PUBLIC NOTICE

FEDERAL COMMUNICATIONS COMMISSION
1919 M STREET, N.W.
WASHINGTON, D.C.  20554                         News Media Information: (202) 418-0500
                                  Fax-On-Demand: (202) 418-2830
                                   Internet: http://www.fcc.gov
                                                     ftp.fcc.gov

                                                      DA 98-162
                                               January 30, 1998
                                                               
                                                               
                        COMMENT SOUGHT 
           ON RESERVE PRICES OR MINIMUM OPENING BIDS 
        FOR THE GENERAL WIRELESS COMMUNICATIONS SERVICE
                (GWCS) IN THE 4660-4685 MHz BAND
                                
            Formula Proposed for May 27 GWCS Auction
                                
Report No. AUC-98-19-A (Auction No. 19)

I.  Reserve Price or Minimum Opening Bid

The Balanced Budget Act of 1997 calls upon the Commission to prescribe methods by which a
reasonable reserve price will be required or a minimum opening bid established when FCC
licenses are subject to auction (i.e., because they are mutually exclusive), unless the Commission
determines that a reserve price or minimum bid is not in the public interest.  Consistent with this
mandate, the Commission has directed the Wireless Telecommunications Bureau ("Bureau") to
seek comment on the use of a minimum opening bid and/or reserve price prior to the start of each
auction.  The Bureau was directed to seek comment on the methodology to be employed in
establishing each of these mechanisms.  Among other factors, the Bureau should consider the
amount of spectrum being auctioned, levels of incumbency, the availability of technology to
provide service, the size of the geographic service areas, the extent of interference with other
spectrum bands, and any other relevant factors that could reasonably have an impact on valuation
of the spectrum being auctioned.  The Commission concluded that the Bureau should have the
discretion to employ either or both of these mechanisms for future auctions.

Normally, a reserve price is an absolute minimum price below which an item will not be sold in a
given auction.  Reserve prices can be either published or unpublished.  A minimum opening bid,
on the other hand, is the minimum bid price set at the beginning of the auction below which no
bids are accepted.  It is generally used to accelerate the competitive bidding process.  Also, in a
minimum opening bid scenario, the auctioneer generally has the discretion to lower the amount
later in the auction.  

The Bureau recently announced the auction of 875 licenses for the General Wireless
Communications Service which is scheduled to begin May 27, 1998.  These licenses encompass
the United States, the Northern Mariana Islands, Guam, American Samoa, the United States
Virgin Islands and Puerto Rico.  Specifically, the licenses include:  (1)  five licenses in each of 172
geographic areas known as Economic Areas (EAs);  (2)  five licenses in each of three EA-like
areas, covering Guam and the Northern Marianas, Puerto Rico and the U.S. Virgin Islands, and
American Samoa.   

In anticipation of this auction and in light of the Balanced Budget Act, the Bureau proposes to
establish minimum opening bids for the GWCS auction, and retain discretion to lower the
minimum opening bids.

The Bureau believes a minimum opening bid, which has been utilized in other auctions, is an
effective bidding tool, and we propose to use this approach in the GWCS auction.  A minimum
opening bid will help to regulate the pace of the auction and provides flexibility.

Specifically, the Commission proposes the following formula for calculating minimum opening
bids in Auction No. 19:

     For each EA License, the minimum opening bid = $0.0030 x 5 MHz x population (based
     on 1990 census)

with a minimum of no less than $2500.00 per license.  See Attachment B.
 
Comment is sought on this proposal.  If commenters believe that the formula proposed above for
minimum opening bids will result in substantial numbers of unsold licenses, or is not a reasonable
amount, or should instead operate as a reserve price, they should explain why this is so, and
comment on the desirability of an alternative approach.  Commenters are advised to support their
claims with valuation analyses and suggested reserve prices or minimum opening bid levels or
formulas.  In establishing the formula for minimum opening bids, we particularly seek comment on
such factors as, among other things, the amount of spectrum being auctioned, levels of
incumbency, the availability of technology to provide service, the size of the geographic service
areas, issues of interference with other spectrum bands and any other relevant factors that could
reasonably have an impact on valuation of the GWCS spectrum.   Alternatively, comment is
sought on whether, consistent with the Balanced Budget Act, the public interest would be served
by having no minimum opening bid or reserve price.

II.  Other Issues

The Bureau finds that seeking comment on other auction-related procedures for GWCS, prior to
resolution of the issues raised in the Part 1 Third Report and Order and Second Further Notice of
Proposed Rule Making, would be premature.  Additionally, certain issues (such as the upfront
payment formula and competitive bidding design) were determined by the Commission in the
1995 GWCS Second Report and Order and may be further addressed by the Commission. 
Because the Commission is subject to a statutory deadline of August 9, 1998, for licensing
GWCS, there is insufficient time to seek comment on auction procedures after a ruling by the
Commission.  Rather, the Bureau finds that in these circumstances, it is in the public interest to
maximize the time available to bidders between announcement of auction procedures and the start
of the auction.  Therefore, the Bureau will announce specific bidding procedures by public notice
upon the release of the GWCS auction rules.

III.  Conclusion

Comments are due on or before February 13, 1998, and reply comments are due on or before
February 20, 1998.  To file formally, parties must submit an original and four copies to the Office
of the Secretary, Federal Communications Commission, Room 222, 1919 M Street N.W.,
Washington, DC 20554.  In addition, parties must submit one copy to Kathleen O'Brien Ham,
Chief, Auctions and Industry Analysis Division, Wireless Telecommunications Bureau, Federal
Communications Commission, Room 5202, 2025 M Street N.W., Washington, D.C. 20554. 
Comments and reply comments will be available for public inspection during regular business
hours in the FCC Public Reference Room, Room 239, 1919 M Street N.W., Washington, D.C.
20554.

For further information concerning this proceeding, contact Kathryn Garland, Bob Reagle, or
Arthur Lechtman, Auctions and Industry Analysis Division, Wireless Telecommunications
Bureau, at (202) 418-0660.

                            - FCC - 
                                
                                
                                                           ATTACHMENT A

Technical Data on the Navy Cooperative Engagement Capability
(CEC) System

I.   INTRODUCTION

     The purpose of this annex is to describe the technical
characteristics of the Cooperative Engagement Capability (CEC)
Data Distribution System.  The CEC, a major new networking system
being developed by the military to provide connectivity between
air, land, and sea units for Theater Air Defense, will operate in
the bands immediately adjacent to the 4635-4685 MHz band.  In
order to minimize mutual interference between the CEC system and
prospective GWCS users, certain CEC technical characteristics are
being made available so that GWCS equipment can be designed to
reduce susceptibility to interference. While details of the
overall CEC program will remain unavailable for public release,
the technical parameters as described below have been recently
declassified to facilitate the release of this basic data.  (The
point of contact at the Naval Electromagnetic Spectrum Center is
Mr. Scott A. Hoschar, at (202) 764-0312, or fax (202) 764-2666. 
The CEC Program Office point of contact is Ms. Lalitha Avula,
PEO(TAD)CB12, at (703) 602-7413, or fax (703) 602-9181.)  

II.  TECHNICAL PARAMETERS

     The CEC operates in the bands above and below the 4635-4685
band.  In order to comply with NTIA regulations, the CEC
authorized bandwidth will be contained wholly within the adjacent
Federal bands so that it does not impinge upon the 4635-4685 MHz
band.  To achieve this, the center frequency of any CEC
transmitted signal will not fall within the range 4624 to 4696
MHz.

     The CEC system employs high power transmitters with
directional antennas to achieve a maximum e.i.r.p. of 58 dBW (630
kW).  Under most deployment scenarios, this maximum e.i.r.p.
level will be directed towards the operational areas defined
below or out to sea.  However, under certain conditions, this
maximum e.i.r.p. value may be directed at the horizon and inland
from aircraft operating in the areas defined below.  


     The CEC emission characteristic was designed to be
spectrally efficient to exceed NTIA requirements for unwanted
emissions.  Specific spectral parameters are as follows:

CEC Spectrum Roll-off Characteristics at 4635-4685 MHz 

     Lower Band Edge          Upper Band Edge     

     Frequency Power          Frequency Power
     (MHz)     (dBW/4kHz)     (MHz)     (dBW/4kHz)

     4635.00   -3.8           4685.00   -3.8
     4636.10   -7.8           4683.90   -7.8 
     4643.95   -17.8          4676.05   -17.8
     4653.00   -37.8          4667.00   -37.8          

Transmitter Noise:  Between 4649.6 and 4670.4 MHz, less than -87
                    dBW/Hz
     
Harmonics and Spurious:  Less than -80 dBc, that is, dB below
                         carrier power.

III. OPERATING AREAS

     The location in which large numbers of CEC nodes will be
operating includes a number of Naval/joint military exercise
areas.  CEC units will be located on ships and aircraft, and at
land based sites.  The normal operating areas are coastal waters
and the contiguous land mass extending 30 nautical mile inland.  
The operating altitude of CEC-equipped aircraft will typically
extend to 35,000 feet. 

COOPERATIVE ENGAGEMENT CAPABILITY OPERATING AREA DESCRIPTIONS

     Eight areas are identified as essential to support training
with a large number of Cooperating Units in a CEC network.  The
significance of these areas is that airborne CEC units with high
power transmitters are expected to be flown directly overhead and
extending out to sea in and around existing military operational
areas.  The areas are as follows.  

(1)  The area extending 30 nautical miles (nm) inland from the
     Atlantic Ocean between Wilmington, North Carolina (NC) and
     Lewes, Delaware (DE) facilitate Atlantic Fleet exercises. 
     The land based CEC terminals at Wallops Island, Virginia
     (VA), Eastville, VA, and Dam Neck, VA are within the
     boundaries established for the Atlantic Fleet exercises. 
     The Cherry Point and Onslow Bay NC areas are also included. 
     The Naval Air Warfare Center at Patuxent River, Maryland
     (MD) and facilities at Greenville, South Carolina (SC),
     Jacksonville, Florida (FL), and St. Petersburg, FL are not
     included in the inland areas.  The exclusion of the four
     sites does not preclude CEC Radio Frequency (RF) emissions
     at these sites.

(2)  The area extending 30 nm inland from the Gulf of Mexico
     between the Louisiana (LA)-Mississippi (MS) state border and
     Panama City, FL, to support Gulf of Mexico exercises.  The
     area includes Gulfport and Biloxi, MS, and Pensacola and
     Eglin AFL, FL.

(3)  The area extending 30 nm inland from the Pacific Ocean
     between Vandenberg Air Force Base, California (CA) and Point
     Mugu Naval Air Station, CA, to support Pacific Fleet
     exercises.

(4)  The area extending 30 nm inland from the Pacific Ocean
     between Newport Beach, CA, and the CA-Mexico international
     border to support Pacific Fleet exercises.  The area
     includes Camp Pendleton, CA.

(5)  The area that includes the White Sands Missile Range, New
     Mexico (NM) and the Fort Bliss Military Reservation, Texas
     (TX) and NM to support the joint Chiefs of Staff Roving
     Sands Exercise.

(6)  The area that includes the China Lake Naval Weapons Center
     and the Fort Irwin Military Reservation, CA.

(7)  All of Hawaii, including the Pacific Missile Range Facility.

(8)  All of Puerto Rico, including the Armed Forces Weapons Test
     Facility.  

Potentially Affected Economic Areas 

     The following Economic Areas appear to be within the
parameters defined by the Navy as being potentially affected by
the CEC system.  Estimated power levels within the 4635-4685 MHz
band should be calculated on the basis of range from the
boundaries of the CEC operating areas and the technical
parameters given above.  



    Cooperative Engagement Capability Impacted Economic Areas

Economic
Area
Name
Economic
Area
Grouping

3
Boston-Worcester-Lawrence-Lowell-Brockton, MA-NH-RI-VT
1

5
Albany-Schenectady-Troy, NY
1

6
Syracuse, NY-PA
1

7
Rochester, NY-PA
1

8
Buffalo-Niagara Falls, NY-PA
1

9
State College, PA
1

10
New York-No. New Jer.-Long Island, NY-NJ-CT-PA-MA-VT
1

11
Harrisburg-Lebanon-Carlisle, PA
1

12
Philadelphia-Wilmington-Atl. City, PA-NJ-DE-MD
2

13
Washington-Baltimore, DC-MD-VA-WV-PA
2

14
Salisbury, MD-DE-VA
2

15
Richmond-Petersburg, VA
2

16
Staunton, VA-WV
2

17
Roanoke, VA-NC-WV
2

18
Greensboro-Winston-Salem-High Point, NC-VA
2

19
Raleigh-Durham-Chapel Hill, NC
2

20
Norfolk-Virginia Beach-Newport News, VA-NC
2

21
Greenville, NC
2

22
Fayetteville, NC
2

23
Charlotte-Gastonia-Rock Hill, NC-SC
2

24
Columbia, SC
2

25
Wilmington, NC-SC
2

26
Charleston-North Charleston, SC
2

27
Augusta-Aiken, GA-SC
3

28
Savannah, GA-SC
3

29
Jacksonville, FL-GA
3

30
Orlando, FL
3

33
Sarasota-Bradenton, FL
3

34
Tampa-St. Petersburg-Clearwater, FL
3

35
Tallahassee, FL-GA
3

36
Dothan, AL-FL-GA
3

37
Albany, GA
3

38
Macon, GA
3

39
Columbus, GA-AL
3

40
Atlanta, GA-AL-NC
3

41
Greenville-Spartanburg-Anderson, SC-NC
2

42
Asheville, NC
2

45
Johnson City-Kingsport-Bristol, TN-VA
2

46
Hickory-Morganton, NC-TN
2

47
Lexington, KY-TN-VA-WV
2

48
Charleston, WV-KY-OH
2

53
Pittsburgh, PA-WV
2

54
Erie, PA
1

73
Memphis, TN-AR-MS-KY
3

74
Huntsville, AL-TN
3

75
Tupelo, MS-AL-TN
3

76
Greenville, MS
3

77
Jackson, MS-AL-LA
3

78
Birmingham, AL
3

79
Montgomery, AL
3

80
Mobile, AL
3

81
Pensacola, FL
3

82
Biloxi-Gulfport-Pascagoula, MS
3

83
New Orleans, LA-MS
3

84
Baton Rouge, LA-MS
3

85
Lafayette, LA
3

86
Lake Charles, LA
3

87
Beaumont-Port Arthur, TX
5

88
Shreveport-Bossier City, LA-AR
3

89
Monroe, LA
3

90
Little Rock-North Little Rock, AR
3

122
Wichita, KS-OK
5

126
Western Oklahoma, OK
5

127
Dallas-Fort Worth, TX-AR-OK
5

128
Abilene, TX
5

129
San Angelo, TX
5

131
Houston-Galveston-Brazoria, TX
5

135
Odessa-Midland, TX
5

136
Hobbs, NM-TX
5

137
Lubbock, TX
5

138
Amarillo, TX-NM
5

139
Santa Fe, NM
5

140
Pueblo, CO-NM
5

141
Denver-Boulder-Greeley, CO-KS-NE
5

151
Reno, NV-CA
6

152
Salt Lake City-Ogden, UT-ID
5

153
Las Vegas, NV-AZ-UT
6

154
Flagstaff, AZ-UT
5

155
Farmington, NM-CO
5

156
Albuquerque, NM-AZ
5

157
El Paso, TX-NM
5

158
Phoenix-Mesa, AZ-NM
5

159
Tucson, AZ
5

160
Los Angeles-Riverside-Orange County, CA-AZ
6

161
San Diego, CA
6

162
Fresno, CA
6

163
San Francisco-Oakland-San Jose, CA
6

164
Sacramento-Yolo, CA
6

172
Honolulu, HI
6

174
Puerto Rico and the U.S. Virgin Islands
3