, and
     businesses owned by members of minority groups and women."[^587]

283. The Commission's existing designated entity provisions apply based
     on an entity's qualification as a small business.[^588] We note
     that minority and women-owned businesses and rural telephone
     companies that qualify as small businesses may take advantage of
     the special provisions we have adopted for small businesses.[^589]
     We seek comment on whether our small business provisions are
     sufficient to promote participation by businesses owned by
     minorities and women, as well as rural telephone companies.[^590]
     To the extent that commenters propose additional provisions to
     ensure participation by minority- or women-owned businesses, or
     rural telephone companies, they should address how such provisions
     should be crafted to meet the relevant constitutional standards.

284. We seek comment on the appropriate definition(s) of small business
     that should be used to determine eligibility for bidding credits in
     the auction. With respect to the auction of EBS licenses, we
     further seek comment on any special challenges associated with
     governmental educational institutions or non-governmental
     non-profit educational institutions participating in auctions.

285. In the *Competitive Bidding Second Memorandum Opinion and Order*,
     the Commission stated that it would define eligibility requirements
     for small businesses on a service-specific basis, taking into
     account the capital requirements and other characteristics of each
     particular service in establishing the appropriate threshold.[^591]
     The Part 1 Third *Report and Order*, while it standardizes many
     auction rules, provides that the Commission will continue a
     service-by-service approach to defining small businesses.[^592]
     Generally, when establishing service-specific small business size
     standards, we look to the capital required to provide likely
     service using the spectrum. We do not know the precise type of
     service that new licensees may attempt to provide in this band. The
     Coalition has suggested that the ITFS and MDS bands may be used to
     provide ubiquitous broadband services using next generation
     low-power, cellular systems on fixed, portable and/or mobile
     bases.[^593] We invite comment on whether likely services in this
     band may have capital requirements similar to current BRS services;
     or similar to mobile services, such as Personal Communications
     Services; or similar to fixed services, such as services in the 24
     GHz and 39 GHz bands.

286. In the *Part 1 Third Report and Order*, we adopted a standard
     schedule of bidding credits for certain small business definitions,
     the levels of which were developed based on our auction
     experience.[^594] The standard schedule appears at Section
     1.2110(f)(2) of the Commission's rules.[^595] Are these levels of
     bidding credits appropriate for this band? For this proceeding, we
     would propose to define an entity with average annual gross
     revenues not exceeding \$40 million for the preceding three years
     as a "small business;" an entity with average gross revenues not
     exceeding \$15 million for the same period as a "very small
     business;" and an entity with average gross revenues not exceeding
     \$3 million for the same period as an "entrepreneur."[^596] In the
     event that we offer bidding credits on this basis, we propose to
     provide qualifying "small businesses" with a bidding credit of 15%,
     qualifying "very small businesses" with a bidding credit of 25%;
     and qualifying "entrepreneurs" with a bidding credit of 35%,
     consistent with Section 1.2110(f)(2).[^597] Finally, we invite
     comment on the effect of potentially having three small business
     sizes, and bidding credits, for new licenses in this band while
     having had only one small business size (average annual gross
     revenues for the preceding three years not exceeding \$40 million)
     and one credit (15%) in the BRS service.[^598] We seek comment on
     this proposal.

287. We recognize that educational institutions and non-profit
     educational organizations eligible to hold EBS licenses may have
     unique characteristics. We therefore invite comment on whether
     distinctive characteristics of EBS licensees require distinct rules
     for assessing the relative size of potential participants in an
     auction. How do our designated entity provisions comport with the
     unique challenges and status of educational institutions? Should we
     establish special provisions for non-profit educational
     institutions that may want to have access to EBS spectrum but do
     not have the financial capability to compete in an auction for
     spectrum licenses? Commenters that propose special provisions for
     non-profit educational institutions should address the statutory
     basis for such proposals. Our standard schedule of small business
     bidding credits provides for bidding credits based on a calculation
     of bidders' average annual gross revenues for the three years
     preceding the auction.[^599] We seek comment on whether the
     non-commercial character of EBS licensees requires any special
     procedures for determining the average annual gross revenues of
     such entities. For example, are our standard gross revenue
     attribution rules an appropriate method of evaluating the relative
     resources of universities and government entities? We also invite
     comment on whether some other criterion besides average annual
     gross revenues should be used for identifying small entities among
     EBS licensees and similar applicants.

288. Commenters proposing alternative business size standards should
     give careful consideration to the likely capital requirements for
     developing services in this spectrum. In this regard, we note that
     new licensees may be presented with issues and costs involved in
     transitioning incumbents and developing markets, technologies, and
     services. Commenters also should consider whether the band plan and
     characteristics of the band suggest adoption of other small
     business size definitions and/or bidding credits in this instance.

### Transitions to the New Band Plan When No Proponent Files a Timely Initiation Plan

289. Notwithstanding the Commission's rules facilitating
     proponent-initiated transitions to the new band plan, there may be
     some MEAs where potential proponents are unable or unwilling to
     develop a viable Initiation Plan within the allotted three-year
     period. Although we could extend the three-year period for filing
     Initiation Plans, we are concerned that this would introduce delay
     and uncertainty into the transition process and could frustrate
     successful implementation of the new band plan. We believe that in
     MEAs for which no Initiation Plan is submitted within the
     three-year period, the Commission should move the transition
     forward by adopting an alternative process for transitioning to the
     new band plan. Accordingly, with respect to such MEAs, we seek
     comment on the proposal detailed below, as well as on other
     alternatives proposed.

290. In summary, the proposal presented here calls for the Commission to
     adopt rules to clear current spectrum assignments from the band
     while preserving the incumbents' ability to access spectrum
     comparable in value to currently assigned spectrum. As an initial
     matter, incumbents would receive modified licenses to enable them
     to continue current operations, for the duration of the license, so
     long as those operations did not conflict new licensees' plans to
     utilize the spectrum pursuant to the new band plan.[^600] Moreover,
     incumbents would be issued bidding offset credits to enable them to
     obtain spectrum licenses comparable in value to their original
     licenses. The proposal calls for new licenses consistent with the
     new band plan to be assigned by an auction open to all potentially
     qualified licensees. Accordingly, licenses with restricted
     eligibility, such as EBS licenses, could be bid on only by parties
     potentially meeting all the restrictions on licensees. Incumbents
     could use their bidding offset credits to obtain licenses
     comparable in value to their original licenses in this or any other
     Commission auction. Finally, we propose that this alternative
     transition process include a limited "opt-out" option for
     incumbents who prefer to preserve current high-power operations to
     the extent possible on a frequency block in the MBS, rather than to
     pursue the wider options available under the new band plan. New
     licensees whose licenses cover spectrum made available by the
     relocation of such opt-outs would be required to pay the
     incumbent's costs of relocating its operations, including any
     upgrade to digital transmission. We seek comment on all aspects of
     this proposal, as well as on all aspects of other alternatives
     proposed.

291. We also welcome comment on the following principles guiding the
     proposal outlined below, both generally and with regard to how
     particular aspects of the proposal, or suggested alternatives,
     comply or conflict with them. First, the proposal seeks to achieve
     the benefits of the new band plan and service rules without
     imposing inequitable or unnecessary burdens or disruptions on
     existing spectrum users and uses, or more particularly on prior
     Commission licensing decisions authorizing those users and uses. In
     this regard, the proposal need not impose any burdens or
     disruptions greater than those that will result from a transition
     to the new band plan pursuant to a proponent-sponsored Initiation
     Plan. Indeed, if all the incumbents in an MEA act together under
     the proposal, they should be able to use the bidding offset credits
     that they would receive to outbid any other applicants for new
     licenses covering all the incumbents' original spectrum assignments
     in their MEA. Acting together, such incumbents then could partition
     and disaggregate the spectrum to achieve the same result they could
     have achieved under a transition pursuant to a proponent's
     Initiation Plan. Obviously, incumbents seeking such an outcome
     simply should proceed with a consensus Initiation Plan. We seek
     comment on this alternative proposal for transitioning to the new
     band plan precisely because incumbents may be unable to reach
     consensus on an Initiation Plan. The point here is simply to
     illustrate that incumbents need be no worse off under this proposal
     than they would be under an Initiation Plan.

292. Second, the proposal to issue bidding offset credits to incumbent
     licensees, while somewhat different from past practice, is
     fundamentally similar to the Commission's prior grant of bidding
     credits when assigning licenses by auction. In essence, the bidding
     offset credits proposed here give a bidding preference to incumbent
     licensees in order to limit the burdens and disruptions on existing
     spectrum users and use while facilitating a transition to a new
     band plan and new service rules. Limiting the burdens and
     disruptions on existing spectrum users and uses reflects the public
     interest in avoiding unnecessary disruptions to the Commission's
     licensing decisions in the public interest. The Commission's
     decisions to license spectrum are only the first step to achieving
     the public interest benefits of spectrum use. While past Commission
     licensing decisions are subject to review and revision, spectrum
     utilization is facilitated to the extent that parties utilizing
     spectrum are able to rely reasonably on the continued effectiveness
     of past Commission action licensing the spectrum. All parties,
     licensees and consumers, benefit when they can act in reasonable
     reliance on past Commission licensing action. While the benefits of
     the new band plan and service rules cannot be achieved without
     changing the status quo of existing licensees, the proposal's use
     of bidding offset credits preserves the existing licensees' ability
     to access spectrum of comparable value, and thereby serves the
     public interest in effective utilization of the spectrum.

293. Third, the proposal reflects the indispensable role of the
     Commission in the management of the public spectrum resource. The
     proposal makes use of market mechanisms, such as auctions, where
     appropriate but is not an attempt to substitute Commission action
     for private markets. Adoption of the new band plan and service
     rules; the creation of new licenses with more effective GSAs; and
     the assignment of licenses taking into account all potential
     licensees, are functions the Commission is best, and perhaps
     uniquely, able to achieve. The proposal attempts to incorporate all
     these functions in assigning new licenses for the band.

294. Fourth, the proposal reflects appropriate limits on the
     Commission's authority as a manager of the public spectrum
     resource. The proposal does not use public funds or credit to
     compensate licensees. The bidding offset credits that would be
     issued would be defined by the spectrum that would be made
     available in an auction of Commission licenses. As detailed below,
     the Commission would quantify these bidding offset credits in terms
     of bandwidth and covered population, and the sum total of all the
     bidding offset credits would be no greater than the sum total of
     all the licenses measured in bandwidth and covered population.
     While the proposal would create a process for calculating a face
     dollar value of those bidding offset credits, the sum total of all
     bidding offset credits measured in dollars would be no greater than
     the sum total of winning bids in an auction of licenses for the
     spectrum.[^601]

295. The Commission always balances a variety of public interest goals
     when managing the spectrum or making any other decisions within its
     authority. Accordingly, the foregoing principles are guidelines and
     not absolute requirements for the process of transitioning to the
     new band plan.

     **a. Modified Licenses for Incumbents to Continue Current
     Operations Pending Notice from New Licensees**

296. In considering any proposed mechanism for clearing spectrum in MEAs
     that do not develop their own transition plan, we must consider the
     public interest in protecting existing spectrum uses and users from
     needless disruption or inequitable treatment. To accomplish these
     objectives, we propose to modify existing EBS and BRS licenses,
     with the exception of licenses for MDS channels 1 and 2/2A, so that
     incumbents may continue current operations until a new licensee is
     prepared to use spectrum pursuant to the new band plan in a manner
     incompatible with incumbent operations and to issue existing EBS
     and BRS licensees bidding offset credits that should enable them to
     preserve their access to spectrum of comparable value. With respect
     to the ability to continue current operations using current
     spectrum assignments, licenses for MDS channels 1 and 2/2A would be
     subject to the separate procedures for clearing that spectrum.

297. Under this proposal, modified licenses would authorize incumbent
     licensees to continue offering services on existing channels for
     the duration of the original license, but these rights would be
     secondary to those conferred by new licenses that we would issue
     authorizing primary access under the new band plan.   This is
     intended to enable incumbents to continue operations until new
     licensees prepare to offer incompatible new service; not to enable
     incumbents to conduct long-term secondary operations. The modified
     licenses would expire at the end of their term and would not be
     renewed. Modifying existing licenses in this manner would
     effectively require incumbents to clear their current spectrum
     assignments when new licensees are ready to use the spectrum in
     ways incompatible with existing uses. We seek comment on this
     proposal.

298. As discussed further below, the bidding offset credits would enable
     incumbent EBS and BRS licensees to obtain new spectrum licenses
     offering spectrum access comparable in value to their existing
     licenses. In addition, we propose permitting incumbent licensees to
     transfer their bidding offset credits in whole or in part. This
     could enable incumbents with otherwise limited resources to finance
     upgrading or relocating existing facilities to take advantage of
     the wider options under the new band plan. We seek comment on this
     proposal.

299. *Geographic Areas of Modified Licenses.* The proposed modified
     licenses held by incumbents would have a GSA determined according
     to the process for converting PSAs to GSAs, with two exceptions.
     First, as noted above, licensees for MDS channels 1 and 2/2A would
     not receive modified licenses. Their continued use of current
     spectrum assignments would be governed by the separate process for
     clearing that spectrum. Second, for purposes of determining
     modified license rights, we propose that BRS licenses issued on a
     BTA basis that have not been built out as required by Commission
     rules in effect on the date this *Report and Order* and Further
     *Notice of Proposed Rulemaking* is released be treated as
     site-based licenses for sites in operation as of that release date.
     Under this proposal, post-release build-out would have no effect on
     the incumbent's modified license or bidding offset credit.
     Alternatively, BTA licensees could receive credit for post-release
     build-out only if the post-release build-out satisfies build-out
     requirements in place prior to the release date. In other words,
     BTA licensees would be given credit for build-out that was not
     completed as of the release date but that was undertaken to meet
     requirements existing prior to that date. We seek comment on these
     alternatives.

300. *Procedure for Making New Licenses Primary.* We propose the
     following process to determine when incumbents with modified
     licenses would be required to accommodate new primary licensees. We
     also seek comment on alternatives. We would require new licensees
     to provide notice to the Commission and any affected licensees of
     intent to commence authorized spectrum use that may interfere with
     modified licenses. The notice would identify the relevant new and
     modified licenses and certify that the new licensee has complied
     with Commission rules regarding service of the notice on all
     affected licensees and the Commission. As described in the
     discussion below of the option for incumbents to "opt-out" of this
     transition process, the notice also would be required to include a
     certification that the new licensee has taken certain actions to
     relocate "opt-out" licensees covered by the new license. In the
     event the Commission subsequently finds that any filed
     certification regarding relocation is inaccurate, the new licensee
     on whose behalf the certification was made shall be responsible for
     all reasonably required costs incurred in the relocation, including
     the costs of any party arising from the inaccurate certification.
     Further, we propose that unlike comparable new licensees making
     correct certifications, a new licensee on whose behalf an incorrect
     certification was made would not be entitled to recover relocations
     costs from any other potentially responsible new licensee.

301. We would delegate authority to the Wireless Telecommunications
     Bureau to issue a Public Notice listing receipt of such notices
     from new licensees. The Public Notice listing receipt of a notice
     from the new licensee shall constitute constructive notice to all
     affected licensees. Absent the required certification, any notice
     shall be deemed null and void, irrespective of being listed on any
     Public Notice listing notices received by the Commission. One
     hundred and eighty (180) days after release of the Public Notice
     announcing the receipt of the notice or 18 months after the close
     of the three year period for filing Initiation Plans, whichever
     comes later, the new license(s) designated in the notice shall
     become primary to the modified license(s) designated in the notice.
     Prior to that time, the modified licenses would remain primary. As
     noted above, modified licenses shall not be eligible for renewal,
     irrespective of primary or secondary status, in order to assure
     finality regarding the transition.

302. We seek comment on this proposed notice process. Commenters are
     asked to discuss whether any special sanction should be imposed on
     secondary licensees that interfere with primary licensees and
     whether any sanction should be imposed on new licensees that do not
     commence new use within a year after filing the notice. Commenters
     proposing special sanctions for interference by secondary use
     should address the appropriate method for measuring the
     interference. Commenters proposing sanctions for new licensees not
     commencing new use should address when to evaluate the new use, the
     standards for such evaluation, and the most appropriate sanctions.

     **b. Bidding Offset Credits for Incumbents to Obtain Spectrum
     Licenses of Comparable Value**

303. *Issuing Bidding Offset Credits.* In addition to modifying
     incumbent licenses as discussed above, we propose to issue existing
     licensees, including licensees for MDS channels 1 and 2/2A in the
     relevant MEAs, bidding offset credits that can be used to obtain
     new licenses in the 2496-2690 MHz band or auctioned licenses in any
     other spectrum band. We further propose that these bidding offset
     credits would be transferable to any other party, so that licensees
     would have the option of transferring them to others rather than
     being required to use them themselves. We seek comment on this
     proposal. As a threshold matter, we believe we have authority to
     issue the bidding offset credits. The Commission has authority to
     take actions necessary to execute its functions and to carry out
     the provisions of the Communications Act, not otherwise
     inconsistent with the Act. 47 U.S.C. §§ 154(i) and 303(r). The
     Commission's functions include management of the spectrum in the
     public interest, pursuant to Section 303 of the Act, and assignment
     of licenses to use spectrum in the public interest, pursuant to
     Section 309. Issuing bidding offset credits in order to protect
     existing spectrum uses -- and past Commission public interest
     judgments reflected in prior licensing decisions -- while clearing
     existing spectrum assignments is necessary to the management of
     spectrum in the public interest and not inconsistent with the
     Communications Act.

304. Effectively clearing prior spectrum assignments so that new
     licenses for this spectrum may be assigned by competitive bidding
     will promote statutory objectives.[^602] Issuing bidding offset
     credits is within the Commission's statutory authority regarding
     the design of competitive bidding systems. Section 309(j)(4) of the
     Communications Act grants the Commission authority to consider a
     variety of methods of helping entities pay for licenses that are
     offered at auction, including alternative payment schedules, tax
     credits, and bidding preferences. The legislative history also
     indicates that Congress intended that Section 309(j)(4) would
     provide the Commission with "flexibility to utilize any combination
     of techniques that would serve the public interest."[^603] Section
     309(j)(4)(A) specifically authorizes the Commission to consider
     methods of payment that promote Section 309(j)(3)(B) statutory
     objectives of competitive bidding, which include disseminating
     licenses among a wide variety of applicants. Existing EBS and BRS
     licensees reflect in part the public interest in disseminating such
     licenses (particularly EBS licenses) to a wide variety of locally
     based licensees. Issuing bidding offset credits should ensure that
     such licensees can participate effectively in an auction of new
     licenses and thereby promotes that public interest.

305. We propose to quantify the bidding offset credits based on the
     bandwidth, measured in megahertz, of the incumbent's modified
     license multiplied by the population within the modified license's
     GSA. We refer to this unit of measurement as MHzPops. For licensees
     of MDS channels 1 and 2/2A, bidding offset credits would be based
     on the MHzPops of the licensee's original license. An incumbent
     holding a bidding offset credit for a certain amount of MHzPops
     could offset, *i.e.*, satisfy, some or all of a winning bid for a
     new license in the same service in this band covering the same
     population depending on the ratio between the bidding offset credit
     MHzPops and the new license's MHzPops. For example, suppose an
     incumbent held a modified EBS license for a single frequency block
     that entitled it to a 10 MHzPop bidding offset credit. Suppose
     further that a new EBS license for the same frequency block,
     *i.e.*, with the same bandwidth, as the incumbent's modified
     license covered the entire population within the incumbent's GSA as
     well as an equal amount of population outside the GSA, *i.e.*,
     reached twice the population with the same bandwidth. That new
     license could be measured as having 20 MHzPops. The ratio between
     the bidding offset credit and the new license, in terms of MHzPops,
     would be 1:2. Accordingly, the EBS incumbent could offset 1/2 of
     the winning bid, regardless of the dollar amount, for the new EBS
     license. Note that if the incumbent held modified licenses for two
     frequency blocks in the same area, it would double its bidding
     offset credit and have a 1:1 ratio between its bidding offset
     credit and the new license. Such an incumbent could offset, or
     satisfy, a winning bid of any amount for the new license. We
     propose that bidding offset credits be used in this manner only
     with respect to licenses in the same service, given the potential
     different market values of otherwise comparable spectrum, depending
     on the service to which it is allocated. Otherwise, licensees in
     one service could convert their licenses to the other service
     without taking into account the differences between the two. We
     seek comment on this proposal.

306. We further propose that incumbents be able to use their bidding
     offset credits to obtain spectrum licenses in new areas or
     different bands than those authorized by their original license.
     However, spectrum licenses in different areas or in different bands
     may differ so substantially that it would be inappropriate to
     offset winning bids for such spectrum licenses on a uniform MHzPops
     basis. Nevertheless, bidding offset credits could be used to offset
     winning bids for other spectrum licenses fairly and effectively if
     the bidding offset credit could be quantified in a generally
     applicable measurement of value, such as dollars, rather than
     MHzPops. We propose that we use an average price per MHzPops,
     derived from the auction for new licenses in this band, to give the
     bidding offset credit a face dollar value. Once given a face dollar
     value, bidding offset credits could be used to offset any winning
     bid for any Commission spectrum license, up to the face amount of
     the bidding offset credit.[^604] In the event that we issue bidding
     offset credits, we propose that the Wireless Telecommunications
     Bureau develop procedures to advise bidders of the current
     projected face dollar value of their bidding offset credits during
     the auction of licenses in this band based on winning bids in the
     most recent round, so that the bidding offset credits could be used
     for any license in the auction. We seek comment on these proposals.

307. We also seek comment on how to determine the appropriate average
     price per MHzPops for quantifying bidding offset credits. For
     example, should we account for the fact that the new licenses
     permit new uses of the spectrum and may reach other population
     and/or use different frequencies than the original license? If so,
     how? Should we calculate different averages for different
     incumbents depending on whether the spectrum being cleared by the
     incumbent in exchange for the bidding offset credit is in
     high-power, MBS or for the low-power, lower and upper band
     segments?

308. We seek comment on three potential methods for calculating the
     value of bidding offset credits under this proposal. First, we
     could average the prices per MHzPops for all the related new
     licenses, regardless of any differences between the new licenses,
     and multiply the bidding offset credit's MHzPops by that average
     price. Like the proponent-initiated transition process, which would
     grant each licensee equal shares of each new band segment, this
     method makes no distinction among different licensees that cover
     the same geographic area. However, as a consequence, this method
     also makes no distinction between the different values for the
     different types of new licenses. Second, recognizing that the
     original ITFS or MDS license only permitted high-power use of the
     spectrum, we could determine the face dollar value of the
     licensee's bidding offset credit by multiplying the bidding offset
     credit's MHzPops by the average price per MHzPops for related MBS
     licenses permitting similar high-power use. Third, recognizing that
     original licensees may need to acquire LBS/UBS licenses to retain
     current bandwidth and that prices for such licenses may exceed MBS
     prices, we could multiply the bidding offset credit's MHzPops by a
     weighted average of the average price per MHzPops for related MBS
     licenses and related LBS/UBS licenses. For example, we could weight
     the two equally (even though there is more than three times as much
     LBS/UBS spectrum) by taking the mean of the average price per
     MHzPops for related MBS licenses and the average price per MHzPops
     for LBS/UBS licenses. We seek comment on these and any other
     alternatives for determining the average price per MHzPops to use
     in calculating the face dollar value of bidding offset credits.

309. Regardless of how we take into account various factors discussed
     above, we propose to set average prices per MHzPops for bidding
     offset credits issued to EBS licensees using prices for new EBS
     licenses and average prices per MHzPops for bidding offset credits
     issued to BRS licensees using prices for new BRS licenses. In this
     way, we can take into account the effect of restricting the parties
     eligible to hold EBS licensees in setting the face dollar value of
     bidding offset credits and leave the parties holding the bidding
     offset credits free to use them as they see fit.

310. As discussed above, we believe that each new MBS license will cover
     an entire EA and each new license for the LBS and UBS will cover an
     entire MEA. Consequently, each new license will cover larger areas
     and different populations than the modified EBS and BRS licenses.
     The face dollar value of the bidding offset credit would be
     calculated using a uniform average price per MHzPops with respect
     to all population covered by the new license. Accordingly, the
     difference in population between the incumbent's modified license,
     which is the basis of the bidding offset credit's MHzPops, and the
     new license does not require altering the proposed process above
     for calculating the face dollar value of the bidding offset credit.
     However, EBS and BRS licenses may reach populations covered by more
     than one new license geographic areas. In that event, to take into
     account the potential differences between the average prices per
     MHzPops in the different new license areas, the bidding offset
     credit issued to the licensee would be treated as two independent
     bidding offset credits, one in each new license area.[^605] We seek
     comment on this approach.

311. *Dividing and Transferring Bidding Offset Credits.* We propose that
     bidding offset credits should be divisible, given that parties
     using the bidding offset credits may be interested in a variety of
     licenses and that bidding offset credits are unlikely to precisely
     equal future winning bids. In addition, parties receiving bidding
     offset credits may need flexibility regarding business plans to
     offer spectrum-based services. We believe that such parties should
     be free to transfer some or all of their bidding offset credits.
     Because the Commission will be able to evaluate whether any
     transferee holding a bidding offset credit is qualified to be a
     licensee at the time the Commission considers a license
     application, the public interest in the qualifications of licensees
     would not be implicated by a transfer of the bidding offset credit.
     Moreover, permitting existing EBS and BRS licensees to transfer
     their bidding offset credit in whole or in part could facilitate
     relocating existing facilities, thus serving the public interest in
     avoiding unnecessary disruptions to existing services. We seek
     comment on whether it would be appropriate to adopt a time limit
     for parties to make us of the bidding offset credit, to provide
     definition and certainty with respect to the continued viability of
     the bidding offset credit or for any other reason. Finally, we do
     not see any reason to propose limitations on the transfer or use of
     bidding offset credits held by EBS licensees. The face dollar value
     of the bidding offset credits issued to EBS licensees would be
     calculated using the average price per MHzPops of new EBS licenses.
     Accordingly, the face dollar value of the bidding offset credit
     will incorporate any effect restrictions on EBS licenses may have
     on the price for such licenses. Therefore, we do not propose to
     limit subsequent use of the bidding offset credit to EBS licensees
     or EBS licenses. In effect, EBS licensees that do not use their
     bidding offset credit to obtain a new EBS license have transferred
     their former spectrum assignment to a new EBS-qualified licensee
     and are then free to use the bidding offset credit they receive as
     best serves their needs. The public interest reflected in the
     restrictions on licensees eligible to hold EBS licenses is
     protected by limiting new EBS licenses to qualified licensees.

312. However, in order to prevent future disputes regarding the parties
     that are entitled to use a bidding offset credit, we propose to
     require that all parties to any transfer notify the Commission of
     any transfer, identifying all relevant parties, and waive any
     claims for relief that would require returning the bidding offset
     credit to the transferee. Such a waiver would not require that the
     parties waive any claims for relief other than returning the
     bidding offset credit, *e.g.*, claims for monetary damages. We seek
     comment on this procedure generally and in particular regarding
     whether additional protections are available and necessary to
     protect against any efforts to force returns of the bidding offset
     credit. Would it protect against subsequent attempts to avoid
     transfers in bankruptcy to require that the parties give advance
     notice of a transfer and only consummate the transfer after a
     waiting period? If so, how long should the waiting period be? Would
     a waiting period unnecessarily complicate transfers of bidding
     offset credits?

     **c. New Licenses and Relocation of Incumbents Opting not to
     Receive Modified Licenses and Bidding Offset Credits**

313. *Opt-outs.* Existing licensees that only want to continue current
     high-power operations solely in their limited PSA/GSA may not find
     new licenses suitable for such uses. For example, there may be no
     new license covering precisely the same geographic area as the
     existing license. Consequently, we propose offering such licensees
     an opportunity to retain their GSA rather than receive a bidding
     offset credit to obtain a new license. In such cases, the
     licensee's current license would be modified in the same manner as
     all other licensees being cleared. The modified license would grant
     the licensee primary status on the relevant spectrum until a new
     licensee gives proper notice of incompatible new uses. The modified
     license then would grant the licensee secondary status for the
     remainder of the license term. The modified license would not be
     renewable. In addition, an opt-out licensee would receive a new 6
     megahertz primary license for operations in its current GSA on
     frequencies selected by the Commission at the core of the MBS. The
     new license would have the same geographic area as the modified
     license, would have primary status, and would be eligible for
     renewal. We seek comment on this proposal.

314. The new band plan provides only one six megahertz block for
     high-power operations in the MBS for each original license in the
     band.  Consequently, in areas subject to an proponent's Initiation
     Plan, incumbent licensees are entitled to only one six megahertz
     block in the MBS.  In areas not transitioned pursuant to an
     Initiation Plan, incumbents that opt-out of receiving bidding
     offset credits in order to continue high-power operations likewise
     will receive a six megahertz block in the MBS.  In addition, such
     incumbents will have others pay for their relocation.  The
     conversion to digital transmission may enable some licensees to
     continue offering the same services on six megahertz that they may
     have offered on twenty-four, presuming they were licensed on all
     four channels in a group, prior to the implementation of the new
     band plan. As discussed below, we propose that digital facilities
     capable of transmitting on six megahertz the same services
     previously transmitted on a larger amount of bandwidth using analog
     facilities be considered "comparable" to such analog facilities
     when determining the obligations of others to pay for the
     incumbent's relocation. Perhaps most importantly, in areas where
     bidding offset credits are made available, incumbent licensees that
     want additional bandwidth in the MBS for high-power operations
     will have the opportunity to obtain it at the auction of new
     licenses.

315. *Financing Relocation of Opt-Outs.* We propose that the cost of
     relocating current licensees that opt-out should be paid by the new
     licensees for whose licenses spectrum is made available by the
     relocation. Licensees choosing to receive new MBS licenses rather
     than bidding offset credits may incur significant costs to relocate
     to the new high-power MBS. Given the non-commercial nature of EBS
     licensees, licensees that opt to receive a six megahertz license
     rather than a bidding offset credit in order to assure continuation
     of existing services may have difficulty financing their
     relocation. BRS licensees choosing to receive a new MBS license
     rather than a bidding offset credit also may lack capital for
     relocation. If we adopt the proposal to auction new licenses
     without designating frequency blocks until after the auction,
     bidders for new licenses may not know when bidding whether their
     specific spectrum was occupied by the relocating licensee. Given
     that all bidders for new licenses that encompass the geographic
     area covered by the original license may win frequencies covered by
     the original license, we propose that in such circumstances all new
     licensees with licenses encompassing the geographic area covered by
     the original license be deemed to benefit from the relocation. In
     the event that we accept bids for new licenses for specific
     frequencies, the new licensees winning license for frequencies
     covered by the original license would benefit from relocation. We
     propose that relevant new licensees pay for the relocation of the
     original licensee pursuant to the procedure described below. We
     seek comment on this proposed procedure.

316. With respect to licensees who propose to opt-out of the bidding
     offset credit process and accept MBS spectrum, we propose
     delegating authority to the Wireless Telecommunications Bureau to
     announce a date for such licensees to file a relocation plan. The
     date for filing shall be at least sixty (60) days prior to the
     start of any auction for new licenses in this band. In the filing,
     relocating licensees would provide a detailed proposal setting
     forth all actions reasonably required to relocate their current
     facilities or construct comparable new facilities consistent with
     the new MBS license. In light of the limited availability of MBS
     spectrum and the need for relocating licensees to make due with
     less bandwidth, we propose that digital transmission facilities
     capable of carrying the same number channels previously carried by
     the licensee on four analog channels be considered comparable to
     the analog transmission facilities. The proposal would itemize the
     cost of each action to be taken, and would document costs already
     incurred. We seek comment on this proposed approach.

317. We also propose that relocating licensees be able to relocate
     themselves and subsequently seek reimbursement from new licensees.
     Itemized costs related to relocation that the licensee incurs prior
     to the date of filing shall be deemed reasonably required. Itemized
     costs related to relocation that the licensee incurs after the date
     of filing that are less than or equal to the estimates provided in
     the filed relocation plan shall be deemed reasonably required but
     subject to review. Costs related to relocation that the licensee
     incurs after the date of filing that exceed the estimates provided
     in the filed plan shall be deemed not reasonably required and are
     not recoverable.

318. Further, we propose that new licensees holding licenses that
     encompass the geographic area of any relocated license would be
     required to certify to the Commission that they have taken
     reasonably required actions to relocate the affected licensee and
     that the relocated licensee has been reimbursed for all reasonably
     required relocation costs that it incurred. Such certifications
     would be required to detail all actions taken in this regard.
     Reimbursement would include any reasonably required costs subject
     to review, unless such costs were determined by binding arbitration
     to be not reasonably required as part of the relocation. We propose
     that if the Commission should find relocated licensees unreasonably
     refused to submit to binding arbitration, the relocating licensee
     would not be entitled to recover any costs subject to review. In
     the event that affected licensees do not relocate themselves, new
     licensees would be required to relocate them by taking the actions
     set forth in the filed relocation plan, paying the cost of such
     relocation up to one hundred and twenty percent (120%) of the
     estimate provided in the plan. No new licensee would have any
     obligation to relocate the affected licensee or pay any relocation
     costs to the relocated licensee once any responsible new licensee
     certifies that it has paid reasonably required relocation costs of
     one hundred and twenty percent (120%) of the estimate provided in
     the plan.

319. Absent the required certification, we propose that any notice of
     intent to commence new operations pursuant to the license that may
     conflict with existing uses would be deemed null and void,
     regardless of whether it is inadvertently listed on any Public
     Notice listing notices received by the Commission. In the event the
     Commission subsequently found that any filed certification is
     inaccurate, we propose that the new licensee on whose behalf the
     certification was made would be held responsible for all reasonably
     required costs incurred in the process of relocation irrespective
     of the estimates in the filed relocation plan, including the costs
     of any party arising from the inaccurate certification. Under this
     proposal, such a new licensee would not be entitled to recover any
     amounts it pays from any other new licensee responsible for
     relocation costs. With the exception of any responsible new
     licensee that files an inaccurate certification regarding
     relocation, we propose that any responsible new licensee paying
     more than the fraction of the recoverable relocation costs equal to
     the new licensee's fraction of bandwidth made available in the area
     in the auction would be entitled to recover excess amounts from any
     other responsible new licensee that has not previously paid its own
     fractional share.

## Performance Requirements

320. *Background.* In the *NPRM*, we sought comment on what performance
     requirements should be applicable to MDS BTA authorization holders
     and site-based MDS and ITFS licensees.[^606] Given our decisions to
     adopt geographic area licensing for these services,[^607] and to
     eliminate forfeiture, cancellation, and discontinuance of service
     rules for certain BRS and EBS licensees,[^608] we conclude that it
     is necessary to review performance requirements for these services
     as well. Because these standards exist in order to encourage
     licensees to build out wireless facilities, we sought comment
     specifically on whether the existing benchmarks were adequate or
     whether these standards actually frustrated licensees' abilities to
     deploy service quickly and efficiently.[^609] As noted in the
     *NPRM*, the Commission has been willing to entertain "substantial
     service" as a flexible, alternative approach that fulfills our goal
     of promoting innovation and development by maximizing flexibility
     in the service rules.[^610] Many commenters favor this standard,
     offering that a substantial service approach is a better
     alternative to current static build-out requirements, which follow
     fixed time-schedules.[^611] We also sought comment in the *NPRM* as
     to the appropriate method for conducting a substantial service
     analysis, including what factors a licensee may use to demonstrate
     substantial service including "safe harbors".[^612]

321. The Commission seeks to prescribe performance requirements that
     serve "to ensure prompt delivery of service to rural areas, to
     prevent stockpiling or warehousing of spectrum by licensees or
     permittees, and to promote investment in and rapid deployment of
     new technologies and services."[^613] Additionally, we seek to
     promote the availability of broadband to all Americans, including
     broadband technologies for educators, and to encourage the highest
     valued use of radio licenses and promote the economic viability of
     services in this band by ensuring that the spectrum is as fungible,
     tradable, and marketable as possible. Thus, in order to accomplish
     these goals, we believe a market-oriented approach to spectrum
     policy best ensures the build-out of wireless facilities and
     broader provision of wireless services.[^614] We believe that
     economic forces will guide competing providers to innovate and
     broaden deployment of services. To this end, we aim to provide
     licensees greater flexibility "to tailor the use of their spectrum
     to unique business plans and needs."[^615] We believe that
     establishing more flexible rules will result in ubiquitous,
     high-quality service to the public and at the same time encourage
     investment by increasing the value of licenses. We believe more
     flexible rules will make licensees more economically viable and
     will provide incumbents with reasonable opportunities to continue
     their current uses of the spectrum. We believe flexible rules will
     also facilitate speedier transition and deployment in the band. For
     the reasons discussed herein, we tentatively conclude that
     performance requirements based on the substantial service standard
     set forth in Part 27 of our Rules[^616] will provide the strongest
     incentives to licensees to develop and deploy new services. We seek
     comment on specific safe harbors that will satisfy the substantial
     service requirements tentatively adopted for BRS and EBS services.

322. "'Substantial' service is defined in Part 27 of our Rules as
     service which is sound, favorable, and substantially above a level
     of mediocre service which just might minimally warrant
     renewal."[^617] The Commission has implemented substantial service
     requirements for other wireless services.[^618] Among our goals, we
     seek to clarify and stabilize the regulatory treatment of similar
     spectrum-based services. Thus, we believe that adopting substantial
     service performance requirements for BRS and EBS services will
     create regulatory parity between these services and other wireless
     services.[^619] And "\[w\]hile the definition of substantial
     service is generally consistent among wireless services, the
     factors that the Commission will consider when determining if a
     license has met the standard vary among services."[^620] We believe
     that within a substantial service framework, refined measures may
     be adopted to suit any challenges that BRS and EBS licensees face
     in development and deployment. Our decision to shift to geographic
     area licensing for BRS and EBS services is in part based on the
     need to provide flexibility to licensees so as to encourage
     efficient use of the fullest capacity of allotted spectrum.[^621]
     We believe that implementing substantial service performance
     requirements will also promote flexibility and thus allow licensees
     to provide quality, widespread services to the public.

323. We believe that construction benchmarks focusing solely on
     population served or geography covered do not necessarily reflect
     the most important underlying goal of ensuring public access to
     quality, widespread service.[^622] For example, such requirements
     alone do not take into account qualitative factors important to
     end-users and the market such as reliability of service, and the
     availability of technologically sophisticated premium
     services.[^623] While it may be argued that market forces ensure a
     requisite level of quality in the services reaching consumers, this
     is not always the case. We seek input on factors that can be used
     as indicia to satisfy safe harbors under substantial service.

324. We further believe that fixed, inflexible construction requirements
     hinder widespread deployment of wireless services and do not always
     reflect elements of service such as cost or, more importantly,
     populations served. At the least, in some instances, fixed
     construction requirements do not easily permit the Commission to
     measure the deployment of service by a licensee.[^624] As we have
     noted, merely satisfying such benchmarks does not necessarily
     demonstrate adequate deployment in rural areas, to niche markets,
     or to discrete populations or regions with special needs.[^625] We
     believe that a standard based on substantial service is better able
     to respond to these various concerns. We agree with commenters and
     believe that a shift towards a substantial service standard will
     help encourage licensees to provide the best possible service and
     avoid "construction...solely to meet regulatory requirements rather
     than market conditions."[^626]

325. The Coalition argues that substantial service standards would allow
     the Commission to evaluate a licensee's entire system of stations,
     rather than each station's service standing alone.[^627] This is
     important and relatively unique in the context of MDS and ITFS
     service, according to the Coalition, because MDS and ITFS
     providers, unlike those providing most other services, will use
     channels combined from a variety of sources.[^628] Thus, the
     Coalition asks us to "recognize that in some cases a licensee may
     not use particular spectrum covered by one license, or certain
     channels authorized by a license, that is part of a larger
     operating system" because the licensee is using the spectrum in
     some other way still critical to the system's overall design.[^629]
     In other words, a system otherwise providing substantial service
     may yet necessitate limited cases of what appears to be
     warehousing.[^630] The Coalition also argues that system operators
     may not build out some spectrum so that it can be held for future
     uses demanded by the market.[^631] Finally, the Coalition and other
     commenters argue that licensees may focus portions of their service
     to particular constituents rather than the general population of
     the GSA.[^632] For these many reasons, the Coalition not only
     supports substantial service requirements over fixed benchmarks,
     but recommends that Commission evaluations under this standard
     proceed case-by-case, looking at the overall service of one parent
     provider/licensee as opposed to the adequacy of service within a
     single service area.[^633] We see merit in at least some of these
     arguments; however, we do not plan to proceed on a case-by-case
     basis in determining whether substantial service has been met.
     Rather, as discussed below, we instead seek comment on specific
     safe harbors that will meet the proposed substantial service
     standard for BRS and EBS services.

326. Many commenters favor a substantial service standard for
     geographically-licensed MDS and ITFS operators. Sprint agrees with
     the Coalition that a substantial service performance standard will
     best suit the MDS/ITFS regulatory scheme, "particularly as the
     centerpiece to this model is likely to be flexible use within a
     geographic area."[^634] Likewise, BellSouth "wholeheartedly"
     supports this standard and takes the position that alternative
     standards proposed by a few commenters "would not solve the
     problems associated with the existing patchwork of rules."[^635]
     EarthLink, Rural Commenters, AHMLC, and HITN, among other
     commenters, also support a substantial service standard.[^636]

327. Not all commenters, however, appear to support a substantial
     service performance requirement. We note that NTCA supports
     construction benchmarks, particularly for those larger carriers
     obtaining licenses for large geographic areas.[^637] IPWireless
     agrees and recommends "stringent construction and operation
     requirements" to prevent warehousing of spectrum by MMDS and ITFS
     licensees.[^638] To that effect, IPWireless suggests the following
     fixed benchmarks: MMDS licensees and other operators leasing MMDS
     spectrum should be required to provide commercial service to at
     least one community within 36 months, and should build and operate
     a system capable of serving 1/3 of the GSA population within 48
     months and 2/3 of the population within 60 months.[^639]

328. We recognize the importance of fixed benchmarks and timetables as
     incentives to quickly deploy service and avoid spectrum
     warehousing. We suggest, however, that benchmarks may yet be
     assimilated into the substantial service framework as safe harbors,
     rather than as goals unto themselves. We invited comment in the
     *NPRM* regarding whether we should adopt 'safe harbors' to
     complement the proposed substantial service approach.[^640] Most
     commenters responded positively regarding the substantial service
     approach proposed in the *NPRM*. Responses regarding safe harbors
     were similarly favorable, but were vague. We now seek comment on
     specific safe harbors that will meet the substantial service
     standard we have tentatively adopted for BRS and EBS services. For
     example, we seek comment on whether construction requirements such
     as those proposed by IPWireless above would be suitable as a safe
     harbor to meet the substantial service standard. We seek comment on
     what other specific safe harbors -- in addition to or apart from
     these -- may be appropriate. Finally, we seek comment on whether
     licensees' existing benchmarks, if met, should be available methods
     of demonstrating substantial service.[^641]

329. Finally, rural build out remains an important concern to us. We
     recognize that, "as a result of varying technical and demographics,
     the economics of providing service can be significantly different
     in rural areas as compared to urban areas."[^642] With respect to
     rural areas, we recognize that "market characteristics, especially
     demographics, will affect the optimal market structure."[^643]
     Various commenters echo these concerns.[^644] In the *NPRM* we
     sought comment on ways in which our construction benchmarks could
     be modified to better promote service to rural areas.[^645]

330. We seek comment on whether there should be rural-specific safe
     harbors within the substantial service framework to encourage rural
     build out. For example, in the Rural *NPRM*, we suggested two safe
     harbors for rural service.[^646] The first, available to licensees
     providing mobile wireless services, proposed that licensees "will
     be deemed to have met the substantial service requirement if it
     provides coverage, through construction or lease, to at least 75
     percent of the geographic area of at least 20 percent of the
     'rural' counties within its licensed area."[^647] For fixed
     services, we proposed a safe harbor that would consider a licensee
     to have met the substantial service requirement if the licensee,
     "through construction or lease, constructs at least one end of a
     permanent link in at least 20 percent of the 'rural' counties
     within its licensed area."[^648] We seek comment on whether meeting
     these requirements would be appropriate methods for rural carriers
     to satisfy safe harbors and satisfy the substantial service
     standard.

331. Grand Wireless proposes the following fixed construction
     benchmarks: licensees should be required to cover 30 percent of
     their rural area population within two years, 50 percent within
     four years, 70 percent within six years, and 80 percent within
     eight years.[^649] We seek comment, however, on the fitness of
     these requirements as one way to satisfy a safe harbor, as opposed
     to using these percentages as fixed construction benchmarks. We
     seek comment on rural-specific safe harbors.

332. In the *NPRM*, we sought comment on how to define a rural service
     area.[^650] We now note that this issue is taken up in the *Rural
     NPRM*, where it was noted that various definitions of "rural" have
     been utilized by federal agencies generally and the Commission
     specifically.[^651] While the Communications Act directs the
     Commission to promote the development and deployment of services to
     rural areas, the Act did not provide a specific definition of rural
     areas.[^652] We have not previously clarified and adopted a
     definition for rural area, but have rather allowed the term to vary
     "depending on the particular regulatory initiative at issue."[^653]
     We seek additional comment on the following definitions of rural
     area proposed in the *Rural NPRM*: (1) counties with a population
     density of 100 persons or fewer per square mile; (2) RSAs; (3)
     non-nodal counties within an EA; (4) the definition for "rural"
     used by the RUS for its broadband program; (5) the definition for
     "rural area" used by the Commission in connection with universal
     service support for schools, libraries, and rural health care
     providers; (6) the definition of "rural" based on census tracts as
     outlined by the Economics Research Service of the USDA; (7) the
     Census Bureau definition of "rural" counties; and (8) any census
     tract that is not within ten miles of any incorporated or
     census-designated place containing more than 2,500 people, and its
     not within a county or county equivalent which has an overall
     population density of more than 500 persons per square mile of
     land.[^654]

## Grandfathered E and F Channel ITFS Stations 

333. In 1983, the Commission redesignated the E and F Group ITFS
     channels from the ITFS service to MDS usage.[^655] The Commission
     took this action in an effort to spur the development of MDS to
     promote effective and intense utilization of the spectrum leading
     to its highest valued use.[^656] As part of its decision, the
     Commission grandfathered ITFS licensees operating on the E Group
     and F Group channels subject to the following limitations:

     Grandfathered ITFS stations operating on the E and F channels will
     only be protected to the extent of their service that is either in
     the operation or the application stage as of May 26, 1983. These
     licensees or applicants will not generally be permitted to change
     transmitter location or antenna height, or to change transmission
     power. In addition, any new receive stations added after May 26,
     1983 will not be protected against interference from MDS
     transmissions. In this fashion, all facets of grandfathered ITFS
     operations were frozen as of May 26, 1983.[^657]

     The Commission stated that "there may be instances where the
     natural evolution of an ITFS station may reasonably require the
     addition of receive stations without changing the nature or the
     scope of the ITFS operation" that would justify the addition of
     additional receive sites.[^658] In those instances, the Commission
     stated that the grandfathered ITFS licensee could request a waiver
     of Section 74.902(c).[^659] Our rules provide that "in those areas
     where Multipoint Distribution Service use of these channels is
     allowed, Instructional Television Fixed Service users of these
     channels will continue to be afforded protection from harmful
     co-channel and adjacent channel interference from Multipoint
     Distribution Service stations."[^660]

334. Commenters in the present proceeding raised the issue of the proper
     future treatment of grandfathered E and F group ITFS
     licensees.[^661] Grand Alliance argues that the Commission must be
     fair in establishing the rights of grandfathered MDS licensees on
     the E and F group channels pending the resolution of overlapping
     service areas with other MDS licensees, protecting any co-channel
     pre-1983 ITFS receive sites.[^662] Grand Alliance asserts that
     co-channel licensees should not be afforded new rights protecting
     new receive sites, or, as suggested by the Coalition, have any
     technical or other restrictions on their grandfathered operations
     lifted.[^663] Grand Alliance reasons that other conclusions would
     be inconsistent with the Commission's stated intent in the original
     orders reallocating the E and F channels to MDS and "freezing"
     incumbent ITFS operations on those channels.[^664]

335. In response, the Department of Education, Archdiocese of New York
     (DOEANY) states that Grand Alliance's argument effectively ignores
     the Commission's determination extending protected service areas to
     all ITFS licensees, including E and F Group licensees, embodied in
     Section 74.903(d) of the Commission's Rules, which states that ITFS
     licensees "must be protected from harmful electrical interference
     at each of \[their\] receive sites registered previously as of
     September 17, 1998, and within a PSA."[^665] Stanford, Northeastern
     University, and the Diocese of Brooklyn further argue that Grand
     Alliance's proposal expands the rights of E/F Channel MDS licensees
     and revokes existing spectrum rights of grandfathered E/F Channel
     ITFS stations.[^666] Region 10 argues that registered grandfathered
     receive sites should always be protected, including those outside
     current PSA boundaries.[^667]

336. If grandfathered E and F Group ITFS licensees are not permitted to
     modify their equipment and MDS licensees must continue operating on
     a secondary basis, grandfathered E and F Group ITFS licensees will
     cause interference to low-power MDS co-channel licensees in some
     markets. Put another way, if MDS licensees that are on co-channel
     frequencies with grandfathered E and F Group ITFS licensees must
     avoid interfering with these frozen licensees, then the deployment
     of MDS broadband services may be hindered. Additionally, the
     grandfathered E and F Group ITFS licensees will never be able to
     transition to a low-power cellularized broadband system due to the
     restriction on modifying their equipment, which is presently
     contained in our rules.

337. We seek comment on how to modify our rules concerning grandfathered
     E and F channel ITFS stations in order to equitably allow both MDS
     and ITFS stations to provide advanced broadband wireless services.
     We ask whether it makes sense to adopt different approaches to
     different scenarios, rather then a one size fits all approach.

338. The first scenario that we envision is where the PSA of the
     grandfathered E and F Group ITFS licensee almost entirely overlaps
     the PSA of the co-channel MDS licensee. In this scenario, we seek
     comment on whether in keeping with the intent and spirit of the
     Commission's 1983 *E and F Group Reallocation Order* to free up
     spectrum for MDS,[^668] we should require grandfathered E and F
     Group ITFS licensees to operate on a secondary non-interference
     basis to the co-channel MDS licensee. In the *E and F Group
     Reallocation Order*, the Commission stated that the two major
     public interest arguments favoring the authorization of
     multichannel MDS are efficiency and flexibility,[^669] which are
     goals in the present proceeding in achieving the availability of
     new broadband technologies to all Americans as quickly as possible.
     If the grandfathered E and F Group ITFS licensees are to operate on
     a secondary non-interference basis to the co-channel MDS licensees
     we seek comment on whether the MDS licensees should bear the cost
     of relocating and/or coming to some other mutual arrangement with
     the grandfathered ITFS licensees that will adequately address the
     grandfathered ITFS licensees' concerns about being able to continue
     their operations.

339. Alternatively, we seek comment on allowing grandfathered E and F
     Group ITFS licensees to modify their equipment and be given a GSA,
     while the co-channel MDS operators would have to operate on a
     secondary non-interference basis. The *E and F Group Reallocation
     Order* seems to suggest that the Commission's intent in 1983 was to
     grandfather the E and F Group ITFS licensees forever. The
     Commission stated that "\[e\]xisting ITFS licensees (as well as
     existing permittees and applicants that eventually become
     licensees) of the reallocated channels would be grandfathered in
     perpetuity."[^670]

340. A third approach would be to rely on voluntary negotiations between
     the parties. The Commission stated in 1983 that "\[it\] expect\[s\]
     that the MDS permittees and the ITFS users of the reallocated
     channels will negotiate in good faith to mutually accommodate each
     others\' communications requirements."[^671] Given the lack of
     progress in some markets between co-channel MDS licensee and
     grandfathered E and F Group ITFS licensee, we question whether
     continued reliance on negotiations would be appropriate.
     Nevertheless, we seek comment on whether there are changes we could
     make to our rules that could make negotiations more effective.

341. The second scenario we envision is where the PSAs of the
     grandfathered E and F Group ITFS licensees overlap to some extent,
     but not as much as the in scenario one. We seek comment on whether,
     in that situation, we should adopt the same "splitting the
     football" mechanism we are using to separate other overlapping
     PSAs.[^672] If we adopted that approach, co-channel MDS licensees
     and grandfathered E and F Group ITFS licensees would draw a
     boundary line through a "football" shaped area where the PSAs
     intersect, with each licensee agreeing to limit the interference it
     generates across the boundary and getting a GSA based on its prior
     PSA. We seek comment on whether this same approach makes sense in
     the co-channel BRS and grandfathered E and F Group ITFS licensee
     scenario as well. We also seek comment on the maximum amount of
     overlap under which the "splitting the football" approach would be
     practical.

342. We also seek comment on whether, as suggested by DOEANY and Region
     10, we should continue to afford protection to grandfathered ITFS E
     and F group receive sites that fall outside the new GSAs. We note
     that in other contexts, we have declined to protect receive sites
     outside GSAs. We seek comment on whether there is any reason to
     treat grandfathered E and F channel ITFS stations differently.

343. Finally, the third and last scenario we envision is that where the
     grandfathered E and F Group ITFS licensee remains frozen, unable to
     modify its system, and there is no co-channel MDS licensee. We seek
     comment on allowing the grandfathered E and F Group ITFS licensee
     to modify and to assign their facilities where there is no
     co-channel MDS licensee. We believe that allowing such freedom may
     facilitate innovative new educational broadband service offerings.

## Limitation on Channel Assignments for EBS Licensees

344. Section 74.902(d)(1) of the Commission's Rules (the Four-Channel
     Rule) limits a licensee "to the assignment of no more than four
     channels for use in a single area of operation, all of which should
     be selected from the same \[channel\] Group . . . ."[^673] The
     rules prohibit applicants from reserving additional channels by
     applying for more channels than they intend to construct within a
     reasonable time, simply for the purpose of reserving additional
     channels.[^674] Rather, the number of channels authorized to an
     applicant must be based on the demonstration that the licensee
     needs the number of channels requested.[^675] In making such an
     assessment, the Commission considers such factors as the amount of
     use of any currently assigned channels and the amount or proposed
     use of each channel requested, the amount of, and justification
     for, any repetition in the schedules, and the overall demand and
     availability of ITFS channels in the community.[^676]

345. We note that the transition plan we have adopted today contemplates
     situations that would be inconsistent with continued application of
     the four-channel rule. For example, an ITFS licensee that wished to
     continue high-power operations using four channels in the MBS could
     receive the high-power channel in four different channel groups,
     which under our current rules would be prohibited. Because the
     record demonstrates a significant level of support for the
     Coalition's transition plan, including the ability to "swap"
     channels with other licensees in the same geographic region, we
     believe that the record supports our decision not to apply the
     four-channel rule in those areas that have transitioned. No party
     argued that the Coalition's transition plan was inappropriate
     because it would require changes to the four-channel rule.
     Accordingly, we conclude that the four-channel rule does not apply
     in those MEAs that have transitioned.

346. We seek comment on eliminating the four-channel rule in markets
     that have not yet transitioned. The purpose of the four-channel
     rule has been "to provide as many educators as possible with the
     opportunity to operate ITFS systems that meet their educational
     needs."[^677] At the time the four-channel rule was established,
     ITFS was limited to video broadcast uses. Given the wider range of
     services that ITFS can now be used for and the changes to our
     leasing rules, it appears that the four-channel rule may unduly
     limit the ability of educational institutions and organizations to
     take full advantage of the potential of ITFS. We are also concerned
     that the four-channel rule may require that spectrum lay fallow
     when an educator wishes to use the spectrum. Furthermore, in those
     markets where all ITFS spectrum is assigned, the four-channel rule
     may artificially limit the ability to assign spectrum to educators
     who are in a better position than the existing licensee to utilize
     the spectrum. Commenters supporting retention of the four-channel
     rule should explain why they believe the rule is appropriate and
     necessary given the current market and regulatory conditions.

## Wireless Cable Exception to EBS Eligibility Restrictions

347. In 1990, the Commission initiated a proceeding to review and
     simplify disparate technical, procedural, ownership and other
     requirements and restrictions in the three microwave radio services
     used in the provision of wireless cable service -- MDS, ITFS, and
     OFS.[^678] By affording wireless cable operators a more
     accommodating regulatory framework, the Commission aimed to enhance
     the potential of wireless cable as a competitive force in the
     multichannel video distribution marketplace. At the same time, the
     Commission wished to ensure that ITFS continued to be a useful tool
     for providing educational opportunities.[^679]

348. As part of the Commission's effort to enhance the potential of
     wireless cable as a competitive force in the multichannel video
     distribution marketplace, the Commission proposed to allow wireless
     cable entities to be licensed on vacant ITFS channels under certain
     circumstances. On October 25, 1991, the Commission adopted a
     proposal to permit use of available ITFS channels by wireless cable
     entities.[^680] This proposal was implemented in the *Second Report
     and Order* as Section 74.990 of the Commission's Rules. In order to
     ensure that wireless cable use did not have a negative impact upon
     ITFS, the Commission established a series of requirements that must
     be met before ITFS channels could be used for wireless cable
     use.[^681] In order for commercial operators to take advantage of
     ITFS frequencies, at least 8 ITFS channels must remain available in
     the community.[^682] Also, there can be no co-channel ITFS station
     within 50 miles of the proposed system.[^683] If an ITFS applicant
     applies at the same time as the commercial operator, the ITFS
     applicant automatically wins.[^684]

349. Although we sought comment on eligibility issues, no party
     specifically commented on the "wireless cable" exception to the
     ITFS/EBS eligibility issue. We conclude that this rule should not
     apply to EBS post-transition. We believe that the changes we have
     made to our rules, especially the inclusion of BRS and EBS in our
     secondary market rules, provides commercial operators with
     sufficient access to BRS spectrum. We note that this rule could be
     difficult to apply in the context of geographic area licensing.
     Given that EBS-eligible licensees have not been able to apply for
     new stations in this band since 1995, we believe the better action
     is to restrict access to ITFS frequencies after the transition to
     educational institutions and non-profit educational organizations.

350. In the absence of a record, we seek further comment on whether
     retain the rule at this time for markets that have not
     transitioned. Regardless of our ultimate decision, we will
     grandfather existing licenses granted pursuant to these rules. Such
     licenses may continue to be renewed and assigned.

## Regulatory Fee Issues

351. Section 9 of the Communications Act[^685] requires the Commission
     to assess regulatory fees to recover the costs associated with the
     Commission's enforcement, policy and rulemaking, user information,
     and international activities.[^686] Below, we seek comment on a new
     methodology to assess regulatory fees based on the scope of a BRS
     licensee's authorized spectrum use rather than our current approach
     of assessing a flat fee per call sign. We also seek comment on our
     tentative conclusion to apply this updated methodology to ITFS
     licensees to the extent they are not statutorily exempt from
     regulatory fees because of their status as governmental or
     nonprofit entities. Specifically, and as explained in more detail
     below, we seek comment on a proposed fee methodology that would
     account for the benefits of an EBS or BRS spectrum authorization
     based on metrics, such as covered population (MHz/pops) or area
     (MHz/km2), to account for the bandwidth and the potential
     population or area that could be served.

352. *Background.* In the *NPRM*, we asked whether we should treat BRS
     and ITFS applicants and licensees differently for fee
     purposes.[^687] We asked whether ITFS licensees and applicants
     should become subject to regulatory fees, to the extent that such
     licensees or applicants do not fall within an express statutory
     exemption.[^688] We noted that MDS and ITFS licensees often provide
     service as part of the same system, and that ITFS licensees
     presently can lease up to ninety-five percent of their capacity to
     other entities (usually MDS licensees).[^689] In light of these
     factors and the contemplated changes to our rules that could result
     in further equality among MDS and ITFS licensees, we sought comment
     on our tentative conclusion that regulatory fees for MDS and ITFS
     licensees should be identical. Finally, we sought comment on
     possibly changing the regulatory fee structure applicable to MDS
     licensees.[^690]

353. Several parties commented on regulatory fee issues.[^691] AHMLC
     states that it is inequitable not to assess fees on ITFS licensees
     on the grounds that they are non-commercial when, in fact, they
     often lease up to 95% of their capacity to commercial MDS
     licensees, which must pay fees. AHMLC therefore asserts that to the
     extent ITFS fees are not statutorily barred,[^692] we should treat
     commercial ITFS licensees the same as their competitors.[^693] By
     contrast, the Coalition argues that ITFS licensees should be exempt
     from regulatory fees because most would be exempt as a result of
     their governmental or nonprofit status.[^694] The Coalition also
     argues that we should treat MDS like WCS for regulatory fee
     purposes, and include it in the CMRS Mobile Service fee
     category.[^695] The Coalition asserts that the ability to offer
     CMRS was dispositive in classifying WCS for regulatory fee
     purposes, and it should be so for MDS. Grand Wireless argues that
     regulatory fees are particularly onerous for rural operators
     because, on a per population basis, the fees can amount to multiple
     times that of fees paid by urban licensees. Grand Wireless
     therefore asserts that a sliding fee---based upon population
     density---would more equitably distribute fees.[^696]

354. In the *NPRM* we sought comment on how to treat MDS and ITFS
     applicants and licensees for fee purposes.[^697] We sought comment
     on whether ITFS licensees and applicants should become subject to
     application fees and regulatory fees, to the extent that such
     licensees or applicants do not fall within an express statutory
     exemption.[^698] We noted that MDS and ITFS licensees often provide
     service as part of the same system, and that ITFS licensees
     presently can lease up to ninety-five percent of their capacity to
     other entities (usually MDS licensees). In light of these factors
     and given the proposed rule changes in the *NPRM* that focused on
     regulatory parity among MDS and ITFS licensees,[^699] we sought
     comment on our tentative conclusion that, to the extent that we
     determine that ITFS licensees should pay regulatory fees, the
     regulatory fees for MDS and ITFS licensees should be identical.
     Finally, we sought comment on changing the regulatory fees
     applicable to MDS licensees.[^700]

355. *Discussion.* Several parties commented on regulatory fees issues
     and these commenters generally disagree whether ITFS and MDS should
     pay the same regulatory fee.[^701] In light of the comments
     received in this proceeding regarding fees and our decisions today
     that confirm EBS as a service distinct from BRS, we have elected to
     seek further comment on this issue. In our FY 2004 Regulatory Fees
     proceeding, we have proposed to continue to assess a regulatory fee
     of \$270 for each BRS call sign.[^702] We will therefore assess
     former MDS licensees in the BRS/EBS spectrum the regulatory fee
     amount determined in the FY 2004 Regulatory Fee proceeding. Because
     current EBS licensees are not subject to application and regulatory
     fees under the Commission's rules, and because most such licensees
     are exempt from fees as non-profit corporations or governmental
     institutions, we have determined that EBS licensees will not be
     subject to regulatory and application fees at this time. In future
     years, however, we believe the public interest would be better
     served by assessing BRS/EBS regulatory fees based on the scope of a
     licensee's authorized spectrum use.

356. Continuing to define regulatory fee categories based simply on a
     "type of service" scheme may no longer serve the public interest.
     We are sensitive to Grand Wireless's concern that rural licensees
     may be disadvantaged by having to pay the same regulatory fees as
     their urban counterparts whose licenses often cover a much greater
     population. Technological advances and the increased flexibility
     that the Commission has provided to ITFS licensees in this
     proceeding moreover have made their spectrum more fungible with MDS
     spectrum. Indeed, technological advances in recent years enable
     licensees utilizing distinct, but relatively close, frequency bands
     to provide services that are virtually indistinguishable to
     customers.[^703] Rather than adopt service-based fee categories for
     MDS and ITFS, we intend to eliminate fee differences between these
     services that currently have similar spectrum benefits.[^704] If we
     adopt a new fee methodology, licensees should be able to determine
     their fee obligations through a simple calculation, based
     predominantly on fixed, known variables.[^705]

357. We propose a methodology to assess regulatory fees based on the
     scope of an BRS or EBS licensee's authorization and the benefits
     provided to licensees thereunder in accordance with Section 9(b)(3)
     and Section 9(b)(1)(a) of the Act.[^706] Section 9(b)(1)(A)
     requires that fees "be adjusted to take into account factors that
     are reasonably related to the benefits provided to the payer of the
     fee by the Commission's activities, including such factors as
     service area coverage, shared use versus exclusive use, and other
     factors that the Commission determines are necessary in the public
     interest."[^707] Section 9(b)(3) further provides that permissive
     amendments to the regulatory fee schedule shall "reflect additions,
     deletions, or changes in the nature of \[our\] services as a
     consequence of Commission rulemaking proceedings or changes in
     law."[^708] Our goal is to ensure comparable treatment of similarly
     situated BRS/EBS licensees based on factors more reasonably related
     to the benefits they receive under their spectrum authorizations
     rather than assessing a flat fee per call sign.

358. Assessing fees based on the benefits of spectrum requires that we
     quantify and measure those benefits to the greatest extent
     possible. In addition to the coverage area and the extent of
     exclusivity specified in Section 9(b)(1)(A), we invite comment on
     other factors that would enable us to approximate better the
     benefits of a spectrum authorization and that are necessary in the
     public interest. Specifically, we seek comment on a proposed fee
     methodology that would account for the benefits of an BRS/EBS
     spectrum authorization based on metrics, such as covered population
     (MHz/pops) or area (MHz/km2), to account for the bandwidth and the
     potential population or area that could be served. A metric such as
     MHz/pops, which we have used in spectrum auctions to determine
     upfront payment amounts and bidding eligibility,[^709] would
     account more precisely for the relative benefits of a particular
     spectrum authorization.

359. We propose that any metric that we adopt be applied consistently to
     all BRS/EBS licensees. Commenters should address the costs and
     benefits of adopting a metric based upon covered population
     (MHz/pops), square kilometers (MHz/km2), some combination of these
     measures, or any other method of calculating the licensee's
     regulatory fee. We seek comment on the ability of such metrics to
     accurately measure the benefits of the spectrum underlying a given
     authorization. A metric based on the size of the area that an
     authorization covers might undervalue spectrum in small, densely
     populated urban areas relative to large, sparsely populated rural
     areas. Metrics driven by the ratio of spectrum to population
     similarly also might undervalue spectrum in urban areas. Another
     approach, similar to that applied to regulatory fees for television
     stations, would be to group categories of licenses by market rank
     as determined by the population of the market served or geographic
     licensed service area. We also seek comment on a proposed metric's
     ability to logically and consistently rank the benefits of spectrum
     authorizations.

## Gulf of Mexico Proceeding

360. In the *NPRM*, we incorporated the docket of the ongoing Gulf of
     Mexico proceeding, wherein the Commission proposed to establish a
     GSA in the Gulf of Mexico known as the "Gulf Service Area," subject
     to the same rules as the service areas established in the *Report
     and Order*, with certain limitations.[^710] This rulemaking was
     initiated by Gulf Coast MDS Service Company ("Gulf Coast"), which
     sought to have the Gulf of Mexico treated as one service area with
     MDS and ITFS licenses assigned by competitive bidding.[^711]
     PetroCom License Corporation ("PetroCom"), Gulf Coast's successor
     in interest, continues to request that the Commission establish a
     service area in the Gulf of Mexico using the *Report and Order* as
     a model,[^712] but opines that the Commission should only authorize
     two licenses in the area and adopt eligibility restrictions to
     avoid excessive concentration of licenses.[^713]

361. As noted in the *NPRM*, commenters generally supported the creation
     of a Gulf Service Area.[^714] However, some commenters expressed
     concern over the timing of the adoption of rules for the service
     area due to certain technical and economic aspects of the
     proposal.[^715] These commenters sought to delay the licensing of
     MDS in the Gulf of Mexico until after the Commission addressed the
     Coalition's proposals[^716] and until the Commission established
     service rules.[^717] However, because the rapid development and
     deployment of services to as many areas and populations as
     prudently possible is an important goal in this proceeding, in the
     *NPRM*, we adopted the proposal to create a Gulf service area
     because such a preliminary step "would not have to wait for the
     adoption of final rules in the proceeding."[^718] We believed that
     to delay acting without having encountered any commenter opposition
     to the proposal would unnecessarily hinder the needs of businesses
     and consumers in the Gulf of Mexico region.[^719] We agreed with
     the Gulf Coast Petition that establishing the Gulf Service Area
     "would allow specialized businesses that operate in the Gulf of
     Mexico to obtain advanced communication services that are currently
     unavailable to them" and thus operate more efficiently.[^720]

362. While we proposed to create the Gulf Service Area for MDS services,
     we also proposed in the *Gulf Notice* to exclude all ITFS channels
     from licensing in the Gulf service area.[^721] Our proposal was
     based on the fact that ITFS licensees had not expressed interest in
     seeking licenses to operate in the Gulf of Mexico, the area most
     likely had little need for educational service, and the requested
     commercial use did not require the full bandwidth available in the
     2500-2690 MHz band.[^722] We sought comment on this proposal and on
     whether we should consider unlicensed uses in the Gulf of
     Mexico.[^723] We did not receive comment on these proposals, and
     therefore renew our request for feedback on these issues.

363. We noted in the *NPRM* that the Gulf Service Area does not have a
     significant population center and is based primarily on the
     geographic confines of the Gulf and on the likely commonality of
     commercial interests among the potential users in the Gulf.[^724]
     Therefore, we believe that setting the proper geographic boundaries
     for the Gulf Service Area is particularly important as we seek to
     ensure the best possible service both inside the GSA and in
     neighboring service areas. In the Gulf Notice, the Commission
     proposed to use the same boundary definitions as adopted in the WCS
     *Report and Order*.[^725] Pursuant to this approach, land-based
     license regions neighboring the Gulf area would extend to the limit
     of United States territorial waters in the Gulf of Mexico, which
     extend to the maritime zone approximately twelve nautical miles
     from the United States coastline.

364. PetroCom disagrees with the Commission's proposal to establish the
     demarcation line of the Gulf Service area at twelve nautical miles
     from the coastline and maintains that the better approach is to
     define the Gulf Service Area boundaries as the land-water
     line.[^726] PetroCom points out that the land-water line was
     adopted as the boundary for cellular services. [^727] Furthermore,
     PetroCom asserts that a shoreline boundary mirrors Commission rules
     regarding BTAs, as defined by Rand McNally, where boundaries follow
     county lines.[^728] PetroCom argues that current MDS and ITFS
     licensees provide fixed services that do not require protection
     beyond the shore,[^729] and that allowing land-based MDS and ITFS
     operations to extend into the Gulf will create interference
     problems for prospective Gulf licensees.[^730] Thus, PetroCom
     implies that the Commission proposal to follow the WCS *Report and
     Order* boundary definitions will benefit incumbent land-based
     licensees at the expense of potential entrants, and discourage Gulf
     licensees from fully developing their systems.[^731]

365. The Coalition disagrees with the Commission's decision to
     immediately establish the Gulf Service Area.[^732] The Coalition
     further argues that any future operations in the Gulf must not
     adversely impact land-based services using the 2.5 GHz band. Noting
     that the 35-mile radii allotted to PSAs may extend well into the
     Gulf,[^733] the Coalition argues that existing BTAs and PSAs must
     be fully protected.[^734] WCA also contends that county line
     boundaries forming the basis for BTA boundary definitions extend
     into the Gulf as well, contrary to PetroCom's assertions.[^735]
     Therefore, the Coalition supports a Gulf Service Area boundary
     beginning approximately twelve miles from shore.[^736] The
     Coalition suggests further that any area between the Gulf Service
     Area and existing land-based service areas should be designated a
     Gulf Coastal Zone and that both the Gulf Service Area provider and
     the adjacent land-based service provider should be permitted to
     offer service therein.[^737] We seek additional comment on the
     merits of the boundary definitions proposed by both PetroCom and
     the Coalition.

366. Sprint is similarly concerned that Gulf operations could interfere
     with its own land-based operations.[^738] Therefore, Sprint also
     favors defining the boundary for the Gulf Service Area as twelve
     nautical miles from the coastline.[^739] Sprint further shares the
     Coalition's concern that a particular interference problem known as
     "ducting" may be caused by operations in the Gulf Service
     Area.[^740] We seek additional comment on the ducting propagation
     phenomenon. For example, how often does ducting occur and will
     there be ducting of inland signals? Can any steps be taken to
     minimize the adverse impacts of signal propagation?

367. As previously noted, commenters requested that the Commission delay
     considering the issues presented in the *Gulf Notice* until after
     the Commission considered the Coalition proposal to transform the
     service.[^741] We remain concerned that the record is not
     sufficiently developed to resolve issues concerning the amount of
     spectrum to license in the Gulf Service Area, competitive bidding,
     partitioning and disaggregation, interference protection
     requirements, construction periods, and license term. Therefore, we
     renew our request for comment on these and the other issues
     discussed herein.

## Streamlining FCC Review of Transactions 

368. As discussed in Section III.B.4, we expect that the transition to
     the new band plan will be implemented swiftly, and we anticipate
     that proponent-driven transition plans are likely to involve the
     assignment, partitioning, disaggregation, and leasing of spectrum
     usage rights in order to rationalize new spectrum holdings. We seek
     comment generally on ways to streamline our current procedures for
     reviewing these transactions to facilitate more efficient
     transitions.

369. We note that we have taken steps to simplify the licensing process
     and remove unnecessary regulatory burdens by standardizing a number
     of MDS and ITFS practices and procedures. For example, once
     mandatory electronic filing in ULS is in place, MDS and ITFS
     licensees will use FCC Form 603 and associated schedules to apply
     for consent to assignment of existing authorizations (including
     channel swaps), to apply for Commission consent to the transfer of
     control of entities holding authorizations, to notify the
     Commission of the consummation of assignments or transfers, and to
     request extensions of time for consummation of assignments or
     transfers. We seek comment on whether additional streamlining of
     the filing or review process for transfers and assignments, as well
     as spectrum leases, should be implemented. In addition, in Section
     6, we decided to permit partitioning and disaggregation for both
     ITFS and MDS licensees. We seek comment on whether the procedures
     set forth in Section 21.931 and Section 1.948 of our rules permit
     sufficiently streamlined notification and review. We seek comment
     on any other ways to streamline our procedures for transactions
     involving MDS and ITFS licensees.

## Continuing Review of Progress Towards Policy Goals

370. *Background.* In the *R&O*, we have taken a series of actions to
     further our broadband and spectrum policy goals. Perhaps the most
     fundamental action we took was to adopt a radically altered band
     plan in order to facilitate the development of wireless broadband
     systems and to reduce the likelihood of interference caused by
     incompatible uses. We have also adopted a streamlined transition
     plan designed to facilitate a rapid transition to the new band plan
     while preserving the existing uses in the band. In addition, we
     have retained the EBS eligibility requirements in order to protect
     and promote existing and new educational uses in the band. We have
     also taken various other actions to facilitate the development of
     advanced broadband and educational systems and to eliminate
     outdated and burdensome rules on our licensees. While we are asking
     for broad policy information in response to this aspect of the
     *FNPRM*, we do not intend to revisit the policy decisions we have
     made in the *R&O*. Our purpose in asking these questions is to
     gather information that will allow us to monitor developments in
     the band to ensure that we are responsive to future changes.

371. The goals we seek to accomplish in this proceeding, however, are
     not short term. Rather, we seek long-term and sustainable changes
     in this band. Indeed, as explained in the R&O, we believe that the
     changes we have implemented will unlock much of the promise in this
     band. Given the importance of lasting transformation of this band,
     we believe it is important to actively review the state of
     development in this band to ensure that the measures we have
     adopted today accomplish our stated policy goals. We are committed
     to ensuring that the Commission takes an active role in assessing
     whether our policy goals remain appropriate and, more importantly,
     whether the specific rules we have adopted are appropriately
     tailored to meet our policy goals. In that regard, we seek comment
     on various issues relating to the future of BRS and EBS.

372. *Discussion.* Given the many difficulties that licenses have
     traditionally faced in deploying services in this band, we believe
     it is particularly important in this proceeding that we continue to
     actively monitor the state of deployment in this band. In order to
     keep fully informed, we seek comment on the future trends that
     licensees, equipment manufacturers, and other stakeholders expect
     for BRS and EBS. For example, we ask licensees that currently use
     BRS or EBS for high-power operations to provide their expectations
     as to how long they expect the MBS will be used for high-power
     operations. We will continue to monitor progress in the use of BRS
     in providing advanced wireless broadband services, as well as the
     success of EBS in meeting their educational mission. We invite
     comments on how we can continue to ensure that the Commission\'s
     licensing policies truly support that important educational aim. It
     is critical that the Commission\'s rules and policies concerning
     BRS and EBS facilitate deployment of services to educational
     institutions, students, and broadband services to consumers
     generally. Time is of the essence. We understand that both the
     demand and the technology is there for a third broadband pipe into
     the home. We expect that licensees will aggressively take advantage
     of the opportunities we are creating today to offer advanced and
     innovative services to customers and students. Efficient use of
     spectrum is of paramount importance. We will closely monitor
     deployment to determine whether changes are necessary down the road
     and whether the rules and policies we have adopted continue to have
     a nexus to our laudable goals.

373. We intend to closely monitor the marketplace to determine whether
     the rules we have adopted are serving their intended purpose. We
     strongly anticipate that as a result of the rules we are adopting
     today, this band will be much more intensively utilized by
     commercial interests, educational interests, and other entities. We
     seek comment on the type of information we should track in order to
     monitor deployment, as well as information that would help us to
     identify obstacles to deployment. To the extent that deployment is
     not taking place in the band, we intend to thoroughly review the
     situation and consider appropriate changes to our rules. For
     example, if BRS and EBS spectrum is being underutilized, there
     could be several possible causes for that underutilization. Further
     revisions could be necessary to our technical rules. Alternatively,
     continued technological and market developments could have
     unanticipated effects on this band. We ask commenters to provide
     examples of the types of information that the Commission should
     look at to determine whether our rules are working as intended.

374. We recognize that the ultimate success in recreating this band is
     also closely linked to the availability of investment dollars in
     support of wireless broadband services. We believe that our rules
     create a more stable environment that will promote additional
     capital investment. However, we seek comment on whether there are
     additional actions that we can take that will compel additional
     investment. At the same time, we seek comment on whether there are
     any actions that we are taking that may hinder or provide
     disincentives to investment.

# Procedural matters

## *Ex Parte* Rules -- Permit-But-Disclose

375. This is a permit-but-disclose notice and comment rulemaking
     proceeding. Ex parte presentations are permitted, except during the
     Sunshine Agenda period, provided they are disclosed pursuant to the
     Commission's rules.[^742]

## Comment Period and Procedures

376. Pursuant to applicable procedures set forth in Sections 1.415 and
     1.419 of the Commission's rules,[^743] interested parties may file
     comments on this Notice on or before \[30 days from publication in
     the Federal Register\], and reply comments on or before \[60 days
     from publication in the Federal Register\]. Comments and reply
     comments should be filed in WT Docket No. 03-66, and may be filed
     using the Commission's Electronic Comment Filing System (ECFS) or
     by filing paper copies.[^744] All relevant and timely comments will
     be considered by the Commission before final action is taken in
     this proceeding.

377. Comments filed through the ECFS can be sent as an electronic file
     via the Internet to \<http://www.fcc.gov/e-file/ecfs.html\>. In
     completing the transmittal screen, commenters should include their
     full name, Postal Service mailing address, and the applicable
     docket number. Parties may also submit an electronic comment by
     e-mail via the Internet. To obtain filing instructions for e-mail
     comments, commenters should send an e-mail to <ecfs@fcc.gov>, and
     should include the following words in the body of the message: "get
     form \<your e-mail address\>." A sample form and directions will be
     sent in reply.

378. Parties who choose to file by paper must file an original and four
     copies of each filing. If parties want each Commissioner to receive
     a personal copy of their comments, they must file an original plus
     nine copies. All filings must be sent to the Commission's
     Secretary, Marlene H. Dortch, Office of the Secretary, Federal
     Communications Commission, 445 12th Street, S.W., Room TW-A325,
     Washington, D.C. 20554. Furthermore, parties are requested to
     provide courtesy copies for the following Commission staff: (1)
     Nancy Zaczek, Genevieve Ross, and Stephen Zak, Broadband Division,
     Wireless Telecommunications Bureau, Federal Communications
     Commission, 445 12th Street, S.W., Room. 3-C124, Washington, D.C.
     20554; and (2) William Huber and Erik Salovaara, Auctions and
     Spectrum Access Division, Wireless Telecommunications Bureau,
     Federal Communications Commission, 445 12th Street, S.W., Room.
     4-A760, Washington, D.C. 20554. One copy of each filing (together
     with a diskette copy, as indicated below) should also be sent to
     the Commission's copy contractor, Best Copy and Printing, Inc, 445
     12th Street, SW, Room CY-B402, Washington, DC, 20554,
     1-800-378-3160.

379. Parties who choose to file by paper should also submit their
     comments on diskette. These diskettes should be attached to the
     original paper filing submitted to the Office of the Secretary.
     Such a submission should be on a 3.5 inch diskette formatted in an
     IBM compatible format using Microsoft TM Word 97 for Windows or
     compatible software. The diskette should be accompanied by a cover
     letter and should be submitted in "read only" mode. The diskette
     should be clearly labeled with the commenter's name, proceeding,
     type of pleading (comment or reply comment), date of submission,
     and the name of the electronic file on the diskette. The label
     should also include the following phrase "Disk Copy -- Not an
     Original." Each diskette should contain only one party's pleadings,
     preferably in a single electronic file. In addition, commenters
     should send diskette copies to the Commission's copy contractor,
     Qualex International, 445 12th Street, SW, Room CY-B402,
     Washington, DC, 20554, 202-863-2893.

380. The public may view the documents filed in this proceeding during
     regular business hours in the FCC Reference Information Center,
     Federal Communications Commission, 445 12th Street, S.W., Room
     CY-A257, Washington, D. C. 20554, and on the Commission's Internet
     Home Page: \<[http://www.fcc.gov](http://www.fcc.gov/)\>. Copies of
     comments and reply comments are also available through the
     Commission's duplicating contractor: Best Copy and Printing, Inc.,
     445 12th Street, SW, Room CY-B402, Washington, DC, 20554,
     1-800-378-3160. Accessible formats (computer diskettes, large
     print, audio recording and Braille) are available to persons with
     disabilities by contacting Brian Millin, of the Consumer &
     Governmental Affairs Bureau, at (202) 418-7426, TTY (202) 418-7365,
     or at <bmillin@fcc.gov>.

## Final Regulatory Flexibility Analysis

381. The Regulatory Flexibility Act (RFA)[^745] requires that an agency
     prepare a regulatory flexibility analysis for notice and comment
     rulemakings, unless the agency certifies that \"the rule will not,
     if promulgated, have a significant economic impact on a substantial
     number of small entities.[^746] Accordingly, we have prepared a
     Final Regulatory Flexibility Analysis concerning the impact of the
     rule changes contained in this *R&O* on small entities. The Final
     Regulatory Flexibility Analysis is set forth in Appendix B.

## Initial Regulatory Flexibility Analysis

382. As required by the Regulatory Flexibility Act of 1980 (RFA),[^747]
     the Commission has prepared an Initial Regulatory Flexibility
     Analysis (IRFA) of the possible significant economic impact on
     small entities of the policies and rules proposed in the Notice.
     The analysis is found in Appendix A. We request written public
     comment on the analysis. Comments must be filed in accordance with
     the same deadlines as comments filed in response to the *NPRM* &
     MO&O, and must have a separate and distinct heading designating
     them as responses to the IRFA. The Commission's Consumer and
     Governmental Affairs Bureau, Reference Information Center, will
     send a copy of this *NPRM* & MO&O, including the IRFA, to the Chief
     Counsel for Advocacy of the Small Business Administration.

## Paperwork Reduction Analysis

383. This document contains new information collection requirements
     subject to the Paperwork Reduction Act of 1995 (PRA), Public Law
     104-13. It will be submitted to the Office of Management and Budget
     (OMB) for review under Section 3507(d) of the PRA. OMB, the general
     public, and other Federal agencies are invited to comment on the
     new information collection requirements contained in this
     proceeding. In addition, we note that pursuant to the Small
     Business Paperwork Relief Act of 2002, Public Law 107-198,
     *[see]{.underline}* 44 U.S.C. 3506(c)(4), we previously sought
     specific comment on how the Commission might "further reduce the
     information collection burden for small business concerns with
     fewer than 25 employees."

384. In this present document, we have assessed the effects of requiring
     licensees to file Initiation Plans and Post Transition Notification
     Plans, and find that these requirements will not adversely affect
     businesses with fewer than 25 employees. First, it is unlikely that
     such businesses will serve as Proponents under our new Transition
     Plan thereby triggering the requirement to file an Initiation Plan
     as we generally expect that Proponents will largely consist of
     larger businesses with sufficient revenue to transition an entire
     market. To the extent that such businesses would serve as
     Proponents, the filing of Initiation Plans will not constitute a
     burden or require significant paperwork preparation because these
     Proponents will meet this filing requirement, by submitting, in
     whole or in part, their written agreements on transition. With
     regard to the Post Transition Notification Plan, we do not believe
     that such a filing would constitute a burden to businesses with
     fewer than 25 employees because such notices will consist of a
     simple notification to the Commission that the transition has been
     completed. This notification is in the public interest because it
     will help to ensure that the BRS/EBS spectrum is properly utilized.
     We seek comment on these conclusions.

## Further Information

385. For further information concerning this rulemaking proceeding,
     contact Genevieve Ross or Nancy Zaczek, Broadband Division,
     Wireless Telecommunications Bureau, Federal Communications
     Commission, 445 12th Street, S.W., Room 3-B-153, Washington, D.C.
     20554; at (202) 418-2487 or via the Internet to
     <Nancy.Zaczek@fcc.gov> or <Genevieve.Ross@fcc.gov>.

# ORDERING CLAUSES 

386. Accordingly, IT IS ORDERED, pursuant to sections 1, 2, 4(i), 7, 10,
     201, 214, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, 333 and
     706 of the Communications Act of 1934, 47 U.S.C. §§ 151, 152,
     154(i), 157, 160, 201, 214, 301, 302, 303, 307, 308, 309, 310, 319,
     324, 332, 333, and 706, that this *Report and Order* is hereby
     ADOPTED.

387. IT IS FURTHER ORDERED, pursuant to sections 1, 2, 4(i), 7, 10, 201,
     214, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, 333 and 706
     of the Communications Act of 1934, 47 U.S.C. §§ 151, 152, 154(i),
     157, 160, 201, 214, 301, 302, 303, 307, 308, 309, 310, 319, 324,
     332, 333, and 706, that this *Further* *Notice of Proposed
     Rulemaking* is hereby ADOPTED.

388. IT IS FURTHER ORDERED that NOTICE IS HEREBY GIVEN of the proposed
     regulatory changes described in this *Further* *Notice of Proposed
     Rulemaking*, and that comment is sought on these proposals.

389. IT IS FURTHER ORDERED, that the proceeding entitled Amendment of
     Parts 21 and 74 to Enable Multipoint Distribution Service and the
     Instructional Television Fixed Service Amendment of Parts 21 and 74
     to Engage in Fixed Two-Way Transmissions, MM Docket No. 97-217 IS
     TERMINATED.

390. IT IS FURTHER ORDERED that the Commission's Consumer and
     Governmental Affairs Bureau, Reference Information Center, SHALL
     SEND a copy of this *Report and Order* & *Further* *Notice of
     Proposed Rulemaking*, including the Initial Regulatory Flexibility
     Analysis, to the Chief Counsel for Advocacy of the Small Business
     Administration.

> Federal Communications Commission
>
> Marlene H. Dortch

Secretary

# APPENDIX A {#appendix-a .unnumbered}

# INITIAL REGULATORY FLEXIBILITY ANALYSIS {#initial-regulatory-flexibility-analysis-1 .unnumbered}

*(For Further Notice of Proposed Rulemaking)*

1.  As required by the Regulatory Flexibility Act of 1980, as amended
    (RFA),[^748] the Commission has prepared this present Initial
    Regulatory Flexibility Analysis (IRFA) of the possible significant
    economic impact on a substantial number of small entities by the
    policies and rules proposed in this *Further Notice of Proposed Rule
    Making (FNPRM)*. Written public comments are requested on this IRFA.
    Comments must be identified as responses to the IRFA and must be
    filed by the deadlines specified in the *FNPRM* for comments. The
    Commission will send a copy of this *FNPRM*, including this IRFA, to
    the Chief Counsel for Advocacy of the Small Business Administration
    (SBA).[^749] In addition, the *FNPRM* and IRFA (or summaries
    thereof) will be published in the Federal Register.[^750]

**Need for, and Objectives of, the Proposed Rules:**

2.  In this *FNPRM* we seek comments on solutions to implement in the
    event that the plan we adopt today for transitioning to the new band
    plan, set forth in section 5, *supra,* does not reach a satisfactory
    stage of implementation within three years. A quick and efficient
    transition to a segmented, de-interleaved band plan is critical to
    ensuring that the public spectrum resource represented by the
    2500-2690 MHz band does not remain underutilized. We have adopted a
    new band plan to further the public interest in efficient and
    intensive use of spectrum. To prevent undue delay in implementing
    the new band plan, the transition process will sunset in each major
    economic area[^751] where a proponent does not timely file within
    three years of the rules' effective date a transition proposal that
    has resolved, pursuant to the Commission's rules, any properly
    presented objections. This three year time limit will provide an
    incentive for existing users to develop transition proposals in a
    timely manner.[^752] Finally, recognizing that parties may not be
    able to control the timing of all aspects of the transition, we
    require only that the proposal be finalized, with any objections
    addressed, and filed within the three-year period.

3.  Irrespective of how well the transition process to the new band plan
    is designed, it may not be possible for private parties to
    transition existing uses to the new band plan in a way that balances
    the public interest in protecting those uses with the public
    interest in the new band plan. There are large numbers of existing
    users in the band with varied and disparate interests. A proponent
    therefore must coordinate large numbers of substantially varying
    interests in order to transition to the new band plan. A proponent
    may not come forward in every major economic area and every
    proponent that comes forward may not be able to resolve all
    reasonable objections made to its proposal. Furthermore, the
    transition process may not perfectly define reasonable transition
    proposals or rapidly and accurately determine whether particular
    objections to particular transitions are reasonable. Consequently,
    transitions to the new band plan may not occur within one or more
    major economic area within the allotted time.

4.  Consequently, we tentatively conclude herein that in major economic
    areas that are not transitioned to the new band plan pursuant to the
    transition process we have adopted herein,[^753] the public interest
    in services made possible by the new band plan will be best served
    by clearing existing users from the spectrum. The transition process
    we have adopted represents the best effort at transitioning existing
    use to facilities compatible with the new band plan. While new
    transition plans, including in areas otherwise without one, might
    result from refinements to the transition process, we conclude that
    the absence of a timely filed Initiation Plan[^754] indicates that
    existing uses cannot be reasonably balanced with the new band plan
    in the relevant area. Consequently, the public will receive the
    benefits of the new band plan only if existing users are cleared
    from the spectrum and the Commission grants new licenses to use the
    spectrum consistent with the new band plan. Accordingly, we propose
    to implement this transition process in areas where the requirements
    we have instituted herein are not met within the required time
    frame.

5.  As stated in the text of the *FNPRM*,[^755] we request comment on a
    number of issues relating to competitive bidding procedures that
    could be used to assign new licenses in this band by auction. We
    propose to conduct any such auction in conformity with the general
    competitive bidding rules set forth in Part 1, Subpart Q, of the
    Commission's rules, and substantially consistent with many of the
    bidding procedures that have been employed in previous
    auctions.[^756] Specifically, we propose to employ the Part 1 rules
    governing, among other things, competitive bidding design,
    designated entities, application and payment procedures, collusion
    issues, and unjust enrichment.[^757] Under this proposal, such rules
    would be subject to any modifications that the Commission may adopt
    in our Part 1 proceeding.[^758] In addition, consistent with current
    practice, matters such as the appropriate competitive bidding
    design, as well as minimum opening bids and reserve prices, would be
    determined by the Wireless Telecommunications Bureau pursuant to its
    delegated authority.[^759] We seek comment on whether any of our
    Part 1 rules or other auction procedures would be inappropriate or
    should be modified for an auction of new licenses in this band, and
    on whether alternative rules would more effectively serve our basic
    purposes.[^760]

6.  We seek comment on the appropriate definition(s) of small business
    that should be used to determine eligibility for bidding credits in
    the auction. With respect to the auction of EBS licenses, we further
    seek comment on any special challenges associated with governmental
    educational institutions or non-governmental non-profit educational
    institutions participating in auctions.

7.  In the *Part 1 Third Report and Order*, we adopted a standard
    schedule of bidding credits for certain small business definitions,
    the levels of which were developed based on our auction
    experience.[^761] The standard schedule appears at Section
    1.2110(f)(2) of the Commission's rules.[^762] Are these levels of
    bidding credits appropriate for this band? For this proceeding, we
    would propose to define an entity with average annual gross revenues
    not exceeding \$40 million for the preceding three years as a "small
    business;" an entity with average gross revenues not exceeding \$15
    million for the same period as a "very small business;" and an
    entity with average gross revenues not exceeding \$3 million for the
    same period as an "entrepreneur."[^763] In the event that we offer
    bidding credits on this basis, we propose to provide qualifying
    "small businesses" with a bidding credit of 15%, qualifying "very
    small businesses" with a bidding credit of 25%; and qualifying
    "entrepreneurs" with a bidding credit of 35%, consistent with
    Section 1.2110(f)(2).[^764] Finally, we invite comment on the effect
    of potentially having three small business sizes, and bidding
    credits, for new licenses in this band while having had only one
    small business size (average annual gross revenues for the preceding
    three years not exceeding \$40 million) and one credit (15%) in the
    BRS service.[^765] We seek comment on this proposal.

8.  We recognize that educational institutions and non-profit
    educational organizations eligible to hold EBS licenses may have
    unique characteristics. We therefore invite comment on whether
    distinctive characteristics of EBS licensees require distinct rules
    for assessing the relative size of potential participants in an
    auction. How do our designated entity provisions comport with the
    unique challenges and status of educational institutions? Should we
    establish special provisions for non-profit educational institutions
    that may want to have access to EBS spectrum but do not have the
    financial capability to compete in an auction for spectrum licenses?
    We seek comment on whether the non-commercial character of EBS
    licensees requires any special procedures for determining the
    average annual gross revenues of such entities. For example, are our
    standard gross revenue attribution rules an appropriate method of
    evaluating the relative resources of universities and government
    entities? We also invite comment on whether some other criterion
    besides average annual gross revenues should be used for identifying
    small entities among EBS licensees and similar applicants.

9.  Commenters proposing alternative business size standards should give
    careful consideration to the likely capital requirements for
    developing services in this spectrum. In this regard, we note that
    new licensees may be presented with issues and costs involved in
    transitioning incumbents and developing markets, technologies, and
    services. Commenters also should consider whether the band plan and
    characteristics of the band suggest adoption of other small business
    size definitions and/or bidding credits in this instance.

10. We believe our proposals will encourage utilization of this band and
    the development of new innovative services to the public such as
    providing wireless broadband services, including high-speed Internet
    access and mobile services. We also believe that our proposals will
    provide licensees flexibility of use which will allow them to adapt
    quickly to changing market conditions and the marketplace.

**Legal Basis:**

11. The proposed action is authorized under Sections 1, 2, 4(i), 7, 10,
    201, 214, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, 333 and
    706 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151,
    152, 154(i), 157, 160, 201, 214, 301, 302, 303, 307, 308, 309, 310,
    319, 324, 332, 333, and 706.

> **Description and Estimate of the Number of Small Entities to Which
> the Proposed Rules Will Apply:**

12. The RFA directs agencies to provide a description of and, where
    feasible, an estimate of the number of small entities that may be
    affected by the proposed rules.[^766] The RFA generally defines the
    term "small entity" as having the same meaning as the terms, "small
    business," "small organization," and "small governmental
    jurisdiction."[^767] In addition, the term "small business" has the
    same meaning as the term "small business concern" under the Small
    Business Act.[^768] A small business concern is one which: (1) is
    independently owned and operated; (2) is not dominant in its field
    of operation; and (3) satisfies any additional criteria established
    by the SBA.[^769]

13. Nationwide, there are 4.44 million small business firms, according
    to SBA reporting data.[^770] In this section, we further describe
    and estimate the number of small entity licensees and regulatees
    that may be affected by rules adopted pursuant to this *NPRM*. The
    most reliable source of information regarding the total numbers of
    certain common carrier and related providers nationwide, as well as
    the number of commercial wireless entities, appears to be the data
    that the Commission publishes in its Trends in Telephone Service
    report.[^771] The SBA has developed small business size standards
    for wireline and wireless small businesses within the three
    commercial census categories of Wired Telecommunications
    Carriers,[^772] Paging,[^773] and Cellular and Other Wireless
    Telecommunications. [^774] Under these categories, a business is
    small if it has 1,500 or fewer employees. Below, using the above
    size standards and others, we discuss the total estimated numbers of
    small businesses that might be affected by our actions.

14. Multipoint Distribution Service, Multichannel Multipoint
    Distribution Service, and ITFS. Multichannel Multipoint Distribution
    Service (MMDS) systems, often referred to as "wireless cable,"
    transmit video programming to subscribers using the microwave
    frequencies of the Multipoint Distribution Service (MDS) and
    Instructional Television Fixed Service (ITFS).[^775] In connection
    with the 1996 MDS auction, the Commission established a small
    business size standard as an entity that had annual average gross
    revenues of less than \$40 million in the previous three calendar
    years.[^776] The MDS auctions resulted in 67 successful bidders
    obtaining licensing opportunities for 493 Basic Trading Areas
    (BTAs). Of the 67 auction winners, 61 met the definition of a small
    business. MDS also includes licensees of stations authorized prior
    to the auction. In addition, the SBA has developed a small business
    size standard for Cable and Other Program Distribution, which
    includes all such companies generating \$12.5 million or less in
    annual receipts.[^777] According to Census Bureau data for 1997,
    there were a total of 1,311 firms in this category, total, that had
    operated for the entire year.[^778] Of this total, 1,180 firms had
    annual receipts of under \$10 million and an additional 52 firms had
    receipts of \$10 million or more but less than \$25 million.
    Consequently, we estimate that the majority of providers in this
    service category are small businesses that may be affected by the
    rules and policies adopted herein. This SBA small business size
    standard also appears applicable to ITFS. There are presently 2,032
    ITFS licensees. All but 100 of these licenses are held by
    educational institutions. Educational institutions are included in
    this analysis as small entities.[^779] Thus, we tentatively conclude
    that at least 1,932 licensees are small businesses.

15. In connection with the 1996 MDS auction, the Commission defined
    "small business" as an entity that, together with its affiliates,
    has average gross annual revenues that are not more than \$40
    million for the preceding three calendar years.[^780] The Commission
    established this small business definition in the context of this
    particular service and with the approval of SBA.[^781] The MDS
    auction resulted in 67 successful bidders obtaining licensing
    opportunities for 493 Basic Trading Areas (BTAs).[^782] Of the 67
    auction winners, 61 met the definition of a small business. At this
    time, we estimate that of the 61 small business MDS auction winners,
    48 remain small business licensees. In addition to the 48 small
    businesses that hold BTA authorizations, there are approximately 392
    incumbent MDS licensees that are considered small entities.[^783]
    After adding the number of small business auction licensees to the
    number of incumbent licensees not already counted, we find that
    there are currently approximately 440 MDS licensees that are defined
    as small businesses under either the SBA or the Commission's rules.
    Some of those 440 small business licensees may be affected by the
    proposals in this *NPRM & MO&O*.

16. Multipoint Distribution Service, Multichannel Multipoint
    Distribution Service, and Instructional Television Fixed Service. 
    Multichannel Multipoint Distribution Service (MMDS) systems, often
    referred to as "wireless cable," transmit video programming to
    subscribers using the microwave frequencies of the Multipoint
    Distribution Service (MDS) and Instructional Television Fixed
    Service (ITFS).  In connection with the 1996 MDS auction, the
    Commission defined "small business" as an entity that, together with
    its affiliates, has average gross annual revenues that are not more
    than \$40 million for the preceding three calendar years.  The SBA
    has approved of this standard.  The MDS auction resulted in 67
    successful bidders obtaining licensing opportunities for 493 Basic
    Trading Areas (BTAs).  Of the 67 auction winners, 61 claimed status
    as a small business.  At this time, we estimate that of the 61 small
    business MDS auction winners, 48 remain small business licensees. 
    In addition to the 48 small businesses that hold BTA authorizations,
    there are approximately 392 incumbent MDS licensees that have gross
    revenues that are not more than \$40 million and are thus considered
    small entities.

17. In addition, the SBA has developed a small business size standard
    for Cable and Other Program Distribution, which includes all such
    companies generating \$12.5 million or less in annual receipts. 
    According to Census Bureau data for 1997, there were a total of
    1,311 firms in this category, total, that had operated for the
    entire year.  Of this total, 1,180 firms had annual receipts of
    under \$10 million, and an additional 52 firms had receipts of \$10
    million or more but less than \$25 million. Consequently, we
    estimate that the majority of providers in this service category are
    small businesses that may be affected by the proposed rules and
    policies.

18. Finally, while SBA approval for a Commission-defined small business
    size standard applicable to ITFS is pending, educational
    institutions are included in this analysis as small entities.  There
    are currently 2,032 ITFS licensees, and all but 100 of these
    licenses are held by educational institutions.  Thus, we tentatively
    conclude that at least 1,932 ITFS licensees are small businesses.

19. Cable and Other Program Distribution.  This category includes cable
    systems operators, closed circuit television services, direct
    broadcast satellite services, multipoint distribution systems,
    satellite master antenna systems, and subscription television
    services.  The SBA has developed small business size standard for
    this census category, which includes all such companies generating
    \$12.5 million or less in revenue annually.   According to Census
    Bureau data for 1997, there were a total of 1,311 firms in this
    category, total, that had operated for the entire year.  Of this
    total, 1,180 firms had annual receipts of under \$10 million and an
    additional 52 firms had receipts of \$10 million or more but less
    than \$25 million.  Consequently, the Commission estimates that the
    majority of providers in this service category are small businesses
    that may be affected by the rules and policies proposed herein.

20. There are presently 2032 ITFS licensees. All but 100 of these
    licenses are held by educational institutions (these 100 fall in the
    MDS category, above). Educational institutions may be included in
    the definition of a small entity.[^784] ITFS is a non-profit
    non-broadcast service that, depending on SBA categorization, has, as
    small entities, entities generating either \$10.5 million or less,
    or \$11.0 million or less, in annual receipts.[^785] However, we do
    not collect, nor are we aware of other collections of, annual
    revenue data for ITFS licensees. Thus, we find that up to \[1932\]
    of these educational institutions are small entities, some of which
    these providers, specifically those who have not met the
    requirements for transition articulated herein may be affected by
    our spectrum clearing proposal

**Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements:**

21. There are no new reporting, recordkeeping or other compliance
    requirements proposed in the *FNPRM.*

> **Steps Taken to Minimize Significant Economic Impact on Small
> Entities, and Significant Alternatives Considered:**

22. The RFA requires an agency to describe any significant alternatives
    that it has considered in reaching its proposed approach, which may
    include the following four alternatives: "(1) the establishment of
    differing compliance or reporting requirements or timetables that
    take into account the resources available to small entities; (2) the
    clarification, consolidation, or simplification of compliance or
    reporting requirements under the rule for such small entities; (3)
    the use of performance, rather than design standards; and (4) an
    exemption from coverage of the rule, or any part thereof, for small
    entities."[^786]

23. In this *FNPRM*, we seek comment on a spectrum clearing
    proposal[^787] to ensure that the 2500-2690 MHz band does not lie
    fallow. Inasmuch as this proposal provides opportunities for new
    entrants in the band, it opens up economic opportunities to a
    variety of spectrum users, including small businesses. In the *R&O*
    portion of this document, we have adopted an alternative to this
    spectrum clearing proposal, which consists of transitioning current
    users to the new band plan also adopted.[^788] Our spectrum clearing
    proposal could be implemented in the event that the plan we adopt is
    not satisfactorily implemented within three years. Therefore,
    affected parties have been given an alternative to our spectrum
    clearing proposal, and will only be subject thereto in the event
    that they do not comply with our new rules in a reasonable amount of
    time. We also seek comment on significant alternatives commenters
    believe we should adopt.

**Federal Rules that May Duplicate, Overlap, or Conflict with the
Proposed Rule**

24. None.

#  {#section .unnumbered}

# APPENDIX B {#appendix-b .unnumbered}

# FINAL REGULATORY FLEXIBILITY ANALYSIS {#final-regulatory-flexibility-analysis-1 .unnumbered}

*(For Report and Order)*

25. As required by the Regulatory Flexibility Act of 1980, as amended
    (RFA),[^789] an Initial Regulatory Flexibility Analysis (IRFA) of
    the possible significant economic impact on a substantial number of
    small entities by the policies and rules proposed in the *Notice of
    Proposed Rule Making (NPRM)* was incorporated therein. The
    Commission sought written public comment on the proposals in the
    *NPRM,* including comment on the IRFA. No comments were submitted
    specifically in response to the IRFA; we nonetheless discuss certain
    general comments below. This present Final Regulatory Flexibility
    Analysis (FRFA) conforms to the RFA.[^790]

    **Need for, and Objectives of, the Proposed Rules:**

26. In this *Report and Order (R&O)* we adopt a number of changes
    concerning the rules governing the 2500-2690 MHz band, for the
    Multipoint Distribution Service (MDS), the Multi-channel Multipoint
    Distribution Service (MMDS), and the Instructional Television Fixed
    Service (ITFS). The rules we adopt today include: revising technical
    rules to increase licensee flexibility; revising the band plan to
    eliminate the current interleaved channel scheme to provide
    licensees with contiguous spectrum; implementing service rules for
    mobile operation; retaining eligibility restrictions to preserve the
    ITFS service; simplifying and streamlining the licensing process;
    and implementing application filing and processing electronically
    via our Universal Licensing System with a six-month transition
    period after application processing in ULS begins before requiring
    mandatory electronic filing.

27. We believe the rules we adopt today will both encourage the
    enhancement of existing services using this band and promote the
    development of new innovative services to the public, such as
    providing wireless broadband services, including high-speed Internet
    access and mobile services. We also believe that our new rules will
    allow licensees to adapt quickly to changing market conditions and
    the marketplace, rather than to government regulation, in
    determining how this band can best be used.

**Summary of Significant Issues Raised by Public Comments in Response to
the IRFA:**

28. No comments were submitted specifically in response to the IRFA.

> **Description and Estimate of the Number of Small Entities to Which
> the Proposed Rules Will Apply:**

29. The RFA directs agencies to provide a description of and, where
    feasible, an estimate of the number of small entities that may be
    affected by the proposed rules.[^791] The RFA generally defines the
    term "small entity" as having the same meaning as the terms, "small
    business," "small organization," and "small governmental
    jurisdiction."[^792] In addition, the term "small business" has the
    same meaning as the term "small business concern" under the Small
    Business Act.[^793] A small business concern is one which: (1) is
    independently owned and operated; (2) is not dominant in its field
    of operation; and (3) satisfies any additional criteria established
    by the SBA.[^794] A small organization is generally "any
    not-for-profit enterprise which is independently owned and operated
    and is not dominant in its field."[^795]

30. In this section, we further describe and estimate the number of
    small entity licensees and regulatees that may be affected by rules
    adopted pursuant to this *NPRM*. The most reliable source of
    information regarding the total numbers of certain common carrier
    and related providers nationwide, as well as the number of
    commercial wireless entities, appears to be the data that the
    Commission publishes in its *Trends in Telephone Service*
    report.[^796]

31. Multipoint Distribution Service, Multichannel Multipoint
    Distribution Service, and ITFS. Multichannel Multipoint Distribution
    Service (MMDS) systems, often referred to as "wireless cable,"
    transmit video programming to subscribers using the microwave
    frequencies of the Multipoint Distribution Service (MDS) and
    Instructional Television Fixed Service (ITFS).[^797] In connection
    with the 1996 MDS auction, the Commission established a small
    business size standard as an entity that had annual average gross
    revenues of less than \$40 million in the previous three calendar
    years.[^798] The MDS auctions resulted in 67 successful bidders
    obtaining licensing opportunities for 493 Basic Trading Areas
    (BTAs). Of the 67 auction winners, 61 met the definition of a small
    business. MDS also includes licensees of stations authorized prior
    to the auction. At this time, we estimate that of the 61 small
    business MDS auction winners, 48 remain small business licensees. In
    addition to the 48 small businesses that hold BTA authorizations,
    there are approximately 392 incumbent MDS licensees that are
    considered small entities.[^799] After adding the number of small
    business auction licensees to the number of incumbent licensees not
    already counted, we find that there are currently approximately 440
    MDS licensees that are defined as small businesses under either the
    SBA or the Commission's rules. Some of those 440 small business
    licensees may be affected by the decisions in this *R&O*.

32. In addition, the SBA has developed a small business size standard
    for Cable and Other Program Distribution, which includes all such
    companies generating \$12.5 million or less in annual
    receipts.[^800] According to Census Bureau data for 1997, there were
    a total of 1,311 firms in this category, total, that had operated
    for the entire year.[^801] Of this total, 1,180 firms had annual
    receipts of under \$10 million and an additional 52 firms had
    receipts of \$10 million or more but less than \$25 million.
    Consequently, we estimate that the majority of providers in this
    service category are small businesses that may be affected by the
    rules and policies adopted herein. This SBA small business size
    standard is also applicable to ITFS. There are presently 2,032 ITFS
    licensees. All but 100 of these licenses are held by educational
    institutions. Educational institutions are included in this analysis
    as small entities.[^802] Thus, we estimate that at least 1,932
    licensees are small businesses.

33. MDS is also heavily encumbered with licensees of stations authorized
    prior to the auction. The SBA has developed a definition of small
    entities for pay television services that includes all such
    companies generating \$11 million or less in annual receipts.[^803]
    This definition includes multipoint distribution systems, and thus
    applies to MDS licensees and wireless cable operators that did not
    participate in the MDS auction. Information available to us
    indicates that there are \[832\] of these licensees and operators
    that do not generate revenue in excess of \$11 million annually.
    Therefore, for purposes of this IRFA, we find there are
    approximately \[892\] small MDS providers as defined by the SBA and
    the Commission's auction rules, and some of these providers may take
    advantage of our amended rules to provide two-way MDS.

34. There are presently \[2032\] ITFS licensees. All but \[100\] of
    these licenses are held by educational institutions (these \[100\]
    fall in the MDS category, above). Educational institutions may be
    included in the definition of a small entity.[^804] ITFS is a
    non-profit non-broadcast service that, depending on SBA
    categorization, has, as small entities, entities generating either
    \$10.5 million or less, or \$11.0 million or less, in annual
    receipts.[^805] However, we do not collect, nor are we aware of
    other collections of, annual revenue data for ITFS licensees. Thus,
    we find that up to \[1932\] of these educational institutions are
    small entities that may take advantage of our amended rules to
    provide additional flexibility to ITFS.

**Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements:**

35. Applicants for MDS or ITFS licenses must submit license applications
    through the Universal Licensing System using FCC Form 601,[^806] and
    other appropriate forms.[^807] Licensees will also be required to
    apply for an individual station license by filing FCC Form 601 for
    those individual stations that (1) require submission of an
    Environmental Assessment of the facilities under Section 1.1307 of
    our Rules;[^808] (2) require international coordination of the
    application;[^809] or (3) require coordination with the Frequency
    Assignment Subcommittee (FAS) of the Interdepartment Radio Advisory
    Committee (IRAC). While these requirements are new with respect to
    potential licensees in the ITFS and MDS bands, the Commission has
    applied these requirements to licensees in other bands. Moreover,
    the Commission is also eliminating many burdensome filing
    requirements that have previously been applied to MDS and
    ITFS.[^810]

> **Steps Taken to Minimize Significant Economic Impact on Small
> Entities, and Significant Alternatives Considered:**

36. The RFA requires an agency to describe any significant alternatives
    that it has considered in reaching its proposed approach, which may
    include the following four alternatives: "(1) the establishment of
    differing compliance or reporting requirements or timetables that
    take into account the resources available to small entities; (2) the
    clarification, consolidation, or simplification of compliance or
    reporting requirements under the rule for such small entities; (3)
    the use of performance, rather than design standards; and (4) an
    exemption from coverage of the rule, or any part thereof, for small
    entities."[^811]

37. Regarding our decision to retain ITFS eligibility restrictions, we
    realize that certain entities expressed their wishes that
    eligibility restrictions be lifted throughout the entire ITFS
    spectrum. However, this concern is mitigated by the fact that even
    though only qualifying educational institutions can hold licenses in
    the band, such institutions are free to lease out excess capacity to
    non-educational entities. Throughout the years, this has been the
    dominant practice in the band, and in fact, the band is used by
    non-educational entities. Our decision is also mitigated by the fact
    that non-educational entities may also acquire this spectrum by
    entering into negotiations with BRS licensees, who occupy the same
    spectrum.

38. Herein we have adopted a variation of the band plan recommended by
    the Wireless Communications Association (WCA), National
    Instructional Television Fixed Service (NIA) and Catholic Television
    Network (CTN) (collectively, the Coalition). Our preferred variation
    contains upper and lower band segments for low-power operations (UBS
    and LBS, respectively), and a mid band segment (MBS) for high-power
    operations. We do not anticipate that this variation will have any
    adverse effect on small entities. This is because the new band plan
    provides contiguous blocks of spectrum whereas the old band plan
    provided interleaved channels that prevented licensees from
    employing innovative technologies. Although some entities rejected
    the three segment plan we have adopted and argued that the
    Commission should adopt across-the-board power reductions instead of
    the three band segments which require a shuffling of channel
    assignments, we believe this alternative would have had a
    significant negative impact on ITFS and MDS licensees. This is
    because many of these licensees use this spectrum for high-power
    operations, and an across-the-board power reduction rule would
    result in the virtual shut down of such licensees' operations. In
    contrast, the approach we have adopted will accommodate both high
    and low-power operations.

39. Regarding our decision to adopt, with some modifications, the
    Coalition's plan for transitioning licensees to the new band plan,
    we recognize that some commenters were resistant to the Coalition
    transition plan criticizing it for having no deadlines and arguing
    that it would create daisy chains that would actually prevent the
    transition from being completed.[^812] However, we believe this
    concern is mitigated by our decision to set a three year deadline
    for initiating the transition process. We have also notified
    interested parties herein that if they do not comply with the three
    year deadline, we will implement another transition plan, and have
    sought comment on other transition plans we can implement if we
    later find that the one we adopt today is not successful. With
    regard to the possible daisy chain problem, we have modified the
    Coalition plan to transition to the new band plan using larger areas
    than the Coalition recommends.

40. Finally, licensees that must transition to the new band plan will be
    affected in that some will have to bear the costs of such
    transition. However, the record reflects that licensees unanimously
    agree that the band plan must be modified, and the transition costs
    are outweighed by the value and utility of converting the band plan
    into one which provides licensees with contiguous spectrum.

41. Regarding our decision to implement geographic area licensing for
    all licensees in the band, we do not anticipate any adverse effect
    on small entities. Instead, our approach here should benefit all
    licensees, including small entities, as it reduces the burdens
    associated with filing applications for new sites.

42. Regarding our decision to provide licensees with the flexibility to
    employ the technologies of their choice in the band, we do not
    anticipate any adverse effect on small entities. To the contrary,
    this decision will allow licensees to quickly adjust to changes in
    technology and market demand without seeking Commission approval.

43. Regarding our decision to refrain from allowing high-power
    unlicensed operations in the 2500-2690 MHz band, we recognize that
    some small businesses would have liked to deploy unlicensed
    operations in the band. However, we believe this concern is
    outweighed by the fact that allowing such operations would cause
    interference to primary operations in the band, thereby creating
    uncertainty for licensees and discouraging investment in the band.
    Furthermore, we note that Part 15 of the Commission's Rules provides
    other opportunities for unlicensed operations in the electromagnetic
    spectrum. We note specifically that the Commission has initiated
    another rulemaking that specifically deals with unlicensed
    operations that may ultimately provide more opportunities for
    unlicensed use.

44. The regulatory burdens contained in the *R&O,* such as filing
    applications on appropriate forms and filing transition plans with
    the Commission, are necessary in order to ensure that the public
    receives the benefits of innovative new services, or enhanced
    existing services, in a prompt and efficient manner. Nonetheless, we
    have reduced burdens wherever possible by eliminating a number of
    unnecessary regulations concerning filing requirements.[^813]

> **Federal Rules that May Duplicate, Overlap, or Conflict with the
> Proposed Rule**

45. None.

> **Report to Congress:**

The Commission will send a copy of this *R&O*, including this FRFA, in a
report to be sent to Congress pursuant to the Congressional Review
Act.[^814] In addition, the Commission will send a copy of this *R&O*,
including this FRFA, to the Chief Counsel for Advocacy of the Small
Business Administration. A copy of this *R&O* and FRFA (or summaries
thereof) will also be published in the *Federal Register*.[^815]

# APPENDIX C {#appendix-c .unnumbered}

# FINAL RULES  {#final-rules .unnumbered}

For the reasons discussed in the preamble, the Federal Communications
Commission amends 47 CFR Parts 1, 2, 11, 15, 21, 27, 73, 74, 76, 78, 79,
and 101 as follows:

**PART 1 -- PRACTICE AND PROCEDURE**

1\. The authority citation for Part 1 continues to read:

** AUTHORITY: 47 U.S.C. 151, 154(i), 154(j), 155, 225, 303(r), 309 and
325(e).**

2\. Section 1.65 is amended by revising paragraph (b) to read as
follows:

**§ 1.65 Substantial and significant changes in information furnished by
applicants to the Commission.**

**\* \* \* \* \***

b\) Applications in broadcast services subject to competitive bidding
will be subject to the provisions of §§ 1.2105(b), 73.5002 and 73.3522
regarding the modification of their applications.

\* \* \* \* \*

3.  Section 1.815 is amended by deleting and reserving paragraph (c)(1).

4.  Section 1.933 is amended by adding paragraphs (c)(8) and (c)(9) to
    read as follows:

**§ 1.933 Public notices.**

> \* \* \* \* \*

\(c\) \* \* \*

\(8\) Broadband Radio Service; and

> \(9\) Educational Broadband Service.

\* \* \* \* \*

5.  Section 1.1102 is amended by revising paragraph (20) to read as
    follows:

**§ 1.1102 Schedule of charges for applications and other filings in the
wireless telecommunication services.**

\* \* \* \* \*

20. Broadband Radio Service

**\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_**

**Action FCC Form Fee Payment Address**

**No. amount type code**

a. New Station  601 & 159 220.00 CJM Federal Communications

> Commission,

Wireless Bureau Applications,

P.O. Box 358155, 

Pittsburgh, PA 15251-5155. 

b. Major Modification   601 &159 220.00 CJM  Federal Communications

of License Commission,

Wireless Bureau Applications,

P.O. Box 358994, 

Pittsburgh, PA 15251-5155. 

c. Certification of 601 & 159 80.00 CJM      Federal Communications 

Commission, Wireless Bureau Applications,

Completion of  P.O. Box 358155, 

Construction  Pittsburgh, PA 15251-5155. 

d. License Renewal  601 & 159 220.00 CJM     Federal Communications

  Commission,

Wireless Bureau Applications,

P.O. Box 358155, 

Pittsburgh, PA 15251-5155. 

  -----------------------------------------------------------------------

  -----------------------------------------------------------------------

e. Assignment or        

Transfer: 

\(i\) First Station on  603 & 159 80.00  CCM Federal Communications 

Application  Commission

> Wireless Bureau Applications,

  P.O. Box 358155, 

Pittsburgh, PA 15251-5155. 

(ii) Each Additional  603 & 159  50.00  CAM  Federal Communications 

Station   Commission,

Wireless Bureau Applications,

P.O. Box 358155, 

Pittsburgh, PA 15251-5155. 

f. Extension of  601 & 159  185.00  CHM    Federal Communications 

  Construction  Commission,

  Authorization  Wireless Bureau Applications,

P.O. Box 358155, 

Pittsburgh, PA 15251-5155. 

g. Special Temporary  Corres & 159  100.00  CEM Federal Communications 

Authority or Request  Commission,

for Waiver of Prior  Wireless Bureau Applications,

Construction  P.O. Box 358155, 

Authorization        Pittsburgh, PA 15251-5155. 

6.  Section 1.1152 is amended by revising numbered item (8) to read as
    follows:

**§ 1.1152 Schedule of annual regulatory fees and filing locations for
wireless radio services.**

**\* \* \* \* \***

8\. Broadband Radio Service (BRS)\...\...\...\...\... \$265 FCC, BRS,
P.O. Box 358835, Pittsburgh, PA,

15251-5835.

\* \* \* \* \*

7.  Section 1.1307 is amended by revising Table 1 as follows:

**§ 1.1307 Actions that may have a significant environmental effect, for
which Environmental Assessments (EAs) must be prepared.**

\* \* \* \* \*

Table 1.\--Transmitters, Facilities and Operations Subject to Routine

Environmental Evaluation

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Service (title 47 CFR rule part) Evaluation required if

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Broadband Radio Service and Educational Broadband Service

(subpart M of part 27) \...\...\.... Non-building-mounted antennas:
height above

ground level to lowest point of antenna \<

10 m and power \> 1640 W EIRP.

Building-mounted antennas: power \> 1640 W

EIRP.

BRS and EBS licensees are required to attach a

label to subscriber transceiver or

transverter antennas that:

\(1\) provides adequate notice regarding

potential radiofrequency safety hazards,

e.g., information regarding the safe

minimum separation distance required

between users and transceiver antennas;

and

\(2\) references the applicable FCC-adopted

limits for radiofrequency exposure

specified in § 1.1310.

Wireless Communications Service

(Part 27) \...\...\...\...\...\...\..... (1) For the 1390-1392 MHz,
1392-1395 MHz,

1432-1435 MHz 1670-1675 MHz and 2385-2390

MHz bands:

Non-building-mounted antennas: height above

ground level to lowest point of antenna

\<10m and total power of all channels \>

2000 W ERP (3280 W EIRP).

Building-mounted antennas: total power of

all channels \>2000 W ERP (3280 W EIRP).

\(2\) For the 746-764 MHz, 776-794 MHz,

2305-2320 MHz, and 2345-2360 MHz bands.

Total power of all channels \>1000 W ERP

(1640 W EIRP).

\* \* \* \* \*

8.  Section 1.7001 is amended by revising paragraph (b) to read as
    follows:

**§ 1.7001 Scope and content of filed reports.**

**\* \* \* \* \***

\(b\) All commercial and government-controlled entities, including but
not limited to common carriers and their affiliates (as defined in 47
U.S.C. 153(1)), cable television companies, Broadband Radio Service
(BRS) \"wireless cable\" carriers, other fixed wireless providers,
terrestrial and satellite mobile wireless providers, utilities and
others, which are facilities-based providers and are providing at least
250 full or one-way broadband lines or wireless channels in a given
state, or provide full or one-way broadband service to at least 250
end-user consumers in a given state, shall file with the Commission a
completed FCC Form 477, in accordance with the Commission\'s rules and
the instructions to the FCC Form 477, for each state in which they
exceed this threshold.

\* \* \* \* \*

9.  Section 1.9005 is amended by redesignating paragraphs (h) through
    (bb) as paragraphs (j) through (dd) and adding new paragraphs (h)
    and (i) to read as follows:

**§ 1.9005 Included services.**

\* \* \* \* \*\
(h) The Broadband Radio Service (part 27 of this chapter);

\(i\) The Educational Broadband Service (part 27 of this chapter);

\* \* \* \* \*

10. Section 1.9020 is amended by revising paragraph (d)(2)(i) to read as
    follows:

**§ 1.9020 Spectrum manager leasing arrangements.**

**\* \* \* \* \***

\(d\) \* \* \*

(2)(i) The spectrum lessee must meet the same eligibility and
qualification requirements that are applicable to the licensee under its
license qualification, except that spectrum lessees entering into
spectrum leasing arrangements involving licensees in the Educational
Broadband Service (*see* § 27.1201) are not required to comply with the
eligibility requirements pertaining to such licensees (*see* § 27.1201)
so long as the spectrum lessees meet the other eligibility and
qualification requirements applicable to Part 27 services (*see* §
27.12).

\* \* \* \* \*

11. Section 1.9030 is amended by revising paragraph (d)(2)(i) to read as
    follows:

**§ 1.9030 Long-term de facto transfer leasing arrangements.**

\* \* \* \* \*

\(d\) \* \* \*

(2)(i) The spectrum lessee must meet the same eligibility and
qualification requirements that are applicable to the licensee under its
license qualification, except that spectrum lessees entering into
spectrum leasing arrangements involving licensees in the Educational
Broadband Service (*see* § 27.1201) are not required to comply with the
eligibility requirements pertaining to such licensees (*see* § 27.1201)
so long as the spectrum lessees meet the other eligibility and
qualification requirements applicable to Part 27 services (*see* §
27.12).

\* \* \* \* \*

12. A new Section 1.9047 is added to read as follows:

**§ 1.9047 Special provisions relating to spectrum leasing arrangements
involving Educational Broadband Service spectrum**

Licensees in the Educational Broadcasting Service may enter into
spectrum leasing arrangements with spectrum lessees only insofar as such
arrangements comply with the applicable requirements for spectrum
leasing arrangements involving spectrum in that ser vice as set forth in
Section 27.1214 of this chapter.

**PART 2 -- FREQUENCY ALLOCATIONS AND RADIO TREATY MATTERS; GENERAL
RULES AND REGULATIONS**

13. The authority citation for part 2 continues to read as follows:

**AUTHORITY: 47 U.S.C. 154, 302a, 303, and 336, unless otherwise
noted.**

14. Section 2.106, the Table of Frequency Allocations, is amended by
    revising pages 51, 52, 53, and footnote NG147 to read as follows.

**[§ 2.106 Table of Frequency Allocations.]{.underline}**

\* \* \* \* \*

+-----------+-----------+-----------+-----------+-----------+---------+
| 2345-2655 |           |           |           |           | Page 51 |
| MHz (UHF) |           |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| Inte      |           |           | United    |           | FCC     |
| rnational |           |           | States    |           | Rule    |
| Table     |           |           | Table     |           | Part(s) |
+-----------+-----------+-----------+-----------+-----------+---------+
| Region 1  | Region 2  | Region 3  | Federal   | No        |         |
|           |           |           | G         | n-Federal |         |
|           |           |           | overnment | G         |         |
|           |           |           |           | overnment |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| See       |           |           | 2345-2360 | 2345-2360 | W       |
| previous  |           |           |           |           | ireless |
| page for  |           |           | Fixed     | FIXED     |         |
| 2300-2450 |           |           |           |           | Communi |
| MHz       |           |           | Mobile    | MOBILE    | cations |
|           |           |           | US339     | US339     | (27)    |
|           |           |           |           |           |         |
|           |           |           | Radi      | RADI      | A       |
|           |           |           | olocation | OLOCATION | viation |
|           |           |           | G2 G120   |           | (87)    |
|           |           |           |           | BROA      |         |
|           |           |           | US327     | DCASTING- |         |
|           |           |           |           |           |         |
|           |           |           |           | SATELLITE |         |
|           |           |           |           | 5.396     |         |
|           |           |           |           | US327     |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           | 2360-2385 | 2360-2385 | A       |
|           |           |           |           |           | viation |
|           |           |           | MOBILE    | MOBILE    | (87)    |
|           |           |           | US276     | US276     |         |
|           |           |           |           |           |         |
|           |           |           | RADI      |           |         |
|           |           |           | OLOCATION |           |         |
|           |           |           | G2 G120   |           |         |
|           |           |           |           |           |         |
|           |           |           | Fixed     |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           | 2385-2390 | 2385-2390 | W       |
|           |           |           |           |           | ireless |
|           |           |           | US363     | FIXED     |         |
|           |           |           |           |           | Communi |
|           |           |           |           | MOBILE    | cations |
|           |           |           |           | NG174     | (27)    |
|           |           |           |           |           |         |
|           |           |           |           | US363     |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           | 2390-2400 | 2390-2400 | Amateur |
|           |           |           |           |           | (97)    |
|           |           |           | G122      | AMATEUR   |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           | 2400-2402 | 2400-2417 | ISM     |
|           |           |           |           |           | Eq      |
|           |           |           | 5.150     | AMATEUR   | uipment |
|           |           |           | G123      |           | (18)    |
|           |           |           |           |           |         |
|           |           |           |           |           | Amateur |
|           |           |           |           |           | (97)    |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           | 2402-2417 | 5.150     |         |
|           |           |           |           | 5.282     |         |
|           |           |           | 5.150     |           |         |
|           |           |           | G122      |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           | 2417-2450 | 2417-2450 |         |
|           |           |           |           |           |         |
|           |           |           | Radi      | Amateur   |         |
|           |           |           | olocation |           |         |
|           |           |           | G2        | 5.150     |         |
|           |           |           |           | 5.282     |         |
|           |           |           | 5.150     |           |         |
|           |           |           | G124      |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 24        | 24        |           | 24        | 24        | ISM     |
| 50-2483.5 | 50-2483.5 |           | 50-2483.5 | 50-2483.5 | Eq      |
|           |           |           |           |           | uipment |
| FIXED     | FIXED     |           | 5.150     | FIXED     | (18)    |
|           |           |           | US41      |           |         |
| MOBILE    | MOBILE    |           |           | MOBILE    | Au      |
|           |           |           |           |           | xiliary |
| Radi      | RADI      |           |           | Radi      | Broad   |
| olocation | OLOCATION |           |           | olocation | casting |
|           |           |           |           |           |         |
| 5.150     | 5.150     |           |           | 5.150     | \(74\)  |
| 5.397     | 5.394     |           |           | US41      |         |
|           |           |           |           |           | Private |
|           |           |           |           |           | Land    |
|           |           |           |           |           | Mobile  |
|           |           |           |           |           | (90)    |
|           |           |           |           |           |         |
|           |           |           |           |           | Fixed   |
|           |           |           |           |           | Mi      |
|           |           |           |           |           | crowave |
|           |           |           |           |           | (101)   |
+-----------+-----------+-----------+-----------+-----------+---------+

+-----------+-----------+-----------+-----------+-----------+---------+
| 24        | 24        | 24        | 24        | 24        | ISM     |
| 83.5-2500 | 83.5-2500 | 83.5-2500 | 83.5-2500 | 83.5-2495 | Eq      |
|           |           |           |           |           | uipment |
| FIXED     | FIXED     | FIXED     | MOBILE-   | MOBILE-   | (18)    |
|           |           |           | SATELLITE | SATELLITE |         |
| MOBILE    | MOBILE    | MOBILE    |           |           | Sa      |
|           |           |           | (space-   | (space-   | tellite |
| MOBILE-   | MOBILE-   | MOBILE-   | to-Earth) | to-Earth) |         |
| SATELLITE | SATELLITE | SATELLITE | US319     | US319     | Communi |
|           |           |           |           |           | cations |
| (space-   | (space-   | (space-   | US380     | US380     | (25)    |
| to-Earth) | to-Earth) | to-Earth) | US391     |           |         |
| 5.351A    | 5.351A    | 5.351A    |           | R         |         |
|           |           |           | R         | ADIODETER |         |
| Radi      | RADI      | RADI      | ADIODETER | MINATION- |         |
| olocation | OLOCATION | OLOCATION | MINATION- |           |         |
|           |           |           |           | SATELLITE |         |
|           | R         | R         | SATELLITE | (         |         |
|           | ADIODETER | adiodeter | (         | space-to- |         |
|           | MINATION- | mination- | space-to- |           |         |
|           |           | satellite |           | Earth)    |         |
|           | SATELLITE |           | Earth)    | 5.398     |         |
|           | (         | (space-   | 5.398     |           |         |
|           | space-to- | to-Earth) |           | 5.150     |         |
|           |           | 5.398     |           | 5.402     |         |
|           | Earth)    |           |           | US41      |         |
|           | 5.398     |           |           | NG147     |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 5.150     |           | 5.150     | 5.150     | 2495-2500 | ISM     |
| 5.371     |           | 5.400     | 5.402     |           | Eq      |
| 5.397     |           | 5.402     | US41      | FIXED     | uipment |
| 5.398     |           |           |           |           | (18)    |
| 5.399     |           |           |           | MOBILE    |         |
| 5.400     |           |           |           | except    | Sa      |
| 5.402     |           |           |           |           | tellite |
|           |           |           |           | aer       |         |
|           |           |           |           | onautical | Communi |
|           |           |           |           | mobile    | cations |
|           |           |           |           |           | (25)    |
|           |           |           |           | MOBILE-   |         |
|           |           |           |           | SATELLITE | W       |
|           |           |           |           |           | ireless |
|           |           |           |           | (space-   |         |
|           |           |           |           | to-Earth) | Communi |
|           |           |           |           | US319     | cations |
|           |           |           |           |           | (27)    |
|           |           |           |           | US380     |         |
|           |           |           |           |           |         |
|           |           |           |           | R         |         |
|           |           |           |           | ADIODETER |         |
|           |           |           |           | MINATION- |         |
|           |           |           |           |           |         |
|           |           |           |           | SATELLITE |         |
|           |           |           |           | (         |         |
|           |           |           |           | space-to- |         |
|           |           |           |           |           |         |
|           |           |           |           | Earth)    |         |
|           |           |           |           | 5.398     |         |
|           |           |           |           |           |         |
|           |           |           |           | 5.150     |         |
|           |           |           |           | 5.402     |         |
|           |           |           |           | US41      |         |
|           |           |           |           | US391     |         |
|           |           |           |           | NG147     |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           | 5.150     |           |           |           |         |
|           | 5.402     |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 2500-2520 | 2500-2520 |           | 2500-2655 | 2500-2655 | W       |
|           |           |           |           |           | ireless |
| FIXED     | FIXED     |           |           | FIXED     |         |
| 5.409     | 5.409     |           |           | US205     | Communi |
| 5.410     | 5.411     |           |           |           | cations |
| 5.411     |           |           |           | MOBILE    | (27)    |
|           | FIXED-    |           |           | except    |         |
| MOBILE    | SATELLITE |           |           |           |         |
| except    | (space-   |           |           | aer       |         |
| aer       | to-Earth) |           |           | onautical |         |
| onautical | 5.415     |           |           | mobile    |         |
|           |           |           |           |           |         |
| mobile    | MOBILE    |           |           |           |         |
| 5.384A    | except    |           |           |           |         |
|           | aer       |           |           |           |         |
| MOBILE-   | onautical |           |           |           |         |
| SATELLITE | mobile    |           |           |           |         |
| (space-   | 5.384A    |           |           |           |         |
|           |           |           |           |           |         |
| to-Earth) | MOBILE-   |           |           |           |         |
| 5.403     | SATELLITE |           |           |           |         |
| 5.351A    | (space-   |           |           |           |         |
|           | to-Earth) |           |           |           |         |
| 5.405     | 5.403     |           |           |           |         |
| 5.407     | 5.351A    |           |           |           |         |
| 5.412     |           |           |           |           |         |
| 5.414     | 5.404     |           |           |           |         |
|           | 5.407     |           |           |           |         |
|           | 5.414     |           |           |           |         |
|           | 5.415A    |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 2520-2655 | 2520-2655 | 2520-2535 |           |           |         |
|           |           |           |           |           |         |
| FIXED     | FIXED     | FIXED     |           |           |         |
| 5.409     | 5.409     | 5.409     |           |           |         |
| 5.410     | 5.411     | 5.411     |           |           |         |
| 5.411     |           |           |           |           |         |
|           | FIXED-    | FIXED-    |           |           |         |
| MOBILE    | SATELLITE | SATELLITE |           |           |         |
| except    |           |           |           |           |         |
|           | (space-   | (space-   |           |           |         |
| aer       | to-Earth) | to-Earth) |           |           |         |
| onautical | 5.415     | 5.415     |           |           |         |
| mobile    |           |           |           |           |         |
| 5.384A    | MOBILE    | MOBILE    |           |           |         |
|           | except    | except    |           |           |         |
| BROA      |           |           |           |           |         |
| DCASTING- | aer       | aer       |           |           |         |
|           | onautical | onautical |           |           |         |
| SATELLITE | mobile    | mobile    |           |           |         |
| 5.413     | 5.384A    | 5.384A    |           |           |         |
| 5.416     |           |           |           |           |         |
|           | BROA      | BROA      |           |           |         |
|           | DCASTING- | DCASTING- |           |           |         |
|           |           |           |           |           |         |
|           | SATELLITE | SATELLITE |           |           |         |
|           | 5.413     | 5.413     |           |           |         |
|           | 5.416     | 5.416     |           |           |         |
|           |           |           |           |           |         |
|           |           | 5.403     |           |           |         |
|           |           | 5.415A    |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 5.339     | 5.339     | 2535-2655 | 5.339     | 5.339     |         |
| 5.403     | 5.403     |           | US205     |           |         |
| 5.405     | 5.418B    | FIXED     |           |           |         |
| 5.412     | 5.418C    | 5.409     |           |           |         |
| 5.418     |           | 5.411     |           |           |         |
| 5.418B    |           |           |           |           |         |
| 5.418C    |           | MOBILE    |           |           |         |
|           |           | except    |           |           |         |
|           |           |           |           |           |         |
|           |           | aer       |           |           |         |
|           |           | onautical |           |           |         |
|           |           | mobile    |           |           |         |
|           |           | 5.384A    |           |           |         |
|           |           |           |           |           |         |
|           |           | BROA      |           |           |         |
|           |           | DCASTING- |           |           |         |
|           |           |           |           |           |         |
|           |           | SATELLITE |           |           |         |
|           |           | 5.413     |           |           |         |
|           |           | 5.416     |           |           |         |
|           |           |           |           |           |         |
|           |           | 5.339     |           |           |         |
|           |           | 5.418     |           |           |         |
|           |           | 5.418A    |           |           |         |
|           |           | 5.418B    |           |           |         |
|           |           | 5.418C    |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
|           |           |           |           |           | Page 52 |
+-----------+-----------+-----------+-----------+-----------+---------+

+-----------+-----------+-----------+-----------+-----------+---------+
| 2655-3700 |           |           |           |           | Page 53 |
| MHz       |           |           |           |           |         |
| (UHF/SHF) |           |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| Inte      |           |           | United    |           | FCC     |
| rnational |           |           | States    |           | Rule    |
| Table     |           |           | Table     |           | Part(s) |
+-----------+-----------+-----------+-----------+-----------+---------+
| Region 1  | Region 2  | Region 3  | Federal   | No        |         |
|           |           |           | G         | n-Federal |         |
|           |           |           | overnment | G         |         |
|           |           |           |           | overnment |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 2655-2670 | 2655-2670 | 2655-2670 | 2655-2690 | 2655-2690 | W       |
|           |           |           |           |           | ireless |
| FIXED     | FIXED     | FIXED     | Earth     | FIXED     |         |
| 5.409     | 5.409     | 5.409     | exp       | US205     | Communi |
| 5.410     | 5.411     | 5.411     | loration- |           | cations |
| 5.411     |           |           | satellite | MOBILE    | (27)    |
|           | FIXED-    | FIXED-    |           | except    |         |
| MOBILE    | SATELLITE | SATELLITE | (passive) |           |         |
| except    |           |           |           | aer       |         |
|           | (Earth-   | (Earth-   | Radio     | onautical |         |
| aer       | to-space) | to-space) | astronomy | mobile    |         |
| onautical |           | 5.415     | US269     |           |         |
| mobile    | (space-   |           |           | Earth     |         |
| 5.384A    | to-Earth) | MOBILE    | Space     | exp       |         |
|           | 5.415     | except    | research  | loration- |         |
| BRO       |           |           | (passive) | satellite |         |
| ADCASTING | MOBILE    | aer       |           |           |         |
|           | except    | onautical |           | (passive) |         |
| SATELLITE |           | mobile    |           |           |         |
| 5.413     | aer       | 5.384A    |           | Radio     |         |
| 5.416     | onautical |           |           | astronomy |         |
|           | mobile    | BROA      |           |           |         |
| Earth     | 5.384A    | DCASTING- |           | Space     |         |
| exp       |           |           |           | research  |         |
| loration- | BROA      | SATELLITE |           | (passive) |         |
| satellite | DCASTING- | 5.413     |           |           |         |
|           |           | 5.416     |           |           |         |
| (passive) | SATELLITE |           |           |           |         |
|           | 5.413     | Earth     |           |           |         |
| Radio     | 5.416     | exp       |           |           |         |
| astronomy |           | loration- |           |           |         |
|           | Earth     | satellite |           |           |         |
| Space     | exp       |           |           |           |         |
| research  | loration- | (passive) |           |           |         |
| (passive) | satellite |           |           |           |         |
|           |           | Radio     |           |           |         |
| 5.149     | (passive) | astronomy |           |           |         |
| 5.412     |           |           |           |           |         |
| 5.420     | Radio     | Space     |           |           |         |
|           | astronomy | research  |           |           |         |
|           |           | (passive) |           |           |         |
|           | Space     |           |           |           |         |
|           | research  | 5.149     |           |           |         |
|           | (passive) | 5.420     |           |           |         |
|           |           |           |           |           |         |
|           | 5.149     |           |           |           |         |
|           | 5.420     |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 2670-2690 | 2670-2690 | 2670-2690 | US205     | US269     |         |
|           |           |           |           |           |         |
| FIXED     | FIXED     | FIXED     |           |           |         |
| 5.409     | 5.409     | 5.409     |           |           |         |
| 5.410     | 5.411     | 5.411     |           |           |         |
| 5.411     |           |           |           |           |         |
|           | FIXED-    | FIXED-    |           |           |         |
| MOBILE    | SATELLITE | SATELLITE |           |           |         |
| except    |           |           |           |           |         |
|           | (Earth-   | (Earth-   |           |           |         |
| aer       | to-space) | to-space) |           |           |         |
| onautical |           | 5.415     |           |           |         |
| mobile    | (space-   |           |           |           |         |
| 5.384A    | to-Earth) | MOBILE    |           |           |         |
|           | 5.415     | except    |           |           |         |
| MOBILE-   |           |           |           |           |         |
| SATELLITE | MOBILE    | aer       |           |           |         |
|           | except    | onautical |           |           |         |
| (Earth-   |           | mobile    |           |           |         |
| to-space) | aer       | 5.384A    |           |           |         |
|           | onautical |           |           |           |         |
| Earth     | mobile    | MOBILE-   |           |           |         |
| exp       | 5.384A    | SATELLITE |           |           |         |
| loration- |           |           |           |           |         |
| satellite | MOBILE-   | (Earth-   |           |           |         |
|           | SATELLITE | to-space) |           |           |         |
| (passive) |           |           |           |           |         |
|           | (Earth-   | Earth     |           |           |         |
| Radio     | to-space) | exp       |           |           |         |
| astronomy |           | loration- |           |           |         |
|           | Earth     | satellite |           |           |         |
| Space     | exp       |           |           |           |         |
| research  | loration- | (passive) |           |           |         |
| (passive) | satellite |           |           |           |         |
|           |           | Radio     |           |           |         |
| 5.149     | (passive) | astronomy |           |           |         |
| 5.419     |           |           |           |           |         |
| 5.420     | Radio     | Space     |           |           |         |
|           | astronomy | research  |           |           |         |
|           |           | (passive) |           |           |         |
|           | Space     |           |           |           |         |
|           | research  | 5.149     |           |           |         |
|           | (passive) | 5.419     |           |           |         |
|           |           | 5.420     |           |           |         |
|           | 5.149     | 5.420A    |           |           |         |
|           | 5.419     |           |           |           |         |
|           | 5.420     |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 2690-2700 |           |           | 2690-2700 |           |         |
|           |           |           |           |           |         |
| EARTH     |           |           | EARTH     |           |         |
| EXP       |           |           | EXP       |           |         |
| LORATION- |           |           | LORATION- |           |         |
| SATELLITE |           |           | SATELLITE |           |         |
| (passive) |           |           | (passive) |           |         |
|           |           |           |           |           |         |
| RADIO     |           |           | RADIO     |           |         |
| ASTRONOMY |           |           | ASTRONOMY |           |         |
|           |           |           | US74      |           |         |
| SPACE     |           |           |           |           |         |
| RESEARCH  |           |           | SPACE     |           |         |
| (passive) |           |           | RESEARCH  |           |         |
|           |           |           | (passive) |           |         |
| 5.340     |           |           |           |           |         |
| 5.421     |           |           | US246     |           |         |
| 5.422     |           |           |           |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+
| 2700-2900 |           |           | 2700-2900 | 2700-2900 |         |
|           |           |           |           |           |         |
| AER       |           |           | AER       | 5.423     |         |
| ONAUTICAL |           |           | ONAUTICAL | US18      |         |
| RADION    |           |           | RADIO-    |           |         |
| AVIGATION |           |           |           |           |         |
| 5.337     |           |           | N         |           |         |
|           |           |           | AVIGATION |           |         |
| Radi      |           |           | 5.337     |           |         |
| olocation |           |           |           |           |         |
|           |           |           | METEO     |           |         |
| 5.423     |           |           | ROLOGICAL |           |         |
| 5.424     |           |           | AIDS      |           |         |
|           |           |           |           |           |         |
|           |           |           | Radi      |           |         |
|           |           |           | olocation |           |         |
|           |           |           | G2        |           |         |
|           |           |           |           |           |         |
|           |           |           | 5.423     |           |         |
|           |           |           | US18 G15  |           |         |
+-----------+-----------+-----------+-----------+-----------+---------+

\* \* \* \* \*

NG147 Stations in the broadcast auxiliary service and private radio
services licensed as of July 25, 1985, or on a subsequent date following
as a result of submitting an application for license on or before July
25, 1985, may continue to operate on a primary basis with the
mobile-satellite service and the radiodetermination satellite service.

\* \* \* \* \*

**PART 11\--EMERGENCY ALERT SYSTEM (EAS)**

15. The authority citation for Part 11 continues to read as follows:

**AUTHORITY: 47 U.S.C. 151, 154(i) and (o), 303(r), 544(g), and 606,
unless otherwise noted.**

16. Section 11.11 is amended by revising paragraphs (a) and (c) to read
    as follows:

**§ 11.11 The Emergency Alert System (EAS).**

a\) The EAS is composed of broadcast networks; cable networks and
program suppliers; AM, FM Low-power FM (LPFM) and TV broadcast stations;
Class A television (CA) stations; Low-power TV (LPTV) stations; cable
systems; wireless cable systems which may consist of Broadband Radio
Service (BRS), or Educational Broadband Service (EBS) stations; and
other entities and industries operating on an organized basis during
emergencies at the National, State and local levels. It requires that at
a minimum all participants use a common EAS protocol, as defined in §
11.31, to send and receive emergency alerts in accordance with the
effective dates in the following tables:

Wireless Cable Systems (BRS/EBS Stations)

\[A. Wireless cable systems serving fewer than 5,000 subscribers from a
single transmission site must either provide the National level EAS
message on all programmed channels\--including the required testing\--by
October 1, 2002, or comply with the following EAS requirements. All
other wireless cable systems must comply with B.\]

Wireless Cable Systems (BRS/EBS Stations)

\* \* \* \* \*

\(c\) For purposes of the EAS, Broadband Radio Service (BRS) and
Educational Broadband Service (EBS) stations operated as part of
wireless cable systems in accordance with subpart M of part 27 of this
chapter are defined as follows:

\(1\) A \"wireless cable system\" is a collection of channels in the BRS
or EBS used to provide video programming services to subscribers. The
channels may be licensed to or leased by the wireless cable system
operator.

\* \* \* \* \*

17. Section 11.31 is amended by revising subparagraph (LLLLLLLL) of
    paragraph (c) to read as follows:

**§ 11.31 EAS protocol.**

\* \* \* \* \*

\(c\) \* \* \*

LLLLLLLL\--This is the identification of the broadcast station, cable
system, BRS/EBS station, NWS office, etc., transmitting or
retransmitting the message. These codes will be automatically affixed to
all outgoing messages by the EAS encoder.

\* \* \* \* \*

18. Section 11.35 is amended by revising paragraph (a) to read as
    follows:

**§ 11.35 Equipment operational readiness.**

\(a\) Broadcast stations and cable systems and wireless cable systems
are responsible for ensuring that EAS Encoders, EAS Decoders and
Attention Signal generating and receiving equipment used as part of the
EAS are installed so that the monitoring and transmitting functions are
available during the times the stations and systems are in operation.
Additionally, broadcast stations and cable systems and wireless cable
systems must determine the cause of any failure to receive the required
tests or activations specified in §§ 11.61(a)(1) and (2). Appropriate
entries must be made in the broadcast station log as specified in §
73.1820 and § 73.1840 of this chapter, cable system record as specified
in §§ 76.1700, 76.1708, and 76.1711 of this chapter, BRS station
records, indicating reasons why any tests were not received.

\* \* \* \* \*

**PART 15 -- RADIO FREQUENCY DEVICES**

19. The authority citation for Part 15 continues to read as follows:

**AUTHORITY: 47 U.S.C. 154, 302(a), 303, 304, 336, and 544(a), unless
otherwise noted.**

20. Section 15.205(a) is amended by deleting "2655-2900 MHz" and
    replacing that listing with "2690-2900 MHz."

> \* \* \* \* \*

**PART 21 -- DOMESTIC PUBLIC FIXED RADIO SERVICES**

21. Under the authority 47 U.S.C. § 154, amend 47 C.F.R. Chapter I by
    removing Part 21.

**PART 27 -- MISCELLANEOUS WIRELESS COMMUNICATIONS SERVICES**

22. The authority citation for Part 27 continues to read as follows:

**AUTHORITY: 47 U.S.C. 154 and 303, unless otherwise noted.**

23. Section 27.1 is amended by adding the following subparagraph to
    paragraph (b):

**§ 27.1 Basis and purpose.**

**\* \* \* \* \***

\(9\) 2495-2690 MHz.

\* \* \* \* \*

24. Section 27.3 is amended by deleting paragraph (h) and by
    redesignating paragraphs (i) through (q) as (h) through (p),
    respectively.

25. Section 27.4 is amended by adding the following definitions to read
    as follows:

26. 

**§ 27.4 Terms and definitions.**

> \* \* \* \* \*

*Attended operation*. Operation of a station by a designated person on
duty at the place where the transmitting apparatus is located with the
transmitter in the person\'s plain view.

> \* \* \* \* \*

*Booster service area*. A geographic area to be designated by an
applicant for a booster station, within which the booster station shall
be entitled to protection against interference as set forth in this
part. The booster service area must be specified by the applicant so as
not to overlap the booster service area of any other booster authorized
to or proposed by the applicant. However, a booster station may provide
service to receive sites outside of its booster service area, at the
licensee\'s risk of interference. The booster station must be capable of
providing substantial service within the designated booster service
area.

*Broadband Radio Service (BRS).* A radio service using certain
frequencies in the 2150-2162 and 2496-2690 MHz bands which can be used
to provide fixed and mobile services, except for aeronautical services.

> \* \* \* \* \*

*Documented complaint*. A complaint that a party is suffering from
non-consensual interference. A documented complaint must contain a
certification that the complainant has contacted the operator of the
allegedly offending facility and tried to resolve the situation prior to
filing. The complaint must then specify the nature of the interference,
whether the interference is constant or intermittent, when the
interference began and the site(s) most likely to be causing the
interference. The complaint should be accompanied by a videotape or
other evidence showing the effects of the interference. The complaint
must contain a motion for a temporary order to have the interfering
station cease transmitting. The complaint must be filed with the
Secretary\'s office and served on the allegedly offending party.

*Educational Broadband Service (EBS).* A fixed or mobile service, the
licensees of which are educational institutions or non-profit
educational organizations, and intended primarily for video, data, or
voice transmissions of instructional, cultural, and other types of
educational material to one or more receiving locations.

> \* \* \* \* \*

*Lower Band Segment (LBS).* Segment of the BRS/EBS band consisting of
channels in the frequencies 2496-2572 MHz.

*Middle Band Segment (MBS).* Segment of the BRS/EBS band consisting of
channels in the frequencies 2572-2614 MHz.

> \* \* \* \* \*

*Point-to-point Broadband station.* A Broadband station that transmits a
highly directional signal from a fixed transmitter location to a fixed
receive location.

> \* \* \* \* \*

*Remote control.* Operation of a station by a designated person at a
control position from which the transmitter is not visible but where
suitable control and telemetering circuits are provided which allow the
performance of the essential functions that could be performed at the
transmitter.

> \* \* \* \* \*

*Sectorization.* The use of an antenna system at an broadband station,
booster station and/or response station hub that is capable of
simultaneously transmitting multiple signals over the same frequencies
to different portions of the service area and/or simultaneously
receiving multiple signals over the same frequencies from different
portions of the service area.

> \* \* \* \* \*

*Studio to transmitter link (STL).* A directional path used to transmit
a signal from a station\'s studio to its transmitter.

*Temporary fixed broadband station.* A broadband station used for the
transmission of material from temporary unspecified points to a
broadband station.

> \* \* \* \* \*

*Unattended operation.* Operation of a station by automatic means
whereby the transmitter is turned on and off and performs its functions
without attention by a designated person.

> \* \* \* \* \*

*Upper Band Segment (UBS).* Segment of the BRS/EBS band consisting of
channels in the frequencies 2614-2690 MHz.

\* \* \* \* \*

27. Section 27.5 is amended by adding a new paragraph (i) to read as
    follows:

**§ 27.5 Frequencies.**

\* \* \* \* \*

\(i\) Frequency assignments for the BRS/EBS band.

\(1\) Pre-transition frequency assignments.

BRS Channel 1: 2150-2156 MHz

BRS Channel 2: 2156-2162 MHz

BRS Channel 2A: 2156-2160 MHz

EBS Channel A1: 2500-2506 MHz

EBS Channel B1: 2506-2512 MHz

EBS Channel A2: 2512-2518 MHz

EBS Channel B2: 2518-2524 MHz

EBS Channel A3: 2524-2530 MHz

EBS Channel B3: 2530-2536 MHz

EBS Channel A4: 2536-2542 MHz

EBS Channel B4: 2542-2548 MHz

EBS Channel C1: 2548-2554 MHz

EBS Channel D1: 2554-2560 MHz

EBS Channel C2: 2560-2566 MHz

EBS Channel D2: 2566-2572 MHz

EBS Channel C3: 2572-2578 MHz

EBS Channel D3: 2578-2584 MHz

EBS Channel C4: 2584-2590 MHz

EBS Channel D4: 2590-2596 MHz

BRS Channel E1: 2596-2602 MHz

BRS Channel F1: 2602-2608 MHz

BRS Channel E2: 2608-2614 MHz

BRS Channel F2: 2614-2620 MHz

BRS Channel E3: 2620-2626 MHz

BRS Channel F3: 2626-2632 MHz

BRS Channel E4: 2632-2638 MHz

BRS Channel F4: 2638-2644 MHz

EBS Channel G1: 2644-2650 MHz

BRS Channel H1: 2650-2656 MHz

EBS Channel G1: 2656-2662 MHz

BRS Channel H1: 2662-2668 MHz

EBS Channel G1: 2668-2674 MHz

BRS Channel H1: 2674-2680 MHz

EBS Channel G1: 2680-2686 MHz

I Channels: 2686-2690 MHz

\(2\) *Post transition frequency assignments*. The frequencies available
in the Broadband Radio Service (BRS) and Educational Broadband Service
(EBS) are listed in this section in accordance with the frequency
allocations table of §2.106 of this chapter.

i)  Lower Band Segment (LBS): The following channels shall constitute
    the Lower Band Segment:

BRS Channel 1: 2496-2502 MHz

EBS Channel A1: 2502-2507.5 MHz

EBS Channel A2: 2507.5-2513 MHz

EBS Channel A3: 2513-2518.5 MHz

EBS Channel B1: 2518.5-2524 MHz

EBS Channel B2: 2524-2529.5 MHz

EBS Channel B3: 2529.5-2535 MHz

EBS Channel C1: 2535-2540.5 MHz

EBS Channel C2: 2540.5-2546 MHz

EBS Channel C3: 2546-2551.5 MHz

EBS Channel D1: 2551.5-2557 MHz

EBS Channel D2: 2557-2562.5 MHz

EBS Channel D3: 2562.5-2568 MHz

EBS Channel JA1: 2568.00000-2568.33333 MHz

EBS Channel JA2: 2568.33333-2568.66666 MHz

EBS Channel JA3: 2568.66666-2569.00000 MHz

EBS Channel JB1: 2569.00000-2569.33333 MHz

EBS Channel JB2: 2569.33333-2569.66666 MHz

EBS Channel JB3: 2569.66666-2570.00000 MHz

EBS Channel JC1: 2570.00000-2570.33333 MHz

EBS Channel JC2: 2570.33333-2570.66666MHz

EBS Channel JC3: 2570.66666-2571.00000 MHz

EBS Channel JD1: 2571.00000-2571.33333 MHz

EBS Channel JD2: 2571.33333-2571.66666 MHz

EBS Channel JD3: 2571.66666-2572.00000 MHz

ii) Middle Band Segment (MBS): The following channels shall constitute
    the Middle Band Segment:

EBS Channel A4: 2572-2578 MHz

EBS Channel B4: 2578-2584 MHz

EBS Channel C4: 2584-2590 MHz

EBS Channel D4: 2590-2596 MHz

EBS Channel G4: 2596-2602 MHz

BRS Channel F4: 2602-2608 MHz

BRS Channel E4: 2608-2614 MHz

iii) Upper Band Segment (UBS): The following channels shall constitute
     the Upper Band Segment:

BRS Channel KH1: 2614.00000-2614.33333 MHz

BRS Channel KH2: 2614.33333-2614.66666 MHz

BRS Channel KH3: 2614.66666-2615.00000 MHz

EBS Channel KG1: 2615.00000-2615.33333 MHz

EBS Channel KG2: 2615.33333-2616.66666 MHz

EBS Channel KG3: 2615.66666-2616.00000 MHz

BRS Channel KF1: 2616.00000-2616.33333 MHz

BRS Channel KF2: 2616.33333-2616.66666MHz

BRS Channel KF3: 2616.66666-2617.00000 MHz

BRS Channel KE1: 2617.00000-2617.33333 MHz

BRS Channel KE2: 2617.33333-2617.66666 MHz

BRS Channel KE3: 2617.66666-2618.00000 MHz

BRS Channel 2: 2618-2624 MHz

BRS Channel E1: 2624-2629.5 MHz

BRS Channel E2: 2629.5-2635 MHz

BRS Channel E3: 2635-2640.5 MHz

EBS Channel F1: 2640.5-2646 MHz

EBS Channel F2: 2646-2651.5 MHz

EBS Channel F3: 2651.5-2657 MHz

BRS Channel H1: 2657-2662.5 MHz

BRS Channel H2: 2662.5-2668 MHz

BRS Channel H3: 2668-2673.5 MHz

BRS Channel G1: 2673.5-2679 MHz

BRS Channel G2: 2679-2684.5 MHz

BRS Channel G3: 2684.5-2690 MHz

Note to paragraph (i)(2): No 125 kHz channels are provided for channels
in operation

in this service. The 125 kHz channels previously associated with these
channels have

been reallocated to Channel H3 in the upper band segment.

\(3\) Frequencies will be assigned as follows:

\(i\) An EBS licensee is limited to the assignment of no more than one 6
MHz channel in the MBS and three channels in the LBS or UBS for use in a
single area of operation. Applicants shall not apply for more channels
than they intend to construct within a reasonable time, simply for the
purpose of reserving additional channels. The number of channels
authorized to an applicant will be based on the demonstration of need
for the number of channels requested. The Commission will take into
consideration such factors as the amount of use of any currently
assigned channels and the amount of proposed use of each channel
requested, the amount of, and justification for, any repetition in the
schedules, and the overall demand and availability of broadband channels
in the community. For those applicant organizations formed for the
purpose of serving accredited institutional or governmental
organizations, evaluation of the need will only consider service to
those specified receive sites which submitted supporting documentation.

\(ii\) An applicant leasing excess capacity and proposing a schedule
which complies in all respects with the requirements of Section 1.9047
will have presumptively demonstrated need for no more than four
channels. This presumption is rebuttable by demonstrating that the
application does not propose to comport with our educational usage
requirements as defined in Section 27.1203, and to transmit the
requisite minimum educational usage of Section 1.9047 for genuinely
educational purposes.

\(4\) A temporary fixed broadband station may use any available
broadband channel on a secondary basis, except that operation of
temporary fixed broadband stations is not allowed within 56.3 km (35
miles) of Canada.

\(5\)

(i)A point-to-point EBS station on the E and F-channel frequencies, may
be involuntarily displaced by a BRS applicant or licensee, provided that
suitable alternative spectrum is available and that the BRS entity bears
the expenses of the migration. Suitability of spectrum will be
determined on a case-by-base basis; at a minimum, the alternative
spectrum must be licensable by broadband operators on a primary basis
(although it need not be specifically allocated to the broadband
service), and must provide a signal that is equivalent to the prior
signal in picture quality and reliability, unless the broadband licensee
will accept an inferior signal. Potential expansion of the BRS licensee
may be considered in determining whether alternative available spectrum
is suitable.

\(ii\) If suitable alternative spectrum is located pursuant to paragraph
(h)6(i) of this section, the initiating party must prepare and file the
appropriate application for the new spectrum, and must

simultaneously serve a copy of the application on the EBS licensee to be
moved. The initiating party will be responsible for all costs connected
with the migration, including purchasing, testing and installing new
equipment, labor costs, reconfiguration of existing equipment,
administrative costs, legal and engineering expenses necessary to
prepare and file the migration application, and other reasonable
documented costs. The initiating party must secure a bond or establish
an escrow account to cover reasonable incremental increase in ongoing
expenses that may fall upon the migrated licensee. The bond or escrow
account should also account for the possibility that the initiating
party subsequently becomes bankrupt. If it becomes necessary for the
Commission to assess the sufficiency of a bond or escrow amount, it will
take into account such factors as projected incremental increase in
electricity or maintenance expenses, or relocation expenses, as relevant
in each case.

\(iii\) The EBS licensee to be moved will have a 60-day period in which
to oppose the involuntary migration. The broadband party should state
its opposition to the migration with specificity, including engineering
and other challenges, and a comparison of the present site and the
proposed new site. If involuntary migration is granted, the new
facilities must be operational before the initiating party will be
permitted to begin its new or modified operations. The migration must
not disrupt the broadband licensee\'s provision of service, and the
broadband licensee has the right to inspect the construction or
installation work.

28. Section 27.12 is revised to read as follows:

**§ 27.12 Eligibility.**

Except as provided in §§ 27.604, 27.1201, and 27.1202, any entity other
than those precluded by section 310 of the Communications Act of 1934,
as amended, 47 U.S.C. 310, is eligible to hold a license under this
part.

29. Section 27.50 is amended by redesignating paragraph (h) as (i) and
    adding a new paragraph (h) to read as follows:

**§ 27.50 Power limits.**

\* \* \* \* \*

\(h\) The following power limits shall apply in the BRS and EBS:

\(1\) *LBS and UBS.* Base stations are limited to 2000 watts peak EIRP.
Mobile stations are limited to 2.0 watts EIRP. Response stations are
limited to 2.0 watts transmitter output power.

\(2\) *MBS.* (i) The maximum EIRP of a main or booster station in the
MBS shall not exceed 33 dBW + 10log(X/6) dBW, where X is the actual
bandwidth if other than 6 MHz, except as provided in subparagraph (ii)
of this section.

\(ii\) If a main or booster station sectorizes or otherwise uses one or
more transmitting antennas with a non-omnidirectional horizontal plane
radiation pattern, the maximum EIRP over a 6 MHz channel in dBW in a
given direction shall be determined by the following formula:

EIRP = 33 dBW + 10 log(X/6) dBW + 10 log(360/beamwidth) dBW, where X is
the channel width in MHz and 10 log(360/beamwidth) \<= 6 dB. Beamwidth
is the total horizontal plane beamwidth of the individual transmitting
antenna for the station or any sector measured at the half-power points.

\(3\) For television transmission, the peak power of the accompanying
aural signal must not exceed 10 percent of the peak visual power of the
transmitter. The Commission may order a reduction in aural signal power
to diminish the potential for harmful interference.

\(4\) For main, booster and response stations utilizing digital
emissions with non-uniform power spectral density (e.g. unfiltered
QPSK), the power measured within any 100 kHz resolution bandwidth within
the 6 MHz channel occupied by the non-uniform emission cannot exceed the

power permitted within any 100 kHz resolution bandwidth within the 6 MHz
channel if it were occupied by an emission with uniform power spectral
density, i.e., if the maximum permissible power of a station utilizing a
perfectly uniform power spectral density across a 6 MHz channel were
2000 watts EIRP, this would result in a maximum permissible power flux
density for the station of 2000/60 = 33.3 watts EIRP per 100 kHz
bandwidth. If a non-uniform emission were substituted at the station,
station power would still be limited to a maximum of 33.3 watts EIRP
within any 100 kHz segment of the 6 MHz channel, irrespective of the
fact that this would result in a total 6 MHz channel power of less than
2000 watts EIRP.

\* \* \* \* \*

30. Section 27.53 is amended by redesignating paragraph (l) as
    paragraph (m) by adding a new paragraph (l) to read as follows:

**§ 27.53 Emission limits.**

\* \* \* \* \*

\(l\) For BRS and EBS stations, the power of any emissions outside the
licensee's frequency bands of operation shall be attenuated below the
transmitter power (P) measured in watts.

\(1\) For analog operations in the MBS with an EIRP in excess of -9 dBW,
the signal shall be attenuated at the channel edges by at least 38 dB
relative to the peak visual carrier, then linearly sloping from that
level to at least 60 dB of attenuation at 1 MHz below the lower band
edge and 0.5 MHz above the upper band edge, and attenuated at least 60
dB at all other frequencies.

\(2\) For fixed and temporary fixed digital stations, the attenuation
shall be not less than 43 + 10 log (P) dB, unless a documented
interference complaint is received from an adjacent channel licensee.
Provided that the complaint cannot be mutually resolved between the
parties, both licensees of existing and new systems shall reduce their
out-of-band emissions by at least 67 + 10 log (P) dB measured at 3 MHz
from their channel's edges for distances between stations exceeding 1.5
km. For stations separated by less than 1.5 km, the new licensee shall
reduce attenuation at least 67 + 10 log (P) -- 20 log(D~km~/1.5), or
when colocated, limit the undesired signal level at the affected
licensee's base station receiver(s) at the colocation site to no more
than -107 dBm. Mobile Service Satellite licensees operating on
frequencies below 2495 MHz may also submit a documented interference
complaint against BRS licensees operating on channel BRS1 on the same
terms and conditions as adjacent channel BRS or EBS licensees.

\(3\) For mobile digital stations, the attenuation factor shall be not
less than 43 + 10 log (P) dB at the channel edge and 55 + 10 log (P) dB
at 5.5 MHz from the channel edges. Mobile Service Satellite licensees
operating on frequencies below 2495 MHz may also submit a documented
interference complaint against BRS licensees operating on channel BRS1
on the same terms and conditions as adjacent channel BRS or EBS
licensees.

\(4\) Measurement procedure. Compliance with these rules is based on the
use of measurement instrumentation employing a resolution bandwidth of 1
MHz or greater. However, in the 1 MHz bands immediately outside and
adjacent to the frequency block a resolution bandwidth of at least one
percent of the emission bandwidth of the fundamental emission of the
transmitter may be employed. A narrower resolution bandwidth is
permitted in all cases to improve measurement accuracy provided the
measured power is integrated over the full required measurement
bandwidth (i.e. 1 MHz or 1 percent of emission bandwidth, as specified).
The emission bandwidth is defined as the width of the signal between two
points, one below the carrier center frequency and one above the carrier
center frequency, outside of which all emissions are attenuated at least
26 dB below the transmitter power. With respect to television
operations, measurements must be made of the separate visual and aural
operating powers at sufficiently frequent intervals to ensure compliance
with the rules.

\(5\) Alternative out of band emission limit. Licensees in this service
may establish an alternative out of band emission limit to be used at
specified band edge(s) in specified geographical areas, in lieu of that
set forth in this section, pursuant to a private contractual arrangement
of all affected licensees and applicants. In this event, each party to
such contract shall maintain a copy of the contract in their station
files and disclose it to prospective assignees or transferees and, upon
request, to the FCC.

\* \* \* \* \*

31. Section 27.55 is amended by revising paragraph (a) to include a new
    subparagraph (4) to read as follows:

**Sec. 27.55 Signal Strength Limits.**

(a)\* \* \*

\(4\) BRS and UBS: The predicted or measured median field strength at
any location on the geographical border of a licensee\'s service area
shall not exceed the value specified unless the adjacent affected
service area licensee(s) agree(s) to a different field strength. This
value applies to both the initially offered services areas and to
partitioned services areas. Licensees may exceed this signal level where
there is no affected licensee that is constructed and providing service.
Once the affected licensee is providing service, the original licensee
will be required to take whatever steps necessary to comply with the
applicable power level at its GSA boundary, absent consent from the
affected licensee.

\(i\) LBS and UBS band: 47 dB \[mμ\] V/m. This field strength is to be
measured at 1.5 meters above the ground over the channel bandwidth
(i.e., each 5.5 MHz channel for licensees that hold a full channel
block, and for the 5.5 MHz channel for licensees that hold individual
channels).

\(ii\) MBS band: -73.0 dBW/m².

\* \* \* \* \*

32. Section 27.58 is amended by revising the title of the rule and by
    revising paragraphs (a), (d) and (e) to read as follows:

**§ 27.58 Interference to BRS/EBS Receivers.**

\(a\) WCS licensees shall bear full financial obligation to remedy
interference to BRS/EBS block downconverters if all of the following
conditions are met:

\(1\) The complaint is received by the WCS licensee prior to February
20, 2002;

\(2\) The BRS/EBS downconverter was installed prior to August 20, 1998;

\(3\) The WCS fixed or land station transmits at 50 or more watts peak
EIRP;

\(4\) The BRS/EBS downconverter is located within a WCS transmitter\'s
free space power flux density contour of -34 dBW/m super2; and

\(5\) The BRS/EBS customer or licensee has informed the WCS licensee of
the interference within one year from the initial operation of the WCS
transmitter or within one year from any subsequent power increases at
the WCS station.

\* \* \* \* \*

\(d\) If the WCS licensee cannot otherwise eliminate interference caused
to BRS/EBS reception, then that licensee must cease operations from the
offending WCS facility.

\(e\) At least 30 days prior to commencing operations from any new WCS
transmission site or with increased power from any existing WCS
transmission site, a WCS licensee shall notify all BRS/EBS licensees in
or through whose licensed service areas they intend to operate of the
technical parameters of the WCS transmission facility. WCS and BRS/EBS
licensees are expected to coordinate voluntarily and in good faith to
avoid interference problems and to allow the greatest operational
flexibility in each other\'s operations.

\* \* \* \* \*

33. Part 27 is amended to add a new Subpart M to read as follows:

**Subpart M---Broadband Radio Service and Educational Broadband
Service**

**27.1200 Change to BRS and EBS.**

**27.1201 EBS Eligibility.**

**27.1202 Cable/BRS Cross-ownership.**

**27.1203 EBS Programming Requirements.**

**27.1206 Geographic Service Area.**

**27.1207 BTA License Authorization.**

**27.1208 Service Areas.**

**27.1209 Conversion of Incumbent EBS and BRS Stations to Geographic
Area Licensing.**

**27.1210 Remote Control Operation.**

**27.1211 Unattended Operation.**

**27.1212 License Term.**

**27.1213 Designated entity provisions for BRS in Commission auctions
commencing prior to January 1, 2004.**

**27.1214 EBS spectrum leasing arrangements and grandfathered leases.**

**Technical Standards**

**27.1220 Transmission standards.**

**27.1221** **Interference Protection.**

**27.1222 Operations in the 2568-2572 and 2614-2618 bands.**

**Policies Governing the Transition of the 2500-2690 MHz Band for BRS
and EBS.**

**27.1230 Conversion of the 2500-2690 MHz band.**

**27.1231 Initiating the transition.**

**27.1232 Planning the Transition.**

**27.1233 Reimbursement costs of transitioning.**

**27.1234 Terminating existing operations in transitioned markets.**

**27.1235 Post-transition notification.**

**§ 27.1200 Change to BRS and EBS.**

\(a\) As of **\[Insert the effective date of the rules\],** licensees
assigned to the Multipoint Distribution Service (MDS) and the
Multichannel Multipoint Distribution Service (MMDS) shall be reassigned
to the Broadband Radio Service (BRS) and licensees in the Instructional
Television Fixed Service (ITFS) shall be reassigned to the Educational
Broadband Service (EBS).

**§ 27.1201 EBS Eligibility.**

\(a\) With certain limited exceptions set forth in (c) below, a license
for an Educational Broadband Service station will be issued only to an
accredited institution or to a governmental organization engaged in the
formal education of enrolled students or to a nonprofit organization
whose purposes are educational and include providing educational and
instructional television material to such accredited institutions and
governmental organizations, and which is otherwise qualified under the
statutory provisions of the Communications Act of 1934, as amended.\
(1) A publicly supported educational institution must be accredited by
the appropriate state department of education.\
(2) A privately controlled educational institution must be accredited by
the appropriate state department of education or the recognized regional
and national accrediting organizations.\
(3) Those applicant organizations whose eligibility is established by
service to accredited institutional or governmental organizations must
submit documentation from proposed receive sites demonstrating that they
will receive and use the applicant\'s educational usage. In place of
this documentation, a state educational television (ETV) commission may
demonstrate that the public schools it proposes to serve are required to
use its proposed educational usage. Documentation from proposed receive
sites which are to establish the eligibility of an entity not serving
its own enrolled students for credit should be in letter form, written
and signed by an administrator or authority who is responsible for the
receive site\'s curriculum planning. No receive site more than 35 miles
from the transmitter site shall be used to establish basic eligibility.
The administrator must indicate that the applicant\'s program offerings
have been viewed and that such programming will be incorporated in the
site\'s curriculum. The letter should discuss the types of programming
and hours per week of formal and informal programming expected to be
used and the site\'s involvement in the planning, scheduling and
production of programming. If other levels of authority must be obtained
before a firm commitment to utilize the service can be made, the nature
and extent of such additional authorization(s) must be provided.\
(4) Nonlocal applicants, in addition to submitting letters from proposed
receive sites, must demonstrate the establishment of a local program
committee in each community where they apply. Letters submitted on
behalf of a nonlocal entity must confirm that a member of the receive
site\'s staff will serve on the local program committee and demonstrate
a recognition of the composition and power of the committee. The letter
should show that the staff member will aid in the selection, scheduling
and production of the programming received over the system.

\(b\) No numerical limit is placed on the number of stations which may
be licensed to a single licensee. A single license may be issued for
more than one transmitter if they are to be located at a common site and
operated by the same licensee. Applicants are expected to accomplish the
proposed operation by the use of the smallest number of channels
required to provide the needed service.

\(c\) (1) Notwithstanding paragraph (a), a wireless cable entity may be
licensed on EBS frequencies in areas where at least eight other EBS
channels remain available in the community for future EBS use. Channels
will be considered available for future EBS use if there are no co-
channel operators or applicants within 80.5 km (50 miles) of the
transmitter site of the proposed wireless cable operation, and if the
transmitter site remains available for use at reasonable terms by new
EBS applicants on those channels within three years of commencing
operation.\
(2) No more than eight EBS channels per community may be licensed to
wireless cable entities.\
(3) To be licensed on EBS channels, a wireless cable applicant must hold
a license or a lease, or must have filed an unopposed application for at
least four BRS channels to be used in conjunction with the facilities
proposed on the EBS frequencies. An unopposed application is one that
faces no competing application(s) or petition(s) to deny. Applicants
will be required to confirm their unopposed status after the period for
filing competing applications and petitions to deny has passed. If a BRS
application is opposed, the companion EBS application will be returned.\
(4) To be licensed on EBS channels, a wireless cable applicant must show
that there are no BRS channels available for application, purchase or
lease that could be used in lieu of the EBS frequencies applied for. A
wireless cable entity may apply for EBS channels at the same time it
applies for the related BRS frequencies, but if that BRS application is
opposed by a timely filed mutually exclusive application or petition to
deny, the application for EBS facilities will be returned.\
(5) If an EBS application and a wireless cable application for available
EBS facilities are mutually exclusive, the EBS application will be
granted if the applicant is qualified. An EBS applicant may not file an
application mutually exclusive with a wireless cable application if
there are other EBS channels available for the proposed EBS facility.

\(6\) (i) An educational institution or entity that would be eligible
for EBS channels that are licensed to a wireless cable entity may be
entitled to access to those channels. Requests for access may be made by
filing a request with the Commission. A cover letter must clearly
indicate that the application is for EBS access to a wireless cable
entity\'s facilities on EBS channels.\
(ii) An EBS entity determined by the Commission to have right of access
to wireless cable licensed facilities may have access to a maximum of 40
hours per channel per week. The EBS entity has the right to designate 20
of those hours as follows: 3 hours of the EBS entity\'s choice each day,
Monday through Friday, between 8 a.m. and 10 p.m., excluding weekends,
holidays and school vacations; and the remaining five hours any time of
the EBS entity\'s choice between 8 a.m. and 10 p.m., Monday through
Saturday.\
(iii) No time-of-day and day-of-week obligations will be imposed on
either party with respect to the other 20 hours of access time.\
(iv) The EBS user must provide the wireless cable licensee with its
planned schedule of use four months in advance. No minimum amount of
programming will be required of an EBS operator seeking access to one
channel; for access to a second channel, the EBS user must use at least
20 hours per week on the first channel from 8 a.m. to 10 p.m., Monday
through Saturday; for access to a third channel, the EBS entity must use
at least 20 hours per week on the first channel and on the second
channel during the hours prescribed above, and so on. Only one
educational institution or entity per wireless cable licensed channel
will be entitled to access from the wireless cable entity. Access will
not be granted to a single entity for more than four channels, unless it
can satisfy the waiver provisions of § 27.5(i)(3) of this part.\
(v) When an EBS entity is granted access to an EBS channel of a wireless
cable licensee, the wireless cable licensee will be required to pay half
of the cost of five standard receive sites on that channel. The wireless
cable entity may, at its option, pay the costs of an application and
facility construction for such EBS entity on other available EBS
channels, including half of the cost of five receive sites per channel.\
(vi) After three years of operation, a wireless cable entity licensed to
use EBS channels will not be required to grant new or additional access
to such EBS channels, or provide any alternative facilities to any EBS
entity seeking access to its facilities, if there are suitable EBS
frequencies available for the EBS entity to build its own system.\
(vii) The parties may mutually agree to modify any requirements or
obligations imposed by these provisions, except for the requirement that
an educational entity use at least 20 hours per week on a channel of a
wireless cable licensee before requesting access to an additional
channel.

**§ 27.1202 Cable/BRS Cross-ownership.**

\(a\) Initial or modified authorizations for BRS stations may not be
granted to a cable operator if a portion of the BRS station\'s protected
services area is within the portion of the franchise area actually
served by the cable operator\'s cable system and the cable operator will
be using the BRS station as a multichannel video programming distributor
(as defined in Section 76.64(d) of this chapter). No cable operator may
acquire such authorization either directly, or indirectly through an
affiliate owned operated, or controlled by or under common control with
a cable operator if the cable operator will use the BRS station as a
multichannel video programming distributor.\
(b) No licensee of a station in this service may lease transmission time
or capacity to a cable operator either directly, or indirectly through
an affiliate owned, operated, controlled by, or under common control
with a cable operator, if a portion of the BRS station\'s protected
services area is within the portion of the franchise area actually
served by the cable operator\'s cable system the cable operator will use
the BRS station as a multichannel video programming distributor.\
(c) Applications for new stations, station modifications, assignments or
transfers of control by cable operators of BRS stations shall include a
showing that no portion of the PSA of the BRS station is within the
portion of the franchise area actually served by the cable operator\'s
cable system, or of any entity indirectly affiliated, owned, operated,
controlled by, or under common control with the cable operator.
Alternatively, the cable operator may certify that it will not use the
BRS station to distribute multichannel video programming.\
\
Note 1: In applying the provisions of this section, ownership and other
interests in BRS licensees or cable television systems will be
attributed to their holders and deemed cognizable pursuant to the
following criteria:\
\
(a) Except as otherwise provided herein, partnership and direct
ownership interests and any voting stock interest amounting to 5% or
more of the outstanding voting stock of a corporate BRS licensee or
cable television system will be cognizable;\
\
(b) Investment companies, as defined in 15 U.S.C. § 80a-3, insurance
companies and banks holding stock through their trust departments in
trust accounts will be considered to have a cognizable interest only if
they hold 20% or more of the outstanding voting stock of a corporate BRS
licensee or cable television system, or if any of the officers or
directors of the BRS licensee or cable television system are
representatives of the investment company, insurance company or bank
concerned. Holdings by a bank or insurance company will be aggregated if
the bank or insurance company has any right to determine how the stock
will be voted. Holdings by investment companies will be aggregated if
under common management.\
\
(c) Attribution of ownership interests in a BRS licensee or cable
television system that are held indirectly by any party through one or
more intervening corporations will be determined by successive
multiplication of the ownership percentages for each link in the
vertical ownership chain and application of the relevant attribution
benchmark to the resulting product, except that wherever the ownership
percentage for any link in the chain exceeds 50%, it shall not be
included for purposes of this multiplication. For purposes of paragraph
(i) of this note, attribution of ownership interests in a BRS licensee
or cable television system that are held indirectly by any party through
one or more intervening organizations will be determined by successive
multiplication of the ownership percentages for each link in the
vertical ownership chain and application of the relevant attribution
benchmark to the resulting product, and the ownership percentage for any
link in the chain that exceeds 50% shall be included for purposes of
this multiplication. \[For example, except for purposes of paragraph (i)
of this note, if A owns 10% of company X, which owns 60% of company Y,
which owns 25% of \"Licensee,\" then X\'s interest in \"Licensee\" would
be 25% (the same as Y\'s interest because X\'s interest in Y exceeds
50%), and A\'s interest in \"Licensee\" would be 2.5% (0.1 x 0.25).
Under the 5% attribution benchmark, X\'s interest in \"Licensee\" would
be cognizable, while A\'s interest would not be cognizable. For purposes
of paragraph (i) of this note, X\'s interest in \"Licensee\" would be
15% (0.6 x 0.25) and A\'s interest in \"Licensee\" would be 1.5% (0.1 x
0.6 x 0.25). Neither interest would be attributed under paragraph (i) of
this note.\]\
\
(d) Voting stock interests held in trust shall be attributed to any
person who holds or shares the power to vote such stock, to any person
who has the sole power to sell such stock, and to any person who has the
right to revoke the trust at will or to replace the trustee at will. If
the trustee has a familial, personal or extra-trust business
relationship to the grantor or the beneficiary, the grantor or
beneficiary, as appropriate, will be attributed with the stock interests
held in trust. An otherwise qualified trust will be ineffective to
insulate the grantor or beneficiary from attribution with the trust\'s
assets unless all voting stock interests held by the grantor or
beneficiary in the relevant BRS licensee or cable television system are
subject to said trust.\
\
(e) Subject to paragraph (i) of this note, holders of non-voting stock
shall not be attributed an interest in the issuing entity. Subject to
paragraph (i) of this note, holders of debt and instruments such as
warrants, convertible debentures, options or other non-voting interests
with rights of conversion to voting interests shall not be attributed
unless and until conversion is effected.\
\
(f)(1) A limited partnership interest shall be attributed to a limited
partner unless that partner is not materially involved, directly or
indirectly, in the management or operation of the BRS or cable
television activities of the partnership and the licensee or system so
certifies. An interest in a Limited Liability Company (\"LLC\") or
Registered Limited Liability Partnership (\"RLLP\") shall be attributed
to the interest holder unless that interest holder is not materially
involved, directly or indirectly, in the management or operation of the
BRS or cable television activities of the partnership and the licensee
or system so certifies.\
\
(2) For a licensee or system that is a limited partnership to make the
certification set forth in paragraph (f)(1) of this note, it must verify
that the partnership agreement or certificate of limited partnership,
with respect to the particular limited partner exempt from attribution,
establishes that the exempt limited partner has no material involvement,
directly or indirectly, in the management or operation of the BRS or
cable television activities of the partnership. For a licensee or system
that is an LLC or RLLP to make the certification set forth in paragraph
(f)(1) of this note, it must verify that the organizational document,
with respect to the particular interest holder exempt from attribution,
establishes that the exempt interest holder has no material involvement,
directly or indirectly, in the management or operation of the BRS or
cable television activities of the LLC or RLLP. Irrespective of the
terms of the certificate of limited partnership or partnership
agreement, or other organizational document in the case of an LLC or
RLLP, however, no such certification shall be made if the individual or
entity making the certification has actual knowledge of any material
involvement of the limited partners, or other interest holders in the
case of an LLC or RLLP, in the management or operation of the BRS or
cable television businesses of the partnership or LLC or RLLP.\
\
(3) In the case of an LLC or RLLP, the licensee or system seeking
installation shall certify, in addition, that the relevant state statute
authorizing LLCs permits an LLC member to insulate itself as required by
our criteria.\
\
(g) Officers and directors of a BRS licensee or cable television system
are considered to have a cognizable interest in the entity with which
they are so associated. If any such entity engages in businesses in
addition to its primary business of BRS or cable television service, it
may request the Commission to waive attribution for any officer or
director whose duties and responsibilities are wholly unrelated to its
primary business. The officers and directors of a parent company of a
BRS licensee or cable television system, with an attributable interest
in any such subsidiary entity, shall be deemed to have a cognizable
interest in the subsidiary unless the duties and responsibilities of the
officer or director involved are wholly unrelated to the BRS licensee or
cable television system subsidiary, and a statement properly documenting
this fact is submitted to the Commission. The officers and directors of
a sister corporation of a BRS licensee or cable television system shall
not be attributed with ownership of these entities by virtue of such
status.\
\
(h) Discrete ownership interests will be aggregated in determining
whether or not an interest is cognizable under this section. An
individual or entity will be deemed to have a cognizable investment if:\
\
(1) The sum of the interests held by or through \"passive investors\" is
equal to or exceeds 20 percent; or\
\
(2) The sum of the interests other than those held by or through
\"passive investors\" is equal to or exceeds 5 percent; or\
\
(3) The sum of the interests computed under paragraph (h)(1) of this
note plus the sum of the interests computed under paragraph (h)(2) of
this note is equal to or exceeds 20 percent.\
\
(i) Notwithstanding paragraphs (e) and (f) of this note, the holder of
an equity or debt interest or interests in a BRS licensee or cable
television system subject to the BRS/cable cross-ownership rule
(\"interest holder\") shall have that interest attributed if:\
\
(1) The equity (including all stockholdings, whether voting or
nonvoting, common or preferred) and debt interest or interests, in the
aggregate, exceed 33 percent of the total asset value (all equity plus
all debt) of that BRS licensee or cable television system; and\
\
(2) The interest holder also holds an interest in a BRS licensee or
cable television system that is attributable under paragraphs of this
note other than this paragraph (i) and which operates in any portion of
the franchise area served by that cable operator\'s cable system.\
\
(j) The term \"area served by a cable system\" means any area actually
passed by the cable operator\'s cable system and which can be connected
for a standard connection fee.\
\
(k) As used in this section \"cable operator\" shall have the same
definition as in § 76.5 of this chapter.\
\
Note 2: The Commission will entertain requests to waive the restrictions
in paragraph (a) of this section where necessary to ensure that all
significant portions of the franchise area are able to obtain
multichannel video service.

\(d\) The provisions of paragraphs (a) through (c) of this section will
not apply to one BRS channel used to provide locally-produced
programming to cable headends. Locally-produced programming is
programming produced in or near the cable operator\'s franchise area and
not broadcast on a television station available within that franchise
area. A cable operator will be permitted one BRS channel for this
purpose, and no more than one BRS channel may be used by a cable
television company or its affiliate or lessor pursuant to this
paragraph. The licensee for a cable operator providing local programming
pursuant to a lease must include in a notice filed with the Wireless
Telecommunications Bureau a cover letter explicitly identifying itself
or its lessees as a local cable operator and stating that the lease was
executed to facilitate the provision of local programming. The first
application or the first lease notification in an area filed with the
Commission will be entitled to the exemption. The limitations on one BRS
channel per party and per area include any cable/BRS operations or
cable/EBS operations. The cable operator must demonstrate in its BRS
application that the proposed local programming will be provided within
one year from the date its application is granted. Local programming
service pursuant to a lease must be provided within one year of the date
of the lease or one year of grant of the licensee\'s application for the
leased channel, whichever is later. If a BRS license for these purposes
is granted and the programming is subsequently discontinued, the license
will be automatically forfeited the day after local programming service
is discontinued.

\(e\) Applications filed by cable television companies, or affiliates,
for BRS channels prior to February 8, 1990, will not be subject to the
prohibitions of this section. Applications filed on February 8, 1990, or
thereafter will be returned. Lease arrangements between cable and BRS
entities for which a lease or a firm agreement was signed prior to
February 8, 1990, will also not be subject to the prohibitions of this
section. Leases between cable television companies, or affiliates, and
BRS station licensees, conditional licensees, or applicants executed on
February 8, 1990, or thereafter, are invalid.\
(1) Applications filed by cable operators, or affiliates, for BRS
channels prior to February 8, 1990, will not be subject to the
prohibitions of this section. Except as provided in paragraph (e)(2)
below, applications filed on February 8, 1990, or thereafter will be
returned. Lease arrangements between cable and BRS entities for which a
lease or a firm agreement was signed prior to February 8, 1990, will
also not be subject to the prohibitions of this section. Except as
provided in paragraph (e)(2) below, leases between cable operators, or
affiliates, and BRS/EBS station licensees, conditional licensees, or
applicants executed on or before February 8, 1990, or thereafter are
invalid.\
(2) Applications filed by cable operators, or affiliates for BRS
channels after February 8, 1990, and prior to October 5, 1992, will not
be subject to the prohibition of this section, if, pursuant to the then
existing overbuild or rural exceptions, the applications were allowed
under the then existing cable/BRS cross-ownership prohibitions. Lease
arrangements between cable operators and BRS entities for which a lease
or firm agreement was signed after February 8, 1990, and prior to
October 5, 1992, will not be subject to the prohibitions of this
section, if, pursuant to the then existing rural and overbuild
exceptions, the lease arrangements were allowed.\
(3) The limitations on cable television ownership in this section do not
apply to any cable operator in any franchise area in which a cable
operator is subject to effective competition as determined under section
623(l) of the Communications Act.

**§ 27.1203 EBS Programming Requirements.**

\(a\) Except as provided in paragraphs (b), (c), and (d) of this
section, BRS and EBS licensees are authorized to provide fixed or mobile
service, except aeronautical mobile service, subject to the technical
requirements of subparts C and M of this part.

\(b\) Educational Broadband Service stations are intended primarily
through video, data, or voice transmissions to further the educational
mission of accredited public and private schools, colleges and
universities providing a formal educational and cultural development to
enrolled students. Authorized educational broadband channels must be
used to further the educational mission of accredited schools offering
formal educational courses to enrolled students, with limited exceptions
as set forth in section §§ 27.1201(c) of this chapter.

\(c\) In furtherance of the educational mission of accredited schools,
Educational Broadband Service stations may be used for:\
(1) In-service training and instruction in special skills and safety
programs, extension of professional training, informing persons and
groups engaged in professional and technical activities of current
developments in their particular fields, and other similar endeavors;\
(2) Transmission of material directly related to the administrative
activities of the licensee, such as the holding of conferences with
personnel, distribution of reports and assignments, exchange of data and
statistics, and other similar uses.

\(d\) Stations, including high-power EBS signal booster stations, may be
licensed in the EBS as originating or relay stations to interconnect
educational broadband fixed stations in adjacent areas, to deliver
instructional and cultural material to, and obtain such material from,
commercial and noncommercial educational television broadcast stations
for use on the educational broadband system, and to deliver
instructional and cultural material to, and obtain such material from,
nearby terminals or connection points of closed circuit educational
television systems employing wired distribution systems or radio
facilities authorized under other parts of this Chapter, or to deliver
instructional and cultural material to any cable television system
serving a receiving site or sites which would be eligible for direct
reception of EBS signals under the provisions of Section 27.1201.

**§ 27.1206 Geographic Service Area.**

(a)The Geographic Service Area (GSA) is either:

\(1\) the area for incumbent site-based licensees that is bounded by a
circle having a 35 mile radius and centered at the station's reference
coordinates, which was the previous PSA entitled to incumbent licensees
prior to \[effective date of the rules\], and is bounded by the chord(s)
drawn between intersection points of the licensee's previous 35 mile PSA
and those of respective adjacent market, co-channel licensees;

or:

\(2\) the BTA that is licensed to the respective BRS BTA authorization
holder subject to the exclusion of overlapping, co-channel incumbent
GSAs as described in subpart (a)(1) of this rule.

\(b\) If the license for an incumbent BRS station cancels or is
forfeited, the GSA area of the incumbent station shall dissolve and the
right to operate in that area automatically reverts to the GSA licensee
that held the corresponding BTA.

**§ 27.1207 BTA License Authorization.**

\(a\) Winning bidders must file an application (FCC Form 601) for an
initial authorization in each market and frequency block.

\(b\) Blanket licenses are granted for each market and frequency block.
Blanket licenses cover all mobile and response stations. Blanket
licenses also cover all fixed stations anywhere within the authorized
service area, except as follows:

\(1\) A station would be required to be individually licensed if:

\(i\) International agreements require coordination;

\(ii\) Submission of an Environmental Assessment is required under §
1.1307 of this chapter;

\(iii\) The station would affect the radio quiet zones under § 1.924 of
this chapter.

\(2\) Any antenna structure that requires notification to the Federal
Aviation Administration (FAA) must be registered with the Commission
prior to construction under § 17.4 of this chapter.

**§ 27.1208 Service Areas.**

Most BRS/EBS service areas are Basic Trading Areas (BTAs). BTAs are
based on the Rand McNally 1992 Commercial Atlas & Marketing Guide, 123rd
Edition, at pages 38-39. The following are additional BRS or EBS service
areas in places where Rand McNally has not defined BTAs: American Samoa;
Guam; Northern Mariana Islands; Mayaguez/Aguadilla-Ponce, Puerto Rico;
San Juan, Puerto Rico; and the United States Virgin Islands. The
Mayaguez/Aguadilla-Ponce, PR, service area consists of the following
municipios: Adjuntas, Aguada, Aguadilla, Anasco, Arroyo, Cabo Rojo,
Coamo, Guanica, Guayama, Guayanilla, Hormigueros, Isabela, Jayuya, Juana
Diaz, Lajas, Las Marias, Maricao, Maunabo, Mayaguez, Moca, Patillas,
Penuelas, Ponce, Quebradillas, Rincón, Sabana Grande, Salinas, San
German, Santa Isabel, Villalba and Yauco. The San Juan service area
consists of all other municipios in Puerto Rico.

**§ 27.1209 Conversion of Incumbent EBS and BRS Stations to Geographic
Area Licensing.**

\(a\) Any EBS or BRS station licensed by the Commission, other than BTA
authorizations and facilities authorized pursuant to BTA authorizations,
shall be considered an incumbent station.

\(b\) As of **\[insert effective date of rules\]**, all incumbent EBS
and BRS licenses shall be converted to a geographic area license.
Pursuant to that geographic area license, such incumbent licensees may
modify their systems provided the modified system complies with the
applicable rules. The blanket license covers all fixed stations anywhere
within the authorized service area, except as follows:

\(1\) A station would be required to be individually licensed if:

\(i\) International agreements require coordination;

\(ii\) Submission of an Environmental Assessment is required under §
1.1307 of this chapter;

\(iii\) The station would affect the radio quiet zones under § 1.924 of
this chapter.

\(2\) Any antenna structure that requires notification to the Federal
Aviation Administration (FAA) must be registered with the Commission
prior to construction under § 17.4 of this chapter.

\(c\) The frequencies associated with incumbent authorizations that have
been cancelled automatically or otherwise been recovered by the
Commission will automatically revert to the applicable BTA licensee.

**§ 27.1210 Remote Control Operation.**

Licensed BRS/EBS stations may be operated by remote control without
further authority.

**§ 27.1211 Unattended Operation.**

Unattended operation of licensed BRS/EBS stations is permitted without
further authority. An unattended relay station may be employed to
receive and retransmit signals of another station provided that the
transmitter is equipped with circuits which permit it to radiate only
when the signal intended to be retransmitted is present at the receiver
input terminals.

**§27.1212 License Term.**

\(a\) BRS/EBS licenses shall be issued for a period of 10 years
beginning with the date of grant.

\(b\) An initial BTA authorization shall be issued for a period of ten
years from the date the Commission declared bidding closed in the MDS
auction.

**§ 27.1213 Designated entity provisions for BRS in Commission auctions
commencing prior to January 1, 2004.**

\(a\) Eligibility for small business provisions. For purposes of
Commission auctions commencing prior to January 1, 2004 for BRS
licenses, a small business is an entity that together with its
affiliates has average annual gross revenues that are not more than \$40
million for the preceding three calendar years.

\(b\) Designated entities. As specified in this section, designated
entities that are winning bidders in Commission auctions commencing
prior to January 1, 2004 for BTA service areas are eligible for special
incentives in the auction process. See 47 CFR 1.2110.

\(c\) Installment payments. Small businesses and small business
consortia may elect to pay the full amount of their winning bids in
Commission auctions commencing prior to January 1, 2004 for BTA service
areas in installments over a ten (10) year period running from the date
that their BTA authorizations are issued.

\(1\) Upon issuance of a BTA authorization to a winning bidder in a
Commission auction commencing prior to January 1, 2004 that is eligible
for installment payments, the Commission will notify such eligible BTA
authorization holder of the terms of its installment payment plan. For
BRS, such installment payment plans will:

\(i\) Impose interest based on the rate of ten (10) year U.S. Treasury
obligations at the time of issuance of the BTA authorization, plus two
and one half (2.5) percent;

\(ii\) Allow installment payments for a ten (10) year period running

from the date that the BTA authorization is issued;

\(iii\) Begin with interest-only payments for the first two (2) years;
and

\(iv\) Amortize principal and interest over the remaining years of the
ten (10) year period running from the date that the BTA authorization is
issued.

\(2\) Conditions and obligations. See Sec. 1.2110(f)(4) of this chapter.

\(3\) Unjust enrichment. If an eligible BTA authorization holder that

utilizes installment financing under this subsection seeks to partition,
pursuant to applicable rules, a portion of its BTA containing one-third
or more of the population of the area within its control in the licensed
BTA to an entity not meeting the eligibility standards for installment
payments, the holder must make full payment of the remaining unpaid
principal and any unpaid interest accrued through the date of partition
as a condition of approval.

\(d\) Reduced upfront payments. For purposes of Commission auctions
commencing prior to January 1, 2004 for BRS licenses, a prospective
bidder that qualifies as a small business, or as a small business
consortia, is eligible for a twenty-five (25) percent reduction in the
amount of the upfront payment otherwise required. To be eligible to bid
on a particular BTA, a small business will be required to submit an
upfront payment equal to seventy-five (75) percent of the upfront
payment amount specified for that BTA in the public notice listing the
upfront payment amounts corresponding to each BTA service area being
auctioned.

\(e\) Bidding credits. For purposes of Commission auctions commencing
prior to January 1, 2004 for BRS licenses, a winning bidder that
qualifies as a small business, or as a small business consortia, may use
a bidding credit of fifteen (15) percent to lower the cost of its
winning bid on any of the BTA authorizations awarded in the Commission
BRS auctions commencing prior to January 1, 2004.

\(f\) Short-form application certification; Long-form application or
statement of intention disclosure. A BRS applicant in a Commission
auction commencing prior to January 1, 2004 claiming designated entity
status shall certify on its short-form application that it is eligible
for the incentives claimed. A designated entity that is a winning bidder
for a BTA service area(s) shall, in addition to information otherwise
required, file an exhibit to either its initial long-form application
for a BRS station license, or to its statement of intention with regard
to the BTA, which discloses the gross revenues for each of the past
three years of the winning bidder and its affiliates. This exhibit shall
describe how the winning bidder claiming status as a designated entity
satisfies the designated entity eligibility requirements, and must list
and summarize all agreements that affect designated entity status, such
as partnership agreements, shareholder agreements, management agreements
and other agreements, including oral agreements, which establish that
the designated entity will have both de facto and de jure control of the
entity. See 47 CFR 1.2110(i).

\(g\) Records maintenance. All holders of BTA authorizations acquired in
a Commission auction commencing prior to January 1, 2004 that claim
designated entity status shall maintain, at their principal place of
business or with their designated agent, an updated documentary file of
ownership and revenue information necessary to establish their status.
Holders of BTA authorizations or their successors in interest shall
maintain such files for a ten (10) year period running from the date
that their BTA authorizations are issued. The files must be made
available to the Commission upon request.

**§ 27.1214 EBS spectrum leasing arrangements and grandfathered
leases.**

\(a\) A licensee in the EBS that is solely utilizing analog
transmissions may enter into a spectrum leasing arrangement to transmit
material other than the educational programming defined in Sections
27.1203(b) and (c) of this subpart, subject to the following conditions:

\(1\) Before entering into a spectrum leasing arrangement involving
material other than educational programming on any one channel, the
licensee must provide at least 20 hours per week of EBS educational
programming (as defined in Sections 27.1203(b) and (c) of this Chapter)
on that channel, except as provided in paragraphs (a)(2) and (a)(3) of
this section. An additional 20 hours per week per channel must be
strictly reserved for EBS use and not used for non-EBS purposes, or
reserved for recapture by the EBS licensee for its EBS educational
usage, subject to one year\'s advance, written notification by the EBS
licensee to its lessee and accounting for all recapture already
exercised, with no economic or operational detriment to the licensee.
These hours of recapture are not restricted as to time of day or day of
the week, but may be established by negotiations between the EBS
licensee and the lessee. The 20 hours per channel per week EBS
educational usage requirement and the recapture and/or reservation
requirement of an additional 20 hours per channel per week shall apply
spectrally over the licensee\'s whole actual service area.

\(2\) For the first two years of operation, an EBS entity may enter into
a spectrum leasing arrangement involving material other than educational
programming if it provides EBS educational usage for at least 12 hours
per channel per week, provided that the entity does not employ channel
loading technology.

\(3\) The licensee may shift its requisite EBS educational usage onto
fewer than its authorized number of channels, via channel mapping or
channel loading technology, so that it can enter into a spectrum leasing
arrangement involving full-time channel capacity on its EBS station
and/or associated EBS booster stations, subject to the condition that it
provide a total average of at least 20 hours per channel per week of EBS
educational usage on its authorized channels. The use of channel mapping
or channel loading consistent with the Rules shall not be considered
adversely to the EBS licensee in seeking a license renewal. The licensee
also retains the unabridgeable right to recapture, subject to six
months\' advance written notification by the EBS licensee to the
spectrum lessee, an average of an additional 20 hours per channel per
week, accounting for all recapture already exercised. Regardless of
whether the licensee has educational receive sites within its GSA, the
licensee may lease booster stations in the entire GSA, provided that the
licensee maintains the unabridgeable right to ready recapture at least
40 hours per channel per week for EBS educational usage. The licensee
may agree to the transmission of this recapture time on channels not
authorized to it, but which are included in the wireless system of which
it is a part. A licensee under this paragraph which enters into a
spectrum leasing arrangement on any one of its channels to an operator
may \"channel shift\" pursuant to and under the conditions of paragraph
(d)(2) of this section.

\(b\) A licensee utilizing digital transmissions on any of its licensed
channels may enter into a spectrum leasing arrangement to transmit
material other than the educational programming defined in Sections
27.1203(b) and (c) of this subpart, subject to the following conditions:

\(1\) The licensee must reserve a minimum of 5% of the capacity of its
channels for instructional purposes only, and may not enter into a
spectrum leasing arrangement involving this reserved capacity. In
addition, before leasing excess capacity, the licensee must provide at
least 20 hours per licensed channel per week of EBS educational usage.
This 5% reservation and this 20 hours per licensed channel per week EBS
educational usage requirement shall apply spectrally over the
licensee\'s whole actual service area. However, regardless of whether
the licensee has an educational receive site within its GSA served by a
booster, the licensee may lease excess capacity without making at least
20 hours per licensed channel per week of EBS educational usage,
provided that the licensee maintains the unabridgeable right to
recapture on one months\' advance notice such capacity as it requires
over and above the 5% reservation to make at least 20 hours per channel
per week of EBS educational usage.

\(2\) The licensee may shift its requisite EBS educational usage onto
fewer than its authorized number of channels, via channel mapping or
channel loading technology, and may shift its requisite EBS educational
usage onto channels not authorized to it, but which are included in the
wireless system of which it is a part (\"channel shifting\"), so that it
can enter into a spectrum leasing arrangement involving full-time
channel capacity on its EBS station, associated EBS booster stations,
and/or EBS response stations and associated response station hubs,
subject to the condition that it provide a total average of at least 20
hours per licensed channel per week of EBS educational usage. The use of
channel mapping, channel loading, and/or channel shifting consistent
with the Rules shall not be considered adversely to the EBS licensee in
seeking a license renewal. In addition, an EBS entity receiving
interference protection will continue to receive such protection if it
elects to swap channels with another EBS or BRS station.

\(c\) All spectrum leasing arrangements involving EBS spectrum must
afford the EBS licensee an opportunity to purchase or to lease EBS
equipment in the event that the spectrum leasing arrangement is
terminated as a result of action by the spectrum lessee.

\(d\) All leases of current EBS spectrum entered into prior to
**\[insert effective date of this rule**\] and in compliance with
leasing rules formerly contained in Part 74 of this chapter may continue
in force and effect, notwithstanding any inconsistency between such
leases and the rules applicable to spectrum leasing arrangements set
forth in this chapter. Such leases entered into pursuant to the former
Part 74 rules may be renewed and assigned in accordance with the terms
of such lease. All spectrum leasing arrangements leases entered into
after **\[insert effective date of this rule\]**, pursuant to the rules
set forth in Parts 1 and 27, must comply with the rules in those parts.

**Technical Standards**

**§ 27.1220 Transmission standards.**

The width of a channel in the LBS and UBS is 5.5 MHz, with the exception
of BRS channels 1 and 2 which are 6.0 MHz. The width of all channels in
the MBS is 6 MHz. However, the licensee may subchannelize its authorized
bandwidth, provided that digital modulation is employed and the
aggregate power does not exceed the authorized power for the channel.
The licensee may also, jointly with other licensees, transmit utilizing
bandwidth in excess of its authorized bandwidth, provided that digital
modulation is employed, all power spectral density requirements set
forth in this part are met and the out-of-band emissions restrictions
set forth in Section 27.53 are met at the edges of the channels
employed.

**§ 27.1221** **Interference Protection.**

Interference protection will be afforded to BRS on a station by station
basis based on the heights of the stations in the LBS and UBS and also
on height benchmarking, although the heights of antennas utilized are
not restricted.

\(a\) *Height Benchmarking.* Height benchmarking is defined for pairs of
base stations, one in each of two neighboring service areas. The height
benchmark for a particular station in a service area relative to a base
station in an adjacent service area is the distance--squared between the
station and the GSA service area boundary measured along the radial
between the respective stations, divided by 17. That is, the height
benchmark is h~b~ = D^2^/17. Interference protection will be afforded on
a station by station basis based on the actual antenna height above
average terrain (HAAT) and this height benchmark.

\(b\) *Protection for a Receiving-Antenna not Exceeding the Height
Benchmark:* A base station receive-antenna with an HAAT less than or
equal to the height benchmark relative to a neighbor's transmitting base
station will be protected if that station's HAAT exceeds its height
benchmark. That station is required to take such measures to limit the
undesired signal at the receiving base station to -107dBm or less.

\(c\) *No Protection from a Transmitting-Antenna not Exceeding the
Height Benchmark*: A base station transmitting-antenna with an HAAT less
than or equal to the height benchmark relative to a neighbor's receiving
antenna is not required to protect that receiving station, regardless of
the HAAT of that station.

\(d\) *No Protection for a Receiving-Antenna Exceeding the Height
Benchmark:* A base station transmitting-antenna with an HAAT greater
than the height benchmark relative to a neighbor's receiving antenna is
not required to protect that receiving antenna if its HAAT is greater
than its height benchmark.

**§ 27.1222 Operations in the 2568-2572 and 2614-2618 bands.**

All operations in the 2568-2572 and 2614-2618 MHz bands shall be
secondary to adjacent-channel operations. Stations operating in the
2568-2572 and 2614-2618 MHz must not cause interference to licensees in
operation in the LBS, MBS, and UBS and must accept any interference from
any station operating in the LBS, MBS, and UBS in compliance with the
rules established in this subpart. Stations operating in the 2568-2572
and 2614-2618 bands may cause interference to stations in operation in
the LBS, MBS, and UBS if the affected licensees consent to such
interference.

**Policies Governing the Transition of the 2500-2690 MHz Band for BRS
and EBS.**

**§ 27.1230 Conversion of the 2500-2690 MHz band.**

BRS and EBS licensees in the 2500-2690 MHz band on the pre-transiton A-I
Channels will be transitioned from the frequencies assigned to them
under § 27.5(i)(1) to the frequencies assigned to them under §
27.5(i)(2) of this subpart. The transition, which will be undertaken by
one or more proponent(s), will occur in the following five phases:
initiating the transition process (see § 27.1231), planning the
transition (see § 27.1232), reimbursing transition costs (see 27.1233),
terminating existing operations in transitioned markets that do not
comport with § 27.5(i)(2) of this subpart (see § 27.1234), and filing
the post-transition notification (see § 27.1235).

**§ 27.1231 Initiating the transition.**

\(a\) The transition will occur by MEA. MEAs are based on the U.S.
Department of Commerce's 172 Economic Area (EAs). There are 52 MEAs
composed of one or more EAs. Additionally, there are three EA-like
areas: Guam and Northern Mariana Islands; Puerto Rico and the U.S.
Virgin Islands; and American Samoa, which will also be transitioned to
the band plan in Section 27.5(i)(2) of this subpart. The MEA associated
with the Gulf of Mexico will not be transitioned. MEAs are identified in
the Table to § 27.6(a) of this part.

\(b\) Sections 27.1231-27.1235 apply only to transitions initiated by a
proponent(s) within 3 years of (INSERT DATE 3O DAYS AFTER PUBLICATION IN
FEDERAL REGISTER).

\(c\) When a proponent(s) is a Basic Trading Area (BTA) BRS licensee
that is located in more than one MEA, the proponent(s) may elect to
transition only one MEA or may elect to transition two or more MEAs that
overlap the proponent(s)'s BTA.

\(d\) A proponent(s) may be an EBS or BRS licensee or an EBS lessee. To
initiate a transition, a proponent(s) must submit the following
information to the Commission at the Office of the Secretary in
Washington, DC:

\(1\) a list of the MEA(s) that the proponent(s) is transitioning;

\(2\) a list by call sign of all of the BRS and EBS licensees in the
MEA(s) that are being transitioned;

\(3\) a statement indicating that the engineering analysis to transition
all of the BRS and EBS licensees in the MEA(s) has been completed;

\(4\) a statement indicating when the transition will be completed;

\(5\) a statement indicating that an agreement has been concluded with
the proponent(s) of the adjoining or adjacent MEA(s) when the
engineering analysis indicates that a licensee or licensees in an
adjacent or adjoining MEA must be transitioned to avoid interference to
licensees in the MEA being transitioned, or in lieu of an agreement, the
proponent(s) may provide an alternative means of transitioning the
licensees in an adjacent or adjoining MEA;

\(6\) a statement indicating that an agreement has been concluded with
another proponent(s) on how a MEA will be transitioned when there are
two or more proponents seeking to transition the same MEA and a
statement that identifies the specific portion of the MEA each proponent
will be responsible for transitioning; and

\(7\) a certification that the proponent or joint proponents have the
funds available to pay the reasonable expected costs of the transition
based on the information contained in the Pre-Transition Data Request
(see paragraph (f) of this section).

\(e\) A proponent(s) may, at it own discretion, withdraw from
transitioning a MEA(s) by amending the information submitted to the
Commission under paragraph (d) of this section and notifying all
affected BRS and EBS licensees in the MEA(s).

\(f\) [Pre-transition data request]{.underline}. To assist a potential
proponent(s) in assessing whether to transition a MEA(s), a proponent(s)
must send a Pre-transition data request to each EBS and BRS licensee in
the MEA the proponent(s) seeks to transition. The proponent(s) shall
include its full name, postal mailing address, contact person, e-mail
address, and phone and fax numbers. The proponent(s) must request EBS
and BRS licensees within a MEA to provide the following information to
the potential proponent(s):

\(1\) The location (by street address and by geographic coordinates) of
every constructed EBS receive site that, as of the date of receipt of
the Pre-Transition Data Request, is entitled to a replacement
downconverter (see § 27.1233(a) of this subpart). The response must:

\(i\) Specify whether the downconverting antenna is mounted on a
structure attached to the building or on a free-standing structure;

\(ii\) Specify the approximate height above ground level of the
downconverting antenna;

\(iii\) Specify, if known, the adjacent channel D/U ratio that can be
tolerated by any receiver(s) at the receive site; and

\(2\) The number and identification of EBS video programming or data
transmission tracks the EBS licensee is entitled to receive in the MBS
and whether the EBS licensee will accept fewer tracks in the MBS (see §
27.1233(b) of this subpart).

\(g\) *The Transition Notice*. The proponent(s) must send a Transition
Notice to all BRS and EBS licensees in the MEA(s) being transitioned.
The proponent(s) must include the following information in the
Transition Notice:

\(1\) the proponent(s)'s full name; postal mailing address, contact
person, e-mail address, and phone and fax numbers

\(2\) the identification of the BRS and EBS licensees that will be
transitioned;

\(3\) copies of the most recent response to the Pre-Transition Data
Request for each participant in the process; and

\(4\) a certification that the proponent(s) has the funds available to
pay the reasonably expected costs of the transition based on the
information in the Pre-Transition Data Request.

**§ 27.1232 Planning the Transition.**

\(a\) *The Transition Planning Period.* The Transition Planning Period
is a 90-day period that commences on the day after the proponent(s) file
the Initiation Plan with the Commission.

\(b\) *The Transition Plan.* The proponent(s) must provide to each BRS
and EBS licensee within a MEA, a Transition Plan no later than 30 days
prior to the conclusion of the Transition Planning Period.

\(1\) The Transition Plan must:

\(i\) identify the call signs of the stations that are transitioning;

\(ii\) identify the specific channels that each licensee will receive
following the transition;

\(iii\) identify the receive sites at which replacement downconverters
will be installed (see § 27.1233(a) of this subpart);

\(iv\) identify the video programming and data transmission tracks that
will be migrated to the MBS and provide for the MBS channels to be
authorized to operate with transmission parameters that are
substantially similar to those of the licensee's operation prior to
transition (see § 27.1233(b) of this subpart);

\(v\) identify the technical configuration of the MBS facilities;

\(vi\) identify the approximate time line for effectuating the
transition, which, unless dispute resolution procedures are used, may
not exceed 18 months from the conclusion of the Transition Planning
Period;

\(vii\) provide for the establishment of an escrow or other appropriate
mechanism for ensuring completion of the transition in accordance with
the Transition Plan.

\(2\) The Transition Plan may provide for interruptions of EBS
transmissions, so long as those interruptions are limited to a period of
less than seven days at any reception site. The proponent(s) must
coordinate with each EBS licensee to minimize the extent of any
disruption.

\(3\) The Transition Plan may provide for the shifting of an EBS
licensee's program to alternative channels. Such shifting may not be
considered an interruption, if the EBS licensee's receive sites are
equipped to receive and internally distribute the channel to which the
programming is shifted.

\(4\) The Transition Plan may provide for the installation of an
appropriate filter on an MBS transmitter if the proponent(s) determines
that the installation of a filter will mitigate interference from
transmissions in the MBS to operations outside the MBS.

\(d\) *Counterproposals*. No later than 10 days before the conclusion of
the Transition Planning Period, affected BRS and EBS licensees may
submit a counterproposal to the proponent(s) if they believe that the
Transition Plan is unreasonable. The proponent(s) may:

\(1\) accept the counterproposal, modify the Transition Plan
accordingly, and send the modified Transition Plan to all EBS and BRS
licensees in the MEA;

\(2\) invoke dispute resolution procedures for a determination of
whether the Transition Plan is reasonable and take no action until a
determination of reasonableness is made; or

\(3\) invoke dispute resolution procedures for a determination of
whether the Transition Plan is reasonable, but may implement the
transition immediately.

\(e\) *Safe harbors*. An offer by a proponent(s) shall be reasonable if
it meets one of the following safe harbors:

\(1\) *Safe harbor #1*. This safe harbor applies when the default
high-power channel assigned to each channel group is authorized to
operate after the transition with the same transmission parameters
(coordinates, antenna pattern, height of center radiation, EIRP) as the
downstream facilities before the transition. If the proponent(s) does
not propose a change in the geographic coordinates of the facilities
(other than as necessary to conform the actual location with the
Commission's Antenna Survey Branch database), the proponent may also
propose the following to the extent consistent with this subpart:

\(i\) An increase in the height of the center of radiation of the
transmission antenna or a decrease in such height of no more than 8
meters (provided that such change does not result in an increase in
antenna support structure lease costs to the EBS licensee and the
consent of the owner of the antenna support structure is obtained).

\(ii\) A change in the EIRP of the transmission system of up to 1.5 dB
in any direction.

\(iii\) Digitization, precision frequency offset, or other upgrades to
the EBS transmission or reception systems that allow the proponent(s) to
invoke more advantageous interference protection requirements applicable
to upgraded systems.

\(2\) *Safe harbor \# 2*. This safe harbor applies when an EBS licensee
has channel-shifted its single video programming or data transmission
track to spectrum licensed to another licensee. Under Section 27.5(i)(2)
of this subpart, that track must be on the high-power channel licensed
to the EBS licensee upon completion of the transition. For example,
before the transition, an A Group licensee might have shifted its EBS
video programming to channel C1. If one of the pre-transition A Group
channels is licensed with technical parameters substantially similar to
those of pre-transition channel C1, the Transition Plan may provide for
high-power channel A4 to be licensed with the same technical parameters
as the pre-transition channel C1. However, if the pre-transition A Group
channels are licensed to operate with technical parameters materially
different from those of pre-transition channel C1, the proponent(s) may:

\(i\) Arrange a channel swap with the licensee of the C Group so that
the A Group licensee will receive high-power channel C4 (which will
automatically be licensed with the same transmission parameters as the
pre-transition channel C1) in exchange for channel A4.

\(ii\) Arrange for high-power channel A4 to operate with transmission
parameters substantially similar to those of the pre-transition channel
C1 (see paragraph (e)(1) of this section).

**§ 27.1233 Reimbursement costs of transitioning.**

\(a\) *Replacement downconverters*. The proponent(s) must install at
every eligible EBS receive site a downconverter designed to minimize the
reception of signals from outside the MBS.

\(1\) An EBS receive site is eligible to be replaced if:

\(i\) a reception system was installed at that site on or before the
date the EBS licensee receives its Pre-Transition Data Request (see §
27.1231(f) of this subpart);

\(ii\) the reception system was installed by or at the direction of the
EBS licensee;

\(iii\) the reception system receives EBS programming under § 27.1203(b)
and (c) of this subpart or is located at a cable television system
headend and the cable system relays educational or instructional
programming for an EBS licensee; and

\(iv\) it is within the licensee's 35-mile radius GSA.

\(2\) Replacement downconverters must meet the following minimum
technical requirements:

\(i\) The downconverter's input frequency range (the "in-band
frequencies") must be 2572 MHz to 2614 MHz and output frequency range
must be 294 MHz to 336 MHz;

\(ii\) The downconversion process must not invert frequencies;

\(iii\) The nominal gain of the downconverter must be 32 dB, or greater;

\(iv\) The downconverter must include filtering prior to the first
amplifier that attenuates frequencies below 2500 MHz and above 2705 MHz
by at least 25 dB;

\(v\) The downconverter must have an out-of-band input 3rd order
intercept point (input IP3) of at least +9 dBm, where out-of-band is
defined as all frequencies below 2566 MHz and all frequencies above 2620
MHz;

\(vi\) The downconverter must have a typical noise figure of no greater
than 3.5 dB and a worst case noise figure of no greater than 4.5 dB
across all in-band frequencies and across its entire intended operating
temperature range;

\(vii\) The downconverter must not introduce a delta group delay of more
than 20 nanoseconds for digital operations or 100 nanoseconds for analog
operations over any individual six megahertz MBS channel.

\(b\) *Migration of Video Programming and Data Transmission Track*

\(1\) The proponent(s) must provide, at its cost, to each EBS licensee
that intends to continue downstream high-power, high-site educational
video programming or data transmission services, with one programming
track on the MBS channels for each EBS video or data transmission track
the licensee is transmitting on a simultaneous basis before the
transition.

\(i\) To be eligible for migration, a program track must contain EBS
programming that complies with § 27.1203(b) and (c) of this subpart.

\(ii\) The proponent(s) must pay only the costs of migrating programming
tracks being transmitted on December 31, 2002 or within six months prior
thereto.

\(2\) The proponent(s) must migrate each eligible programming track to
spectrum in the MBS that will be licensed to the affected licensee at
the conclusion of the transition.

\(3\) After the transition, the desired-to-undesired signal level ratio
at each of the receive sites securing a replacement downconverter must
satisfy the following criteria:

\(i\) *Cochannel D/U Ratio*.

\(A\) When the post-transition desired signal is transmitted using
analog modulation, the actual cochannel D/U ratio measured at the output
of the reception antenna must be at least the lesser of 45 dB or the
actual pre-transmission D/U ratio less 1.5 dB.

\(B\) When the post-transition desired signal will be transmitted using
digital modulation, the actual cochannel D/U ratio measured at the
output of the reception antenna must be at least the lesser of 32 dB or
the pre-transition D/U ratio less 1.5 dB.

\(C\) Where in implementing the Transition Plan, the proponent(s)
deploys precise frequency offset in an analog system, the minimum
cochannel D/U ratio is reduced to 38 dB, provided that the transmitters
have or are upgraded pursuant to the Transition Plan to have the
appropriate "plus," "zero," or "minus" 10,010 Hertz precision frequency
offset with a ± 3 Hertz (or better) stability.

\(ii\) *Adjacent Channel D/U Ratio.* The actual adjacent channel D/U
must equal or exceed the lesser of 0 dB or the actual pre-transmission
D/U ratio. However, in the event that the receive site uses receivers or
is upgraded by the proponent(s) as part of the Transition Plan to use
receivers that can tolerate negative adjacent channel D/U ratios, the
actual adjacent channel D/U ratio at such receive site must equal or
exceed such negative adjacent channel D/U ratio.

\(c\) *BRS Costs*. BRS licensees must pay their own transition costs.
BRS licensees in the LBS or UBS must reimburse the proponent(s) a pro
rata share of the cost of transitioning the facilities they use to
provide commercial service, either directly or through a lease agreement
with an EBS licensee.

**§ 27.1234 Terminating existing operations in transitioned markets.**

Licensees may discontinue operations during the transition.

**§ 27.1235 Post-transition notification.**

\(a\) The proponent(s) and all affected licensees must jointly notify
the Commission at the Office of the Secretary, Washington DC, that the
Transition Plan has been fully implemented.

\(1\) The notification must provide the identification of the licensees
that have transitioned to the band plan in § 27.5(i)(2) this subpart and
the specific frequencies on which each licensee is operating.

\(2\) For each station in the MBS, the notification must provide the
following information:

\(i\) the station coordinates,

\(ii\) the make and model of each antenna,

\(iii\) the horizontal and vertical pattern of the antenna;

\(iv\) EIRP of the main lobe;

\(v\) orientation;

\(vi\) height of antenna center of radiation;

\(vii\) transmitter output power;

\(viii\) all line and combiner losses.

\(3\) The proponent(s) must provide copies of the post-transition notice
to all parties of the transition.

**PART 73\--RADIO BROADCAST SERVICES**

34. The authority citation for Part 73 continues to read as follows:

**AUTHORITY: 47 U.S.C. 154, 303, 334 and 336.**

35. Section 73.1010(e) is amended by deleting paragraph 7 and
    redesignating paragraph 8 as paragraph 7.

36. The table at Section 73.3500(a) is amended by deleting the
    references to Form numbers 330, 330-L, and 330-R.

37. Section 73.3533(a) is amended by deleting paragraph 4 and
    redesignating paragraphs 5 through 8 as paragraphs 4 through 7.

38. Section 73.3534 is deleted and reserved.

39. Section 73.3536(b) is amended by deleting paragraph 4 and
    redesignating paragraphs 5 through 7 as paragraphs 4 through 6.

40. Section 73.5000 is amended by revising paragraph (a) to read as
    follows:

\(a\) Mutually exclusive applications for new facilities and for major
changes to existing facilities in the following broadcast services are
subject to competitive bidding: AM; FM; FM translator; analog
television; low-power television; television translator; and Class A
television. Mutually exclusive applications for minor modifications of
Class A television and television broadcast are also subject to
competitive bidding. The general competitive bidding procedures set
forth in part 1, subpart Q of this chapter will apply unless otherwise
provided in part 73 or part 74 of this chapter.

\* \* \* \* \*

41. Section 73.5002 is amended by revising paragraphs (a), (b), (c),
    and (d) to read as follows:

**§ 73.5002 Application and certification procedures; return of mutually
exclusive applications not subject to competitive bidding procedures;
prohibition of collusion.**

a\) Prior to any broadcast service auction, the Commission will issue a
public notice announcing the upcoming auction and specifying the period
during which all applicants seeking to participate in an auction, and
all applicants for noncommercial educational broadcast stations, as
described in 47 U.S.C. 397(6), on non-reserved channels, must file their
applications for new broadcast facilities or for major changes to
existing facilities. Broadcast service applications for new facilities
or for major modifications will be accepted only during these specified
periods. This initial and other public notices will contain information
about the completion and submission of applications to participate in
the broadcast auction, and applications for noncommercial educational
broadcast stations, as described in 47 U.S.C. 397(6), on non-reserved
channels, as well as any materials that must accompany the applications,
and any filing fee that must accompany the applications or any upfront
payments that will need to be submitted. Such public notices will also,
in the event mutually exclusive applications are filed for broadcast
construction permits that must be resolved through competitive bidding,
contain information about the method of competitive bidding to be used
and more detailed instructions on submitting bids and otherwise
participating in the auction. In the event applications are submitted
that are not mutually exclusive with any other application in the same
service, or in the event that any applications that are submitted that
had been mutually exclusive with other applications in the same service
are resolved as a result of the dismissal or modification of any
applications, the non-mutually exclusive applications will be identified
by public notice and will not be subject to auction.

\(b\) To participate in broadcast service auctions, or to apply for a
noncommercial educational station, as described in 47 U.S.C. 397(6), on
a non-reserved channel, all applicants must timely submit short-form
applications (FCC Form 175), along with all required certifications,
information and exhibits, pursuant to the provisions of § 1.2105(a) of
this chapter and any Commission public notices. So determinations of
mutual exclusivity for auction purposes can be made, applicants for
non-table broadcast services must also submit the engineering data
contained in the appropriate FCC form (FCC Form 301, FCC Form 346, or
FCC Form 349). Beginning January 1, 1999, all short-form applications
must be filed electronically. If any application for a noncommercial
educational broadcast station, as described in 47 U.S.C. 397(6), is
mutually exclusive with applications for commercial broadcast stations,
and the applicants that have the opportunity to resolve the mutually
exclusivity pursuant to paragraph (c) and (d) of this section fail to do
so, the application for noncommercial educational broadcast station, as
described in 47 U.S.C. 397(6), will be returned as unacceptable for
filing, and the remaining applications for commercial broadcast stations
will be processed in accordance with competitive bidding procedures.

\(c\) Applicants in all broadcast service auctions, and applicants for
noncommercial educational stations, as described in 47 U.S.C. 397(6), on
non-reserved channels will be subject to the provisions of § 1.2105(b)
of this chapter regarding the modification and dismissal of their
short-form applications. Notwithstanding the general applicability of §
1.2105(b) of this chapter to broadcast auctions, and applicants for
noncommercial educational stations, as described in 47 U.S.C. 397(6), on
non-reserved channels, the following applicants will be permitted to
resolve their mutual exclusivities by making amendments to their
engineering submissions following the filing of their short-form
applications:

\(1\) applicants for all broadcast services who file major modification
applications that are mutually exclusive with each other;

\(2\) applicants for all broadcast services who file major modification
and new station applications that are mutually exclusive with each
other; or

\(3\) applicants for the secondary broadcast services who file
applications for new stations that are mutually exclusive with each
other.

\(d\) The prohibition of collusion set forth in § 1.2105(c) of this
chapter, which becomes effective upon the filing of short-form
applications, shall apply to all broadcast service auctions.
Notwithstanding the general applicability of § 1.2105(c) of this chapter
to broadcast auctions, the following applicants will be permitted to
resolve their mutual exclusivities by means of engineering solutions or
settlements during a limited period after the filing of short-form
applications, as further specified by Commission public notices:

\(1\) applicants for all broadcast services who file major modification
applications that are mutually exclusive with each other;

\(2\) applicants for all broadcast services who file major modification
and new station applications that are mutually exclusive with each
other; or

\(3\) applicants for the secondary broadcast services who file
applications for new stations that are mutually exclusive with each
other.

\* \* \* \* \*

42. Section 73.5003 is revised to read as follows:

> \* \* \* \* \*

**§ 73.5003 Submission of full payments.**

If a winning bidder fails to pay the balance of its winning bid in a
lump sum by the applicable deadline as specified by the Commission, it
will be allowed to make payment within ten (10) business days after the
payment deadline, provided that it also pays a late fee equal to five
(5) percent of the amount due. Broadcast construction permits licenses
will be granted by the Commission following the receipt of full payment.

43. Section 73.5005 is amended by revising paragraph (a) to read as
    follows:

**§ 73.5005 Filing of long-form applications.**

\(a\) Within thirty (30) days following the close of bidding and
notification to the winning bidders, each winning bidder must submit an
appropriate long-form application (FCC Form 301, FCC Form 346, or FCC
Form 349) for each construction permit or license for which it was the
high bidder. Long-form applications filed by winning bidders shall
include the exhibits required by § 1.2107(d) of this chapter (concerning
any bidding consortia or joint bidding arrangements); § 1.2110(j) of
this chapter (concerning designated entity status, if applicable); and §
1.2112 of this chapter (concerning disclosure of ownership and real
party in interest information, and, if applicable, disclosure of gross
revenue information for small business applicants).

\* \* \* \* \*

44. Section 73.5006 is amended by revising paragraphs (a), (b), (c)
    and (d) to read as follows:

**§ 73.5006 Filing of petitions to deny against long-form
applications.**

a\) As set forth in 47 CFR 1.2108, petitions to deny may be filed
against the long-form applications filed by winning bidders in broadcast
service auctions and against the long-form applications filed by
applicants whose short-form applications were not mutually exclusive
with any other applicant, or whose short-form applications were mutually
exclusive only with one or more short-form applications for a
noncommercial educational broadcast station, as described in 47 U.S.C.
397(6).

\(b\) Within ten (10) days following the issuance of a public notice
announcing that a long-form application for an AM, FM or television
construction permit has been accepted for filing, petitions to deny that
application may be filed. Within fifteen (15) days following the
issuance of a public notice announcing that a long-form application for
a low-power television, television translator or FM translator
construction permit has been accepted for filing, petitions to deny that
application may be filed. Any such petitions must contain allegations of
fact supported by affidavit of a person or persons with personal
knowledge thereof.

\(c\) An applicant may file an opposition to any petition to deny, and
the petitioner a reply to such opposition. Allegations of fact or
denials thereof must be supported by affidavit of a person or persons
with personal knowledge thereof. In the AM, FM and television broadcast
services, the time for filing such oppositions shall be five (5) days
from the filing date for petitions to deny, and the time for filing
replies shall be five (5) days from the filing date for oppositions. In
the low-power television, television translator and FM translator
broadcast services, the time for filing such oppositions shall be
fifteen (15) days from the filing date for petitions to deny, and the
time for filing replies shall be ten (10) days from the filing date for
oppositions.

\(d\) If the Commission denies or dismisses all petitions to deny, if
any are filed, and is otherwise satisfied that an applicant is
qualified, a public notice will be issued announcing that the broadcast
construction permit(s) is ready to be granted, upon full payment of the
balance of the winning bid(s). See 47 CFR 73.5003. Construction of
broadcast stations shall not commence until the grant of such permit or
license to the winning bidder.

45. Section 73.5007 is amended by deleting paragraph (b)(2)(vi) and
    revising paragraphs (b)(2)(iv) and (v) to read as follows:

**§ 73.5007 Designated entity provisions.**

> \* \* \* \* \*

(b)(2)

\* \* \*

\(iv\) Cable television system\--the franchised community of a cable
system; and

\(v\) Daily newspaper\--community of publication.

> \* \* \* \* \*

46. Section 73.5008 is amended by revising paragraph (b) to read as
    follows:

\* \* \* \* \*

\(b\) A medium of mass communications means a daily newspaper; a cable
television system; or a license or construction permit for a television
broadcast station, an AM or FM broadcast station, or a direct broadcast
satellite transponder.

\* \* \* \* \*

**PART 74 \-\-- EXPERIMENTAL RADIO, AUXILIARY, SPECIAL BROADCASTING AND
OTHERPROGRAM DISTRIBUTIONAL SERVICES**

47. The authority citation for Part 74 continues to read as follows:

**AUTHORITY: 47 U.S.C. 154, 303, 307, and 554.**

48. Section 74.1 is amended by revising paragraph (b) to read as
    follows:

**§ 74.1 Scope.**

\* \* \* \* \*

\(b\) Rules in Part 74 which apply exclusively to a particular service
are contained in that service subpart, as follows: Experimental
Broadcast Stations, Subpart A; Remote Pickup Broadcast Stations, Subpart
D; Aural Broadcast STL and Intercity Relay Stations, Subpart E; TV
Auxiliary Broadcast Stations, Subpart F; Low-power TV, TV Translator and
TV Booster Stations, Subpart G; Low-power Auxiliary Stations, Subpart H;
FM Broadcast Translator Stations and FM Broadcast Booster Stations,
Subpart L.

49. Section 74.15 is amended by deleting paragraph (e) and redesignating
    paragraphs (f) and (g) as (e) and (f) respectively.

50. Section 74.703 is amended by revising paragraph (d) to read as
    follows:

**§ 74.703 Interference.**

\* \* \* \* \*

d\) When a low-power TV or TV translator station causes interference to
a CATV system by radiations within its assigned channel at the cable
headend or on the output channel of any system converter located at a
receiver, the earlier user, whether cable system or low-power TV or TV
translator station, will be given priority on the channel, and the later
user will be responsible for correction of the interference. When a
low-power TV or TV translator station causes interference to a BRS or
EBS system by radiations within its assigned channel on the output
channel of any system converter located at a receiver, the earlier user,
whether BRS system or low-power TV or TV translator station, will be
given priority on the channel, and the later user will be responsible
for correction of the interference.

\* \* \* \* \*

51. Section 74.832 is amended by revising paragraph (a) to read as
    follows:

**§ 74.832 Licensing requirements and procedures.**

\(a\) \* \* \*

\(6\) Licensees and conditional licensees of stations in the Service and
Multichannel Multipoint Distribution Service as defined in § 21.2 of
this chapter, or entities that hold an executed lease agreement with an
MDS or MMDS licensee or conditional licensee or with an Instructional
Television Fixed Service licensee or permittee.

\* \* \* \* \*

52. Subpart I is removed and reserved.

**PART 76 - MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE**

53. The authority for Part 76 continues to read as follows:

**AUTHORITY: 47 U.S.C. 151, 152, 153, 154, 301, 302a, 303, 303a, 307,
308, 309, 312, 317, 325, 338, 339, 503, 521, 522, 531, 532, 533, 534,
535, 536, 537, 543, 544, 544a, 545, 548, 549, 552, 554, 556, 558, 560,
531, 571, 572, and 573.**

54. Section 76.64 is amended by revising paragraph (d) to read as
    follows:

**§ 76.64 Retransmission consent.**

**\* \* \* \* \***

\(d\) A multichannel video program distributor is an entity such as, but
not limited to, a cable operator, a BRS/EBS provider, a direct broadcast
satellite service, a television receive-only satellite program
distributor, or a satellite master antenna television system operator,
that makes available for purchase, by subscribers or customers, multiple
channels of video programming.

\* \* \* \* \*

55. Section 76.71 is amended by revising paragraph (a) to read as
    follows:

**§ 76.71 Scope of application.**

\(a\) The provisions of this subpart shall apply to any corporation,
partnership, association, joint-stock company, or trust engaged
primarily in the management or operation of any cable system. Cable
entities subject to these provisions include those systems defined in §
76.5(a), all satellite master antenna television systems serving 50 or
more subscribers, and any multichannel video programming distributor.
For purposes of the provisions of this subpart, a multichannel video
programming distributor is an entity such as, but not limited to, a
cable operator, a BRS/EBS provider, a direct broadcast satellite
service, a television receive-only satellite program distributor, or a
video dialtone program service provider, who makes available for
purchase, by subscribers or customers, multiple channels of video
programming, whether or not a licensee. Multichannel video programming
distributors do not include any entity which lacks control over the
video programming distributed. For purposes of this subpart, an entity
has control over the video programming it distributes, if it selects
video programming channels or programs and determines how they are
presented for sale to consumers. Nothwithstanding the foregoing, the
regulations in this subpart are not applicable to the owners or
originators (of programs or channels of programming) that distribute six
or fewer channels of commonly-owned video programming over a leased
transport facility. For purposes of this subpart, programming services
are \"commonly- owned\" if the same entity holds a majority of the stock
(or is a general partner) of each program service.

\* \* \* \* \*

56. Section 76.503 is amended by revising paragraph (e) to read as
    follows:

**§ 76.503 National Subscriber Limits.**

**\* \* \* \* \***

\(e\) \"Multichannel video-programming subscribers\" means subscribers
who receive multichannel video-programming from cable systems, direct
broadcast satellite services, direct-to-home satellite services,
BRS/EBS, local multipoint distribution services, satellite master
antenna television services (as defined in § 76.5(a)(2)), and open video
systems.

\* \* \* \* \*

57. Section 76.905 is amended by revising paragraph (d) to read as
    follows:

**§ 76.905 Standards for identification of cable systems subject to
effective competition.**

\* \* \* \* \*

\(d\) A multichannel video program distributor, for purposes of this
section, is an entity such as, but not limited to, a cable operator, a
BRS/EBS provider, a direct broadcast satellite service, a television
receive-only satellite program distributor, a video dialtone service
provider, or a satellite master antenna television service provider that
makes available for purchase, by subscribers or customers, multiple
channels of video programming.

\* \* \* \* \*

58. Section 76.1000 is amended by revising paragraph (e) to read as
    follows:

**§ 76.1000 Definitions**

**\* \* \* \* \***

\(e\) Multichannel video programming distributor. The term
\"multichannel video programming distributor\" means an entity engaged
in the business of making available for purchase, by subscribers or
customers, multiple channels of video programming. Such entities
include, but are not limited to, a cable operator, a BRS/EBS provider, a
direct broadcast satellite service, a television receive-only satellite
program distributor, and a satellite master antenna television system
operator, as well as buying groups or agents of all such entities.

\* \* \* \* \*

59. Section 76.1200 is amended by revising paragraphs (a) and (b) to
    read as follows:

**§ 76.1200 Definitions.**

As used in this subpart:

\(a\) Multichannel video programming system. A distribution system that
makes available for purchase, by customers or subscribers, multiple
channels of video programming other than an open video system as defined
by § 76.1500(a). Such systems include, but are not limited to, cable
television systems, BRS/EBS systems, direct broadcast satellite systems,
other systems for providing direct-to-home multichannel video
programming via satellite, and satellite master antenna systems.

\(b\) Multichannel video programming distributor. A person such as, but
not limited to, a cable operator, a BRS/EBS provider, a direct broadcast
satellite service, or a television receive-only satellite program
distributor, who owns or operates a multichannel video programming
system.

\* \* \* \* \*

60. Section 76.1300 is amended by revising paragraph (d) to read as
    follows:

**§ 76.1300 Definitions.**

\* \* \* \* \*

\(d\) Multichannel video programming distributor. The term
\"multichannel video programming distributor\" means an entity engaged
in the business of making available for purchase, by subscribers or
customers, multiple channels of video programming. Such entities
include, but are not limited to, a cable operator, a BRS/EBS provider, a
direct broadcast satellite service, a television receive-only satellite
program distributor, and a satellite master antenna television system
operator, as well as buying groups or agents of all such entities.

\* \* \* \* \*

**PART 78 -- CABLE TELEVISION RELAY SERVICE**

61. The authority for Part 78 continues to read as follows:

**AUTHORITY: 47 U.S.C. 2, 3, 4, 301, 303, 307, 308, 309, 48 Stat., as
amended, 1064, 1065, 1066, 1081, 1082, 1083, 1084, 1085; 47 U.S.C. 152,
153, 154, 301, 303, 307, 308, 309.**

62. Section 78.1 is amended to read as follows:

**§ 78.1 Purpose.**

The rules and regulations set forth in this part provide for the
licensing and operation of fixed or mobile cable television relay
service stations (CARS) used for the transmission of television and
related audio signals, signals of standard and FM broadcast stations,
signals of BRS/EBS fixed stations, and cablecasting from the point of
reception to a terminal point from which the signals are distributed to
the public by cable. In addition CARS stations may be used to transmit
television and related audio signals to TV translator and low-power TV
stations.

63. Section 78.5 is amended by revising paragraph (j) to read as
    follows:

**§ 78.5 Definitions.**

\* \* \* \* \*

\(j\) Other eligible system. A system comprised of microwave radio
channels in the BRS/EBS spectrum (as defined in Subpart M of Part 27)
that delivers multichannel television service over the air to
subscribers.

\* \* \* \* \*

64. Section 78.11 is amended by revising paragraph (a) to read as
    follows:

**§ 78.11 Permissible service.**

\(a\) CARS stations are authorized to relay TV broadcast and low-power
TV and related audio signals, the signals of AM and FM broadcast
stations, signals of BRS/EBS fixed stations, and cablecasting intended
for use by one or more cable television systems or other eligible
systems. LDS stations are authorized to relay television broadcast and
related audio signals, the signals of AM and FM broadcast stations,
signals of BRS/EBS fixed stations, cablecasting, and such other
communications as may be authorized by the Commission. Relaying includes
retransmission of signals by intermediate relay stations in the system.
CARS licensees may interconnect their facilities with those of other
CARS, common carrier, or television auxiliary licensees, and may also
retransmit the signals of such CARS, common carrier, or television
auxiliary stations, provided that the program material retransmitted
meets the requirements of this paragraph.

\* \* \* \* \*

65. Section 78.13 is amended by deleting paragraph (e), redesignating
    paragraph (f) as paragraph (e) and revising paragraph (d) to read as
    follows:

**§ 78.13 Eligibility for license.**

\* \* \* \* \*

\(d\) Licensees and conditional licensees of channels in the BRS/EBS
band as defined in **§ 27.5(i)** of this chapter, or entities that hold
an executed lease agreement with a BRS/EBS licensee or conditional
licensee.

> \* \* \* \* \*

66. Section 79.1 is amended by revising paragraph (d) to read as
    follows:

**§ 79.1 Closed captioning of video programming.**

**\* \* \* \* \***

\(d\) \* \* \*

\(7\) EBS programming. Video programming transmitted by an Educational
Broadband Service licensee pursuant to part 27 of this chapter.

\* \* \* \* \*

**PART 101\--FIXED MICROWAVE SERVICES**

67. The authority citation for Part 101 continues to read as follows:

**AUTHORITY: 47 U.S.C. 154, 303.**

68. Section 101.101 is amended by deleting the reference to the
    2150-2160 MHz frequency band.

69. Section 101.147 is amended by deleting the reference to the
    2150-2160 MHz frequency band in paragraph (a), and by deleting and
    reserving paragraphs (e) and (g).

# APPENDIX D {#appendix-d .unnumbered}

# LIST OF COMMENTERS {#list-of-commenters .unnumbered}

**[Comments]{.underline}**

Adams Telecom, Inc., Central Texas Communications, Inc., & Leaco Rural
Telephone

Ad Hoc MMDS Licensee Consortium

Archdiocese of Los Angeles

Archdiocese of New York

Arraycomm, Inc.

Atlanta Interfaith Broadcasters

BellSouth Corporation and BellSouth Wireless Cable, Inc.

Catholic Television Network and National ITFS Association

Cellular Telecommunications & Internet Association

Colorado State University

Comspec Corporation

Dallas MDS Partners

Department of Education Archdiocese of New York

Diocese of Brooklyn

Earthlink, Inc.

The Education Community

Education Service Center Region 10

Ericsson, Inc.

Fixed Wireless Holdings, LLC

Grand Alliance

Grand Wireless Company

Hardin and Associates, Inc.

Hispanic Information and Telecommunications Network, Inc.

Illinois Institute of Technology

Independent MMDS Licensee Coalition

Information Technology Industry Council

Intel Corporation

IPWireless, Inc.

The ITFS/2.5 GHz Mobile Wireless Engineering & Development Alliance

ITFS Parties

Lucent Technologies, Inc.

Michael Kelly Revocable Trust, d/a/a Shannondale Wireless

MMDS License Coalition

Motorola, Inc.

National Telecommunications Cooperative Association

Navini Networks, Inc.

Network for Instructional TV, Inc.

New America Foundation, et. al.

Nextnet Wireless, Inc.

NTCA

Ntelos, Inc.

Oklahoma Western Telephone Company, Inc.

PCIA

Rural Commenters

The School Board of Broward County

The School Board of Miami-Dade County, Florida

South Carolina Educational Television Commission

Spectrum Market, LLC

Sprint Corporation

Stanford University and Northeastern University

Teton Wireless Television, Inc.

Texas State Technical College, Harlingen

University of Colorada

Virginia Communications, Inc.

Wavetel, LLC

W.A.T.C.H. TV Company

Wireless Communications Association, International (WCA), National
Instructional Television Fixed Service (NIA) and Catholic Television
Network (CTN)

WH-TV, Inc. d/b/a Digital TV One

Winbeam, Inc.

Worldcom, Broadband Solutions, Inc.

**[Reply Comments]{.underline}**

Adams Telecom, Inc., Central Texas Communications, Inc., & Leaco Rural
Telephone

Alvarion

Gordon Archer

Arraycomm, Inc.

Atlanta Interfaith Broadcasters

BellSouth Corporation and BellSouth Wireless Cable, Inc.

Bway.Net, Inc.

California Amplifier, Inc.

Catholic Television Network and National ITFS Association

Celplan Technologies, Inc.

Clarendon Foundation

Comspec Corporation

Department of Education Archdiocese of New York

Digital TV One

The Education Community

Education Service Center Region 10

Fixed Wireless Holdings, LLC

Flarion Technologies, Inc.

Peter Frishauf

George Mason University Instructional Foundation, F Corporation, Michael
Kelley Trust

Mary Gorman

Grand Alliance

Gryphon Wireless, LLC

Hispanic Information and Telecommunications Network, Inc.

Daniel Howe

Huntsville City Schools ETV

Intel Corporation

IPWireless, Inc.

The ITFS/2.5 GHz Mobile Wireless Engineering & Development Alliance

ITFS Spectrum Development Alliance, Inc.

Rob Kelley

Joshua Kronengold

Sascha D. Meinrath

Microsoft Corporation

Milwaukee Area Technical College District Board

The Mississippi Ednet Institute, Inc.

Navini Networks, Inc.

Network for Instructional TV, Inc.

New America Foundation, et. al.

Nextnet Wireless, Inc.

Nextel Communications, Inc.

North Carolina Community Colleges

Nucentrix Broadband Networks, Inc.

NTELOS, Inc.

Michael Oh

Polar Communications Mutual Aid Corporation

Pamela Quinn

Rural Commenters

H. Michael Sanders

San Diego ITFS Licensees

SBC Communications

School Board of Broward County

The School Board of Miami-Dade County, Florida

Sioux Valley Wireless

Kurt A Snodgrass

Soma Networks

Spectrum Market, LLC

Sprint Corporation

Stanford University, Northeastern University, Diocese of Brooklyn

Teton Wireless Television, Inc.

Blake Twedt & John Dudeck

University of Arizona

University of South Florida

WH-TV, Inc., D/B/A Digital TV One

Tom Zachman

**[Ex Parte Comments]{.underline}**

Shaun Abshere

Accel Net, Inc.

ACUTA, Inc.

Ad Hoc MMDS Licensee Consortium

Aircable America

Aircomm Associates/Nutec Communications, Inc.

Tommy Allmand

Anaheim City School District

Archbishop of Chicago

Archbishop of Los Angeles

Atlanta Interfaith Broadcasters, Inc.

Dr. Herb Berg

Robert J. Berger

Bishop of Dallas

Moss Bresnahan, President of South Carolina ETV

Donald Briggs

Scott Brooke

James W. Browder

Robert H. Bruininks

John Bucher

Carolyn Burrow

Catholic Television Network and National ITFS Association

Carolyn Bukhair

Christopher Casebeer

Charleston County School District

Clearwire Corporation

Jennifer Davis

Digital Broadcast Corporation

Education Community, Catholic Television Network, and National ITFS
Association

Educational Institutions

Electronic Frontier Foundation

Jim Emal

Lisa Faas

Joe Farmer

Robert J. Fear

Sidnie Feit

Tom Fletcher

Friends of WLRN, Inc.

George Mason University Instructional Foundation

W. Scott Gerstenberger

Alexander Gonzalez, President, California State University-Sacramento

Jim Gottlieb

John Haeger

Elisabeth Hall

Mike Hammett

Lenn Hann

Hawkeye Community College

HITV, Hernando County School Board

Joanne Hugi

Huntsville City Schools ETV Center

Illinois Institute of Technology & Stanford University

Information Technology Industry Council

Intel Corporation

Interested Education Parties

International Society for Technology in Education and Consortium for
School Networking

IPWireless

Dr. Michael R. Kelley

Kirkwood Community College

H. Martin Lancaster, NC Community College System

Michael Lannon

Last Mile Wireless

Jack Lemley

Luxon Wireless

Sandy Maddox

Ed Mass

Mark McAllister

Allen McDaniel

Mary McLaughlin

Charles McMickle

Media Access Project

Stephen Merrill

Miami-Dade County Public Schools

Michiana Wireless

Minnesota Network Services

Missouri Southern State University

Mountain State College

Navini Networks, Inc.

Network For Instructional TV, Inc.

Nextel Communications, Inc.

New America Foundation, *et. al*.

Oregon Wireless Instructional Network

Oswalt Systems, Inc.

Hartwell Pendergrass

Private Networks, Inc.

Pamela K. Quinn

QwikWire.NET

Reliable Internet Services

James R. Richburg, President Okaloosa-Walton Community College

Connie Rodriguez

Rural Ramp

The School Board of Broward County

Mathew Schroebe

John Scrivner - Mt. Vernon. Net, Inc.

Fred Seitz

Sanford C. Shugart

Sioux Valley Wireless

Sprint Corporation

Stanford University

Statewide Internet Services

Texas ISP Association

Tim Steele

Kevin Sullivan

Tarrant County College District

Teton Wireless Television, Inc.

Troy Thoele - Cybercom Wireless

Traer Municipal Utilities

University of Cincinnati, Raymond Walters College, Dean Dolores Y.
Straker

Steve H. Updegrove

WATCH TV Company

Webpipe.net, Inc.

James E. Wesner, University of Cincinnati

Gary Williams

Wireless Communications Association, International

Bill Wisneski

WISPA

Zirkel Wireless - Sean Heskett

Peter Zoller

# APPENDIX E {#appendix-e .unnumbered}

# DISMISSED MUTUALLY EXCLUSIVE ITFS APPLICATIONS {#dismissed-mutually-exclusive-itfs-applications .unnumbered}

  ------------------ ----------------------------- ----------- --------------------
  **MX-groupings**   **Name**                      **Group**   **Location**

  19920402DL         Hillsdale Community Schools   A           Albion, MI

  19920402DM         Jonesville Community School   B           Albion, MI

  19920717DA         Michigan Center School Dist.  A           Jackson, MI

  19920717DB         Concord Community School      B           Jackson, MI

  19920825DE         Clarendon Foundation          A           Baton Rouge, LA

  19920917DB         Views on Learning             B           Baton Rouge, LA

  19920925DE         ABG Foundation Nebraska       D           Omaha, NE
                     Chapter, Inc.                             

  19931228DJ         Louisiana Educational TV      A           Plaquemine, LA
                     Authority                                 

  19931228DA         The Fd Ex LA Pub              C           Plaquemine, LA

  19931230DU         Creighton University          D           Omaha, NE

  9550910            WBSWP Licensing Corporation   H           Boynton Beach, FL
                     (MDS, MX with ITFS)                       

  19950524DD         Florida Atlantic University   C           Palm Beach, FL

  19950915HW         The School Board of Dade      F/G         Miami, FL
                     County, Florida                           

  19950912DO         Instructional                 C           Salt Lake City, UT
                     Telecommunications                        
                     Foundation, Inc.                          

  19950914LC         Verde Valley School           D           Casa Grande, AZ

  19951016AQ         Hispanic Info Telecom Network D           Casa Grande, AZ

  19951016AV         Hispanic Info Telecom Network B           Bloomingdale, GA

  19951016BJ         Hispanic Info Telecom Network C           Santa Rosa, CA

  19951017AM         Shekinah Network              B           Eureka, CA

  19951018AD         Canyon County School          B           Boise, ID

  19951019CC         CA State University           A/B         Santa Barbara
                     Northridge                                

  19951020AG         North American Catholic       A           Eureka, CA
                     Educational Programming                   
                     Foundation, Inc.                          

  19951020AT         Santa Maria Joint Union HS    A/B         Santa Ynez, CA

  19951020BC         The Delta-Montrose AVTC       B           Delta, CO

  19951020BI         Tulane University of LA       A           Monroe, LA

  19951020BL         Ft Hayes St University        A           Great Bend, KS

  19951020ET         Hispanic Info Telecom Network B           Boise, ID

  19951020FM         Santa Rosa Junior College     C           Santa Rosa, CA

  19951020GG         Hispanic Info Telecom Network G           Billings, MT

  19951020GI         Hispanic Info Telecom Network B           Salinas, CA

  19951020HK         LA Educational TV Auth        A           Delhi, LA

  19951020KF         Chicago Inst Tech Td Inc      D           University PK, IL

  19951020LD         North American Catholic       G           Alamosa, CO
                     Educational Programming                   
                     Foundation, Inc.                          

  19951020LM         The Clarendon Foundation      C           Ukiah, CA

  19951020NE         North American Catholic       B           Delta, CO
                     Educational Programming                   
                     Foundation, Inc.                          

  19951020PK         The Information Res F         B           Grand Junction, CO

  19951020PP         LA Educational TV Authority   A           Monroe, LA

  19951020PZ         Views on Learning, Inc.       A           Eureka, CA

  19951020QT         Hartnell Community College    B           Salinas, CA

  19951020RB         Cornerstone Christian SS Inc. A           Grand Junction, CO

  19951020SG         Delta Cty Joint School D #51  A           Delta, CO

  19951020SN         Provo School District         C           Provo, UT

  19951020SQ         St. Bede Academy              D           Ottawa, IL

  19951020SV         Unified Sch Dist 489          A           Hayes, KS

  19951020WP         Hispanic Info Telecom Network G           Alamosa, CO

  19951020XT         Board of Education for        B           Bloomingdale, GA
                     Savannah                                  

  19951020ZR         Yellowstone ED Cnt            G           Billings, MT

  19951020GE         Currituck County Board of     D           Hertford, NC
                     Education                                 

  19951020E2         Elizabeth City State          D           Elizabeth City, NC
                     University                                

  19951020UH         Roanoke Bible College         B           Elizabeth City, NC

  19951020S5         Univ of NC General Admin      B           Chapel Hill, NC
  ------------------ ----------------------------- ----------- --------------------

# APPENDIX F {#appendix-f .unnumbered}

# DISMISSED PLEADINGS RELATING TO MUTUALLY EXCLUSIVE ITFS APPLICATIONS {#dismissed-pleadings-relating-to-mutually-exclusive-itfs-applications .unnumbered}

  ------------ ------------------- -------------------- ------------ ------------
  **File No.** **Applicant**       **Petitioner**       **Type of    **Date
                                                        Pleading**   Pleading
                                                                     Filed**

  19920402DL   Hillsdale Community Wireless Cable, Inc. Petition to  2/19/1993
               Schools                                  Deny         

  19920402DM   Jonesville          Wireless Cable, Inc. Petition to  2/19/1993
               Community Schools                        Deny         

  19920717DA   Michigan Center     Hillsdale Community  Petition to  2/5/1993
               School District     Schools              Deny         

  19951020SN   Provo School        Instructional        Petition to  7/11/1997
               District            Telecommunications   Deny         
                                   Foundation, Inc.                  

  19920925DE   ABG Foundation,     USA Wireless Cable,  Petition to  12/30/1993
               Nebraska Chapter,   Inc.                 Deny         
               Inc.                                                  

  9550910      WBSWP Licensing     WBSWP Licensing      Waiver       5/24/1995
               Corp.               Corp.                Request      

  19950915HW   The School Board of The School District  Petition to  11/1/1996
               Dade County,        of Broward County,   Deny         
               Florida             Florida                           

  19950524DD   Florida Atlantic    The School Board of  Petition to  11/1/1996
               University          Dade County, Florida Deny         
  ------------ ------------------- -------------------- ------------ ------------

**SEPARATE STATEMENT OF**

**CHAIRMAN MICHAEL K. POWELL**

*Re: Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules
to Facilitate the Provision of Fixed and Mobile Broadband Access,
Education and Other Advanced Services in the 2150-2162 and 2500-2690 MHz
Bands (WT Docket No. 03-66); et al., Report and Order and Further Notice
of Proposed Rulemaking.*

We are witnessing the dawn of a new era for wireless broadband. Today's
decision does away with heavy-handed rules that have governed the
MDS/ITFS band ("2.5 GHz band") for far too long. Freed from regulatory
shackles, educational institutions will now have the flexibility to
utilize their spectrum in the way most advantageous to the students and
the public they serve.

The magnitude of today's ruling is apparent when one considers that this
band is *double* the spectrum that sparked the WiFi explosion at 2.4 GHz
and equivalent to the entire spectrum devoted to terrestrial mobile,
wireless services. Until now, 2.5 GHz has failed to emulate the
successes experienced by these other bands.

This Order gives ITFS and the newly named Broadband Radio Service (BRS)
licensees new options for developing and deploying innovative
technologies including low-power, mobile wireless broadband
technologies. These systems will provide a competitive alternative to
cable modem and DSL service and will transform the marketplace by
expanding broadband rural areas and decreasing the price of current
broadband services.

In addition, this Order offers more choices to educational institutions.
Under these new rules, licensees can choose to continue delivering
high-powered educational television, develop new instructional uses over
the ITFS spectrum, or lease excess capacity to commercial operators to
fund alternative educational delivery methods. It's up to them to decide
what makes the most sense to serve their community.

Today's decision is yet another milestone in this drive to expand the
advanced broadband services nationwide. By promoting education,
competition, innovation, and broadband deployment today's decision helps
benefit us all.

Lastly, I would like to express my sincere gratitude to the Wireless
Bureau staff who worked many long hours to resolve the difficult issues
presented in this proceeding. I'd also like to thank everyone who
participated in this proceeding, my esteemed colleagues, the agency
Bureaus, educators, and the industry, for their comments and insightful
proposals.

**SEPARATE STATEMENT OF**

**COMMISSIONER KATHLEEN Q. ABERNATHY**

*Re: Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules
to Facilitate the Provision of Fixed and Mobile Broadband Access,
Education and Other Advanced Services in the 2150-2162 and 2500-2690 MHz
Bands (WT Docket No. 03-66); et al., Report and Order and Further Notice
of Proposed Rulemaking.*

With this order the Commission furthers two critical goals; maximizing
the efficient use of the spectrum resource and facilitating the
deployment of broadband services to all Americans. While many MMDS and
ITFS licensees currently provide very valuable services to the public,
it appears that these services have not yet reached their full potential
and some of the spectrum remains underutilized. Licensees have
repeatedly told us that regulatory hurdles thwart their attempts to
deploy the new, innovative services demanded by the market.

This order responds directly to a proposal from the ITFS and MMDS
industries for major revision of current regulations. Our intent is to
ensure these services will no longer be hindered by outdated and overly
restrictive regulation. While we have not adopted the industry proposal
in total, we have used it as a solid basis for many of the rule changes
we adopt today. These new policies will promote greater flexibility for
the newly named Broadband Radio Service (BRS) licensees so that they can
deploy new products, such as a third broadband pipe to the home, a
mobile solution, a broadcast alternative, or some other service, as
driven by the market. In addition, this order grants the educational
community the same flexibility as commercial users in order to ensure
that our nation's educators have access to the most innovative
technologies and services.

As BRS and ITFS licensees transition to our new band plan, I look
forward to receiving the upcoming reports from the Wireless
Telecommunications Bureau which will monitor and evaluate the use of the
band to ensure that the spectrum is being used efficiently and
effectively.

Finally, I want to thank all the parties that participated in this
proceeding for their cooperation and input, as well as the staff of the
Wireless Telecommunications Bureau for their tireless work to

quickly resolve the many issues presented to us in this proceeding.

**SEPARATE STATEMENT OF**

**COMMISSIONER MICHAEL J. COPPS**

*Re: Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules
to Facilitate the Provision of Fixed and Mobile Broadband Access,
Education and Other Advanced Services in the 2150-2162 and 2500-2690 MHz
Bands (WT Docket No. 03-66); et al., Report and Order and Further Notice
of Proposed Rulemaking.*

Today we take a major step toward providing stability in the MMDS and
ITFS band. We establish a new band plan that separates high-power
operations from low-power operations. We create a transition mechanism
designed to move us from the current plan to a new three-part band plan.
And, most importantly, we resolve with finality the question of ITFS
eligibility. ITFS licenses are, and will continue to be, reserved for
educators. Uncertainty on all these matters has created a confusing
environment for too long, and it has held back needed investment. But
now 1,275 ITFS licensees in 70,000 locations have the stability they
need to make the most of this spectrum. I thank the Chairman and my
colleagues for making this the case.

So now our ITFS and MMDS licensees can fully demonstrate to the
Commission that with this stability they will build out their systems.
Many licensees are already doing incredible work and making efficient
and intensive use of the spectrum. Others are not, but now they have the
opportunity---and the obligation---to do so. The Bureau has been tasked
with reporting to the Commission on progress on the transition and on
the intensity of use of the band. While we all understand that the
dislocations caused by the transition will have an impact on deployment
schedules, every licensee must work hard to ensure that they move
forward and put this valuable spectrum to use rapidly. There are many
who believe that MMDS and ITFS licensees will not use the spectrum
efficiently. I think they are wrong. This is your chance, licensees, to
prove the skeptics wrong.

The best ITFS licensees provide an example of how the public's spectrum
can truly be used to serve the public interest. Children are educated.
Distance learning is enabled. Rural access becomes a reality. Let's make
the best of ITFS the rule for the whole band.

Thanks to the Bureau and thanks again to my colleagues for all the hard
work on this difficult item. I believe that our collaboration has
produced very positive results.

**SEPARATE STATEMENT OF\
COMMISSIONER KEVIN J. MARTIN**

*Re: Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules
to Facilitate the Provision of Fixed and Mobile Broadband Access,
Education and Other Advanced Services in the 2150-2162 and 2500-2690 MHz
Bands (WT Docket No. 03-66); et al., Report and Order and Further Notice
of Proposed Rulemaking.*

I am pleased to support this item, which initiates a fundamental
restructuring of the Instructional Fixed Service (ITFS), Multipoint
Distribution Service (MDS), and Multichannel Multipoint Distribution
Service (MMDS) band. Based on broad support from the affected parties,
this item provides a home for both high-power and low-power operations
and thereby gives users greatly enhanced flexibility. This approach
preserves the ability of users to provide traditional video and other
services, while also significantly promoting broadband deployment.
Indeed, I am optimistic that this spectrum will provide a home for
last-mile broadband applications, providing competition to telephone and
cable lines. In the end, consumers will benefit from innovative services
and lower prices.

I am also particularly pleased that we retained the requirement that
ITFS spectrum be held by educational institutions and organizations.
Encouraging and supporting education is a crucial value to our society,
and that value is reflected in the reservation of spectrum for
educational users. While some argue that educational spectrum is
currently not being used efficiently, we must remember that this
spectrum has been under the cloud of major proposed changes for a number
of years. Now that a plan for restructuring the band is in place, we
should give educators the opportunity and encouragement to move forward.

**SEPARATE STATEMENT OF**

**COMMISSIONER JONATHAN S. ADELSTEIN**

*Re: Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules
to Facilitate the Provision of Fixed and Mobile Broadband Access,
Education and Other Advanced Services in the 2150-2162 and 2500-2690 MHz
Bands (WT Docket No. 03-66); et al., Report and Order and Further Notice
of Proposed Rulemaking.*

The Communications Act places an obligation on the Commission to
encourage the investment in and rapid deployment of new technologies. In
today's Order, we hopefully meet that obligation by adopting rules that
provide a framework for innovation in the BRS and ITFS services. Our
rules accommodate the latest technologies and will facilitate the
provision of broadband over wireless, a potential third pipe to the
home. It is no secret that the BRS and ITFS services have had a tortured
regulatory history. Today we establish a policy regime that will finally
bring these services squarely into the 21^st^ century.

The changes we are making today rightly recognize the potential of the
2496-2690 MHz band and take advantage of its capabilities. I am most
excited about the future use of the spectrum for broadband services,
both commercial and educational. I am a strong believer in the future
and the potential of broadband communications. Broadband has the power
to transform the lives of individuals and the future of communities. I
believe that wireless solutions will play an important role in the
future for broadband deployment especially in rural areas. Today's Order
recognizes this and implements the means to promote advanced wireless
services.

I also am pleased that we reaffirm today that there is a continued role
for educators in this spectrum band. For forty years, ITFS providers
have used this spectrum for educational programming. It would be wrong
to phase out the role of educators at the same time we radically change
the structure of the band. Stanford University, my own alma mater, has
been licensed to operate as an ITFS system for over thirty years. The
university transmits more than 350 programming hours a week. Stanford
provides instructional coursework to thousands of graduate students
throughout the Bay Area and works closely with many in the high tech
community to ensure that their employees have the best education
possible.

As we transition to broadband, we need to consider the important work of
educators using ITFS like Stanford. And we also need to consider the
impact of the transition on those incumbents who are providing video and
broadband services in smaller markets throughout the country. I have
worked hard to ensure as smooth a transition as possible for ITFS and
MDS incumbents, and thank my colleagues for their support in
accommodating a number of my revisions. I am also pleased that the
Commission has asked for a series of reports that will give details on
the progress of the transition process and will comment on some of the
lessons learned as we undertake this novel effort.

I am disappointed, though, that the Order moves forward with a
transition process that is based on major economic areas (MEAs). The BRS
and ITFS services are local services, and I believe that broadband
deployment for the foreseeable future will be rolled out on a relatively
localized basis. I am concerned that the obligation to transition an
entire MEA will make it exceedingly difficult for proponents to
effectuate transitions in their particular market.

Finally, I want to thank the Wireless Telecommunications Bureau for all
of their time and hard work spent on this monumental item. This Order
represents a significant step by the Commission to ensure that providers
continue to have opportunities to deploy broadband so that all consumers
across America have access to the best communications possible.

[^1]: The terms MDS and MMDS are often used interchangeably. The
    Commission coined the term "MDS" at a time when it was making only
    two channels available for the service, at 2150-2162 MHz. The
    Commission began using the term "MMDS" when formulating rules making
    additional channels for the service available in the 2500-2690 MHz
    band. For the purposes of this *Report and Order and Further Notice
    of Proposed Rulemaking (R&O and FNPRM as appropriate)*, we will use
    the term "MDS" to signify both services.

[^2]: Federal Communications Commission, Strategic Plan FY 2003-FY 2008
    at 5 (2002) (*Strategic Plan*).

[^3]: *Id.* at 14.

[^4]: See 47 U.S.C. §§ 157(a), 309(j)(4)(C)(iii).

[^5]: 47 U.S.C. § 303(y). *See, e.g.,* Ad Hoc MMDS Licensee Consortium
    (AHMLC) Comments at 3; ArrayComm Comments at 1; School Board of
    Broward County (SBBC) Comments at 1; Cellular Telecommunications &
    Internet Association (CTIA) Comments at 3; Information Technology
    Industry Council (ITIC) Comments at 2-3.

[^6]: Federal Communications Commission, *Eighth Annual CMRS Competition
    Report* (FCC 03-150, rel. Jul. 14, 2003) at 11.

[^7]: *Id.*

[^8]: A Proposal for Revising the MDS and ITFS Regulatory Regime,
    submitted by the Wireless Communications Association International,
    Inc. (WCA), the National ITFS Association (NIA) and the Catholic
    Television Network (CTN), RM-10586 (filed Oct. 7, 2002) at 4
    (Coalition Proposal or White Paper). WCA is the trade association of
    the wireless broadband industry. NIA is a non-profit, professional
    organization of ITFS licensees, applicants and others interested in
    the ITFS. CTN is an association of Roman Catholic archdioceses and
    dioceses that operate many of the largest parochial school systems
    in the United States. These entities represent that the proposals
    contained in the paper reflect a consensus among the organizations
    concerning rule changes for the 2500-2690 MHz band. *See* Coalition
    Proposal at 1, n.1.

[^9]: Spectrum Study of 2500-2690 MHz Band: The Potential for
    Accommodating Third Generation Mobile Systems, (rel. March 30, 2001)
    at 13 (*3G Final Report)*.

[^10]: Amendment of Parts 1, 21 and 74 to Enable Multipoint Distribution
    Service and Instructional Television Fixed Service Licensees to
    Engage in Fixed Two-Way Transmissions, MM Docket No. 97-217, *Report
    and Order on Further Reconsideration and Further Notice of Proposed
    Rulemaking*, 15 FCC Rcd 14566 (2000) (*Two-Way FNPRM*).

[^11]: *See* Educational Television, Docket No. 14744, *Report and
    Order*, 39 FCC 846 (1963) (*MDS R&O*), *recon. denied*, 39 FCC 873
    (1964) (*ETV Decision*).

[^12]: *See* Amendment of the Commission\'s Rules With Regard to the
    Instructional Television Fixed Service, the Multipoint Distribution
    Service, and the Private Operational Fixed Microwave Service; and
    Applications for an Experimental Station and Establishment of
    Multi-Channel Systems, *Report and Order*, 48 Fed. Reg. 33873, 33875
    ¶ 9 (1983) (*1983 R&O*) *citing ETV Decision*, 39 FCC 846, 853 ¶ 25.

[^13]: *Id*.

[^14]: Amendment of Parts 1, 2, 21, and 43 of the Commission's Rules and
    Regulations to Provide for Licensing and Regulation of Common
    Carrier Radio Stations in the Multipoint Distribution Service,
    *Report and Order*, Docket No. 19493, 45 FCC 2d 616 (1974), *recon.
    denied*, 57 FCC 2d 301 (1975) (*1974 R&O)*. *See also 1983 R&O,* 48
    Fed. Reg. at 33873 ¶ 5. Amendment of Parts 2 and 74 of the
    Commission's Rules to Establish a New Class of Educational
    Television Service for the Transmission of Instructional and
    Cultural Material to Multiple Receiving Locations on Channel in the
    2500-2690 MHz Frequency Band, Docket No. 14744, *Second Report and
    Order*, 30 FCC 2d 197 ¶ 8 (1971) (*1971 R&O)*.

[^15]: *Id*.

[^16]: Amendment of Part 21.703(g), and (h) of the Commission's Rules,
    *Memorandum Opinion and Order*, 47 FCC 2d 957 (1970).

[^17]: *Id*.

[^18]: Amendment of Parts 2, 21, 74 and 94 of the Commission\'s Rules
    and Regulations in regard to frequency allocation to the
    Instructional Television Fixed Service, the Multipoint Distribution
    Service, and the Private Operational Fixed Microwave Service, Gen
    Docket No. 80-112 and CC Docket No. 80-116, *Report and Order*, 94
    FCC 2d 1203 (1983) (*First Leasing Decision*).

[^19]: *Id.* at 1203 ¶ 4.

[^20]: *First* *Leasing Decision*, 94 FCC 2d at 1203.

[^21]: *See* section 3, *infra,* for further discussion of leasing
    practices and issues.

[^22]: Amendment of Part 74 of the Commission's Rules and Regulations in
    Regard to the Instructional Television Fixed Service, MM Docket No.
    83-523, *Second Report and Order*, 101 FCC 2d 50, 87 ¶ 95 (1985)
    (*1985 R&O*).

[^23]: *See* Amendment of Parts 21 and 74 to Enable Multipoint
    Distribution Service and Instructional Television Fixed Service
    Licensees to Engage in Fixed Two-Way Transmissions, *Report and
    Order*, 13 FCC Rcd 19112, 19157 ¶¶ 86-87 (1998) (*Two-Way R&O*).

[^24]: Multipoint Distribution Service Regulatory Classification, CC
    Docket No. 86-179, *Report and Order,* 52 Fed. Reg. 27553 (1987)
    (summarizing FCC 87-210, released July 16, 1987).

[^25]: Amendment of Parts 21, 43, 74, 78, and 94 of the Commission\'s
    Rules Governing Use of the Frequencies in the 2.1 and 2.5 GHz Bands
    Affecting: Private Operational-Fixed Microwave Service, Multipoint
    Distribution Service, Multichannel Multipoint Distribution Service,
    Instructional Television Fixed Service, & Cable Television Relay
    Service, GN Docket No. 90-54, *Order on Reconsideration*, 6 FCC Rcd
    6764, 6774 (1991), *recon. denied,* 7 FCC Rcd 5648 (1992) (*1991
    R&O*).

[^26]: For example, the Commission eliminated the requirement that ITFS
    licensees fulfill their minimum educational usage obligations by
    transmitting such content on their own stations, allowing them the
    option of transmitting it on other licensees' ITFS or MDS stations.
    *See Two-Way R&O*, 13 FCC Rcd at 19165-66 ¶¶ 100-101.

[^27]: Prior to its allocation to ITFS, the 2500-2690 MHz band was
    allocated to shared use by Private Operational Fixed Microwave
    Service (OFS) stations and international control stations. The
    traditional Fixed Service use of this band was primarily private
    microwave communications uses such as multichannel voice and data
    circuits. *See 1983 R&O,* 48 Fed. Reg. at 33873 ¶ 8.

[^28]: *1991 R&O,* 6 FCC Rcd at 6792. In the first *R&O* in this
    proceeding, the Commission made MDS operators eligible to use
    microwave frequencies in the Cable Television Relay Service (CARS).
    Amendment of Parts 21, 43, 74, 78 and 94 of the Commission's Rules
    Governing Use of the Frequencies in the 2.1 and 2.5 GHz Bands
    Affecting Private Operational-Fixed Microwave Service, Multipoint
    Distribution Service, Multi-Channel Multipoint Distribution Service,
    Instructional-Television Fixed Service, and Cable Television Relay
    Service, *Report and Order*, 5 FCC Rcd 6411, 6423 (1990) (*1990
    R&O*). CARS is primarily a service for carrying video. Amendment of
    Eligibility Requirement in Part 78 Regarding 12 GHz Cable Television
    Relay Service, *Report and Order*, 17 FCC Rcd 9930, 9945-6 (2002)
    (*CARS R&O*). ITFS operators are currently not eligible for CARS
    licenses, except in very limited circumstances. 47 C.F.R. §
    78.13(e).

[^29]: Amendment of Part 74 of the Commission's Rules Governing Use of
    the Frequencies in the Instructional Television Fixed Service, MM
    Docket 93-106, *Report and Order,* 9 FCC Rcd 3360 ¶ 2 (1994) (*1994
    R&O*). *See also* 47 C.F.R. § 74.931(e)(9).

[^30]: *See* Use of Digital Modulation by Multipoint Distribution
    Service and Instructional Television Fixed Service Stations,
    *Declaratory Ruling and Order*, 11 FCC Rcd 18839 (1996) (*Digital
    Modulation Declaratory Ruling and Order*).

[^31]: *Two-Way NPRM,* 15 FCC Rcd at 14566.

[^32]: *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, *First Report and
    Order and Memorandum Opinion and Order*, 16 FCC Rcd 17222 (2001)
    (*3G R&O*).

[^33]: Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's
    Rules to Facilitate the Provision of Fixed and Mobile Broadband
    Access, Educational and Other Advanced Services in the 2150-2162 and
    2500-2690 MHz Bands; Part 1 of the Commission\'s Rules - Further
    Competitive Bidding Procedures; Amendment of Parts 21 and 74 to
    Enable Multipoint Distribution Service and the Instructional
    Television Fixed Service Amendment of Parts 21 and 74 to Engage in
    Fixed Two-Way Transmissions; Amendment of Parts 21 and 74 of the
    Commission\'s Rules With Regard to Licensing in the Multipoint
    Distribution Service and in the Instructional Television Fixed
    Service for the Gulf of Mexico; WT Docket Nos. 03-66, 03-67, 02-68,
    MM Docket No. 97-217, *Notice of Proposed Rulemaking and Memorandum
    Opinion and Order*, 18 FCC Rcd 6722, 6734 ¶ 23 (2003) (*NPRM*).

[^34]: *Id.*

[^35]: *Id.*

[^36]: *See generally* Coalition Plan.

[^37]: For example, the Coalition contends that it has become clear that
    the growth of direct broadcast satellite (DBS) and cable systems has
    "closed the window of opportunity for wireless cable" in all but a
    relatively few markets where wireless cable has gained a foothold.
    Coalition Proposal at 2. In regard to two-way services, the
    Coalition states that because of problems associated with first
    generation two-way technology, many in the industry have decided to
    halt deployment of additional first generation systems until those
    problems can be resolved. Coalition Proposal at 4.

[^38]: Coalition Proposal at 5-7.

[^39]: *See* Letter from the Coalition to Thomas J. Sugrue, Chief,
    Wireless Telecommunications Bureau, Federal Communications
    Commission dated Oct. 7, 2002 (accompanied the Coalition Proposal).

[^40]: The Coalition narrowed the channels in the LBS and UBS to 5.5
    megahertz in order to provide room for the J and K bands to separate
    high-power and low-power services. The Coalition explains that
    "\[a\]lthough the channels in the LBS and the UBS will be 5.5 MHz
    wide rather than 6 MHz wide and the channels in the Transition Band
    will be 1.5 MHz wide, no change in the current rules affording
    licensees the flexibility to subchannelize and superchannelize is
    proposed. Therefore, even after the transition licensees can
    continue to utilize 6 MHz channels in the LBS, the UBS, and the
    Transition Bands, provided that appropriate consents are achieved."
    Coalition Proposal at 13 n.32.

[^41]: For example, the Coalition contends that under the current
    licensing model, it will take substantially more applications to
    license a populated market for second generation MDS service
    (*e.g.,* low-power, two-way broadband service). It estimates that it
    could take close to two thousand applications under the current
    licensing approach to fully license the band for a second generation
    system in just one major market. This licensing model, according to
    the Coalition, results in substantial transaction costs and delays
    of providing service. *See* Coalition Proposal at 7-8.

[^42]: For example, the Coalition argues that "an applicant is required
    by the complex 'Appendix D' interference-prediction methodology to
    assume in conducting analyses that each and every one of its
    subscribers is located at the very point most likely to cause
    interference to a neighbor. In other words, an applicant proposing
    to provide service on a given channel to 1000 subscribers
    simultaneously is required to assume that all 1000 subscribers will
    be at the very spot most likely to cause interference.
    Unfortunately, these hypothetical assumptions, for all practical
    purposes, preclude system operators from serving substantial
    portions of their authorized territories. *See* Coalition Proposal
    at 3.

[^43]: Wireless Telecommunications Bureau Seeks Comment of Proposal to
    Revise Multichannel Multipoint Distribution Service and the
    Instructional Television Fixed Service Rules, DA 02-2732, *Public
    Notice* (rel. Oct. 17, 2002) *(MDS/ITFS Public Notice)*. Fifty-three
    entities filed comments and eight filed reply comments.

[^44]: *See NPRM,* 18 FCC Rcd at 6722.

[^45]: *See* Telecommunications Act of 1996, Pub. L. 104-104, § 706(a),
    110 Stat. 56 (1996); 47 U.S.C. § 157.

[^46]: *Id.*

[^47]: *See NPRM*, 18 FCC Rcd at 6743 ¶ 45.

[^48]: *See* Principles for Promoting Efficient Use of Spectrum By
    Encouraging the Development of Secondary Markets, Policy Statement,
    15 FCC Rcd 24178, 24191 ¶ 31 (2000) (*2000* *Spectrum Policy
    Statement)*.

[^49]: *Id.* at 24191 ¶ 32.

[^50]: *Id.* at 24194 ¶ 40.

[^51]: *See NPRM*, 18 FCC Rcd at 6744-45 ¶ 47-48.

[^52]: Amendment of Parts 1, 2, 21, and 43 of the Commission's Rules and
    Regulations to Provide for Licensing and Regulation of Common
    Carrier Radio Stations in the Multipoint Distribution Service,
    Docket No. 19493, *Report and Order*, 45 FCC 2d 616 (1974), *recon.
    denied*, 57 FCC 2d 301 (1975) (*1974 R&O)*. *See also 1993 R&O,* 48
    Fed. Reg. at 33873 ¶ 5; *1971 R&O*, 30 FCC 2d at 197 ¶ 8. As noted
    above, in the top fifty markets, MDS Channel 2 is 2156-2162 MHz.
    Unless the context requires us to specifically discuss the top fifty
    markets, we will refer to MDS Channel 2 as 2156-2160 MHz.

[^53]: Amendment of Part 21.703(g), and (h) of the Commission's Rules,
    *Memorandum Opinion and Order*, 47 FCC 2d 957 (1970).

[^54]: *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, *Second Report
    and Order*, 17 FCC Rcd. 23193 (2002) (*3G 2^nd^ R&O*).

[^55]: *See* Review of the Spectrum Sharing Plan Among Non-Geostationary
    Satellite Orbit Mobile Satellite Service Systems in the 1.6/2.4 GHz
    Bands, IB Docket No. 02-364 (*Big LEO R&O)*; 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, FCC 04-134, *Report and Order, Fourth Report and
    Order, and Further Notice of Proposed Rulemaking* (adopted June 10,
    2004).

[^56]: MDS Channels 1 & 2 are located at 2150-2156 MHz and 2156-2162 MHz
    respectively. Some licensees are authorized to use the 2156-2160 MHz
    portion of the band, known as "Channel 2A." The Office of
    Engineering and Technology has designated MDS 1 and 2 for
    reallocation. *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 (2002) (*3G
    3rd R&O & NPRM*).

[^57]: AT&T Wireless Comments to the *3G 3rd R&O & NPRM* at 12.

[^58]: Verizon Comments to the *3G 3rd R&O & NPRM* at 15.

[^59]: Cingular Comments to the *3G 3rd R&O & NPRM* at 11.

[^60]: Ericsson Comments to the *3G 3rd R&O & NPRM* at 10-11.

[^61]: WCA notes that it has filed a Petition for Reconsideration of the
    *Report and Order* in IB Docket No. 99-81 seeking to revise the MSS
    spectral mask to limit the power flux density into the MDS band. WCA
    Reply Comments at 32.

[^62]: *See* *id.* at 31-33.

[^63]: *See* *WCA Letter*, *supra* n.19. This letter was sent jointly by
    WCA, Bellsouth, Nucentrix, Sprint, and Worldcom. WCA is the trade
    association of the MDS industry. The other parties to the letter
    hold the majority of licenses in the 2150-2160 MHz band.

[^64]: *Id.* at 8-9.

[^65]: *Id.* at 2*.*

[^66]: This action will reduce the potential for interference conflicts
    between new terrestrial services and ATC terrestrial deployments.

[^67]: Because MSS receive units can operate globally, this action is
    needed to ensure new terrestrial services can deploy without having
    to protect globally roaming devices. We also note that the MSS
    downlink allocation goes down to 2483.5 MHz, so the majority of the
    MSS channels will be unencumbered by new terrestrial use of the
    2496-2500 MHz band. The MSS allocation is maintained however in the
    upper portion, so MSS can make use of these channels prior to
    deployment of the new BRS operations in the band, and in geographic
    areas, such as remote areas where new terrestrial services are not
    likely to deploy.

[^68]: See 47 C.F.R. §2.106 NG147. Specifically, these operations
    include: 1 local television transmission license, 12 point-to-point
    microwave, private-industrial business licenses, 4 conventional
    public safety pool licenses, 12 TV intercity relay licenses, 78 TV
    pickup licenses, and 1 TV translator relay license.

[^69]: *See* 47 C.F.R. Part 18.

[^70]: *See* International Telecommunication Union (ITU) Radio
    Regulations, Appendix 5, Table 5-2.

[^71]: Frequency Division Duplex (FDD) provides simultaneous
    communications between two devices through the use of two different
    bands. The forward band refers to the spectrum used by base stations
    and the reverse band refers to the spectrum used by the subscriber.
    In FDD systems, frequency separation between the forward band and
    the reverse bands remains constant among each subscriber-base
    station communication.

[^72]: Time Division Duplex (TDD) provides communications between two
    devices sharing the same band by dynamically allocating short
    duration time intervals for transmitting and receiving. In TDD
    systems, a subscriber's device will operate in a transmit mode while
    the corresponding base station operates in a receive mode and vice
    versa, eliminating the need for duplex filters, as in FDD systems.

[^73]: A GSA is defined as a protected service area (PSA) that is
    bounded by political and/or geographical boundaries. *See* para.
    *53, infra*. A PSA is a land area over which an approved licensee is
    allowed to operate transmitting equipment.

[^74]: *See* para. 55, *infra.*

[^75]: *3G Final Report* at 37-57.

[^76]: *Id.* at 42.

[^77]: We address the complex transitional issues implicated by that
    process in section 5.

[^78]: Specifically, commenters, such as Alvarion Ltd. (Alvarion),
    California Amplifier, Celplan Technologies, Inc. (Celplan), ComSpec
    Corporation (ComSpec), Ericsson, Inc. (Ericsson), Flarion
    Technologies, Inc. (Flarion), Illinois Institute of Technology
    (IIT), Intel Corporation (Intel), Lucent Technologies (Lucent),
    Mississippi Ednet Institute, Inc. (Mississippi Ednet), Navini
    Networks, Inc. (Navini), The North Carolina Community College System
    (NCCCS), SBC Communications, Inc. (SBC), Sioux Valley Wireless, SOMA
    Networks, Inc. (SOMA), South Carolina Educational Television
    (SCETV), Blake Twedt & John Dudeck (Twedt & Dudeck) and the
    University of Arizona (UA) support the Coalition's band plan
    proposal. *See also* Alvarion Reply Comments at 3; IIT Comments at
    15-16; California Amplifier Reply Comments at 1-2; Celplan Reply
    Comments at 2; ComSpec Comments at 2; Flarion Reply Comments at 2;
    Intel Comments at 6; Lucent Comments at 3; Mississippi Ednet Reply
    Comments at 1; Navini Reply Comments at 2; NCCCS Reply Comments at
    1; SBC Communications; Sioux Valley Wireless Reply Comments at 1;
    SOMA Reply Comments at 1; SCETV Comments at 1; Twedt & Dudeck Reply
    Comments at 2; UA Reply Comments at 1. SCETV adds that the
    separation of the two low-power bands is necessary to support both
    FDD and TDD technologies. SCETV Comments at 6. SCETV also believes
    that PSA overlap should be equally divided among the respective
    licensees to create non-overlapping GSA's, but existing receivers
    outside the new GSA should receive grandfathered protection. SCETV
    Comments at 6.

[^79]: Alvarion Reply Comments at 3-5.

[^80]: *See* Joint commenters Adams Telecom, Inc., Central Texas
    Communications, Inc., and Leaco Rural Telephone Cooperative, Inc.
    (Adams et. al.) Comments at 5. *See also* Teton Wireless Television,
    Inc. (Teton) Comments at 9-10.

[^81]: *See* Stanford and Northeastern Comments at 8.

[^82]: Stanford and Northeastern Comments at 7.

[^83]: New America Foundation, et. al. (NAF) Comments at 4.

[^84]: Consistent regulatory treatment among similar services entails
    establishing similar technical and other rules among similar
    services. With respect to the band plan channel widths, 5 MHz is the
    least common multiple in the Personal Communications Systems band
    (PCS ) (47 C.F.R § 24.1 et. seq.) and the Advanced Wireless Services
    band(AWS) (47 C.F.R § 27.1 et. seq.). Also, 5 MHz appears to be the
    most desired current wideband channel size, for FDD (specifically
    CDMA2000) and TDD technologies. The 5.5-megahertz-wide, low-power
    channels in our adopted band plan can easily accommodate a
    5-megahertz-wide channel with 0.5 MHz of spectrum for a guard band,
    thereby enhancing a channel's capacity when considering adjacent
    channel use. We believe that common minimum channel allocations
    among similar services will readily lend the LBS and UBS to current
    as well as future equipment technology standards, thereby
    substantially lowering the cost of deployment.

[^85]: Although power restrictions in both the low-power segments (UBS
    and LBS) are identical, low-power, mobile operations at 2496-2572
    MHz and 2614-2690 MHz will be protected through the transition plan
    and transmitting antenna height requirements.

[^86]: Presently, the response band is largely unused as there are only
    six licenses in this band in the entire U.S.

[^87]: *3G Final Report* at 49.

[^88]: FDD code division multiple access (CDMA) channel widths are
    currently 1.25 MHz, 3.75MHz and 5 MHz. TDD standard channel sizes
    are currently 5, 10 and 15 MHz.

[^89]: For discussion on technical rules *see* section B, *infra*. For
    PCS and AWS technical rules and frequency assignments *see* 47
    C.F.R. Parts 24 and 27 respectively.

[^90]: If a licensee currently has only the fourth channel in a group,
    they will receive one 6 megahertz channel.

[^91]: *See* discussion on Transition, see section 5, *infra.*

[^92]: *Id.*

[^93]: The Coalition originally proposed placing Channel G4 next to the
    K band. It later proposed switching Channels E4 and G4 so that
    Channel E4, an MDS channel, would be located next to the K band.
    Coalition Ex Parte Presentation, June 3, 2004. We adopt this
    proposal because it prevents ITFS licensees from having to address
    interference issues that might arise if ITFS were located adjacent
    to a low-power band.

[^94]: Fixed Wireless Holdings (FWH) Comments at 6.

[^95]: Grand Alliance Comments at 6.

[^96]: FWH Comments at 6 (referencing Reallocation and Service Rules for
    the 698-746 MHz Spectrum Band (Television Channels 52-59), GN Docket
    No. 01-74, Report and Order, 17 FCC Rcd 1022, 1063-63 ¶ 102, 1068-69
    ¶ 119, and 1069-70 ¶ 122 (2002) (*Lower 700 MHz R&O*)).

[^97]: Spectrum Market Reply Comments at 5, quoting SCETV Comments at 5.

[^98]: Diocese of Brooklyn Comments at 1-2; Archdiocese of New York
    Comments at 1.

[^99]: Digital TV One Reply Comments at 4.

[^100]: Digital TV One Reply Comments at 4-5.

[^101]: Teton Wireless Television (Teton) Reply Comments at 5.

[^102]: Teton Reply Comments at 5.

[^103]: BellSouth Reply Comments at 12.

[^104]: NAF Comments at 4.

[^105]: *See* Unlicensed Operation in the TV Broadcast Bands; Additional
    Spectrum for Unlicensed Devices Below 900 MHz and in the 3 GHz Band,
    (ET Docket Nos. 02-380, 04-186, *Notice of Proposed Rule Making*,
    FCC 04-113 (rel. May 25, 2004); In the Matter of Unlicensed
    Operation in the Band 3650 -- 3700 MHz; Additional Spectrum for
    Unlicensed Devices Below 900 MHz and in the 3 GHz Band; Amendment of
    the Commission's Rules With Regard to the 3650-3700 MHz Government
    Transfer Band; ET Docket Nos. 04-151, 02-380, 98-237, *Notice of
    Proposed Rulemaking*, FCC 04-100 (rel. Apr. 23, 2004) (*Unlicensed
    NPRM*).

[^106]: *1991 R&O,* 6 FCC Rcd at 6795.

[^107]: Coalition Proposal at 12, n.30.

[^108]: MMDS Licensee Coalition Comments at 8.

[^109]: *See* In the Matter of Amendment of Parts 2, 25, and 87 of the
    Commission's Rules to Implement Decisions from World
    Radiocommunication Conferences Concerning Frequency Bands Between 28
    MHz and 36 GHz and to Otherwise Update the Rules in this Frequency
    Range, ET Docket No. 02-305, *Order,* 19 FCC Rcd 4653 ¶¶ 1-2 (2004)
    (*36 GHz Order*)*.*

[^110]: Interim Arrangement Concerning the Use of the Frequency Bands
    2150 -- 2162 MHz and 2500 -- 2690 MHz by MCS and MDS Stations Near
    the Canada/United States of America Border (dated Jun. 25, 2002)
    (Interim Sharing Arrangement).

[^111]: General FCC/Industry Canada Understanding Concerning the
    Coordination of the 2500-2686 MHz Band within 80 km (50 Miles) of
    the United States of America/Canada Border (dated December 5, 1997).

[^112]: Interim Sharing Arrangement, ¶ 22.

[^113]: Agreement between the Government of the United States of America
    and the Government of the United Mexican States Concerning the
    Assignment of Frequencies and Usage of the 2500-2686 MHz Band along
    the United States-Mexico Border (dated Aug. 11, 1992, as amended by
    exchange of Diplomatic Notes dated October 1, 1998 and October 23,
    1998).

[^114]: 47 C.F.R. § 21.924(c).

[^115]: 47 C.F.R. § 21.925(b).

[^116]: *See NPRM*, 18 FCC Rcd at 6756 ¶¶ 83-89.

[^117]: *See* 47 C.F.R § § 90.663 (800 MHz SMR), 101.525(a) (24 GHz),
    and 101.1009 (LMDS). *See also NPRM*, 18 FCC Rcd at 6756 ¶ 83.

[^118]: A geographic area licensing scheme will be implemented for all
    the band segments in the MDS and ITFS services, which includes the
    low-power LBS and UBS, as well as the high-power MBS.

[^119]: *See NPRM,* 18 FCC Rcd at 6756 ¶ 86.

[^120]: *See, e.g.,* In the Matter of 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 Proposed
    Rule Making*, 12 FCC Rcd 18600, 18637-8 ¶ 79 (1997) *(39 GHz R&O).*

[^121]: *See* 47 C.F.R. §§ 74.903(d), 21.902(d). Beginning on September
    15, 1995, the initial service boundaries were frozen, *i.e*., the
    circular PSA boundaries were not to be changed regardless of whether
    the licensee subsequently moved its transmitter. *Id.* An ITFS
    licensee's PSA includes the area within a 35-mile radius of its
    transmitter site plus any reception sites beyond that radius that
    were registered with the Commission as of September 17, 1998.

[^122]: We note that MDS incumbents that obtained their licenses prior
    to our 1996 MDS BTA auction have 35-mile PSAs around their main
    stations. *See* 47 C.F.R. §§ 21.902(d), 21.933(a).

[^123]: Section 21.902(d) provides that (1) .... each MDS station
    licensee shall be protected from harmful electrical interference, as
    determined by the theoretical calculations, within a protected
    service area of which the boundary will be 56.3255 kilometers *(35
    miles) from the transmitter site*. (2) As of September 15, 1995, the
    location of these protected service area boundaries shall become
    fixed. The center of the circular area shall be the geographic
    latitude and longitude of the transmitting antenna site specified in
    station authorizations or previously proposed applications filed at
    the Commission before September 15, 1995. Subsequent transmitter
    site changes will not change the location of the 56.3255 kilometers
    (35 mile) protected service area boundaries. 47 C.F.R. § 21.902(d)
    (emphasis added).

[^124]: Section 74.903(d) provides that each authorized or
    previously-proposed applicant, or licensee must be protected from
    harmful electrical interference at each of its receive sites
    registered previously as of September 17, 1998, and within a
    protected service area as defined at § 21.902(d) of this chapter and
    in accordance with the reference receive antenna characteristics
    specified at § 21.902. 47 C.F.R. § 74.903(d).

[^125]: Section 21.933(a) provides that stations licensed to the holder
    of a BTA authorization shall have a protected service area that is
    coterminous with the boundaries of that BTA, subject to the
    exclusion of the 56.33 km (35 mile) protected service area of
    incumbent MDS stations and of previously proposed and authorized
    ITFS facilities within that BTA, even if these protected service
    areas extend into adjacent BTAs. The protected service area also
    includes registered receive sites. 47 C.F.R. § 21.933(a).

[^126]: *See* BellSouth Comments at 10-13; SCETV Comments at 1, 6.

[^127]: *See* AHMLC Comments at 16; Independent MMDS Licensee Coalition
    (IMLC) Comments at 11-12.

[^128]: *See* Teton Comments at 15-16.

[^129]: *See* Rural Commenters Reply at 3.

[^130]: *See* Virginia Communications Comments at 2.

[^131]: *See* Grand Wireless Comments at 7.

[^132]: *See* Coalition Proposal at 19-22, 33-34.

[^133]: Coalition Proposal at 33-34.

[^134]: Coalition Ex Parte (filed Jun. 4, 2004).

[^135]: Effective September 15, 1995, the Commission expanded the PSAs
    of incumbent site-based MDS and ITFS licensees from fifteen miles to
    thirty-five miles. *See* Amendment of Parts 21, 43, 74, 78, and 94
    of the Commission's Rules Governing Use of the Frequencies in the
    2.1 and 2.5 GHz Bands Affecting: Private Operational-Fixed Microwave
    Service, Multipoint Distribution Service, Multichannel Multipoint
    Distribution Service, Instructional Television Fixed Service, &
    Cable Television Relay Service, *Second Report and Order*, Gen.
    Docket Nos. 90-54 and 80-113, 10 FCC Rcd 7074 (1995) (*1995 R&O*).
    In doing so, it created a number of overlaps between licensees whose
    PSAs had not overlapped before the standard PSA radius was
    increased.

[^136]: Coalition Proposal at 20-21.

[^137]: *See* Coalition Proposal Appendix C for a detailed explanation.
    This approach is commonly referred known as "splitting the
    football."

[^138]: Hispanic Information and Telecommunications Network, Inc. (HITN)
    Comments at 10.

[^139]: The ITFS/2.5 GHz Mobile Wireless Engineering & Development
    Alliance (IMWED) Comments at 18.

[^140]: *See* AMHLC Comments at 16; IMLC Comments at 11-12.

[^141]: *See* Education Service Center Region 10 (Region 10) Comments at
    iii, 3-4, 9.

[^142]: Rural Commenters Reply Comments at 4.

[^143]: *See* Joint Comments of Stanford and Northeastern Universities
    at 20.

[^144]: *See* SCETV Comments at 1, 6.

[^145]: Examples of services where service areas are defined exclusively
    on the basis of signal strength limits at geographic borders include
    the lower 700 MHz band (47 C.F.R. § 27.55(a)(2)), broadband PCS (47
    C.F.R. § 24.236), Part 27 services in the 2305-2320 and 2345-2360
    MHz bands (47 C.F.R. § 27.55(a)(1)), and Part 27 services in the
    1390-1395 and 1432-1435 MHz bands (47 C.F.R. § 27.55(a) (3)).

[^146]: *See* IP Wireless Comments at 11.

[^147]: *See* AHMLC Comments at 16; IMLC Comments at 12.

[^148]: *See* Coalition Comments at 59-60.

[^149]: *See* ComSpec Comments at 2.

[^150]: *See* Coalition Comments at 61.

[^151]: *See* Coalition Proposal at 59 n. 118.

[^152]: 47 C.F.R. § 74.903(d). We note that the Coalition asserts that
    there is no current ITFS receive site protection outside the PSA.
    *See* Coalition Proposal at 59 n. 118. The Coalition is incorrect.
    Although 47 C.F.R. § 74.903(a)(5) states that "\[n\]o receive site
    more than 35 miles from the transmitter shall be entitled to
    interference protection," this provision must be read in conjunction
    with the latter occurring provision in 47 C.F.R. § 74.903(d), which
    under certain instances allows receive site protection outside of
    the 35 mile PSA.

[^153]: *See NPRM,* 18 FCC Rcd at 6842-55, Appendix C.

[^154]: Coalition Proposal, Appendix B at 4, 12.

[^155]: Generally, under the Coalition's plan the following are required
    participants: (1) every licensee that has not previously been
    transitioned and that has a transition impact area (TIA) that
    overlaps the GSA in which the contemplated base station will be
    located; (2) every non-transitioned licensee with a TIA to which any
    of the contemplated facility's transmission antennas will have an
    unobstructed transmission path calculated assuming receive antenna
    heights of 9.1 meters above ground level employing a smooth earth
    with 413 earth curvature propagation model; and (3) every
    non-transitioned licensee with a GSA that overlaps the GSA of a
    licensee being transitioned pursuant to (1) or (2). *Id.* at 12-13.

[^156]: The Coalition's plan does not specify who is permitted to be a
    proponent.

[^157]: Coalition Proposal, Appendix B at 14-15.

[^158]: *Id.* at 16.

[^159]: *Id*. at 18.

[^160]: *Id*. at 20.

[^161]: *Id.* at 4.

[^162]: *Id.*

[^163]: *Id.* at 21.

[^164]: *Id.* at 21-27.

[^165]: *Id.* at 16-18.

[^166]: *Id*. at 4.

[^167]: *Id.* at 18.

[^168]: *Id*. at 5.

[^169]: *See* Earthlink Comments at 8.

[^170]: *See* Teton Reply Comments at 4.

[^171]: Sprint Comments at 7.

[^172]: *Id.*

[^173]: *See* Grand Alliance Comments at 8; NAF Reply Comments at 30.

[^174]: *See* Grand Alliance Comments at 9.

[^175]: *See* IMLC Comments at 13-14.

[^176]: *See* Grand Alliance Comments at 9.

[^177]: *See* Spectrum Market Comments at 5 and Appendix 1 at 5-8,
    Exhibits 3-13.

[^178]: *See* Spectrum Market Comments, Engineering Statement of Carl T.
    Jones, Jr., Appendix 1, Exhibit 2.

[^179]: Spectrum Market Comments at 6.

[^180]: MMDS Licensee Coalition ("MMDS Licensees") Comments, filed
    November 14, 2002, at 3.

[^181]: *Id*.

[^182]: *See* Rural Commenters Comments at 4.

[^183]: IP Wireless Comments at 12.

[^184]: IMLC Comments at 16.

[^185]: Intel Comments at 7.

[^186]: *See* paras. 37-44, *supra*.

[^187]: There are fifty-two MEAs, which are comprised of one or more
    Economic Areas. Additionally, there are three EA-like areas: Guam
    and Northern Mariana Islands; Puerto Rico and the U.S. Virgin
    Islands; and American Samoa. *See* 47 C.F.R. § 27.6(a)

[^188]: *See* n.Error: Reference source not found, *supra*.

[^189]: *See* Coalition Proposal, Appendix B at 17-18.

[^190]: WATCH T.V. Company (WATCH TV) provides over 200 channels of
    digital video and audio service to over 13,000 subscribers by using
    and reusing every megahertz available to it in the 2150-2162 MHz
    band and in the 2500-2690 MHz band in Lima, Ohio. WATCH T.V. Company
    *Ex Parte*, filed June 1, 2004 at 1.

[^191]: Sioux Valley Wireless uses 33 MDS and ITFS channels in the Sioux
    Falls, South Dakota Basic Trading Area to deliver a combination of
    video and broadband wireless internet services to over 6000 mostly
    rural subscribers. Sioux Valley Wireless, *Ex Parte*, filed June 1,
    2004.

[^192]: 47 CFR § 76.905(c).

[^193]: 47 C.F.R. § 1.925(b)(3).

[^194]: *See* Coalition Proposal, Appendix B at 12-13 n.34.

[^195]: Amendment of Parts 21 and 74 of the Commission\'s Rules With
    Regard to Licensing in the Multipoint Distribution Service and in
    the Instructional Television Fixed Service for the Gulf of Mexico,
    WT Docket No. 02-68, *Notice of Proposed Rulemaking*, 17 FCC Rcd
    8446 (2002) (*Gulf Notice* or *Gulf of Mexico MDS NPRM* or *Gulf
    NPRM*). That proceeding was incorporated alongside the *NPRM* in
    this proceeding. *NPRM*, 18 FCC Rcd at 6759 ¶ 91.

[^196]: In those instances where there is no proponent in an adjoining
    MEA, and operations in that adjoining MEA would cause interference
    in the proponent's MEA, the proponent must also transition the
    interfering facilities in the adjoining MEA to resolve the
    interference problem.

[^197]: Under § 27.5(i)(2) of the rules we adopt today, we identify
    post-transition frequency assignments for licensees.

[^198]: *See* Coalition's Proposal, Appendix B at 21-27, for a
    description of the Coalition's nine safe harbors.

[^199]: Coalition Proposal, Appendix B at 21-22.

[^200]: *Id.,* Appendix B at 22-23.

[^201]: *See* IP Wireless Comments at 12.

[^202]: Under the Coalition's Plan the proponent pays for the costs to
    modify the facilities of MVPD providers that elect not to transition
    if a modification is necessary to protect other licensees that are
    transitioning. *See* Coalition's Proposal, Appendix B at 18.

[^203]: *See* *Lower 700 MHz Band R&O*, 17 FCC Rcd at 1070 ¶ 119. This
    limit is codified at 47 C.F.R. § 27.55(a)(2).

[^204]: 47 C.F.R. § 24.236.

[^205]: 47 C.F.R. § 27.55(a)(1) and (3).

[^206]: In light of our decision to institute geographic area licensing
    in the MBS, we will not require applicants to demonstrate compliance
    with co-channel and adjacent-channel desired-to-undesired signal
    ratios, as proposed by the Coalition. Coalition Proposal at 36-38.
    Since licensees will be free to place facilities throughout their
    GSA, applicants will not necessarily know where the facilities of
    other licensees will be located. Moreover, we believe the power
    limits and out-of-band emission limits we have adopted will provide
    sufficient protection.

[^207]: We will require that the neighbor licensee be providing actual
    service to internal or third parties. A licensee that is merely
    testing or transmitting data not being received by any party would
    not be entitled to require a licensee to reduce power.

[^208]: *NPRM,* 18 FCC Rcd at 6777 ¶ 132.

[^209]: *See* 47 C.F.R. §§ 21.909(g)(2) and 74.939(g)(2).

[^210]: See 47 C.F.R. § 24.232(b).

[^211]: Coalition Proposal at 25.

[^212]: *Id.* at 26.

[^213]: Amendment of the Commission's Rules to Establish New Personal
    Communications Services, *Second Report and Order*, 8 FCC Rcd 7700,
    7764-65 ¶ 156 (1993).

[^214]: *See* Second Supplement to the Coalition Proposal at 3-7, filed
    Feb. 7, 2003.

[^215]: *Id.* at 5.

[^216]: *Id.* at 6.

[^217]: 47 C.F.R. § 24.232(a).

[^218]: Coalition Proposal at 29.

[^219]: *Lower 700 MHz Band R&O*, 17 FCC Rcd at 1070 ¶ 122.

[^220]: According to the Coalition's Proposal, the written request must
    include a certification from the requesting licensee that it intends
    to initiate service on the affected adjacent channel group at a date
    certain (not more than one year after the date of the written
    request), and that the additional attenuation is required due to the
    respective technical characteristics of the requesting licensee's
    planned facilities and those of the party receiving the request. The
    requesting licensee must also include in the written request
    currently available information regarding its planned network design
    comparable in scope to the information required to be filed upon
    completion of the construction of its facilities. *See* Coalition
    Proposal at 29.

[^221]: The Coalition states "\[i\]n addition to the other requirements
    imposed on *out of band* emissions by stations operating outside the
    MBS, the licensee of any transmitter operating in the LBS, UBS, I,
    J, or K channels shall manage its *out of band* emissions such that
    the noise power introduced into an MBS channel does not exceed an
    EIRP of -37 dBm without the consent of the affected MBS channel
    licensee. Notwithstanding the foregoing, if the licensee of a
    channel outside the MBS digitizes a channel within the MBS, the
    noise power introduced into that channel of the MBS shall not exceed
    an EIRP of -20 dBm without the consent of the affected MBS channel
    licensee." *See* Coalition Proposal at 30.

[^222]: *See* Coalition Proposal at 16, nn.39, 41.

[^223]: For example, the Coalition suggests that we measure *out of
    band* emissions at the outermost edges of the combined channels
    where two or more contiguous channels are employed in the same
    system. *See* Coalition Proposal at 29 n.79. *See also* Coalition
    Proposal at 30 n.81.

[^224]: 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
    Bands, IB Docket No. 01-185, *Report and Order and Notice of
    Proposed Rulemaking*, FCC 03-15, 18 FCC Rcd 1962, 2025-26 ¶ 119
    (2003).

[^225]: *See* 47 C.F.R. § 2.106 n.US246.

[^226]: As the Commission's Spectrum Policy Task Force has recognized,
    there is an inherent tension between the dual objectives of
    affording licensee's flexibility and grouping like systems together;
    if every licensee is free to choose the services it will offer and
    the technology it will employ, the Commission cannot possibly assure
    that technically-disparate systems will be separated.

[^227]: Coalition Proposal at 29.

[^228]: Given the difficulties involved in measuring satellite signals,
    which can operate at very low-power, we will not require MSS
    licensees seeking adjacent-channel protection to provide actual
    measurements of satellite signal levels.

[^229]: Coalition Proposal at 39.

[^230]: Coalition Proposal at 11, 15.

[^231]: The Coalition points out that the Commission's *Interim Report*
    stated that a separation of at least 30 megahertz between upstream
    (customer to base) and downstream (base to customer) transmissions
    is needed to provide sufficient isolation of signals in the
    duplexer. *See* Coalition Proposal at 16. *See also* *Interim
    Report* at 54.

[^232]: All stations, regardless of their use, must comply with the
    emissions standard specified for LBS and UBS. *See* Appendix C,
    Section 27.53, Emission Limits.

[^233]: Intel Reply Comments in RM-10586, at 5; Microsoft Reply Comments
    in RM-10586, at 3-4.

[^234]: Additional Spectrum for Unlicensed Devices Below 900 MHz and in
    the 3 GHz Band, ET Docket No. 02-380, *Notice of Inquiry*, 17 FCC
    Rcd 25632 (2002) ("*Unlicensed NOI*").

[^235]: *Id.* at 25637 ¶ 13.

[^236]: *Id.*

[^237]: *Id.* at 25642 ¶ 21.

[^238]: Coalition Comments in ET Docket No. 02-135, at 10.

[^239]: *NPRM,* 18 FCC Rcd at 6781-6782 ¶ ¶ 143-148.

[^240]: 47 C.F.R. § 15.205.

[^241]: Motorola Comments at 3-4; Sprint Comments at 9.

[^242]: Coalition Comments at 67-68; BellSouth Comments at 26.

[^243]: *See* 47 C.F.R. §§ 1.1307(b) (2), 2.1091(c) and 2.1093(c).

[^244]: *See* Coalition Proposal at 20, nn.26 and 51.

[^245]: The existing requirements are located in 47 C.F.R. §§ 1.1307(b),
    1.1310, 2.1091 and 2.1093.

[^246]: Coalition Proposal at 56.

[^247]: *See* 47 C.F.R. §§ 1.1104 and 21.909(c)(1).

[^248]: 47 C.F.R. § 21.909(h)(i)(2).

[^249]: *See* Mass Media Bureau Multipoint Distribution Service and
    Instructional Television Fixed Service Applications Tendered For
    Filing, Report No. 148, *Public Notice* (Nov. 29, 2000).

[^250]: *Two-Way R&O*, 13 FCC Rcd at 19112.

[^251]: Amendment of Parts 1, 21 and 74 to Enable Multipoint
    Distribution Service and Instructional Television Fixed Service
    Licensees to Engage in Fixed Two-Way Transmissions, *Report and
    Order on Reconsideration*, 14 FCC Rcd 12764 (1999) (*Two-Way R&O on
    Recon*).

[^252]: IPWireless, Inc. Petition for Reconsideration, filed Dec. 22,
    1999.

[^253]: Petitioners' Consolidated Comments and Partial Opposition at 5
    (Consolidated Comments) filed Feb. 10, 2000. Although the Commission
    inadvertently indicated that WCA requested clarification, we take
    this opportunity to correct the record to reflect that the
    Petitioners requested clarification of this issue. *See* *Two-Way
    FNPRM*, 15 FCC Rcd at 14576.

[^254]: Petitioners' Consolidated Comments at 6.

[^255]: *Id*.

[^256]: *Id.*

[^257]: *Id.* at 1.

[^258]: *Id.*

[^259]: *Two-Way FNPRM*, 15 FCC Rcd at 14576.

[^260]: *Id.* at 14576-7 ¶¶ 39-40.

[^261]: 47 C.F.R. § 74.931(a)(1).

[^262]: *See* 47 C.F.R. § 74.932(a). Under certain circumstances,
    "wireless cable entities" may obtain access to ITFS channels so long
    as at least eight other ITFS channels remain available for future
    ITFS use. *See* 47 C.F.R. §§ 74.990-74.992. In the *FNPRM* portion
    of this document, we are seeking comment on whether we should retain
    this restriction. *See* section E , *supra.*

[^263]: *NPRM,* 18 FCC Rcd at 6769 ¶ 111.

[^264]: 47 C.F.R. § 74.931(d)(1).

[^265]: *NPRM,* 18 FCC Rcd at 6770 ¶ 114.

[^266]: NCCCS Reply Comments at 2.

[^267]: Mississippi Ednet Reply Comments at 8-9.

[^268]: BellSouth Comments at 23.

[^269]: BellSouth Comments at 23-24.

[^270]: Network for Instructional Television (NITV) Reply Comments at
    3-4.

[^271]: IMWED Reply Comments at 8.

[^272]: Clearwire Ex Parte (filed May 28, 2004); Nextel Reply Comments
    at 4.

[^273]: IIT Comments at 5.

[^274]: IIT Comments at 8-9.

[^275]: IIT Comments at 10-11.

[^276]: CTN & NIA Comments at 10.

[^277]: *See, e.g.,* Huntsville City Schools Reply Comments at 1;
    Archdiocese of New York Comments at Attachment A; SBBC Comments at
    2-5; IIT Comments at 5-8; ITFS Parties Comments at Appendix.

[^278]: See para. 103, *supra*.

[^279]: CTN & NTIA Comments at 8.

[^280]: CTN & NTIA Comments at 3-4.

[^281]: *See NPRM,* 18 FCC Rcd at 6765-68 ¶¶ 108-109.

[^282]: Jared Bleak, *Educated by the Market: A Researcher's Look at
    Educational Entrepreneurialism* (Harvard Graduate School of
    Education, Oct. 5, 2001)
    http://www.gse.harvard.edu/news/features/market10052001.html).

[^283]: *Id.*

[^284]: IIT Comments at 13.

[^285]: IIT Comments at 15.

[^286]: *See* GMUIF Reply Comments at 3; IIT Comments at 13-15.

[^287]: *2000* *Spectrum Policy Statement*, 15 FCC Rcd at 24178.

[^288]: *NPRM,* 18 FCC Rcd at 6770 ¶ 115.

[^289]: *See* IMWED Reply Comments at 6-7; CTN & NIA Reply Comments at
    6; SBBC Reply Comments at 2.

[^290]: DBS operators must reserve four percent of their channel
    capacity for use by qualified programmers for noncommercial
    programming of an educational or informational nature. *See* 47
    C.F.R. § 100.5.

[^291]: NTCA Comments at 4.

[^292]: *See NPRM*, 18 FCC Rcd at 6776 ¶ 126. The *NPRM* also sought
    comment concerning mobile phone service, another non-video service
    that potentially may be provided using MDS/ITFS spectrum. *Id.*

[^293]: *Id*. at 6774-76 ¶¶ 122-126. The *NPRM* also deemed it unlikely
    that cable operators would acquire MDT/ITFS licenses in order to
    foreclose entry by a wireless MVPD provider and observed that new
    MDS licensees are "very unlikely" to be entrants into the MVPD
    markets, particularly since MDS video providers have penetrated very
    few markets. *Id*. at 6774-75 ¶ 122.

[^294]: *Id*. at 6774-76 ¶¶ 123, 126.

[^295]: *Id.*

[^296]: *See 1990 R&O*, 5 FCC Rcd at 6417 ¶ 42. Before 1990 the
    Commission permitted cable systems to operate MDS (and OFS) channels
    within their franchise areas. *See* *id*. at 6416 ¶ 41.

[^297]: *Id.* at 6417 ¶ 42.

[^298]: *Id.* In the early 1990s, the MVPD market differed greatly from
    that market today. For example, in 1993, cable services accounted
    for nearly 100% of the MVPD market while DBS service was launched
    for the first time that same year. In contrast, as of 2003, DBS
    services accounted for 21.6% of the MVPD market nationwide while MDS
    services accounted for a mere 1.3%. *See* *In the Matter of Annual
    Assessment of the Status of Competition in the Market for the
    Delivery of Video Programming*, Tenth Annual Report, MB Docket No.
    03-172, 19 FCC Rcd 1606 ¶¶ 4, 5 & 16 (rel. Jan. 28, 2004) (*Tenth
    MVPD Report*).

[^299]: *1990 R&O*, 5 FCC Rcd at 6417 ¶ 42.

[^300]: The application process adopted for cable operators provided
    that otherwise acceptable cable system applications for MDS channels
    would be put on public notice for 30 days and could be granted
    provided no non-cable party filed an application. *Id.* at 6417 ¶
    43. The Commission also sought comment on how to define a local
    programming exception to the 1990 restrictions. *1991 R&O*, 6 FCC
    Rcd at 6799 ¶ 34.

[^301]: *Id.* at 6799 ¶ 37.

[^302]: *Id*. at 6799 ¶ 39. The Commission also grandfathered, on
    equitable grounds, cable applications for MDS channels filed before
    February 8, 1990, as well as lease agreements between cable and MDS
    or ITFS entities for which a lease or a firm and enforceable
    agreement was signed prior to the same date. *Id.*

[^303]: *Id.* at 6800 ¶ 41.

[^304]: *Id*. In applying for an MDS channel, a cable operator was
    required to provide the proposed local programming within one year.
    *Id.*

[^305]: *Id.*

[^306]: *Id.*

[^307]: *See, e.g.*, Time Warner Entertainment Co. v. FCC, 240 F.3d
    1126, 1128 (D.C. Circuit 2001), reh'g and reh'g en banc denied, May
    4, 2001. *Time Warner* rejected restrictions the Commission, imposed
    pursuant to Section 613(f)(1) of the 1992 Cable Act, which was
    codified as 47 U.S.C. § 533(f)(1), in part on the ground that the
    Commission failed to show a non-conjectural harm to competition that
    was prevented by such restrictions. *Time Warner*, 240 F.3d at
    1133-1136 ("Congress also sought to 'ensure that cable operators
    continue to expand, where economically justified, their
    capacity,'...and it specifically directed the FCC, in setting the
    ownership limit, to take into account the 'efficiencies and other
    benefits that might be gained through increased ownership or
    control.'") (quoting 1992 Cable Act, § 2(b)(3)).

[^308]: *See* In the Matter of Implementation of Section 11 and 13 of
    the Cable Television Consumer Protection and Competition Act of
    1992, Horizontal and Vertical Ownership Limits, Cross-Ownership
    Limitations, and Anti-Trafficking Provisions, *Report and Order and
    Further Notice of Proposed Rulemaking,* 8 FCC Rcd 6828, 6842 ¶ 101
    (1993) *(1993 Cable R&O)*.

[^309]: Section 613 was added to the Act by Section 11(a) of the Cable
    Television Consumer Protection and Competition Act 1992, Pub. L. No.
    102-385, 106 Stat. 1460 (1992 Cable Act). *See 1993 Cable R&O,* 8
    FCC Rcd at 6841-44 ¶¶ 92-112. The rules in existence when Section
    613 was enacted had been promulgated in proceedings that began in
    1990. *See* *1991 R&O*, 6 FCC Rcd at 6799 ***¶ 34*** (summarizing
    *Report and Order* in Gen. Docket Nos. 90-54 and 80-113, 5 FCC Rcd
    6410 (1990)).

[^310]: *1993 Cable R&O*, 8 FCC Rcd at 6843 ¶ 103.

[^311]: *See Tenth MVPD Report,* 19 FCC Rcd at 1672-73 ¶ 103.

[^312]: *See id*. at 1613-16 ¶ 16.

[^313]: *Id.* at 1610 ¶ 9.

[^314]: *Id.* at 1608-9, 1613-16 ¶¶ 4 (cable market share), 5 (DBS
    growth after 1988 initial authorization and 1993 service initiation)
    & 16 (DBS market share).

[^315]: *Two-Way FNPRM*, 13 FCC Rcd at 19112.

[^316]: *Tenth MVPD Report*, 19 FCC Rcd at 1663-64 ¶ 86.

[^317]: *NPRM*, 18 FCC Rcd at 6774-76 ¶¶ 123-125.

[^318]: *Id*. at 6775-76 ¶ 125.

[^319]: *Id*.

[^320]: 47 U.S.C. § 553(a).

[^321]: 47 U.S.C. § 553(a)(2).

[^322]: *1993 Cable R&O,* 8 FCC Rcd at 6841 ¶¶ 92-94.

[^323]: Earthlink Comments at 15-16.

[^324]: Earthlink Comments at 16-17.

[^325]: Earthlink Comments at 17.

[^326]: *See* Earthlink Comments at 17; Teton Comments at 6-7 ("...
    Teton believes that the Commission should refrain from opening
    eligibility for MDS spectrum to cable and DSL interests. At a
    minimum, the Commission should retain the cable/MDS cross ownership
    restrictions in rural markets where DSL and cable have a virtual
    lock on the broadband market."); Teton Reply Comments at 14 (same);
    NAF Reply Comments at 35 ("In the absence of cross-ownership limits,
    cable and LEC competitors will simply acquire rights in competing
    spectrum, blocking access to competitors.").

[^327]: *NPRM,* 18 FCC Rcd at 6773, ¶ 121.

[^328]: *See NPRM,* 18 FCC Rcd at 6773-74, ¶ 121.

[^329]: *See generally* 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 (2003) (*Secondary Markets Report and Order* and *Further
    Notice*, respectively) Erratum, 18 FCC Rcd 24817 (2003).

[^330]: *See generally Report and Order*, 18 FCC Rcd at 20607-82 ¶¶
    1-194.

[^331]: *See generally id.* at 20682-85 ¶¶ 195-203.

[^332]: *See generally Secondary Markets Further Notice,* 18 FCC Rcd at
    20687-20719 ¶¶ 213-323.

[^333]: *Id.* at 20708-16 ¶¶ 288-314.

[^334]: *See* BellSouth Comments at 6-10; NIA/CTN Comments at 1-9 and
    Reply Comments at 1-3; SBC Comments at 12-13; Spectrum Market LLC
    Comments at 4-5; Sprint Comments at 4-6; WCA Comments at 1-8. Unless
    otherwise noted, all comments cited in this section were filed in WT
    Docket No. 00-230.

[^335]: WCA Comments at 6-7, NIA/CTN Comments at 7-8.

[^336]: NIA/CTN Comments at 5-6.

[^337]: *See generally Secondary Markets Report and Order,* 18 FCC Rcd
    at 20607 ¶ 2.

[^338]: WCA Comments at 7.

[^339]: NIA/CTN Comments at 7.

[^340]: *See id.* at 8.

[^341]: *Id*. at 5-6.

[^342]: *Id*. at 4.

[^343]: *Id.*

[^344]: Biennial Regulatory Review -- Amendment of Parts 0, 1, 13, 22,
    24, 26, 27, 80, 87, 90, 95, 97, and 101 of the Commission's Rules to
    Facilitate the Development and Use of the Universal Licensing System
    in the Wireless Telecommunications Services, *Report and Order*, 13
    FCC Rcd 21027, 21054 ¶ 56 (1998) (*ULS R&O*). *See NPRM*, 18 FCC Rcd
    at 6787 ¶ 159.

[^345]: *See id*.

[^346]: *See id*.

[^347]: *See id.* at 6786 at ¶ 159.

[^348]: *See* 47 C.F.R. § 1. 901 *et seq*.

[^349]: *See* Coalition Comments at 135.

[^350]: *See* BellSouth Comments at 13-14 n.21; OWTC Comments at 6.

[^351]: *See* OWTC Comments at 6.

[^352]: *See* Teton Comments at 15-16.

[^353]: *See NPRM,* 18 FCC Rcd at 6786 ¶ 160.

[^354]: *See* 47 C.F.R. §§ 21.1 *et seq.*, 73.1 *et seq*., and 74.1 *et
    seq*.

[^355]: *See* 47 C.F.R. § 21.23.

[^356]: *See* 47 C.F.R. § 74.911(b).

[^357]: *See id.*

[^358]: *See* 47 C.F.R. § 27.1 *et seq*. In explaining the Part 27
    objectives, the Commission stated that "we believe that a flexible
    licensing approach will allow licensees the freedom to determine the
    services to be offered and the technologies to be used in providing
    those services. This flexibility will better enable licensees to use
    their assigned frequencies in response to market forces...In light
    of these considerations, we believe that the general application of
    our Part 27 licensing and operating rules will promote flexible and
    efficient use of the unpaired 1390-1392 MHz, 1670-1675 MHz, and
    2385-2390 MHz bands and the paired 1392-1395 MHz and 1432-1435 MHz
    bands. We agree with the commenters that application of our Part 27
    rules will provide licensees a streamlined licensing framework that
    will foster innovation, flexible use and regulatory certainty."
    Amendments to Parts 1, 2, 27 and 90 of the Commission's Rules to
    License Services in the 216-220 MHz, 1390-1395 MHz, 1670-1675 MHz
    and 2385-2390 MHz Government Transfer Bands, WT Docket No. 02-8,
    RM-9267, RM-9692, RM-9797, RM-9854, RM-9882, *Report and Order*, 17
    FCC Rcd 9980, 9988 ¶¶ 10-11 (2002) (*27 MHz R&O*) (footnotes
    omitted).

[^359]: *See 1999 Spectrum Policy Statement*, 14 FCC Rcd at 19870-71 ¶
    9.

[^360]: *See id.*

[^361]: *See id*.

[^362]: *See* Coalition Comments at 132-133.

[^363]: *See* EarthLink Comments at 7.

[^364]: *See 27 MHz R&O*, 17 FCC Rcd at 9988 ¶¶ 9-10; *see also supra*
    n.Error: Reference source not found*.*

[^365]: *See* BellSouth Comments at 13-14 n.21.

[^366]: *See* OWTC Comments at 7. We do note that OWTC proposed an
    alternative approach to create consolidated service rules for
    similar aspects of the respective unique services, but then have
    distinct service rule subparts when the historical service rules
    diverge from each other for each unique service.

[^367]: *See* 47 C.F.R. 101.1 *et seq.* \"\[W\]e find that a flexible,
    market-based approach is the most appropriate method for determining
    services rules in \[the Upper 700 MHz Band\]....To comport with the
    range of potential service applications on these bands, and our
    intended use of Part 27 as a basic regulatory framework for service
    rules governing other bands, we have also recast the structure of
    the Part 27 rules to reflect their revised scope.\" In the Matter of
    Service Rules for the 746-764 and 776-794 MHz Bands, and Revisions
    to Part 27 of the Commission\'s Rules, *First Report and Order*, 15
    FCC Rcd 476, 478 ¶ 2 (2000) (footnotes omitted) (*Upper 700 MHz
    First R&O*).

[^368]: *See* 47 C.F.R. §§ 21.1 *et. seq.* and 90.1 *et. seq.*

[^369]: *See* Reorganization and Revision of Parts 1, 2, 21, and 94 of
    the Rules to Establish a New Part 101 Governing Terrestrial
    Microwave Fixed Radio Services, *Notice of Proposed Rulemaking,* 10
    FCC Rcd 2508, 2509 ¶ 2 (1994) (*Part 101 NPRM*).

[^370]: *Id.,* 10 FCC Rcd at 2509 n. 4 (1994).

[^371]: *See* WCA Comments at 134. *See also* discussion of regulatory
    fees in *FNPRM* at D, *infra.*

[^372]: *See, e.g.,* Amendment to Parts 2, 15 and 97 of the Commission's
    Rules To Permit Use of Radio Frequencies Above 40 GHz for New Radio
    Applications, *Memorandum Opinion and Order on Reconsideration and
    Notice of Proposed Rulemaking*, 13 FCC Rcd 16947, 16969-70 ¶ 54
    (1998) ("While the Commission has adopted service rules for LMDS in
    Part 101 of the Commission's Rules, the Commission has also adopted
    a new set of service rules, in Part 27 of the Commission's Rules,
    for wireless services in the 2.3 GHz band. These rules provide a
    licensing framework that may be more appropriate than the Part 101
    rules in that they provide for much greater flexibility in the types
    of services that can be provided and in the technical and
    operational rules that govern those services.") (footnotes omitted).

[^373]: *See generally* Amendment of the Commission's Rules to Relocate
    the Digital Electronic Message Service From the 18 GHz Band to the
    24 GHz Band and to Allocate the 24 GHz Band For Fixed Service,
    *Order,* 12 FCC Rcd 3471, 3476 ¶ 13 (1997); *39 GHz R&O*, 12 FCC Rcd
    at 18637 ¶ 77 (1997).

[^374]: 47 C.F.R. §§ 21.40, 21.41.

[^375]: *See* 47 C.F.R. § 21.40. A major modification for an MDS license
    includes a substantial modification of the engineering proposal such
    as (but not limited to) a change in, or addition of, a radio
    frequency channel; a change in polarization of the transmitted
    signal; a change in type of transmitter emission or an increase in
    emission bandwidth of more than ten percent; a change in the
    geographic coordinates of a station's transmitting antenna of more
    than ten seconds of latitude or longitude or both; any change which
    increases the antenna height by three meters or more; any technical
    change that would increase the effective radiated power in any
    direction by more than 1.5 dB; or any changes or combination of
    changes that would cause harmful electrical interference to an
    authorized facility or result in a mutually exclusive conflict with
    another pending application. 47 C.F.R. § 21.23.

[^376]: *Id.*

[^377]: 47 C.F.R. § 74.951.

[^378]: 47 C.F.R. § 73.5000. We note that our rules permit ITFS
    licensees to exchange channels evenly with each other or with MDS
    licensees after filing pro forma applications. 47 C.F.R. §
    74.902(f).

[^379]: Implementation of Section 309(j) of the Communications Act --
    Competitive Bidding for Commercial Broadcast and Instructional
    Television Fixed Service Licenses, *First Report and Order,* 13 FCC
    Rcd 15920 ¶ 207 (1998).

[^380]: *See* 47 C.F.R. § 74.986.

[^381]: *See* 47 C.F.R. § 1.929.

[^382]: *See* 47 C.F.R. § 1.947.

[^383]: *See* 47 C.F.R. § 1.929.

[^384]: *See* 47 C.F.R. § 1.947(b).

[^385]: *See NPRM,* 18 FCC Rcd at 6786 ¶ 160.

[^386]: *See* *NPRM,* 18 FCC Rcd at 6786 ¶¶ 161-163; *see also* 47
    C.F.R. § 1.901 *et. seq.*

[^387]: *See* BellSouth Comments at 13-14 n.21.

[^388]: *See* IMLC Comments at iii, 8.

[^389]: *See* Coalition Comments at 134 -- 137. The Coalition states
    that minor revisions to Section 1.929 are required to reflect the
    MBS Licensing Scheme. With the development of appropriate individual
    standards for determining whether MBS filings are "major" or
    "minor," Section 1.929 can readily be amended to consolidate the MDS
    and ITFS major and minor change and major and minor amendment rules.
    The common "major changes" standards set forth in Section 1.929(a)
    would seem to be appropriately applied to ITFS and MDS applications,
    whether for the LBS/UBS or the MBS. WCA states, however, that
    additional "major changes" must be defined for applications for the
    MBS channels, so as to assure that the FCC and potentially-affected
    MDS and ITFS licensees will have a fair opportunity to evaluate the
    possibility of interference from proposed modifications or from
    amendments to pending applications. More specifically, the Coalition
    Proposal suggests that the Commission define as "major" for the MBS
    any application, or an amendment to pending application, that
    proposes any of the following: (i) any change in frequency; (ii) any
    change in polarization; (iii) any increase in height of the C/R of
    the transmitting antenna by more than 8 meters (26 feet); (iv) any
    relocation of the station by more than 1.6 km (1 mile); (v) any
    change in the frequency offset of an analog station (however, an
    analog station upgrading from no frequency offset to any specific
    frequency offset (minus, zero or plus) would not be deemed a major
    change); (vi) any increase in occupied bandwidth; or (vii) any
    change to the transmission system that results in an increase in
    EIRP of more than 1.5 dB in any direction. *Id.*

[^390]: *See* discussion of geographic area licensing at Section 4,
    *supra.*

[^391]: *See* n.Error: Reference source not found, *supra.*

[^392]: Once our new BRS/EBS rules become effective, there will be a
    six-month transition period after which before electronic filing in
    ULS mandatory for these services. *See* discussion of transition
    period to ULS electronic filing at Section 17 , *infra.*

[^393]: *See* discussion of FCC Forms at paras. 254-258, *infra.*

[^394]: *See* *NPRM*, 18 FCC Rcd at 6786 ¶ 164.

[^395]: *See* 47 C.F.R. § 1.927.

[^396]: *See* 47 C.F.R. § 1.927(h).

[^397]: *See* 47 C.F.R. § 1.927(g).

[^398]: Our existing rules treat certain amendments as new applications
    that receive a new filing date as of the date the applicant submits
    the amendment. Amendments that we treat as new applications include
    applications submitted up to fourteen days after the application
    appeared as accepted on public notice that reflect any change in the
    technical specifications of the proposed facility; applications
    submitted with a new or modified analysis of potential interference
    to another facility; or applications submitted with an interference
    consent statement from a neighboring licensee. 47 C.F.R. § 21, 23.
    In such cases, the amended application must include an applicant
    certification that it has met all requirements regarding
    interference protection to existing and prior proposed facilities,
    and that it has obtained any necessary consent letters in lieu of
    interference protection. The applicant must also certify that it has
    served all potentially affected parties with copies of its amended
    application and engineering materials, and that the engineering
    analyses comply with the rules and methodology. *See* 47 C.F.R. §§
    21.23, 73.3522(a). Furthermore, ITFS applicants may amend
    applications to cure defects noted in deficiency letters to the
    applicant. *See* 47 C.F.R. § 73.3522(a). MDS BTA applicants may
    amend a long-form application up to the date the application has
    appeared on public notice as accepted for filing or by written
    petition demonstrating good cause if the application is already on
    public notice. *See* 47 C.F.R. § 21.926. In both services,
    applicants may not amend applications if the proposed amendment
    seeks more than a pro forma change of ownership or control.

[^399]: *See, e.g.,* IMLC Comments at iii, 8.

[^400]: At the adoption of this order a six-month transition period will
    begin after before requiring mandatory electronic filing by MDS and
    ITFS applicants and licensees in ULS. *See* discussion of transition
    period to ULS electronic filing at Section 17 *infra.*

[^401]: *See* discussion of FCC forms at paras. 254-258 *infra*.

[^402]: *See NPRM,* 18 FCC Rcd at 6789-90 ¶¶ 165-170; *see also* 47
    C.F.R. § 1.948.

[^403]: *See* 47 C.F.R. § 21.11(d) (Assignment of License); 47 C.F.R. §
    21.11(e) (Transfer of control of corporation holding a conditional
    license or license); 47 C.F.R. § 21.13 (General Application
    Requirements); 47 C.F.R. § 21.15 (Technical Content of
    Applications); 47 C.F.R. § 21.17 (Certification of Financial
    Qualifications); 47 C.F.R. § 21.19 (Waiver of Rules); 47 C.F.R. §
    21.38 (Assignment or Transfer of Station Authorizations); 47 C.F.R.
    § 21.39 (Considerations Involving Transfer or Assignment
    Applications); 47 C.F.R. § 21.912 (Cable Television Eligibility
    Requirements and MDS/Cable Cross Ownership); 47 U.S.C. § 310
    (Limitation on Holding and Transfer of Licenses (Alien Ownership
    Restriction).

[^404]: 47 C.F.R. § 21.11(e).

[^405]: *Id.*

[^406]: *Id.*

[^407]: *Id.*

[^408]: *See* 47 C.F.R. § 21.934. We note that exceptions exist if there
    is not a substantial change in ownership or control of the
    authorized facility from the transaction (assignment/transfer);
    involuntary transaction due to the licensee\'s bankruptcy, death, or
    legal disability; and if the transaction involves BTA
    authorizations. *See id.*

[^409]: *See* 47 C.F.R. §§ 74.910, 73.3500.

[^410]: *See* 47 C.F.R. § 73.3540.

[^411]: *See* 47 C.F.R. § 73.3541.

[^412]: *Id*.

[^413]: *ULS R&O*, 13 FCC Rcd at 21079 ¶ 113.

[^414]: *See NPRM,* 18 FCC Rcd at 6789-91 ¶¶ 165-170.

[^415]: *See id.* at 6791 ¶ 169.

[^416]: *See id.*

[^417]: This procedure is burdensome in that it requires our engineers
    to generate and to enter a minor modification application into BLS
    for each channel that the parties seek to exchange. *See* 47 C.F.R.
    §§ 21.901(d), 74.902(f), 74.951(e).

[^418]: *See NPRM,* 18 FCC Rcd at 6791 ¶ 170.

[^419]: *See* 47 C.F.R. § 74.951(e).

[^420]: *See* 47 C.F.R. § 74.902; *see also* 47 C.F.R. § 21.901.

[^421]: The MDS and ITFS community has also asked that we make changes
    in this area. *See* Coalition Proposal at Appendix B n.49.

[^422]: *See NPRM,* 18 FCC Rcd at 6791 ¶ 170.

[^423]: AHMLC Comments at 7; IMLC Comments at 10. We do note, however,
    that the ITFS Parties are fundamentally opposed to changing the
    eligibility standards for ITFS station licenses, either for parties
    applying for new licenses, or for parties seeking to acquire
    existing licenses. While the ITFS Parties support the Coalition
    Proposal, they also believe that allowing for-profit, commercial
    entities to become licensees would likely result in the ultimate
    destruction of the ITFS service as an educational asset. For this
    reason, the ITFS Parties also support the Joint Comments of CTN and
    NIA on this issue as well. *See* ITFS Parties Comments at 3-4.

[^424]: *See* Rural Commenters Comments at 6.

[^425]: *Id.*

[^426]: *See* 47 C.F.R. § 1.948; *see also* discussion of FCC forms at
    ¶¶ 254-258 *infra*.

[^427]: *See NPRM,* 18 FCC Rcd at 6791-92 ¶¶ 171, 172. Additionally, we
    also sought comment in the *NPRM* on factors other than geography or
    frequency that licensees might reasonably use when disaggregating
    their licenses. For example, the *Spectrum Policy Report* discusses
    the possibility that licensees might also be willing to sell off
    parts of their license rights on the basis of time slots and power
    levels. That report suggests that frequency-agile transceivers are
    already capable of sensing if a given channel is in use at a
    particular moment in time, by switching channels, reducing power, or
    remaining silent until a channel becomes available. *See Spectrum
    Policy Report* at 19.

[^428]: *See*, *e.g.*, 47 C.F.R. §§ 27.15, 101.535, 101.1111, 101.1323.

[^429]: "Partitioning" is the assignment of geographic portions of a
    license along geopolitical or other boundaries. "Disaggregation" is
    the assignment of discrete portions of "blocks" of spectrum licensed
    to a geographic area licensee or qualifying entity.

[^430]: 47 C.F.R. § 21.931.

[^431]: *See NPRM,* 18 FCC Rcd at 6791-2 ¶ 171.

[^432]: *See, e.g*., 47 C.F.R. §§ 21.901, 74.902.

[^433]: *See* Coalition Proposal at 13; BellSouth Comments at 13-14
    n.21.

[^434]: *See* Ericsson Comments at 6-7.

[^435]: *See* OWTC Comments at 4.

[^436]: *See NPRM,* 18 FCC Rcd at 6792-93 ¶¶ 173-177.

[^437]: *See* 47 C.F.R. § 21.11(c).

[^438]: *See* 47 C.F.R. § 21.44(a)(2).

[^439]: *See* 47 C.F.R. § 21.43(b).

[^440]: *See* 47 C.F.R. § 21.929(b).

[^441]: *See* Wireless Telecommunications Bureau Suspends Electronic
    Filing for the Broadband Licensing System on October 11, 2002,
    *Public Notice*, 7 FCC Rcd 18365 (2002).

[^442]: *See* 47 C.F.R. § 73.3539.

[^443]: *See, e.g* Renewal Applications of Jonsson Communications
    Corp*.,* DA 02-3099, *Memorandum Opinion and Order*, 17 FCC Rcd
    22697, 22698 (2002). There is no codified rule specifically
    addressing reinstatement of ITFS licenses.

[^444]: *ULS R&O*, 13 FCC Rcd at 21071 ¶ 96.

[^445]: *See* Biennial Regulatory Review - Amendment of Parts 0, 1, 13,
    22, 24, 26, 27, 80, 87, 90, 95, and 101 of the Commission\'s Rules
    to Facilitate Development and Use of the Universal Licensing System
    in the Wireless Telecommunications Service, WT Docket No. 98-20,
    *Memorandum Opinion and Order on Reconsideration*, 14 FCC Rcd 11476,
    11485 ¶ 22 (1999) (*ULS MO&O*).

[^446]: *See id*. at 11485 ¶ 22.

[^447]: *Id*.

[^448]: *Id*.

[^449]: *Id*. at 11485-6 ¶ 22.

[^450]: *See* Rules and Regulations to Facilitate the Development and
    Use of the Universal Licensing System in the Wireless
    Telecommunications Service, 63 Fed. Reg. 68904, 68908 (1998).

[^451]: *Nunc pro tunc* is a phrase applied to acts allowed to be done
    after the time when they should be done, with a retroactive effect,
    *i.e.*, with the same effect as if regularly done.

[^452]: *See ULS MO&O*, 14 FCC Rcd at 11486 ¶ 22.

[^453]: *See id.*

[^454]: *See id.* at 11485 ¶ 22.

[^455]: *See* *ULS MO&O*, 14 FCC Rcd at 11485 ¶ 21*. See also* Sierra
    Pacific Power Company, *Order*, 16 FCC Rcd 188, 191 ¶ 6 (WTB PSPWD
    2001) (holding that "each licensee bears the exclusive
    responsibility of filing a timely renewal application");
    Alameda-Contra Costa Transit District Private Land Mobile Stations
    KBY746, WFS916, and KM8643, *Order*, 15 FCC Rcd 24547, 24551 ¶ 10
    (WTB PSPWD 2000) (holding that "each licensee is responsible for
    knowing the expiration date of its licenses and submitting a renewal
    of license application in a timely manner"); World Learning,
    *Order*, 15 FCC Rcd 23871, 23872 ¶ 4 (WTB PSPWD 2000) (holding that
    licensee "is solely responsible for filing a timely renewal
    application"); First National Bank of Berryville, *Order*, 15 FCC
    Rcd 19693, 19696 ¶ 8 (WTB PSPWD 2000) (*Berryville*) (holding that
    "it is the responsibility of each licensee to renew its application
    prior to the expiration date of the license"); Montana Power
    Company, *Order*, 14 FCC Rcd 21114, 21115 ¶ 7 (WTB PSPWD 1999)
    (holding that "it is the responsibility of each licensee to apply to
    renew its license prior to the license's expiration date").

[^456]: *See* *Berryville*, 15 FCC Rcd at 19693 ¶ 8 (citing *ULS R&O*,
    13 FCC Rcd 21027, (1998) (holding that a "licensee's obligation to
    timely file a renewal application is not dependent upon the
    Commission sending a renewal notice to the licensee, rather it is
    the responsibility of each licensee to renew its application prior
    to the expiration date of the license")).

[^457]: *See* Fresno City and County Housing Authorities, *Order on
    Reconsideration*, 15 FCC Rcd 10998 (WTB PSPWD 2000) (citing
    Plumas-Sierra Rural Electric Cooperative, *Order,* 15 FCC Rcd 5572,
    5575 ¶ 9 (2000)).

[^458]: *See* 47 C.F.R. § 1.925(b)(3).

[^459]: *See* Amendment of Parts 1 and 90 of the Commission's Rules
    Concerning the Construction, Licensing and Operation of Private Land
    Mobile Radio Stations, *Report and Order*, 6 FCC Rcd 7297, 7301 ¶ 20
    (1991).

[^460]: BellSouth Comments at 13-14 n.21.

[^461]: WCA Comments at 137-139.

[^462]: OWTC Comments at 6. As discussed in ¶ 214, *supra* , we note
    that while we generally provide renewal notices to licensees, the
    pre-expiration notice is not a prerequisite to cancellation should a
    licensee fail to renew its license.

[^463]: Grand Wireless Comments at 13.

[^464]: *ULS R&O,* 13 FCC Rcd at 21071 ¶ 96. The Commission excluded
    Commercial Radio Operators Licenses and Amateur licenses from this
    policy. *Id*.

[^465]: *Id*.

[^466]: *See NPRM,* 18 FCC Rcd at 6794-95 ¶¶ 178-180.

[^467]: *See* 47 C.F.R. § 21.25.

[^468]: 47 C.F.R. § 21.5.

[^469]: 47 U.S.C. § 309(f).

[^470]: *Id.*

[^471]: *See* 47 C.F.R. § 73.3542; *see also* 47 C.F.R. §§ 73.1635,
    74.910.

[^472]: 47 U.S.C. § 309(f).

[^473]: BellSouth Comments at 13-14 n.21. We also note that SCETV is
    concerned about the loss of Special Temporary Authority (STA) in
    several key geographical locations. *See* SCETV Comments at 7.

[^474]: *See* 47 C.F.R. § 1.931; *see also* Section 16, *infra*
    (discussion of FCC Forms).

[^475]: *See* 47 C.F.R. § 1.931.

[^476]: *See* 47 U.S.C. § 310.

[^477]: *See ULS NPRM*, 13 FCC Rcd 9672, 9691 ¶ 43 (1998).

[^478]: ULS will pre-fill information that the licensee has previously
    submitted on a Form 602, enabling the licensee to limit new
    submissions to changed information, and ULS can also fill in certain
    parts of a Form 602 by reference to other previously filed
    information. For example, if Party A has previously submitted its
    own ownership filing and is subsequently listed as a disclosable
    interest holder on the ownership filing of another licensee (Party
    B), Party A\'s FCC-regulated businesses may be automatically copied
    to Party B\'s filing. Wireless Telecommunications Bureau Announces
    Availability of Electronic Filing of FCC Form 602, *Public Notice*,
    17 FCC Rcd 16779 (2002).

[^479]: *See* Wireless Telecommunications Bureau Answers Frequently
    Asked Questions Concerning Reporting of Ownership Information on FCC
    Form 602, DA 99-1001, *Public Notice,*14 FCC Rcd 8261 (May 25, 1999)
    (*WTB Frequently Asked Questions*).

[^480]: *See NPRM,* 18 FCC Rcd at 6795-96 ¶ 181.

[^481]: *See* BellSouth Comments at 13-14 n.21.

[^482]: ULS will pre-fill information that the licensee has previously
    submitted on a Form 602, enabling the licensee to limit new
    submissions to changed information, and ULS can also fill in certain
    parts of a Form 602 by reference to other previously filed
    information. For example, if Party A has previously submitted its
    own ownership filing and is subsequently listed as a disclosable
    interest holder on the ownership filing of another licensee (Party
    B), Party A\'s FCC-regulated businesses may be automatically copied
    to Party B\'s filing. Wireless Telecommunications Bureau Announces
    Availability of Electronic Filing of FCC Form 602, *Public Notice*,
    17 FCC Rcd 16779 (2002).

[^483]: *See WTB Frequently Asked Questions, supra,* n.Error: Reference
    source not found.

[^484]: Wireless Telecommunications Bureau to Temporarily Suspend
    Electronic Filing of FCC Form 430 via the Broadband Licensing
    System, *Public Notice,* 17 FCC Rcd 11131 (2002).

[^485]: *See infra* ¶¶ 252-256 (discussion of FCC Forms).

[^486]: *See NPRM,* 18 FCC Rcd at 6796 ¶ 182.

[^487]: *See e.g.,* 47 C.F.R. §§ 27.10, 101.511, 101.133.

[^488]: *See ULS R &O*, 13 FCC Rcd at 21027 Appendix C.

[^489]: *See NPRM,* 18 FCC Rcd at 6796 ¶ 182.

[^490]: Section 27.10(c)(2) of the Commission's Rules provides that
    \[a\]mendments to change, or add to, the carrier regulatory status
    in a pending application are minor amendments filed under § 1.927 of
    this chapter." 47 C.F.R. § 27.10(c)(2). *See* Section 3, *supra*
    (discussion of major and minor amendments).

[^491]: *See* BellSouth Comments at 13-14 n.21.

[^492]: *See* EarthLink Comments at 7. We note that we plan on relying
    on a Part 27 type regulatory scheme for the MBS, as well as the LBS
    and UBS. *See* Section 4, *supra* (discussion of geographic area
    licensing).

[^493]: *See* Coalition Comments at 142.

[^494]: *See* CTIA Comments at 3.

[^495]: *See* AHMLC Comments at 8, 24; IMLC Comments at 11.

[^496]: *See* Implementation of Sections 3(N) and 332 of the
    Communications Act Regulatory Treatment of Mobile Services, GN
    Docket 93-252, *Second Report and Order*, 9 FCC Rcd 1411, 1418; *see
    also* 47 CFR § 20.15 (2003).

[^497]: *See* 47 C.F.R. § 27.10(c).

[^498]: *See NPRM,* 18 FCC Rcd at 6798 ¶¶ 186 -188.

[^499]: *See* 47 C.F.R. §§ 21.44, 21.303, 21.910, 21.932, 21.936,
    73.3534, 73.3598, 74.932.

[^500]: *See* Reorganization and Revision of Parts 1, 2, 21, and 94 of
    the Rules to Establish a New Part 101 Governing Terrestrial
    Microwave Fixed Radio Services, WT Docket No. 94-148, *Report and
    Order*, 11 FCC Rcd 13,449, 13,465 (1996).

[^501]: *See* 47 C.F.R. §§ 21.903(d), 21.910.

[^502]: *See* 47 C.F.R. § 21.903(d), which provides that the
    notification must state whether there is any affiliation or
    relationship to any intended or likely subscriber or program
    originator.

[^503]: *See* 47 C.F.R. § 21.910, which provides that the notice shall
    be in writing and shall include the name and address of the carrier,
    the date of the event, the area(s) affected and the channels that
    are affected by the event. *Id*. at § 21.910(b).

[^504]: *See* Section 2, *supra* (discussion of service specific rules).

[^505]: We note, however, that our cancellation and forfeiture rules
    will remain in effect for instances where there is a failure to make
    installment payments.

[^506]: Section 27.66, 47 C.F.R. § 27.66, of the Commission's Rules
    provides in pertinent part:

    § 27.66 Discontinuance, reduction, or impairment of service.\
    (a) Involuntary act. If the service provided by a fixed common
    carrier licensee, or a fixed common carrier operating on spectrum
    licensed to a Guard Band Manager, is involuntarily discontinued,
    reduced, or impaired for a period exceeding 48 hours, the licensee
    must promptly notify the Commission, in writing, as to the reasons
    for discontinuance, reduction, or impairment of service, including a
    statement when normal service is to be resumed. When normal service
    is resumed, the licensee must promptly notify the Commission.\
    (b) Voluntary act by common carrier. If a fixed common carrier
    licensee, or a fixed common carrier operating on spectrum licensed
    to a Guard Band Manager, voluntarily discontinues, reduces, or
    impairs service to a community or part of a community, it must
    obtain prior authorization as provided under § 63.71 of this
    chapter. An application will be granted within 31 days after filing
    if no objections have been received.\
    (c) Voluntary act by non-common carrier. If a fixed non-common
    carrier licensee, or a fixed non-common carrier operating on
    spectrum licensed to a Guard Band Manager, voluntarily discontinues,
    reduces, or impairs service to a community or part of a community,
    it must give written notice to the Commission within seven days.

[^507]: Federal Communications Commission, Strategic Plan FY 2003-FY
    2008 at 5 (2002) (*Strategic Plan)*.

[^508]: *Id.* at 14.

[^509]: See discussion of transition at Section 5, *supra*.

[^510]: See discussion of geographic area licensing at 4, *supra*.

[^511]: See discussion of substantial service and performance
    requirements at Section B, *infra*.

[^512]: *See* Coalition Comments at 84, 92-93. *See also Co*alition
    Proposal, Appendix B at n.9.

[^513]: *See* Coalition Comments at 84, 92-93. *See also Co*alition
    Proposal, Appendix B at n.9.

[^514]: *See* Coalition Comments at 84, 92-93. *See also Co*alition
    Proposal, Appendix B at n.9.

[^515]: *See* BellSouth Comments at 13-14 n.21.

[^516]: *See* Sprint Comments at 18.

[^517]: *See* Nextel Reply Comments at 16.

[^518]: *See* 47 C.F.R. § 21.303.

[^519]: AHMLC Comments at 22; IMLC Comments at 22.

[^520]: Grand Wireless Comments at 13; Pace Comments at 8.

[^521]: *See NPRM,* 18 FCC Rcd at 6796 ¶ 189. We are aware that in the
    *NPRM* we sought comment on implementing this requirement pursuant
    to Part 101 of the Commission's Rules; however, as noted in ¶¶
    184-190 *supra*, we have decided to regulate the MDS and ITFS
    pursuant to Part 27 of the Commission's Rules.

[^522]: 47 U.S.C. § 310(a), (b).

[^523]: For example, we do not and would not deny a license to an
    applicant requesting authorization exclusively to provide services
    not enumerated in Section 310(b), solely because its foreign
    ownership would disqualify it from receiving a license if the
    applicant had applied for a license to provide the services
    enumerated in Section 310(b).

[^524]: As was observed in the *LMDS 2d R&O*, requiring submission of
    ownership information that may not be immediately necessary to
    assess the qualifications of a licensee (*i.e.,* one who currently
    operates as a non-common carrier) is an efficient and reasonable
    measure to facilitate the flexibility accorded licensees to change
    status with a minimum of regulatory interference. With this
    approach, updated information can be used whenever the licensee
    changes to common carrier status without imposing an additional
    filing requirement when the licensee makes the change. Moreover,
    having access to this ownership information allows the Commission to
    monitor all of the licensed providers more effectively, in light of
    their ability to provide both common and non-common carrier
    services. We stress that our decision to regulate MDS and ITFS
    pursuant to Part 27 rather than pursuant to Part 101, which
    regulates LMDS, does not make this line of reasoning inapplicable.
    Rulemaking to Amend Parts 1, 2, 21, and 25 of the Commission's Rules
    to Redesignate the 27.5-29.5 GHz Frequency Band, to Reallocate the
    29.5-30.0 GHz Frequency Band, To Establish Rules and Policies for
    Local Multipoint Distribution Service and For Fixed Satellite
    Services, CC Docket No. 92-297, *Second Report and Order, Order on
    Reconsideration, and Fifth Notice of Proposed Rulemaking,* 12 FCC
    Rcd 12545 (1997) (*LMDS 2d R&O*).

[^525]: *See* 47 C.F.R. §§ 27.12, 1.913, 1.919. *See also* Coalition
    Comments at 142.

[^526]: *See* 47 C.F.R. §§ 27.12, 1.913, 1.919.

[^527]: *See* 47 C.F.R. § 21.911.

[^528]: *See NPRM,* 18 FCC Rcd at 6806 ¶ 203.

[^529]: *See* AHMLC Comments at 6; IMLC Comments at 9-10; *See*
    BellSouth Comments at 13-14 n.21.

[^530]: *See* Rural Commenters Comments at 6.

[^531]: *See* Coalition Comments at 142.

[^532]: *See* 47 C.F.R. § 21.920.

[^533]: *See* IMLC Comments at 10. AHMLC, however, supports retaining
    the EEO Report required by Section 21.903 of our rules. *See* AHMLC
    Comments at 7.

[^534]: *See* *NPRM*, 18 FCC Rcd at 6806 ¶ 203.

[^535]: *See* *NPRM*, 18 FCC Rcd at 6806-8 ¶¶ 204-211.

[^536]: *See* Section *IV.a supra* (discussion of geographic licensing).

[^537]: With respect to the processing of ITFS, our existing rules
    require the opening of a filing window before we will accept
    applications. *See* 47 C.F.R. § 74.911(c)(1) and (d). Then we must
    announce a one-week filing period for applications for major
    changes, high-power signal booster station, response station hub and
    R channels point-to-multipoint transmissions licenses. At the
    conclusion of the one-week filing period, we announce the tendering
    for filing of applications submitted during the filing window and
    provide a sixty-day filing window for applicants to amend their
    applications. *See* 47 C.F.R. § 74.911(d). At the conclusion of the
    sixty-day filing window, we announce the acceptance for filing of
    all applications submitted during the initial window, as amended by
    the applicants. Opposing parties receive sixty days from the release
    of the public notice announcing the acceptance for filing of the
    applications to file a petition to deny against an application.
    *See* 47 C.F.R. § 74.911(d). On the sixty-first day, we grant the
    unopposed applications unless we notified the applicant that we were
    not granting the application.

[^538]: Generally, upon receipt of an MDS application, we give the
    application a file number. *See* 47 C.F.R. § 21.26. After
    preliminary review, we place those applications that appeared
    complete on public notice as accepted for filing. *See id*. However,
    with regard to MDS two-way application filings, we currently use a
    rolling one-day filing window. *See* Amendment of Parts 21 and 74 to
    Enable Multipoint Distribution Service and Instructional Television
    Fixed Service Licensees to Engage in Fixed Two-Way Transmissions, MM
    Docket No. 97-217, *Report and Order*, 13 FCC Rcd 19112, 19150
    (1998); 47 C.F.R. § 21.27(d). We announce the "tendering for filing"
    of applications submitted during the filing window. *See* Commission
    Announces Initial Filing Window for Two-Way Multipoint Distribution
    Service and Instructional Television Fixed Service, *Public Notice,*
    15 FCC Rcd 5850 (MMB 2000). Then, after a sixty-day period, we
    released a second public notice announcing those applications that
    we accepted for filing.^?^ *See* 47 C.F.R. § 21.27(d).

[^539]: Mass Media Bureau Implements, *Public Notice*, 2000 WL 684792
    (2000) (*BLS Implementation PN*).

[^540]: Wireless Telecommunications Bureau Suspends Electronic Filing
    for the Broadband Licensing System on October 11, 2002, *Public
    Notice*, 17 FCC Rcd 18365 (2002). We note that effective March 25,
    2002, the Commission transferred the regulatory functions for the
    Services from the former Mass Media Bureau to the Wireless
    Telecommunications Bureau. Radio Services are Transferred from Mass
    Media Bureau to Wireless Telecommunications Bureau, *Public Notice*,
    17 FCC Rcd 5077 (2002).

[^541]: *ULS R&O*, 13 FCC Rcd at 21031 ¶ 4.

[^542]: Because ULS is interactive, ULS prompts the applicant to input
    the required information for the type of action that the applicant
    seeks. As a result, applicants must submit all the appropriate
    information before they may file their applications electronically
    in ULS. *See* Phase I Mandatory Electronic Filing Deadline Extended
    for PCIA and ITA, *Public Notice,* 16 FCC Rcd 13,681 (2001) (the
    Commission extended the deadline for mandatory electronic filing to
    July 25, 2001). Notably, ULS will automatically "pre-fill" licensee
    information already in the system and will display only the portions
    of the form and schedules that require completion for the
    applicant's or licensee's indicated purpose.

[^543]: *See* 47 C.F.R. § 1.933(1).

[^544]: In most instances, applicants will not be required to file
    applications in order to relocate or add transmitters within their
    GSA. *See* discussion on Geographic Area Licensing, Section 4,
    *supra*.

[^545]: *See NPRM,* 18 FCC Rcd at 6808-9 ¶¶ 212-215.

[^546]: *See* ¶ 245, *supra*.

[^547]: *See ULS R&O*, 13 FCC Rcd at 21027; *See also* 47 C.F.R. §
    1.934.

[^548]: *ULS R&O*, 13 FCC Rcd at 21068 ¶ 90.

[^549]: *See, e.g*., *id.*

[^550]: *Id*.

[^551]: *See* Wireless Telecommunications Bureau Clarifies Unified
    Policy for Dismissing and Returning Applications, *Public Notice*,
    17 FCC Rcd 30 (WTB 2001) (*Unified Dismissal and Return PN*);
    Wireless Telecommunications Bureau Revises and Begins Phased
    Implementation of its Unified Policy for Reviewing License
    Applications and Pleadings, *Public Notice*, 14 FCC Rcd 11182, 11185
    (WTB 1999); Wireless Telecommunications Bureau Announces Unified
    Policy for Dismissing and Returning Applications and Dismissing
    Pleadings Associated with Applications, *Public Notice*, 14 FCC Rcd
    5499 (WTB 1999).

[^552]: *Unified Dismissal and Return PN*, 17 FCC Rcd at 30.

[^553]: *Id*. at 32.

[^554]: *See NPRM,* 18 FCC Rcd at 6809-11 ¶¶ 215-219.

[^555]: The MDS and ITFS application forms are FCC Forms 304, 304A, 305,
    306, 330, 330A, 330R, 331, 405, 430, and 701.

[^556]: *ULS R&O*, 13 FCC Rcd at 21033-34 ¶ 10.

[^557]: *Id*.

[^558]: *Id*.

[^559]: *See* 47 C.F.R. § 1.949 for the rules governing renewals.

[^560]: *See* n.Error: Reference source not found, *supra*; 47 C.F.R. §
    0.408.

[^561]: *See* 47 C.F.R. § 1.948.

[^562]: *See* AHMLC Comments at 6; IMLC Comments at 8-9. AHMLC, however,
    observes that certain legal qualifications information called for by
    Form 430 (status of criminal and antitrust litigation) is not called
    for by Form 602. *See id.* We agree with AHMLC's observations,
    however, we believe that MDS and ITFS applicants should only have
    the same Form 602 requirements as all our other wireless services,
    which is consistent with the streamlining goals of this proceeding.

[^563]: *See* Rural Commenters Comments at 6. We note that FCC Form 602
    must be filed or updated under the following circumstances:

    Applicants filing to obtain a new license or authorization who do
    not have a current FCC Form 602 on file with the FCC. *See* 47
    C.F.R. § 1.919(b)(1).

    Applicants filing to renew an existing license or authorization who
    do not have a current FCC Form 602 on file with the FCC. *See* 47
    C.F.R. § 1.919(b) (2).

    Applicants requesting approval for a transfer of control of a
    license or assignment of an authorization who do not have a current
    FCC Form 602 on file with the FCC. *See* 47 C.F.R. §§ 1.919(b) (3),
    1.948(c).

    Applicants filing a notification of consummation of a *pro forma*
    transfer of control of a license or assignment of authorization
    under the Commission's forbearance procedures who do not have a
    current FCC Form 602 on file with the FCC. *See* 47 C.F.R. §§
    1.919(b)(4), 1.948(c)(1)(iii), 1.948(d).

[^564]: *See e.g.* 47 C.F.R §§ 73.3500, 73.3536 (elimination of all
    references to FCC Form 330-L, "Application for Instructional
    Television Fixed Station License); 47 C.F.R. §§ 21.11(b), 73.3500,
    73.3533(b) (elimination of all references to FCC Form 307). In
    addition, we propose to delete references to obsolete MDS forms
    mentioned in Part 74. *See* 47 C.F.R. § 74.991.

[^565]: *See* *NPRM,* 18 FCC Rcd at 6811-13 ¶¶ 220-225.

[^566]: *See ULS R&O*, 13 FCC Rcd at 21027, 21038-39 ¶ 16.

[^567]: *See id.* at 21042-43 ¶ 24.

[^568]: *See id.*

[^569]: *See ULS R&O,* 13 FCC Rcd at 21042-43 ¶ 22-4.

[^570]: *See* AHMLC Comments at 7; IMLC Comments at 10.

[^571]: *See, e.g., Public Notice:* Wireless Telecommunications Bureau
    to Begin Use of Universal Licensing System (ULS) for Microwave
    Services (DA 99-154, rel. Aug. 30, 1999).

[^572]: *See NPRM,* 18 FCC Rcd at 6813-14 ¶ 228. In the interest of
    completeness, we note that in the *NPRM* we stated that effective as
    of its *release* date, we would suspend acceptance of applications
    for ITFS channels for new licenses, amendments or modifications for
    any kind of station temporarily, except for ITFS channels that
    involve minor modifications, assignment of license or transfer of
    control. We explained the suspension is effective until further
    notice and applies to applications received on or after the date of
    release of the *NPRM*. *See NPRM,* 18 FCC Rcd at 6813 ¶¶ 226-227. On
    August 8, 2003, however, we modified the freeze by allowing the
    filing of applications for new licenses and major modifications of
    MDS stations adopted in the *MO&O.* With respect to ITFS stations,
    we accepted major change applications, subject to the existing
    requirement that a licensee may not modify its protected service
    area (PSA). As modified, the freeze on MDS and ITFS applications
    will revert to the *status quo ante* that applied before the *MO&O*
    was adopted. *See* Amendment of Parts 1, 21, 73, 74 and 101 of the
    Commission's Rules to Facilitate the Provision of Fixed and Mobile
    Broadband Access, Educational and Other Advanced Services in the
    2150-2162 and 2500-2690 MHz Bands, Part 1 of the Commission\'s
    Rules - Further Competitive Bidding Procedures, Amendment of Parts
    21 and 74 to Enable Multipoint Distribution Service and the
    Instructional Television Fixed Service Amendment of Parts 21 and 74
    to Engage in Fixed Two-Way Transmissions, Amendment of Parts 21 and
    74 of the Commission\'s Rules With Regard to Licensing in the
    Multipoint Distribution Service and in the Instructional Television
    Fixed Service for the Gulf of Mexico, WT Docket No. 03-66 RM-10586,
    WT Docket No. 03-67, MM Docket No. 97-217, WT Docket No. 02-68
    RM-9718, *Second Memorandum Opinion and Order*18 FC Rcd 16848
    (2003).

[^573]: *See NPRM,* 18 FCC Rcd at 6813-14 ¶ 228. If we approve such a
    settlement agreement, we will allow the processing and grant of the
    remaining non-mutually exclusive applications. *Id.*

[^574]: *See, e.g.,* Amendment of the Commission's Rules Regarding
    Maritime Communications, PR Docket No. 92-257, *Second Report and
    Order and Second Further Notice of Proposed Rule Making*, 12 FCC Rcd
    16949, 17015-17016 (1997).

[^575]: *See NPRM,* 18 FCC Rcd at 6813-14 ¶ 228.

[^576]: *Id.*

[^577]: *See* HITN Comments at 9-10.

[^578]: *See* n.Error: Reference source not found, *supra*.

[^579]: *See* Appendix E for list of dismissed applications. *See*
    Appendix F for a list of dismissed pleadings relating to the
    dismissed applications.

[^580]: *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, 2360-2361, ¶¶ 70-71
    (1994). Citing prior Commission proceedings, the Coalition proposed
    that participation in an auction of ITFS white space should be
    limited solely to parties with pending applications for licenses
    associated with unassigned ITFS spectrum. White Paper at 41 and
    n.111 (quoting 13 FCC Rcd at 16,002). Previously, the Commission
    observed that "it would not serve the public interest to accept
    additional competing ITFS applications despite our authority to do
    so under Section 309(j)(1)," and therefore the only "eligible
    bidders in any auction of the pending ITFS applications" ought to be
    "those with applications already on file." *Id.* However, this prior
    observation applied solely with respect to "any auction of the
    *pending ITFS applications*\[.\]" Those applications have been
    otherwise resolved. We propose that the auction for clear spectrum
    discussed herein will be open to all qualified applicants for the
    reasons set forth above.

[^581]: In the event that particular overlay licenses were returned or
    otherwise cancelled, there may be unassigned MDS spectrum available
    for licensing.

[^582]: *See, e.g.,* Amendment of Part 1 of the Commission's
    Rules---Competitive Bidding Procedures, WT Docket No. 97-82, *Order,
    Memorandum Opinion and Order and Notice of Proposed Rule Making,* 12
    FCC Rcd 5686 (1997); *Third Report and Order and Second Further
    Notice of Proposed Rule Making*, 13 FCC Rcd 374 (1997) (*Part 1
    Third Report and Order)*; *Order on Reconsideration of the Third
    Report and Order, Fifth Report and Order, and Fourth Further Notice
    of Proposed Rule Making*, 15 FCC Rcd 15293 (2000) (*recon. pending*)
    (*Part 1 Recon Order/ Fifth Report and Order* and *Fourth Further
    Notice of Proposed Rule Making*); *Seventh Report and Order*, 16 FCC
    Rcd 17546 (2001); *Eighth Report and Order,* 17 FCC Rcd 2962 (2002).

[^583]: *See* 47 C.F.R. § 1.2101 *et seq.*

[^584]: *See Fourth Further Notice of Proposed Rule Making*, 15 FCC Rcd
    15293; *see also Part 1 Recon Order/Fifth Report and Order*, 15 FCC
    Rcd 15293 (*recon. pending*) \[cite check -- recon pending?\].

[^585]: *See* Amendment of Part 1 of the Commission's Rules -
    Competitive Bidding Procedures*, Third Report and Order and Second
    Further Notice of Proposed Rule Making*, 13 FCC Rcd 374, 448-49,
    454-55 ¶¶ 125, 139 (directing the Bureau to seek comment on specific
    mechanisms relating to auction conduct pursuant to the Balanced
    Budget Act of 1997) (*Part 1 Third Report and Order*).

[^586]: *See* 47 U.S.C. § 309(j)(4)(D).

[^587]: *See* 47 U.S.C. § 309(j)(3)(B).

[^588]: *See* 47 C.F.R. § 1.2110(a). Although the Commission previously
    extended designated entity preferences to minority- and women-owned
    businesses, as well as to small businesses, following the Supreme
    Court's rulings in *Adarand Constructors, Inc. v. Pena*, 515 U.S.
    200 (1995), and *United States v. Virginia, et al*., 518 U.S. 515
    (1996), the Commission concluded that it would not be appropriate to
    adopt special provisions for minority-owned and women-owned
    businesses pending the development of a more complete record on the
    propriety of race- and gender-based provisions for future auctions.
    *See* *Part 1 Fifth Report and Order*, 15 FCC Rcd at 15318-20 ¶¶
    45-50 (discussing constitutional standards and governmental
    interests that would justify the use of race- or gender-based
    preferences).

[^589]: *See Part 1 Fifth Report and Order*, 15 FCC Rcd at 15319 ¶ 48;
    *see also* FCC Report to Congress on Spectrum Auctions, WT Docket
    No. 97-150, *Report*, FCC 97-353 at 29 (rel. Oct. 9, 1997) (finding
    that special provisions for small businesses also increase
    opportunities for minority- and women-owned businesses).

[^590]: We have issued a Notice of Inquiry seeking information about the
    effectiveness of our provisions to promote participation by rural
    telephone companies in our competitive bidding proceedings. *See*
    Facilitating the Provision of Spectrum-Based Services to Rural Areas
    and Promoting Opportunities for Rural Telephone Companies to Provide
    Spectrum-Based Services, WT Docket No. 02-381, *Notice of Inquiry*,
    FCC 02-325 (rel. Dec. 20, 2002).

[^591]: Implementation of Section 309(j) of the Communications
    Act---Competitive Bidding, PP Docket No. 93-253, *Second Memorandum
    Opinion and Order*, 9 FCC Rcd 7245, 7269 ¶ 145 (1994) (*Competitive
    Bidding Second Memorandum Opinion and Order*); 47 C.F.R. §
    1.2110(c)(1).

[^592]: *Part 1 Third Report and Order*, 13 FCC Rcd at 388 ¶ 18; 47
    C.F.R. § 1.2110 (c)(1).

[^593]: *See* White Paper at 11.

[^594]: *See* *Part 1 Third Report and Order*, 13 FCC Rcd at 403-04 ¶
    47.

[^595]: *See* 47 C.F.R. § 1.2110(f)(2).

[^596]: *See* 47 C.F.R. § 1.2110(f)(2). We note that we will coordinate
    the small business size standards for ITFS in this proceeding with
    the U.S. Small Business Administration.

[^597]: 47 C.F.R. § 1.2110(f)(2)(i)-(iii).

[^598]: *See* 47 C.F.R. § 21.961(b).

[^599]: *See* 47 C.F.R. § 1.2110(b).

[^600]: This portion of the proposal would not apply to licenses for
    operations on MDS channels 1 and 2/2A, which would be subject to the
    separate clearing procedures for that spectrum. However, the
    remaining element of the proposal, issuing bidding offset credits,
    would apply to licensees for MDS channels 1 and 2/2A.

[^601]: Should the Commission determine for any reason that the sum
    total of bidding offset credits should not exceed the sum total of
    net winning bids, the Commission would have to consider whether to
    calculate the face dollar value of bidding offset credits using net
    winning bids or whether to refrain from using small business bidding
    credits in the auction which will be used as the source of winning
    bids used to calculate the face dollar value of bidding offset
    credits.

[^602]: *See* 47 U.S.C. § 309(j)(3).

[^603]: P.L. 103-66, Omnibus Budget Reconciliation Act of 1993, House
    Report No. 103-111, Report of the Committee on the Budget, House of
    Representatives, to Accompany H.R. 2264, A Bill to Provide for
    Reconciliation Pursuant to section 7 of the Concurrent Resolution of
    the Budget for Fiscal Year 1994, May 25, 1993, at p. 255.

[^604]: For example, if the modified license authorized exclusive use of
    frequencies equaling 10 megahertz in a GSA with a population of 10
    million, the licensee would receive a bidding offset credit for 100
    million MHzPops. Subsequently, presuming the appropriate average
    price per MHzPops of related new licenses is \$2, the bidding offset
    credit would have a face value of \$200 million (100 MHzPops \* \$2
    per MHzPops). A party holding the bidding offset credit could use it
    to offset up to \$200 million of winning bids for Commission
    spectrum licenses. For example, if the winning bid for a new license
    is \$150 million, the bidding offset credit could be used to offset
    that winning bid in entirety, while retaining a remaining face value
    of \$50 million.

[^605]: For example, if a modified 10 megahertz license reaches two
    million people in the area covered by one new license and eight
    million people in the area covered by a second new license, we will
    treat the bidding offset credit as having 20 million MHzPops with
    respect to the first new license and 80 million MHzPops with respect
    to the second. Assume the auction results in an average price per
    MHzPops of \$1 for the first new license and \$2 for the second. The
    bidding offset credit have a face dollar value of \$180 million ((20
    million MHzPops \* \$1/MHzPops) + (80 million MHzPops \*
    \$2/MHzPops)) = \$20 million + \$160 million = \$180 million). Once
    the face dollar value is determined, no further distinction needs to
    be made between the two areas reached by the modified license.

[^606]: *NPRM*, 18 FCC Rcd at 6799-6804 ¶¶ 190-198.

[^607]: *See* Section *4*, *supra*.

[^608]: See Section 11, *supra*.

[^609]: *See* *NPRM,* 18 FCC Rcd at 6799 ¶ 190.

[^610]: *See* *NPRM,* 18 FCC Rcd at 6800 ¶ 191. *See also*, Amendments
    to Parts 1, 2, 87 and 101 of the Commission\'s Rules To License
    Fixed Services at 24 GHz, *Report and Order*, 15 FCC Rcd 16934,
    16951 ¶ 37 (2000) (*24 GHz Report and Order*) ("Based on the record
    in this proceeding, we believe that the substantial service
    standard, in lieu of specific coverage requirements best serves the
    public interest. In addition to being consistent with the approach
    used in other wireless services, we believe that this standard is
    sufficiently flexible to foster expeditious development and
    deployment of systems and will ultimately create competition among
    service providers in this band.").

[^611]: *See* *NPRM,* 18 FCC Rcd at 6802 ¶ 193. The most important
    construction requirements currently applicable to MDS BTA
    authorization holders are that such licensee has a five-year
    build-out period, beginning on the date of the grant of
    authorization, and in that time the licensee must construct stations
    that will provide service signals to at least two-thirds of the
    population of the applicable service area. *See generally* 47 C.F.R.
    § 21.930. Site-based MDS licensees must construct their facilities
    within twelve months of the date of their grant. *See* 47 C.F.R. §
    21.43. Site-based ITFS licensees must construct their facilities
    within eighteen months of following the issuance of their
    construction permit. *See* 47 C.F.R. § 73.3534.

[^612]: *See* *NPRM,* 18 FCC Rcd at 6800, 6802-03 ¶¶ 191, 193-97.

[^613]: 47 USC §309(j)(4)(B).

[^614]: *See* Facilitating the Provision of Spectrum-Based Services to
    Rural Areas and Promoting Opportunities for Rural Telephone
    Companies to Provide Spectrum-Based Services, *Notice of Proposed
    Rulemaking*, 18 FCC Rcd 20802, 20819 ¶ 34 (2003) (*Rural NPRM*).

[^615]: *See Rural NPRM,* 18 FCC Rcd at 20819 ¶ 34.

[^616]: *See* 47 C.F.R. § 27.14(a) (2004).

[^617]: 47 C.F.R. § 27.14(a).

[^618]: *See, e.g., Rural NPRM,* 18 FCC Rcd at 20819 ¶ 34 ("In more
    recently adopted rules for wireless services, such as our Part 27
    rules for private services, Lower and Upper 700 MHz, 39 GHz, and 24
    GHz, the Commission established the substantial service standard as
    the only construction requirement."). *See also* Coalition Proposal
    at 44. ("There is ample precedent for \[a substantial service\]
    approach as the Commission has adopted this very same requirement
    for operate at 2.3 GHz, the Upper 700 MHz band, the Lower 700 MHz
    band, the paired 1392-1395 MHz and 1432-1435 MHz bands or the
    unpaired 1390-1392 MHz, 1670-1675 MHz and 2385-2390 MHz bands.").

[^619]: *See also* *Rural NPRM,* 18 FCC Rcd at 20821-22 ¶ 37-38. *See
    also 24 GHz Report and Order, supra* note 5, at 16951 ¶ 37.

[^620]: *See Rural NPRM,* 18 FCC Rcd at 20819 ¶ 32. "For example, in
    some wireless services, the Commission indicated that licensees
    providing niche, specialized, or technologically sophisticated
    services may be considered to be providing 'substantial service.' In
    other services, the Commission has indicated that licensees
    providing an offering that does not cover large geographic areas or
    population..., but nonetheless provides a benefit to consumers, also
    may meet the standard." *Id.* at n.75 (citations omitted).

[^621]: *See* Section 4 *supra*.

[^622]: *See* *NPRM,* 18 FCC Rcd at 6803 ¶ 195 ("\[F\]ocusing solely on
    the population served via stations authorized pursuant to a
    particular license hardly tells the story as to whether the licensee
    is providing adequate service to the public."). *See also* *Rural
    NPRM,* 18 FCC Rcd at 20820 ¶ 35 ("\[G\]iven the unique
    characteristics and considerations inherent in constructing within
    rural areas, we believe that applying an inflexible construction
    standard that is based upon coverage of a requisite percentage of an
    area's population may be an inappropriate measure of levels of rural
    construction.").

[^623]: *See, e.g*., Nextel Reply Comments at 15-16 ("\[A\] substantial
    service standard will provide licensees greater flexibility to
    determine how best to implement their business plans based on
    criteria demonstrating actual service to end users, rather than on a
    showing of whether a licensee passes a certain portion of the
    relevant population."). *See also*, Amendment of Parts 2 and 90 of
    the Commission\'s Rules to Provide for the Use of 200 Channels
    Outside the Designated Filing Areas in the 896-901 MHz and the
    935-940 MHz Bands Allotted to the Specialized Mobile Radio Pool,
    *Second Report and Order*, 10 FCC Rcd 6884 ¶ 41 (1995) (*900 MHz
    Second Report and Order*) ("We also conclude that a showing of
    \"substantial service\" is appropriate for 900 MHz because several
    current offerings in this band are cutting-edge niche services.").

[^624]: The Commission has recognized that because certain types of
    services and technologies do not lend themselves to compliance with
    strict construction requirements, they are better gauged based upon
    a substantial service requirement. For example, fixed,
    point-to-point operations provide service in a linear manner, making
    a coverage area calculation inapplicable. *See, e.g*., Amendment of
    Part 90 of the Commission\'s Rules To Provide for the Use of the
    220-222 MHz Band by the Private Land Mobile Radio Service, *Third
    Report and Order*, 12 FCC Rcd 10943 ¶ 156 (1997).

[^625]: *See* *Rural NPRM,* 18 FCC Rcd at 20820 ¶ 35; *see also*
    Coalition Proposal at 45.

[^626]: SBC asserts that construction requirements "likely would result
    in the construction of facilities solely to meet regulatory
    requirements rather than market conditions," possibly causing
    facilities to be "constructed inefficiently, and guided more by
    regulatory necessity than the need to provide least-cost service to
    consumers." *See* SBC Reply Comments at 11. SBC says the consequence
    would be unnecessarily high rates. *See* SBC Reply Comments at 11.
    Finally, SBC argues that fixed construction benchmarks would be
    inconsistent with the pro-competitive policies of the Act,
    handicapping new entrants into the broadband services market. *See*
    SBC Reply Comments at 11. We acknowledge that one of our goals is to
    encourage competition in wireless broadband by creating new
    opportunities for new entrants. Thus, SBC supports a substantial
    service standard for these primary reasons. *See* SBC Reply Comments
    at 12.

[^627]: *NPRM,* 18 FCC Rcd at 6803 ¶ 195; *see* *also* Coalition
    Proposal at 45.

[^628]: *See NPRM,* 18 FCC Rcd at 6803 ¶ 195 (citing Coalition Proposal
    at 35, "MDS/ITFS may pull spectrum from "their own BTA authorized
    stations, incumbent MDS stations they own, and leased capacity of
    MDS and ITFS stations licensed to others.")

[^629]: *NPRM,* 18 FCC Rcd at 6803 ¶ 195; *see* Coalition Proposal at
    45.

[^630]: IPWireless is in apparent agreement with the Coalition that some
    spectrum could permissibly be used as guard band and still be
    considered a valid part of a licensee's commercial service. *See*
    IPWireless Reply Comments at 7; *see also* Sprint Comments at 17.
    However, the IPWireless response cautions some qualification:
    "Spectrum used to provide any guard bands necessary to conform to
    the rules, consistent with sound engineering practices, should be
    counted as having been placed in commercial service. \[However,
    t\]he term 'commercial service' should be limited to direct links
    between a carrier's network and one or more end users/subscribers."
    IPWireless Reply Comments at 7.

[^631]: *NPRM,* 18 FCC Rcd at 6803 ¶ 196; *see* Coalition Proposal at
    46.

[^632]: *Id.*

[^633]: *Id.* at 6803 ¶ 197; *see* Coalition Proposal at 46.

[^634]: *See* Sprint Comments at 16.

[^635]: *See* BellSouth Reply Comments at 22.

[^636]: *See* EarthLink Comments at 8-9; *see* Rural Commenters Reply
    Comments at 3; *see* AHMLC Comments at 24; *see* HITN Comments at 8
    n..8.

[^637]: *See* NTCA Comments at 7. Many commenters are concerned that
    stringent construction requirements put small carriers at greater
    disadvantage, especially as such benchmarks regard rural service.
    *See, e.g.,* NTCA Comments at 7.

[^638]: *See* IPWireless Reply Comments at 6.

[^639]: IPWireless Reply Comments at 6. IPWireless notes that "\[t\]he
    proposed requirements are generally based upon those already
    existing in other services, including broadband Personal
    Communications Service (47 CFR §24.203 "Construction requirements")
    and the Cellular Radiotelephone Service (47 CFR §22.947 "Five year
    build-out period")." IPWireless Reply Comments at n.9.

[^640]: *NPRM,* 18 FCC Rcd at 6801 ¶ 191. We also sought comment on safe
    harbors in the *Rural NPRM*, another proceeding that affects MDS and
    ITFS licensees as well as other service-specific licensees. *See*
    *Rural NPRM,* 18 FCC Rcd at 20824 ¶ 41.

[^641]: *See* n.Error: Reference source not found, *supra*. *See also*
    47 C.F.R. § 27.930 (MDS BTA authorization holders), 47 C.F.R. §
    21.43 (site-based MDS licensees), 47 C.F.R. § 73.3534 (site-based
    ITFS licensees). *See also Rural NPRM,* 18 FCC Rcd at 20824 ¶ 41
    ("We note that these proposed 'safe harbors' are intended to provide
    licensees with a measure of certainty in determining whether they
    are providing substantial service, but are not intended to be the
    only means of demonstrating substantial service. Accordingly, a
    licensee may still satisfy a 'substantial service' standard without
    complying with one of the safe harbors.").

[^642]: *Rural NPRM,* 18 FCC Rcd at 20807 ¶ 7.

[^643]: *Id.*

[^644]: *See* NTCA Comments at 7, Grand Wireless Commments at 13- 14, IP
    Wireless Comments at 23, Pace Comments at 1, 9.

[^645]: *See NPRM,* 18 FCC Rcd at 6803-04 ¶ 198.

[^646]: *See* *Rural NPRM,* 18 FCC Rcd at 20824 ¶ 41; *see also* n.
    Error: Reference source not found *supra.*

[^647]: *Rural NPRM,* 18 FCC Rcd at 20824 ¶ 41.

[^648]: *Id.*

[^649]: *See* Grand Wireless Comments at 14.

[^650]: *See NPRM,* 18 FCC Rcd at 6804 ¶ 198.

[^651]: *See* *Rural NPRM,* 18 FCC Rcd at 20808 ¶ 10.

[^652]: *See generally*, 47 U.S.C. §§ 151, 309(j)(3)-(4).

[^653]: *Rural NPRM,* 18 FCC Rcd at 20808 ¶ 10.

[^654]: *See Rural NPRM,* 18 FCC Rcd at 20808 ¶ 10. Note that for this
    proceeding, we take the same position held in the *Rural NPRM* that
    any definition of "rural area" that is adopted for the purposes of
    the current proceeding will not affect the definition of rural in
    other contexts. *See id.* at 20808 nn.24, 41.

[^655]: *See* In the Matter of Amendment of Parts 2, 21, 74 and 94 of
    the Commission\'s Rules and Regulations in regard to frequency
    allocation to the Instructional Television Fixed Service, the
    Multipoint Distribution Service, and the Private Operational Fixed
    Microwave Service, GN Docket No. 80-112, CC Docket No. 80-116,
    *Report and Order*, 94 FCC 2d 1203 (1983) (*E and F Group
    Reallocation Order*).

[^656]: *Id.* at 1228-29 ¶¶ 61-63.

[^657]: *See* In the Matter of Amendment of Parts 2, 21, 74 and 94 of
    the Commission\'s Rules and Regulations in regard to frequency
    allocation to the Instructional Television Fixed Service, the
    Multipoint Distribution Service, and the Private Operational Fixed
    Microwave Service, GN Docket No. 80-112, CC Docket No. 80-116,
    *Memorandum Opinion and Order on Reconsideration*, 98 FCC 2d 129,
    132-33 ¶ 12 (1983) (*E and F Group Reallocation Reconsideration
    Order*). *See also* 47 C.F.R. § 74.902(c).

[^658]: *See E and F Group Reallocation Reconsideration Order,* 98 FCC
    2d at 132-33 ¶ 12 nn. 7, 8.

[^659]: *Id*.

[^660]: 47 C.F.R. § 74.902(c).

[^661]: See Grand Alliance Comments, DOEANY Reply Comments, Stanford &
    Northeastern Reply Comments, Brooklyn Reply Comments, and Coalition
    Reply Comments at 93-96.

[^662]: *See* Grand Alliance Comments at 9.

[^663]: *See* Grand Alliance Comments at 9

[^664]: *See* Grand Alliance Comments at 9-10.

[^665]: *See* DOEANY Reply Comments at 1. Stanford, Northeastern
    University, and the Diocese of Brooklyn argue that Grand Alliance's
    proposal expands the rights of E/F Channel MDS licensees and revokes
    existing spectrum rights of grandfathered E/F Channel ITFS stations.
    *See* Stanford, Northeastern and Brooklyn Reply Comments at 5-6.

[^666]: *See* Stanford, Northeastern and Brooklyn Reply Comments at 5-6.

[^667]: Region 10 Comments at 9; *see* *NPRM* at 6758-59 ¶ 88.

[^668]: *See E and F Group Reallocation Order,* 94 FCC 2d at 1228-29 ¶¶
    61 - 63.

[^669]: *Id.*

[^670]: *See id.* at 1247-8 ¶ 110.

[^671]: *See id.* at 1247-8 ¶ 110

[^672]: *See* discussion of splitting of the football and geographic
    area licensing in general at Section IV.b, *supra.*

[^673]: 47 C.F.R. § 74.902(d)(1) (1993).

[^674]: *Id.*

[^675]: *Id.*

[^676]: *Id.*

[^677]: Amendment of Part 74 of the Commission's Rules with Regard to
    the Instructional Television Fixed Service, MM Docket No. 93-24,
    *Report and Order*, 10 FCC Rcd 2907, 2914 ¶ 39 (1995).

[^678]: *See* Amendment of Parts 21, 43, 74, 78, and 94 of the
    Commission\'s Rules Governing Use of the Frequencies in the 2.1 and
    2.5 GHz Bands Affecting: Private Operational-Fixed Microwave
    Service, Multipoint Distribution Service, Multichannel Multipoint
    Distribution Service, and Cable Television Relay Service, Gen.
    Docket No. 90-54, *Second Report and Order*, 6 FCC Rcd 6792 at ¶ 1
    (1990) (*Second Report and Order*) (citing Amendment of Parts 21,
    43, 74, 78, and 94 of the Commission\'s Rules Governing Use of the
    Frequencies in the 2.1 and 2.5 GHz Bands Affecting: Private
    Operational-Fixed Microwave Service, Multipoint Distribution
    Service, Multichannel Multipoint Distribution Service, and Cable
    Television Relay Service, Gen. Docket Nos. 90-54 and 90-113, *Notice
    of Proposed Rule Making and Notice of Inquiry*, 5 FCC Rcd 971
    (1990)).

[^679]: *Second Report and Order* at ¶ 1 (citing Amendment of Parts 21,
    43, 74, 78, and 94 of the Commission\'s Rules Governing Use of the
    Frequencies in the 2.1 and 2.5 GHz Bands Affecting: Private
    Operational-Fixed Microwave Service, Multipoint Distribution
    Service, Multichannel Multipoint Distribution Service, Instructional
    Television Fixed Service, and Cable Television Relay Service, Gen.
    Docket Nos. 90-54 and 90-113, *Report and Order*, 5 FCC Rcd 6410
    (1990).

[^680]: *Second Report and Order* at ¶ 4 and ¶¶ 42-58; *see also Second
    Report and Order* at Appendix C; 47 C.F.R. § 74.990 (1991).

[^681]: *See* 47 C.F.R. § 74.990.

[^682]: *See* 47 C.F.R. § 74.990(a).

[^683]: *Id*.

[^684]: *See* 47 C.F.R. § 74.990(e).

[^685]: 47 U.S.C. § 159. Section 9 was enacted by Congress in 1993.
    *See* Pub. L. No. 106-553.

[^686]: 47 U.S.C. § 159(a).

[^687]: *See* *NPRM,* 18 FCC Rcd at 6796-7 ¶¶ 183-185.

[^688]: *Id.* at ¶ 184.

[^689]: *Id.*

[^690]: *See* *NPRM*, 18 FCC Rcd at 6797 ¶ 185.

[^691]: See AHMLC Comments at 8, BellSouth Comments at 13-14 n.21,
    *Coalition* Comments at 140-141, and Grand Wireless Comments at 3,
    13.

[^692]: Governmental and nonprofit entities are statutorily exempt from
    Section 9 regulatory fees. 47 U.S.C. § 159(h).

[^693]: *See* AHMLC Comments at 8. AHMLC also asserts that moving to a
    GSA licensing model should help reduce fees, and that licensees
    should be permitted to consolidate station sites in single markets
    into a single license to avoid multiple renewal and other future
    call sign-based filings. *Id*.

[^694]: *See Coalition* Comments at 140.

[^695]: *See id.* at 140-141.

[^696]: *See* Grand Wireless Comments at 3, 13.

[^697]: *See* *NPRM*, 18 FCC Rcd at 6796-97 ¶¶ 183-185.

[^698]: Governmental entities are statutorily exempt from Section 8
    fees, and both governmental entities and nonprofit entities are
    statutorily exempt from Section 9 fees. 47 U.S.C. §§ 158(d)(1),
    159(h).

[^699]: *See NPRM,* 18 FCC Rcd at 6742 ¶ 41*.*

[^700]: *See* *id.* at 6797 ¶ 185.

[^701]: *See* AHMLC Comments at 8 (to the extent ITFS fees are not
    statutorily barred, treat commercial ITFS licensees the same as
    their competitors), BellSouth Comments at 13-14 n.21, *Coalition*
    Comments at 140-141 (ITFS licensees should be exempt from regulatory
    fees because most would be exempt as a result of their governmental
    or nonprofit status; MDS should be should treat ed like WCS for
    regulatory fee purposes and included in the CMRS Mobile Service fee
    category), and Grand Wireless Comments at 3, 13.

[^702]: In the Matter of Assessment and Collection of Regulatory Fees
    for Fiscal Year 2004, MD Docket No. 04-73, *Notice of Proposed Rule
    Making*, 19 FCC Rcd 5795 (2004).

[^703]: For example, due to the advent of improved signal processing and
    silicon technologies, cellular mobile operations once limited to
    bands below 1 GHz, are now technically feasible in the 1.9 GHz band
    (Personal Communication Services).

[^704]: We note that several different types of microwave services have
    dissimilar general characteristics and, hence, dissimilar spectrum
    benefits, yet are subject to the same fee. For example, various
    private and common carrier point-to-point links are licensed with
    various sized channels such as a 5 MHz, 20 MHz, or a 40 MHz channel
    and can only operate over that one link, whereas some licensees have
    geographic license areas, yet common carrier and private microwave
    fee categories were both subject to an annual regulatory fee of \$25
    per license in FY 2003. The types of benefits received from these
    different services do not relate in a methodical way to fees owed.

[^705]: If the total amount of regulatory fees that Congress requires us
    to collect varies each year, which in the past has increased on
    average by no more than 11.2 percent, this would be the only
    variable that would be less predictable. This average does not
    reflect the fee increase from FY 1994 to FY 1995. The FY 1994 fees
    covered a partial year and the percentage increase in fees from FY
    1994 to FY 1995 therefore was atypically high, 84.76 percent.

[^706]: 47 U.S.C. §§ 159(b)(3) and (b)(1)(A).

[^707]: 47 U.S.C. § 159(b)(1) (emphasis added).

[^708]: 47 U.S.C. § 159(b)(3).

[^709]: *See* *Public Notice*, "Auction of C, D, E, And F Block
    Broadband PCS Licenses Notice and Filing Requirements for Auction of
    C, D, E, and F Block Broadband Personal Communications Services
    Licenses Scheduled for March 23, 1999 Minimum Opening Bids And Other
    Procedural Issues," Report No. Auc-98-22-C (Auction No. 22), DA
    98-2604 13 FCC Rcd 24540 (rel. Dec. 23, 1998).

[^710]: Amendment of Parts 21 and 74 of the Commission\'s Rules With
    Regard to Licensing in the Multipoint Distribution Service and in
    the Instructional Television Fixed Service for the Gulf of Mexico,
    *Notice of Proposed Rulemaking*, WT Docket No. 02-68, 17 FCC Rcd
    8446 (2002) (*Gulf Notice* or *Gulf of Mexico MDS NPRM* or *Gulf
    NPRM*). That proceeding was incorporated alongside the matter of
    Amendment of Parts 1, 21, 73, 74 and 101 of the Commission\'s Rules
    to Facilitate the Provision of Fixed and Mobile Broadband Access,
    Educational and Other Services in the 2150-2162 and 2500-2690 MHz
    Bands. *NPRM*, 18 FCC Rcd at 6759 ¶ 91 (2003) (*NPRM*). *See Gulf
    Notice*, 17 FCC Rcd at 8447 ¶ 2.

[^711]: Petition for Rulemaking of Gulf Coast MDS Service Company (Gulf
    Coast Petition) (May 21, 1996).

    *See* *NPRM*, 18 FCC Rcd at 6759 ¶ 91; *see also* Gulf Coast
    Petition. *See also* Amendment of Parts 21 and 74 of the
    Commission\'s Rules With Regard to Filing Procedures in the
    Multipoint Distribution Service and in the Instructional Television
    Fixed Service, *Report and Order*, 10 FCC Rcd 9589, 9608-17 ¶¶ 34-55
    (1995) (*MDS Report and Order*).

[^712]: *See* Amended Petition at 4. "In the *MDS Report and Order*, the
    Commission adopted a licensing plan under which it assigned, through
    a simultaneous multiple round bidding process, one MDS authorization
    for each of the 487 BTAs and six additional geographic areas" as
    defined in Rand McNally's 1992 *Commercial Atlas and Marketing
    Guide*. *NPRM*, 18 FCC Rcd at 6759 ¶ 89, n.190 (citing *MDS Report
    and Order*, 10 FCC Rcd at 9608-09 ¶¶ 34-37). BTA authorization
    holders may construct facilities to provide service over any usable
    MDS channel within the BTA, although, such channels are only usable
    subject to the Commission's interference standards. *MDS Report and
    Order*, 10 FCC Rcd at 9608-18 ¶¶ 34-55.

[^713]: *See* *NPRM*, 18 FCC Rcd at 6759 ¶ 92 (citing Amended Petition
    for Rulemaking of PetroCom License Corporation (Amended Petition)
    (Nov. 23, 1998)).

[^714]: *See* *id.* at 6760 ¶¶ 92-93.

[^715]: *See id.* at 6760 ¶ 93. *See, e.g*., PetroCom Comments at 3-5;
    Stratos Offshore Services Company at 2-3 (Stratos Offshore); WCA
    Comments at 4; PetroCom Reply Comments at 1-4; Sprint Reply Comments
    at 31.

[^716]: *See* WCA Comments at 4; Stratos Offshore Comments at 3.

[^717]: *See* PetroCom Comments at 3-5; PetroCom Reply Comments at 1-4.
    *See also NPRM* at ¶ 93.

[^718]: *See NPRM*, 18 FCC Rcd at 6761 ¶ 93.

[^719]: *See id*.

[^720]: *See id*. We note that the Gulf of Mexico area is a strong
    example of an underserved area where, for a lack of any significant
    population center, service has not been built out. Calls for
    delaying the creation of the proposed Gulf Service Area, without any
    indication that adverse consequences will result from this step
    alone, frustrates the Commission's goal of the rapid, nationwide
    deployment of services to areas and populations in need. *See also*
    Amendment of the Commission's Rules to Establish Part 27, the
    Wireless Communications Service ("WCS"), GN Docket No. 96-228,
    *Report and Order*, 12 FCC Rcd 10785, 10816 ¶ 59 (1997) (*WCS Report
    and Order*) ("\[C\]reating a service area for the Gulf of Mexico
    region will help meet the growing communications needs of businesses
    operating in the Gulf.").

[^721]: *See Gulf Notice*, 17 FCC Rcd at 8450 ¶ 13. *See also NPRM* at
    6761 ¶ 94.

[^722]: *See Gulf Notice*, 17 FCC Rcd at 8450 ¶ 13.

[^723]: *See NPRM*, 18 FCC Rcd at 6761 ¶ 94.

[^724]: *See id.* at 6761 ¶ 95.

[^725]: *See* *Gulf Notice*, 17 FCC Rcd at 8453 ¶ 18. *See also WCS
    Report and Order*, 12 FCC Rcd at 10816.

[^726]: *See* PetroCom Comments at 5-6.

[^727]: *See* PetroCom Comments at 5-6 (citing Cellular Service and
    Other Commercial Mobile Radio Services in the Gulf of Mexico,
    *Report and Order*, 17 FCC Rcd 1209, 1219 ¶ 31 (2001) (*Gulf
    Cellular Order*).

[^728]: See PetroCom Comments to the Amended Petition at 4.

[^729]: *See* PetroCom Comments at 6.

[^730]: *See* PetroCom Reply Comments at 5.

[^731]: *See* PetroCom Reply Comments at 5.

[^732]: *See* WCA Comments at 74.

[^733]: *See* WCA Comments at 79.

[^734]: *See* WCA Comments at 74.

[^735]: *See* WCA Comments at 79-80.

[^736]: *See* WCA Comments at 80.

[^737]: *See* WCA Comments at 81.

[^738]: *See* Sprint Comments at 15-16.

[^739]: *See* Sprint Comments at 15-16.

[^740]: *See* Sprint Comments at 15-16. *See also* WCA Comments at
    74-78.

[^741]: *See NPRM*, 18 FCC Rcd at 6762 ¶ 97.

[^742]: *See generally* 47 C.F.R. §§ 1.1202, 1.1203, 1.1206.

[^743]: *See* 47 C.F.R. §§ 1.415, 1.419.

[^744]: Electronic Filing of Documents in Rulemaking Proceedings,
    *Report and Order*, 13 FCC Rcd 11322 (1998).

[^745]: *See* 5 U.S.C. § 601--612. The RFA has been amended by the Small
    Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Pub.
    L. No. 104-121, Title II, 110 Stat. 857 (1996).

[^746]: 5 U.S.C. § 605(b).

[^747]: *See* 5 U.S.C. § 603.

[^748]: *See* [5 U.S.C. §
    603](http://www4.law.cornell.edu/uscode/5/603.html). The RFA, *see*
    [5 U.S.C. § 601](http://www4.law.cornell.edu/uscode/5/603.html)-612,
    has been amended by the Small Business Regulatory Enforcement
    Fairness Act of 1996, (SBREFA) Pub. L. No. 104-121, Title II, 110
    Stat. 857 (1996).

[^749]: *See* 5 [U.S.C. §
    603(a).](http://www4.law.cornell.edu/uscode/5/603.html)

[^750]: *See* 5 [U.S.C. §
    603(a).](http://www4.law.cornell.edu/uscode/5/603.html)

[^751]: For detailed discussion on MEAs, *see* para. 82, *supra.*

[^752]: Three years is an adequate period for existing users to develop
    a detailed proposal for transitioning existing uses and facilities
    to the new band plan and address objections from other users. As an
    initial matter, many existing users already have had ample time to
    consider transitions to the new band plan. The new band plan and the
    transition process incorporate substantial elements of the
    Coalition's proposal, which has been the subject of extensive public
    comment for nearly two years. Moreover, many users of this spectrum
    are members of the Coalition and played a role in crafting the
    initial proposal.

[^753]: *See* section 5, *supra.*

[^754]: *See* paras. 86-87, *supra.*

[^755]: *See* para. 264-319, *supra.*

[^756]: *See, e.g.,* Amendment of Part 1 of the Commission's
    Rules---Competitive Bidding Procedures, WT Docket No. 97-82, *Order,
    Memorandum Opinion and Order and Notice of Proposed Rule Making,* 12
    FCC Rcd 5686 (1997); *Third Report and Order and Second Further
    Notice of Proposed Rule Making*, 13 FCC Rcd 374 (1997) (*Part 1
    Third Report and Order)*; *Order on Reconsideration of the Third
    Report and Order, Fifth Report and Order, and Fourth Further Notice
    of Proposed Rule Making*, 15 FCC Rcd 15293 (2000) (*recon. pending*)
    (*Part 1 Recon Order/ Fifth Report and Order* and *Fourth Further
    Notice of Proposed Rule Making*); *Seventh Report and Order*, 16 FCC
    Rcd 17546 (2001); *Eighth Report and Order,* 17 FCC Rcd 2962 (2002).

[^757]: *See* 47 C.F.R. § 1.2101 *et seq.*

[^758]: *See Fourth Further Notice of Proposed Rule Making*, 15 FCC Rcd
    15293; *see also Part 1 Recon Order/Fifth Report and Order*, 15 FCC
    Rcd 15293 (*recon. pending*) \[cite check -- recon pending?\].

[^759]: *See* Amendment of Part 1 of the Commission's Rules -
    Competitive Bidding Procedures*, Third Report and Order and Second
    Further Notice of Proposed Rule Making*, 13 FCC Rcd 374, 448-49,
    454-55, ¶¶ 125, 139 (directing the Bureau to seek comment on
    specific mechanisms relating to auction conduct pursuant to the
    Balanced Budget Act of 1997) (*Part 1 Third Report and Order*).

[^760]: In 1997, Congress mandated that the Commission "ensure that
    small businesses, rural telephone companies, and businesses owned by
    members of minority groups and women are given the opportunity to
    participate in the provision of spectrum-based services." *See* 47
    U.S.C. § 309(j)(4)(D). In addition, section 309(j)(3)(B) of the Act
    provides that in establishing eligibility criteria and bidding
    methodologies, the Commission shall promote "economic opportunity
    and competition . . . by avoiding excessive concentration of
    licenses and by disseminating licenses among a wide variety of
    applicants, including small businesses, rural telephone companies,
    and businesses owned by members of minority groups and women." *See*
    47 U.S.C. § 309(j)(3)(B).

[^761]: *See* *Part 1 Third Report and Order*, 13 FCC Rcd at 403-04, ¶
    47.

[^762]: *See* 47 C.F.R. § 1.2110(f)(2).

[^763]: *See* 47 C.F.R. § 1.2110(f)(2). We note that we will coordinate
    the small business size standards for ITFS in this proceeding with
    the U.S. Small Business Administration.

[^764]: 47 C.F.R. § 1.2110(f)(2)(i)-(iii).

[^765]: *See* 47 C.F.R. § 21.961(b).

[^766]: [5 U.S.C. §
    603(b)(3).](http://www4.law.cornell.edu/uscode/5/603.html)

[^767]: 5 U.S.C. § 601(6).

[^768]: 5 U.S.C. § 601(3) (incorporating by reference the definition of
    "small business concern" in the Small Business Act 1[5 U.S.C. §
    632).](http://www4.law.cornell.edu/uscode/15/632.html) Pursuant to 5
    U.S.C. § 601(3), the statutory definition of a small business
    applies "unless an agency, after consultation with the Office of
    Advocacy of the Small Business Administration and after opportunity
    for public comment, establishes one or more definitions of such term
    which are appropriate to the activities of the agency and publishes
    such definition(s) in the Federal Register." [5 U.S.C. §
    601(3).](http://www4.law.cornell.edu/uscode/5/601.html)

    ^?^ [15 U.S.C. §
    632](http://www4.law.cornell.edu/uscode/15/632.html).

[^769]: [15 U.S.C. §
    632](http://www4.law.cornell.edu/uscode/15/632.html).

[^770]: *See* 1992 Economic Census, U.S. Bureau of the Census, Table 6
    (special tabulation of data under contract to Office of Advocacy of
    the U.S. Small Business Administration).

[^771]: FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, *Trends in Telephone Service*, Table 5.3 (May
    2002) (*Trends in Telephone Service*).

[^772]: 13 C.F.R. § 121.201, North American Industry Classification
    System (NAICS) code 517110.

[^773]: 13 C.F.R. § 121.201, NAICS code 517211.

[^774]: 13 C.F.R. § 121.201, NAICS code 517212.

[^775]: Amendment of Parts 21 and 74 of the Commission's Rules with
    Regard to Filing Procedures in the Multipoint Distribution Service
    and in the Instructional Television Fixed Service and Implementation
    of Section 309(j) of the Communications Act -- Competitive Bidding,
    MM Docket No. 94-131 and PP Docket No. 93-253, *Report and Order*,
    10 FCC Rcd 9589, 9593 ¶ 7 (1995) (*MDS Auction R&O)*.

[^776]: 47 C.F.R. § 21.961(b)(1).

[^777]: 13 C.F.R. § 121.201, NAICS code 513220 (changed to 517510 in
    October 2002).

[^778]: U.S. Census Bureau, 1997 Economic Census, Subject Series:
    Information, "Establishment and Firm Size (Including Legal Form of
    Organization)", Table 4, NAICS code 513220 (issued October 2000).

[^779]: In addition, the term "small entity" within SBREFA applies to
    small organizations (nonprofits) and to small governmental
    jurisdictions (cities, counties, towns, townships, villages, school
    districts, and special districts with populations of less than
    50,000). 5 U.S.C. §§ 601(4)-(6). We do not collect annual revenue
    data on ITFS licensees.

[^780]: 47 C.F.R. § 21.961(b)(1).

[^781]: *See MDS Auction R&O,* 10 FCC Rcd 9589.

[^782]: Basic Trading Areas (BTAs) were designed by Rand McNally and are
    the geographic areas by which MDS was auctioned and authorized. *See
    Id.* at 9608.

[^783]: 47 U.S.C. § 309(j). (Hundreds of stations were licensed to
    incumbent MDS licensees prior to implementation of Section 309(j) of
    the Communications Act of 1934, 47 U.S.C. § 309(j). For these
    pre-auction licenses, the applicable standard is SBA\'s small
    business size standard for \"other telecommunications\" (annual
    receipts of \$11 million or less)). *See* 13 C.F.R. 121.201, NAICS
    code 513220.

[^784]: *See* 5 U.S.C. §§ 601 (3)-(5).

[^785]: *See* 13 C.F.R. § 121.210 (SIC 4833, 4841, and 4899).

[^786]: *See* [5 U.S.C. §
    603(c).](http://www4.law.cornell.edu/uscode/5/603.html)

[^787]: *See* section 2, *supra.*

[^788]: *See* section 5, *supra.*

[^789]: *See* [5 U.S.C. §
    603](http://www4.law.cornell.edu/uscode/5/603.html). The RFA, *see*
    [5 U.S.C. § 601](http://www4.law.cornell.edu/uscode/5/603.html)-612,
    has been amended by the Small Business Regulatory Enforcement
    Fairness Act of 1996, (SBREFA) Pub. L. No. 104-121, Title II, 110
    Stat. 857 (1996).

[^790]: *See* 5 [U.S.C. §
    604.](http://www4.law.cornell.edu/uscode/5/603.html)

[^791]: [5 U.S.C. §
    603(b)(3).](http://www4.law.cornell.edu/uscode/5/603.html)

[^792]: 5 U.S.C. § 601(6).

[^793]: 5 U.S.C. § 601(3) (incorporating by reference the definition of
    "small business concern" in the Small Business Act 1[5 U.S.C. §
    632).](http://www4.law.cornell.edu/uscode/15/632.html) Pursuant to 5
    U.S.C. § 601(3), the statutory definition of a small business
    applies "unless an agency, after consultation with the Office of
    Advocacy of the Small Business Administration and after opportunity
    for public comment, establishes one or more definitions of such term
    which are appropriate to the activities of the agency and publishes
    such definition(s) in the Federal Register." [5 U.S.C. §
    601(3).](http://www4.law.cornell.edu/uscode/5/601.html)

    ^?^ [15 U.S.C. §
    632](http://www4.law.cornell.edu/uscode/15/632.html).

[^794]: [15 U.S.C. §
    632](http://www4.law.cornell.edu/uscode/15/632.html).

[^795]: 5 U.S.C. § 601(4).

[^796]: FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, *Trends in Telephone Service*, Table 5.3 (May
    2002) (*Trends in Telephone Service*).

[^797]: Amendment of Parts 21 and 74 of the Commission's Rules with
    Regard to Filing Procedures in the Multipoint Distribution Service
    and in the Instructional Television Fixed Service and Implementation
    of Section 309(j) of the Communications Act -- Competitive Bidding,
    MM Docket No. 94-131 and PP Docket No. 93-253, *Report and Order*,
    10 FCC Rcd 9589, 9593 ¶ 7 (1995) (*MDS Auction R&O)*.

[^798]: 47 C.F.R. § 21.961(b)(1).

[^799]: 47 U.S.C. § 309(j). (Hundreds of stations were licensed to
    incumbent MDS licensees prior to implementation of Section 309(j) of
    the Communications Act of 1934, 47 U.S.C. § 309(j). For these
    pre-auction licenses, the applicable standard is SBA\'s small
    business size standard for \"other telecommunications\" (annual
    receipts of \$11 million or less)). *See* 13 C.F.R. 121.201, NAICS
    code 513220.

[^800]: 13 C.F.R. § 121.201, NAICS code 513220 (changed to 517510 in
    October 2002).

[^801]: U.S. Census Bureau, 1997 Economic Census, Subject Series:
    Information, "Establishment and Firm Size (Including Legal Form of
    Organization)", Table 4, NAICS code 513220 (issued October 2000).

[^802]: In addition, the term "small entity" within SBREFA applies to
    small organizations (nonprofits) and to small governmental
    jurisdictions (cities, counties, towns, townships, villages, school
    districts, and special districts with populations of less than
    50,000). 5 U.S.C. §§ 601(4)-(6). We do not collect annual revenue
    data on ITFS licensees.

[^803]: 13 C.F.R. § 121.201.

[^804]: *See* 5 U.S.C. §§ 601 (3)-(5).

[^805]: *See* 13 C.F.R. § 121.210 (SIC 4833, 4841, and 4899).

[^806]: 47 C.F.R. § 1.913(a)(1).

[^807]: 47 C.F.R. § 1.2107.

[^808]: 47 C.F.R. § 1.1307.

[^809]: *See e.g.*, 47 C.F.R. § 1.928 (regarding frequency coordination
    arrangements between the U.S. and Canada).

[^810]: *See* section D, *supra.*

[^811]: *See* [5 U.S.C. §
    603(c).](http://www4.law.cornell.edu/uscode/5/603.html)

[^812]: *See* discussion at para. 70, *supra.*

[^813]: *See* section D, *supra.*

[^814]: *See generally,* 5 U.S.C. § 801 (a)(1)(A).

[^815]: *See* 5 U.S.C. § 604(b).