**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

+----------------------------------+----+------------------------------+
| In the Matter of Applications of | *  | File No. BRMD-20010329AGH    |
|                                  | *) |                              |
| KANNEW BROADCAST TECHNOLOGIES    | ** | File No. 50826-CM-P-97       |
|                                  |    |                              |
| For Renewal of License of        | *  |                              |
| Multichannel Multipoint          | *) |                              |
| Distribution Service Station     | ** |                              |
| WMI878, Augusta, Maine           |    |                              |
|                                  | *  |                              |
| For Major Modification           | *) |                              |
|                                  | ** |                              |
| Of Multichannel Multipoint       |    |                              |
| Distribution Service             | *  |                              |
|                                  | *) |                              |
| Station WMI878, Augusta, Maine   | ** |                              |
|                                  |    |                              |
|                                  | *  |                              |
|                                  | *) |                              |
|                                  | ** |                              |
|                                  |    |                              |
|                                  | *  |                              |
|                                  | *) |                              |
|                                  | ** |                              |
|                                  |    |                              |
|                                  | *  |                              |
|                                  | *) |                              |
|                                  | ** |                              |
|                                  |    |                              |
|                                  | ** |                              |
|                                  | )\ |                              |
|                                  | )\ |                              |
|                                  | )\ |                              |
|                                  | )  |                              |
|                                  | ** |                              |
+----------------------------------+----+------------------------------+

**MEMORANDUM OPINION AND ORDER**

**Adopted: November 12, 2003 Released: November 13, 2003**

By the Chief, Public Safety and Private Wireless Division, Wireless
Telecommunications Bureau:

# INTRODUCTION

1.  In this *Memorandum Opinion and Order,* we address a Petition to
    Deny filed by Pegasus Communications Portfolio Holdings, Inc.
    ("Pegasus") regarding Multichannel Multipoint Distribution Service
    (MMDS) Station WMI878, Augusta, Maine, licensed to Kannew Broadcast
    Technologies ("Kannew").[^1] For the reasons stated below, we grant
    the Pegasus Petition. We also dismiss as moot a request for waiver
    of Section 21.303(d) of the Commission's Rules filed by Kannew on
    August 14, 1997, as well as the captioned applications filed by
    Kannew.[^2]

# BACKGROUND

2.  On April 14, 1993, the Commission granted a conditional license to
    Kannew for MMDS Station WMI878, Augusta, Maine. According to the
    terms of the license, Kannew was required to complete construction
    of the station on or before April 14, 1994.[^3] Kannew filed a
    certification of construction on April 21, 1994.[^4] On October 18,
    1995, the Commission issued to Kannew a license for Station WMI878
    with an expiration date of May 1, 2001.[^5]

3.  In March 1994, Kannew entered into a lease agreement with Micro-Lite
    Television (Micro-Lite).[^6] Kannew states that Micro-Lite
    "apparently did not commence commercial service to its
    customers."[^7] On August 14, 1996, Kannew terminated its agreement
    with Micro-Lite because Micro-Lite had not fulfilled its obligations
    under the contract.[^8] Kannew states that on September 3, 1996, it
    informed Pegasus, the MMDS authorization holder for the
    Waterville-Augusta, Maine, Basic Trading Area (BTA), of the
    availability of the station for lease or sale.[^9] One year later,
    on August 14, 1997, Kannew filed a major modification application
    seeking to change the location of the Station and simultaneously
    filed a request for waiver of the Commission's rules to permit the
    Station to be off the air until such time as the Commission granted
    the pending major modification application.[^10] Kannew represented
    that the station would be used within sixty days of the grant of its
    major modification application.[^11] The waiver request remains
    pending.

4.  On March 29, 2001, Kannew filed an application to renew the license
    for Station WMI878.[^12] That application was accepted for filing on
    July 3, 2001.[^13] Pegasus filed its petition to deny on August 2,
    2001.[^14]

# III. DISCUSSION

5.  Pegasus argues that although Kannew certified that its station had
    been constructed, there is no indication on the record before us
    that Station WMI878 has ever been operated.[^15] Pegasus also argues
    that the Commission should not grant a renewal application for a
    station that is not currently constructed.[^16] Pegasus also alleges
    that Kannew is "warehousing" spectrum[^17] and in violation of the
    Commission's Rules by failing to give timely notice of
    discontinuance of service.[^18] Kannew asks the Commission to
    dismiss the Petition because Pegasus allegedly lacks standing to
    file a petition to deny.[^19] Kannew argues that a grant of its
    major modification application would be in the public interest
    because it has made a "firm commitment" to build the station once
    the modification application is granted.[^20]

6.  Initially, we conclude that Pegasus has standing to file a petition
    to deny. Section 309(d)(1) of the Communications Act, as amended,
    permits any "party in interest" to file a petition to deny any
    application.[^21] To establish standing, a petitioner must show "(1)
    a distinct and palpable personal injury-in-fact that is (2)
    traceable to the respondent\'s conduct and (3) redressable by the
    relief requested."[^22] In this case, we conclude that Pegasus has
    standing because if Kannew's license were renewed, it would be
    deprived of the opportunity to file an application to use Kannew's
    channels. If an incumbent MMDS license is forfeited, the BTA
    authorization holder has the exclusive right to apply for an
    authorization to operate a station within the area formerly served
    by the incumbent.[^23] Pegasus' right to apply for Kannew's channels
    in case of forfeiture gives it a palpable interest in the status of
    Kannew's license.

7.  We conclude that Kannew's license forfeited as of May 21, 1995
    because Station WMI878 never provided service to the public. The
    express language of Section 21.303(d) of the Commission's Rules
    requires the licensee to take one of three actions "if any radio
    frequency should not be used to render any service as authorized
    during a consecutive period of twelve months at any time after
    construction is completed. . . ."[^24] The three options are (1)
    submitting its station license for cancellation, (2) filing an
    application for modification of the station license to delete the
    unused frequency, or (3) requesting a waiver pursuant to Section
    21.303(d)(3).[^25] Significantly, prior to the adoption of Section
    21.303(d), the Commission's Rules did not require licensees to
    relinquish unused frequencies.[^26] The Commission found that,
    "\[i\]n addition to preventing others from using the spectrum, this
    results in the Commission being unable to discern when spectrum is
    not being used or is being underutilized."[^27] Therefore, the
    Commission adopted Section 21.303(d) to promote the efficient use of
    the spectrum by requiring licensees to submit licenses covering
    unused spectrum to the Commission for cancellation.[^28]

8.  In the Waiver Request, Kannew argues that it rendered service by
    leasing the station's capacity to MicroLite.[^29] Contrary to that
    argument, a licensee that enters into a channel lease agreement
    assumes the risk of license cancellation if the third party fails or
    ceases to provide service.[^30] We note that Kannew had twelve
    months to work out alternative arrangements and/or ensure that the
    station's facilities were used to provide service. In accordance
    with Section 21.303(d), Kannew had regulatory options available to
    it if it desired to retain the station license - for example, timely
    request a waiver pursuant to Section 21.303(d)(3).[^31] In fact,
    based on the record before us, it appears that Station WMI878 has
    never been used to provide service. We therefore find that the
    license for Station WMI878 was forfeited on May 21, 1995, or one
    year and thirty days after Kannew certified that it had completed
    construction of Station WMI878.[^32] This result is consistent with
    the plain language of Section 21.303(d) and case precedent.[^33]

9.  Since Kannew forfeited the license for Station WMI878 on May 21,
    1995, we will dismiss its August 14, 1997 Waiver Request as moot. We
    will also dismiss as moot the applications to modify and renew the
    license for Station WMI878.

# IV. ORDERING CLAUSES

10. Accordingly IT IS ORDERED that, pursuant to Section 4(i) of the
    Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i), and
    Section 21.303 of the Commission's Rules, 47 C.F.R. § 21.303, that
    the license for Station WMI878 IS DEEMED CANCELED as of May 21,
    1995.

11. IT IS FURTHER ORDERED, pursuant to Sections 4(i) and 309 of the
    Communications Act of 1934, 47 U.S.C. §§ 154(i), 309, and Section
    21.30 of the Commission's Rules, 47 C.F.R. § 21.30, that the
    Petition to Deny filed by Pegasus Communications Portfolio Holdings,
    Inc. on August 2, 2001 IS GRANTED to the extent indicated herein.

12. IT IS FURTHER ORDERED, pursuant to Section 4(i) of the
    Communications Act of 1934, 47 U.S.C. § 154(i), and Section 21.303
    of the Commission's Rules, 47 C.F.R. § 21.303, that the waiver
    request filed by Kannew Broadcast Technologies on August 14, 1997 IS
    DISMISSED AS MOOT.

13. IT IS FURTHER ORDERED, pursuant to Section 4(i) of the
    Communications Act of 1934, 47 U.S.C. § 154(i), and Section 21.28 of
    the Commission's Rules, 47 C.F.R. § 21.28, that the application for
    modification of license filed by Kannew Broadcast Technologies on
    August 14, 1997 (File No. 50826-CM-P-97) and the application for
    renewal filed by Kannew Broadcast Technologies on March 29, 2001
    (File No. 20010329AGH) ARE DISMISSED.

13\. This action is taken under delegated authority pursuant to Sections
0.131 and 0.331 of the Commission's Rules, 47 C.F.R. §§0.131, 0.331.

FEDERAL COMMUNICATIONS COMMISSION

D'wana R. Terry

Chief, Public Safety and Private Wireless Division

Wireless Telecommunications Bureau

[^1]: Petition to Deny Application for Renewal (filed Aug. 2, 2001)
    (Petition).

[^2]: Letter from Todd D. Gray, Esq. to William F. Caton, Acting
    Secretary, Federal Communications Commission (filed Aug. 14, 1997)
    (Waiver Request).

[^3]: *See* Conditional License for Station WMI878, File No.
    BPMD-8306155 (granted Apr. 14, 1993).

[^4]: Letter from Todd D. Gray, counsel to Kannew Broadcast
    Technologies, to William F. Caton, Acting Secretary, Federal
    Communications Commission, Aug. 14, 1997, at 1.

[^5]: License for Station WMI878, File No. BLMD-9450475, granted Oct.
    18, 1995. Pegasus states that the Commission forfeited the license
    after Kannew filed its certification of construction but that the
    Commission later removed the forfeiture when it granted the license
    to Kannew for Station WMI878 on October 18, 1995. The Commission's
    staff has been unable to locate a forfeiture notice in its files.

[^6]: Petition at 2, *citing* letter from Todd Gray, counsel for Kannew,
    to William Caton dated Aug. 14, 1997.

[^7]: Waiver Request at 2.

[^8]: Motion to Dismiss and Opposition to Petition to Deny filed by
    Kannew on Dec. 17, 2002, at 2.

[^9]: Waiver Request at 2.

[^10]: *See id.* at 2-3.

[^11]: *Id.* at 3.

[^12]: File No. BRMD-20010329AGH.

[^13]: Mass Media Bureau Instructional Television Fixed Service
    Multipoint Distribution Service Accepted for Filing, Report No. 424,
    *Public Notice* (rel. Jul. 3, 2001) at 53.

[^14]: Petition. Kannew filed a Motion to Dismiss and Opposition to
    Petition to Deny on August 15, 2001. Motion to Dismiss and
    Opposition to Petition to Deny (filed Aug. 15, 2001) (Opposition).
    Kannew filed a reply on August 23, 2001. Reply to Opposition to
    Petition to Deny (filed Aug. 23, 2001) (Reply).

[^15]: Petition at 2-3.

[^16]: Petition at 3-4.

[^17]: *Id.* at 4-5.

[^18]: *Id.*

[^19]: Opposition at 3-5.

[^20]: *Id.* at 5-6.

[^21]: 47 U.S.C. § 309(d)(1).

[^22]: *See* Weblink Wireless, Inc., *Memorandum Opinion and Order*, 17
    FCC Rcd 24642, 2464\_ ¶ 11 (WTB 2002).

[^23]: 47 C.F.R. § 21.932(c).

[^24]: 47 C.F.R. § 21.303(d).

[^25]: *See* 47 C.F.R. § 21.303(d)(1)-(3).

[^26]: *See* Revision of Part 21 of the Commission's Rules, *Report and
    Order,* 2 FCC Rcd 5713, 5724 ¶ 82 (1987) (*Part 21 R&O*)).

[^27]: *Id.*

[^28]: *See id.*

[^29]: Waiver Request at 2.

[^30]: *See, e.g.,* Section 257 Proceeding to Identify and Eliminate
    Market Entry Barriers for Small Businesses, *Report*, 12 FCC Rcd
    16802, 16904-16905 ¶¶ 188-189 (1997).

[^31]: *See* 47 C.F.R. § 21.303(d)(1), (3). Modification of the license
    to delete *only* the unused frequencies was not an option in this
    matter. *Cf.* 47 C.F.R. § 21.303(d)(2).

[^32]: Under 47 C.F.R. § 21.303(d), a licensee has thirty days after the
    end of the twelve months of nonuse to take one of the actions listed
    in that rule. Accordingly, we conclude that Kannew forfeited the
    license at the end of that thirty-day period.

[^33]: *See* San Diego MDS Company, *Order on Reconsideration*, DA
    03-XXXX (WTB PSPWD rel. Sep. XX, 2003); Hydra Communications, *Order
    on Reconsideration*, 18 FCC Rcd 4481 (WTB PSPWD 2003)