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 Federal  Communications  Commission  FCC  04-  287 
 Before  the  Federal  Communications  Commission 
 Washington,  D.  C.  20554 

 In  the  Matter  of 
 Amendment  of  Part  22  of  the  Commissions  Rules  To  Benefit  the  Consumers  of  Air-  Ground 
 Telecommunications  Services 
 Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  and  90  of  the  Commissions  Rules 

 Amendment  of  Parts  1  and  22  of  the  Commission's  Rules  To  Adopt  Competitive 
 Bidding  Rules  for  Commercial  and  General  Aviation  Air-  Ground  Radiotelephone  Service 

 Application  of  Verizon  Airfone  Inc.  for  Renewal  of  800  MHz  Air-  Ground  Radiotelephone  License, 
 Call  Sign  KNKG804 

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 WT  Docket  No.  03-  103 
 WT  Docket  No.  05-  42 
 File  No.  0001716212 

 REPORT  AND  ORDER  AND 
 NOTICE  OF  PROPOSED  RULEMAKING 

 Adopted:  December  15,  2004  Released:  February  22,  2005 
 By  the  Commission:  Chairman  Powell  issuing  a  statement,  Commissioners  Copps  and  Adelstein  approving  in  part,  dissenting  in  part,  and  issuing  separate  statements. 

 Comment  Date:  20  days  after  publication  in  the  Federal  Register  Reply  Comment  Date:  30  days  after  publication  in  the  Federal  Register 

 TABLE  OF  CONTENTS 
 Heading  Paragraph  # 
 I.  INTRODUCTION..................................................................................................................................  1  II.  REPORT  AND  ORDER  ........................................................................................................................  7 
 A.  800  MHz  Air-  Ground  Radiotelephone  Service  ...............................................................................  7  1.  Background  ...............................................................................................................................  9 
 2.  Market  for  Air-  Ground  Wireless  Communications  Services  ..................................................  12  3.  Reconfiguration  of  the  800  MHz  Air-  Ground  Radiotelephone  Service  Band  ........................  24 
 a.  Spectrum  Reconfiguration  Proposals................................................................................  25  b.  Available  Air-  Ground  Band  Plans  ....................................................................................  29 
 (i)  Location  of  Ground  Stations  ......................................................................................  34  (ii)  Provision  of  Deck-  to-  Deck  Service............................................................................  35 
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 (iii)  Competitive  Considerations  .......................................................................................  37  (iv)  Air-  Ground  Services...................................................................................................  52 
 4.  Technical  Standards  ................................................................................................................  54  5.  Incumbent  Station  KNKG804.................................................................................................  73 
 a.  Transition  of  Incumbent  System.......................................................................................  75  b.  Reimbursement  of  Relocation  Costs.................................................................................  77 
 c.  Renewal  of  Call  Sign  KNKG804......................................................................................  79  6.  Construction  Requirements  .....................................................................................................  83 
 B.  400  MHz  Air-  Ground  Radiotelephone  Service  .............................................................................  86  1.  Form  409,  Airborne  Mobile  Radio  Telephone  License  Application.......................................  87 
 2.  Idle  Tone  .................................................................................................................................  93  3.  Construction  Period  for  General  Aviation  Ground  Stations....................................................  95 
 4.  AGRAS  ...................................................................................................................................  97  C.  Revision  of  Part  22  Non-  Cellular  Rules  ........................................................................................  99 
 1.  Scope  and  Authority  Authorization  Required,  General  Eligibility,  and  Definitions............  99  2.  Licensing  Requirements  and  Procedures...............................................................................  104 
 a.  Construction  Prior  to  Grant  of  Application  ....................................................................  104  b.  Computation  of  Distance  ................................................................................................  106 
 c.  Computation  of  Terrain  Elevation  ..................................................................................  109  d.  ASSB  ..............................................................................................................................  111 
 3.  Operational  and  Technical  Requirements  .............................................................................  113  a.  Channel  Assignment  Policy............................................................................................  113 
 b.  Interference  Protection....................................................................................................  115  c.  Emission  Types  and  Emission  Masks.............................................................................  117 
 d.  Standby  Facilities............................................................................................................  120  e.  Directional  Antennas  ......................................................................................................  122 
 f.  Wave  Polarization...........................................................................................................  124  g.  Access  to  Transmitters....................................................................................................  126 
 h.  Replacement  of  Equipment.............................................................................................  128  i.  Auxiliary  Test  Transmitters  ............................................................................................  130 
 j.  In-  building  Radiation  Systems........................................................................................  132  4.  Developmental  Authorizations..............................................................................................  134 
 a.  Developmental  Authorization  of  43  MHz  Paging  Transmitters  .....................................  135  b.  Developmental  Authorization  of  928-  960  MHz  Fixed  Transmitters  ..............................  137 
 c.  Developmental  Authorization  of  Meteor  Burst  Systems  ................................................  139  5.  Paging  and  Radiotelephone  Service  Rules  ............................................................................  141 
 a.  Composite  Interference  Contour  Over  Water  .................................................................  141  b.  Nationwide  Network  Paging  Channels...........................................................................  145 
 c.  Additional  Channel  Policies  ...........................................................................................  147  d.  Provision  of  Rural  Radiotelephone  Service  on  Paging  Channels  ...................................  149 
 e.  Transmission  Power  Limits  ............................................................................................  151  f.  Dispatch  Service  .............................................................................................................  153 
 g.  Hawaiian  UHF  Channels  for  Point-  to-  Point  Operation  ..................................................  155  h.  Channels  for  Point-  to-  Point  Operation  Microwave  Channels  .....................................  157 
 i.  Effective  Radiated  Power  Limits  ....................................................................................  160  j.  Channel  Usage  Reports...................................................................................................  162 
 6.  Rural  Radiotelephone  Service  Rules  Channels  for  Basic  Exchange  Telephone  Radio  Systems  .......................................................................................................................  165 
 7.  Offshore  Radiotelephone  Service  Rules................................................................................  167  III.  NOTICE  OF  PROPOSED  RULEMAKING    COMPETITIVE  BIDDING......................................  169 
 A.  Incorporation  by  Reference  of  the  Part  1  Standardized  Auction  Rules  .......................................  170 
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 B.  Provisions  for  Designated  Entities...............................................................................................  172  IV.  PROCEDURAL  MATTERS..............................................................................................................  179 
 A.  Comment  Filing  Procedures  ........................................................................................................  179  B.  Ex  parte  Rules  Permit-  But-  Disclose  ........................................................................................  180 
 C.  Congressional  Review  Act...........................................................................................................  181  D.  Final  Regulatory  Flexibility  Analysis  ..........................................................................................  182 
 E.  Initial  Regulatory  Flexibility  Analysis.........................................................................................  183  F.  Paperwork  Reduction  Act  of  1995...............................................................................................  184 
 G.  Contact  Information  .....................................................................................................................  187  V.  ORDERING  CLAUSES.....................................................................................................................  188 

 Appendix  A    Commenting  Parties  Appendix  B    Final  Rules 
 Appendix  C    Final  Regulatory  Flexibility  Analysis  Appendix  D    Initial  Regulatory  Flexibility  Analysis 

 I.  INTRODUCTION 
 1.  In  this  Report  and  Order,  1  we  revise  our  rules  governing  the  four  megahertz  of  dedicated  spectrum  in  the  800  MHz  commercial  Air-  Ground  Radiotelephone  Service  band.  2  In  order  to  facilitate 

 the  provision  of  new,  innovative  wireless  telecommunications  services,  including  broadband  services,  to  the  public  onboard  aircraft,  we  adopt  a  flexible  regulatory  approach  to  determine  the  configuration  of  the 
 band.  Specifically,  we  adopt  rules  that  enable  interested  parties  to  bid  on  spectrum  licenses  according  to  the  band  configuration  that  they  believe  will  best  meet  their  needs  for  the  provision  of  air-  ground 
 services.  Based  on  the  band  configurations  proposed  by  the  parties  in  this  proceeding,  the  Commission  will  make  available  nationwide  air-  ground  licenses  in  three  configurations:  (1)  band  plan  1,  comprised  of 
 two  overlapping,  shared,  cross-  polarized  3  MHz  licenses  (licenses  A  and  B,  respectively),  3  (2)  band  plan  2,  comprised  of  an  exclusive  3  MHz  license  and  an  exclusive  1  MHz  license  (licenses  C  and  D, 
 respectively),  4  and  (3)  band  plan  3,  comprised  of  an  exclusive  1  MHz  license  and  an  exclusive  3  MHz  license  (licenses  E  and  F,  respectively),  with  the  blocks  at  opposite  ends  of  the  band  from  the  second 
 configuration.  5  Licenses  will  have  a  ten-  year  term.  Licenses  will  be  awarded  to  winning  bidders  for  the 
 1  Appendix  A  includes  a  list  of  commenting  parties  and  short  citations  to  such  parties,  which  are  used  in  this 
 document.  2 
 See  47  C.  F.  R  Pt.  22,  Subpt.  G;  Amendment  of  Part  22  of  the  Commission's  Rules  to  Benefit  the  Consumers  of  Air-Ground  Telecommunications  Services,  Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  and  90  of  the 

 Commission's  Rules,  Notice  of  Proposed  Rule  Making,  18  FCC  Rcd  8380  (2003)  (  Notice).  The  spectrum  currently  consists  of  an  uplink  band  at  849-  851  MHz  and  a  downlink  band  at  894-  896  MHz.  47  C.  F.  R.    22.  857. 
 3  Licenses  A  and  B  would  authorize  transmission  of  radio  waves  that  are  vertically  and  horizontally  polarized, 
 respectively,  and  would  initially  share  1.  5  MHz  at  849.  000-  850.  500  MHz  paired  with  1.  5  MHz  at  894.000-  895.  500  MHz.  Once  Verizon  Airfones  incumbent  system  ceases  operations  in  the  upper  0.5  MHz  of  each  band,  licensee  B 

 would  shift  its  operations  to  1.5  MHz  at  849.500-  851.  000  MHz  paired  with  1.5  MHz  at  894.  500-  896.  000  MHz.  If  band  plan  1  is  implemented,  the  parties  may  agree  to  a  different  implementation  scheme. 
 4  License  C  would  be  located  in  the  lower  1.5  MHz  portion  of  each  2  MHz  band  (1.5  MHz  at  849.000-  850.500  MHz 
 paired  with  1.  5  MHz  at  894.000-  895.  500  MHz).  License  D  would  be  located  in  the  upper  0.  5  MHz  portion  of  each  2  MHz  band  (0.  5  MHz  at  850.500-  851.  000  MHz  paired  with  0.5  MHz  at  895.  500-  896.  000  MHz). 

 5  License  E  would  be  located  in  the  lower  0.5  MHz  portion  of  each  2  MHz  band  (0.5  MHz  at  849.000-  849.500  MHz 
 paired  with  0.5  MHz  at  894.  000-  894.500  MHz).  License  F  would  be  located  in  the  upper  1.5  MHz  portion  of  each  2  MHz  band  (1.  5  MHz  at  849.500-  851.  000  MHz  paired  with  1.  5  MHz  at  894.  500-  896.  000  MHz). 
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 licenses  comprising  the  configuration  that  receives  the  highest  aggregate  gross  bid,  subject  to  long-  form  license  application  review.  In  order  to  promote  competition  in  the  800  MHz  air-  ground  band,  we  will 
 prohibit  any  party  from  obtaining  a  controlling  interest,  either  at  auction  or  by  a  post-  auction  transaction,  in  more  than  three  megahertz  of  spectrum  (either  shared  or  exclusive)  in  the  band.  No  single  party, 
 therefore,  may  hold  more  than  one  license  in  any  of  the  available  band  configurations.  In  this  item,  we  also  contemporaneously  issue  a  Notice  of  Proposed  Rulemaking  (Notice)  in  which  we  seek  comment  on 
 competitive  bidding  rules  to  be  used  for  the  new  spectrum  licenses  we  make  available  today  and  on  competitive  bidding  rules  to  resolve  pending  as  well  as  future  mutually  exclusive  applications  for  licenses 
 in  the  400  MHz  general  aviation  Air-  Ground  Radiotelephone  Service.  6 

 Air-  Ground  Band  Plan  Options 

 Plan  1    1.  5  MHz  (shared  with  B  -  vertical  polarization) 
 Plan  1    1.  5  MHz  (shared  with  A  -  horizontal  polarization) 
 Plan  2    1.  5  MHz  (exclusive) 
 Plan  2    0.  5  MHz  (exclusive) 
 Plan  3    0.  5  MHz  (exclusive) 
 Plan  3    1.  5  MHz  (exclusive) 

 849  MHz  849.  5  MHz  850.  5  MHz  851  MHz 
 A 
 B 
 C 
 D 
 E 
 F 

 Plan  1    1.  5  MHz  (shared  with  B  -  vertical  polarization) 
 Plan  1    1.  5  MHz  (shared  with  A  -  horizontal  polarization) 
 Plan  2    1.  5  MHz  (exclusive) 
 Plan  2    0.  5  MHz  (exclusive) 
 Plan  3    0.5  MHz  (exclusive) 
 Plan  3    1.  5  MHz  (exclusive) 

 894  MHz  894.  5  MHz  895.  5  MHz  896  MHz 
 A 
 B 
 C 
 D 
 E 
 F 

 Ground 
 Airborne 
 2.  New  800  MHz  Air-  Ground  Radiotelephone  Service  Band  Plans.  We  adopt  a  flexible  regulatory  framework  that  will  enable  licensees  to  provide  air-  ground  communication  services  using  any 
 existing  or  future  technology  that  can  fit  within  their  assigned  spectrum  block.  Licenses  A,  B,  C,  and  F  could  accommodate  spectrally-  efficient  broadband  technologies  such  as  Code  Division  Multiple  Access 

 6  In  addition  to  the  800  MHz  commercial  air-  ground  spectrum,  there  is  spectrum  in  the  454/  459  MHz  band  allocated 
 for  general  aviation  air-  ground  stations.  47  C.  F.  R.    22.  805. 
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 (CDMA)  2000  1xEV-  DO,  7  Fast  Low-  latency  Access  with  Seamless  Handoff  Orthogonal  Frequency  Division  Multiplexing  (FLASH-  OFDM),  8  and  Global  System  for  Mobile  Communication  Enhanced  Data 
 Rates  for  Global  Evolution  (GSM  EDGE),  9  as  well  as  Integrated  Dispatch  Enhanced  Network  (iDEN)  10  technology  and  other  technologies.  Licenses  D  and  E  also  could  accommodate  iDEN  and  an  array  of 
 narrowband  technologies.  The  licensees  will  be  required  to  provide  service  to  airborne  locations.  Air-ground  service  may  be  any  type  (e.  g.,  voice,  data,  broadband  internet,  etc.)  and  may  be  provided  to  any  or 
 all  aviation  markets  (e.  g.,  commercial,  government,  and  general).  New  licensees  also  may  reconfigure  their  licensed  frequencies  to  accommodate  multiple  overlapping  or  exclusive  air-  ground  systems  through 
 spectrum  leasing,  partitioning,  disaggregation,  or  a  combination  of  these  mechanisms. 
 3.  The  new  rules  for  the  800  MHz  Air-  Ground  Radiotelephone  Service  that  we  adopt  today  will  promote  key  spectrum  policy  objectives  of  the  Commission,  and  will  lead  to  greater  technical, 

 economic,  and  marketplace  efficiency.  11  Our  new  framework  for  flexible  spectrum  access  in  this  band  will  facilitate  the  provision  of  broadband  services  to  consumers  by  eliminating  unnecessary  regulatory 
 restrictions,  and  thereby  provide  greater  flexibility  in  deploying  the  spectrum  to  respond  to  evolving  market  demands.  We  further  our  goal  to  foster  innovation  and  offer  consumers  meaningful  choice  in 
 services  12  by  replacing  the  existing  narrowband  spectrum  sharing  approach  which  limits  services  to  voice  and  very  slow  speed  data  with  a  highly  flexible  licensing  approach.  We  also  further  our  goal  to 
 encourage  the  growth  and  rapid  deployment  of  innovative  and  efficient  communications  technologies  and  services  13  by  providing  flexibility  to  deploy  current  broadband  technologies,  which  heretofore  could  not 
 be  used  in  the  800  MHz  Air-  Ground  Radiotelephone  Service  band,  as  well  as  future  technologies  that  can  be  deployed  within  the  designated  spectrum  and  consistent  with  technical  regulations  necessary  to  prevent 
 harmful  interference  to  adjacent  frequency  bands,  especially  those  used  for  public  safety  communications.  We  also  believe  that  providers  of  broadband  air-  ground  service  in  this  band  will  be  well-  positioned  to 
 compete  against  satellite-  delivered  broadband  air-  ground  telecommunications  services  currently  being  offered  or  under  development. 

 4.  Incumbent  Transition.  Verizon  Airfone  is  the  sole  incumbent  currently  operating  in  the 
 7  CDMA2000  1xEV-  DO  (1x  Evolution    Data  Optimized)  is  an  air  interface  standard  for  Wireless  Internet  officially 
 known  as  IS-  856.  1xEV-  DO  achieves  a  peak  data  rate  of  2.  45  Mbps  on  the  forward  link  (from  the  Base  Station,  BTS,  to  the  user).  The  technology  is  well-  suited  for  high-  speed  mobile  as  well  as  fixed  wireless  Internet  services. 

 See  also  http://  www.  wordiq.  com/  definition/  CDMA2000.  8 
 OFDM  is  a  modulation  scheme  that  divides  a  single  digital  signal  across  multiple  signal  carriers  simultaneously  (FDM).  The  signals  are  spaced  at  precise  frequencies,  which  prevents  the  demodulators  from  seeing  frequencies 

 other  than  their  own  (hence,  orthogonal)  so  they  do  not  interfere  with  each  other.  See  also  http://  www.  flarion.  com/  products/  flash_  ofdm.  asp. 
 9  EDGE  is  a  faster  version  of  GSM  wireless  service,  which  enables  data  to  be  delivered  at  rates  up  to  384  Kbps.  The 
 standard  is  based  on  the  GSM  standard  and  uses  TDMA  multiplexing  technology.  See  also  http://  www.  wordiq.  com/  definition/  Enhanced_  Data_  Rates_  for_  Global_  Evolution  (GSM  EDGE  definition); 

 http://  www.  ericsson.  com/  products/  white_  papers_  pdf/  edge_  wp_  technical.  pdf.  (GSM  EDGE  White  Paper).  10 
 iDEN  is  a  high-  capacity  digital  trunked  radio  system  providing  integrated  voice  and  data  services  to  its  users.  The  iDEN  system  uses  M16-  QAM  digital  modulation  and  VSELP  (Vector  Sum  Excited  Linear  Predictor)  speech  coding 

 techniques  coupled  with  Time  Division  Multiple  Access  (TDMA)  channel  access  methodology  to  enhance  channel  capacity  and  system  services. 
 11  See  FCC  Staff  Report,  Spectrum  Policy  Task  Force  Report,  ET  Dkt.  No.  02-  135  (rel.  Nov.  2002).  This  document 
 is  available  at  http://  hraunfoss.  fcc.  gov/  edocs_  public/  attachmatch/  DOC-  228542A1.  doc.  12 
 Federal  Communications  Commission,  Strategic  Plan  FY  2003-  FY  2008  at  5  (2002).  13 
 Id. 
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 800  MHz  air-  ground  band.  In  April  2004,  the  company  filed  an  application  for  renewal  of  its  authorization  to  operate  in  the  band,  which  is  pending.  14  We  are  granting  Verizon  Airfone  a  non-renewable 
 license  for  a  five-  year  term  on  the  effective  date  of  this  Report  and  Order.  As  explained  below,  the  record  reflects  that  unencumbered  paired  1.5  MHz  channels  are  necessary  to  deploy  broadband 
 technologies  in  the  800  MHz  air-  ground  band.  We  seek  to  ensure  that  the  air-  ground  spectrum  can  be  used  to  provide  broadband  air-  ground  telecommunications  services  in  the  near  future.  If  band  plan  1  or  2 
 is  the  winning  configuration  at  auction,  Verizon  Airfones  incumbent  system  must  cease  operations  in  the  lower  1.5  MHz  portion  of  each  2  MHz  air-  ground  band  within  24  months  of  the  initial  date  of  grant  of  a 
 new  license  or  licenses.  Verizon  Airfone  may  relocate  its  incumbent  operations  to  the  upper  0.5  MHz  portion  of  each  2  MHz  band  (0.5  MHz  at  850.500-  851.000  MHz  paired  with  0.5  MHz  at  895.500-  896.000 
 MHz)  and  may  continue  to  operate  under  the  renewal  authorization  until  the  end  of  the  five-  year  license  term.  If  band  plan  3  is  the  winning  configuration  at  auction,  Verizon  Airfones  incumbent  system  must 
 cease  operations  in  the  upper  1.5  MHz  portion  of  each  2  MHz  air-  ground  band  within  24  months  of  the  initial  date  of  grant  of  license  F;  Verizon  Airfone  may  relocate  to  the  lower  0.5  MHz  portion  of  each  2 
 MHz  band  (0.5  MHz  at  849.  000-  849.500  MHz  paired  with  0.5  MHz  at  894.000-  894.500  MHz)  and  may  continue  to  operate  under  the  renewal  authorization  until  the  end  of  the  five-  year  license  term.  We  note 
 that  if  Verizon  Airfone  acquires  a  new  spectrum  authorization  as  a  result  of  competitive  bidding,  it  could  elect  to  continue  its  incumbent  operations  using  such  new  authorization. 

 5.  Part  22  Biennial  Review.  We  also  revise  and  eliminate,  pursuant  to  our  biennial  review  of  regulations  under  Section  11  of  the  Communications  Act  of  1934  15  as  well  as  a  staff-  initiated 
 assessment  of  our  Part  22  regulations,  certain  non-  cellular  Part  22  Public  Mobile  Services  (PMS)  rules  that  we  find  are  no  longer  warranted  as  a  result  of  technological  change,  increased  competition  in 
 Commercial  Mobile  Radio  Services  (CMRS),  supervening  changes  to  related  Commission  rules,  or  a  combination  of  these  factors.  16  We  implement  certain  staff  recommendations  17  under  Section  11  and  our 
 general  regulatory  authority  for  deleting  or  modifying  various  rules  in  Parts  1,  22,  and  90.  18  Many  of  the 
 14  See  File  No.  0001716212  (filed  Apr.  28,  2004). 
 15  47  U.  S.  C.    161.  Section  11  requires  us  to  review  our  regulations  applicable  to  providers  of  telecommunications 
 service  and  to  determine  whether  any  such  regulation  is  no  longer  necessary  in  the  public  interest  as  the  result  of  meaningful  economic  competition  between  providers  of  such  service,  and  to  repeal  or  modify  any  regulation  that 

 we  find  no  longer  necessary  in  the  public  interest.  47  U.  S.  C.    161(  a)(  2)  &  (b).  16 
 47  C.  F.  R.  Pt.  22.  Part  22  contains  10  subparts.  The  first  three  subparts  Subparts  A  (Scope  and  Authority),  B  (Licensing  Requirements  and  Procedures)  and  C  (Operational  and  Technical  Requirements)  apply  generally  to  all 

 Part  22  licenses.  The  fourth  subpart,  Subpart  D,  contains  rules  for  developmental  authorizations.  Each  of  the  next  five  Subparts  (E  through  I)  contain  rules  applicable  to  one  of  the  five  Part  22  services:  (1)  Paging  and 
 Radiotelephone;  (2)  Cellular  Radiotelephone;  (3)  Rural  Radiotelephone;  (4)  Air-  Ground  Radiotelephone;  and  (5)  Offshore  Radiotelephone.  Finally,  Subpart  J  implements  the  Communications  Assistance  for  Law  Enforcement 
 Act  (CALEA)  as  it  applies  to  Part  22  services.  See  Pub.  L.  No.  103-  414,  108  Stat.  4279  (1994)  (codified  as  amended  in  scattered  sections  of  18  U.  S.  C.  and  47  U.  S.  C.    229,  1001-  1010,  1021). 
 17  See  Biennial  Regulatory  Review,  CC  Docket  No.  00-  175,  Report,  16  FCC  Rcd  1207  (2001)  (  2000  Biennial 
 Review  Report);  Biennial  Regulatory  Review  2000  Updated  Staff  Report  (rel.  Jan.  17,  2001);  2002  Biennial  Regulatory  Review,  Report,  18  FCC  Rcd  4726  (2003);  The  Commission  Seeks  Public  Comment  in  the  2002 

 Biennial  Review  of  Telecommunications  Regulations  Within  the  Purview  of  the  Wireless  Telecommunications  Bureau,  Public  Notice,  17  FCC  Rcd  18933  (2002). 
 18  In  our  Cellular  Year  2000  Biennial  Report  and  Order,  we  stated  that  section  11  places  the  burden  on  the 
 Commission  to  make  the  requisite  determinations;  no  particular  burden  is  placed  on  the  opponents  or  proponents  of  a  given  rule.  Year  2000  Biennial  Regulatory  Review  Amendment  of  Part  22  of  the  Commissions  Rules  to  Modify 

 or  Eliminate  Outdated  Rules  Affecting  the  Cellular  Radiotelephone  Service  and  Other  Commercial  Mobile  Radio  Services,  Report  and  Order,  17  FCC  Rcd  18401,  18404  4  (2002)  (  Cellular  Year  2000  Biennial  Report  and 
 (continued.) 
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 rules  that  we  revise  or  eliminate  today  reflect  outdated  policies  and  technical  concerns  or  unnecessarily  limit  the  flexibility  of  Part  22  licensees  to  respond  to  the  marketplace  and  meet  the  needs  of  consumers. 
 Our  action  today  serves  the  public  interest  as  it  corrects  these  deficiencies  and  should  facilitate  technological  innovation. 

 6.  We  also  seek  to  harmonize  our  rules,  where  appropriate,  across  various  wireless  services.  For  example,  we  afford  licensees  of  nationwide  paging  channels  flexibility  to  provide  other  services  and 
 revise  our  rules  that  currently  limit  the  provision  of  dispatch  service  by  paging  licensees.  We  also  recodify  certain  Part  22  rules  to  Part  1  to  provide  uniform  methods  for  the  calculation  of  terrain  elevation 
 and  distance  for  most  wireless  services.  In  addition  to  eliminating  unnecessary  regulatory  hurdles,  many  of  the  rule  changes  that  we  adopt  today  will  provide  licensees  with  greater  flexibility  regarding  the  use  of 
 their  spectrum  and  thereby  enable  them  to  better  respond  to  market  demands. 
 II.  REPORT  AND  ORDER 
 A.  800  MHz  Air-  Ground  Radiotelephone  Service 
 7.  We  initiated  this  proceeding,  inter  alia,  to  reexamine  our  800  MHz  Air-  Ground  Radiotelephone  Service  band  plan  and  service  rules.  Although  the  Commission  initially  licensed  six  800 

 MHz  air-  ground  nationwide  licensees,  only  one  licensee  (Verizon  Airfone)  continues  to  provide  service  in  the  band,  and  our  service  rules  allow  it  to  provide  only  a  limited  range  of  narrowband  voice  and  data 
 services.  19  This  circumstance  led  us  to  question  in  the  Notice  whether  our  existing  rules  were  impeding  the  provision  of  telecommunications  services  desired  by  the  public  onboard  aircraft.  20  Nearly  all  parties 
 commenting  on  these  issues  agree  that  our  existing  band  plan  and  rules  have  hindered  the  efficient,  competitive  provision  of  services  desired  by  the  public.  Based  on  our  review  of  the  record  in  this 
 proceeding,  we  conclude  that  the  specified  narrow  bandwidth  (6  kHz)  of  the  existing  800  MHz  Air-Ground  Radiotelephone  Service  communications  channels  has  constrained  the  ability  of  licensees  to 
 provide  the  type  of  broadband  air-  ground  services  desired  by  the  traveling  public.  We  find  that  the  public  interest  will  be  served  by  adopting  flexible  rules  that  will  enable  interested  parties  to  bid  on  licenses  in 
 three  possible  band  configurations.  The  three  band  configurations  are  based  on  proposals  submitted  by  parties  in  this  proceeding  and  each  includes  at  least  one  spectrum  block  that  will  permit  the  provision  of 
 high-  speed  telecommunications  services  to  the  public  onboard  aircraft. 
 8.  In  reexamining  the  current  band  plan  and  service  rules,  we  must  address  both  competitive 
 (Continued  from  previous  page)  Order),  citing  In  the  Matter  of  2000  Biennial  Regulatory  Review  Spectrum  Aggregation  Limits  for  Commercial 
 Mobile  Radio  Services,  Report  and  Order,  16  FCC  Rcd  22628,  22679  25  (2001);  see  also  Year  2000  Biennial  Regulatory  Review  Amendment  of  Part  22  of  the  Commissions  Rules  to  Modify  or  Eliminate  Outdated  Rules 
 Affecting  the  Cellular  Radiotelephone  Service  and  other  Commercial  Mobile  Radio  Services,  Second  Report  and  Order,  17  FCC  Rcd  18485  (2002);  Erratum,  17  FCC  Rcd  22140  (2002). 
 19  See  Welcome  to  Airfone  web  site,  www22.verizon.  com/  airfone  and 
 www.  22.  verizon.  com/  airfone/  service/  af_  service.  htm.  Another  commercial  air-  ground  licensee,  AT&  T  Wireless,  discontinued  operations  on  September  1,  2002,  and  cancelled  its  license.  See  Claircom  Licensee  Corporation 

 Application  for  Cancellation  of  License,  Call  Sign  KNKG801,  File  No.  0001161399  (filed  Jan.  16,  2003).  Skyway  Aircraft,  Inc.  has  authority  to  operate  in  the  commercial  air-  ground  band  under  the  current  rules  on  a  shared  basis 
 pursuant  to  a  Special  Temporary  Authorization  (STA).  See  infra  para.  11.  20 
 Notice,  18  FCC  Rcd  at  8389-  8391    17-  21.  The  remaining  five  licenses  have  been  unassigned  for  some  time,  and  no  one  has  formally  requested  that  the  Commission  open  another  application  filing  window.  Pursuant  to  Section 

 22.  875  of  our  rules,  applications  for  authorization  in  this  service  may  only  be  filed  during  window  filing  periods  announced  by  public  notice.  47  C.  F.  R.    22.  875. 
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 issues  (i.  e.,  how  many  competitors  can  the  spectrum  and  the  market  support)  and  technical  considerations  (i.  e.,  how  much  spectrum  is  necessary  to  efficiently  and  effectively  support  a  range  of  air-  ground  service 
 offerings,  including  voice  and  broadband  applications,  and  the  technical  parameters  to  minimize  the  potential  for  air-  ground  systems  to  cause  interference).  We  resolve  these  interrelated  issues  by  adopting 
 flexible  rules  to  determine  the  best  technological  configuration  of  the  band  and  the  number  of  competitors  for  air-  ground  communications  over  multiple  platforms  (i.  e.,  terrestrial  and  satellite).  We  note  that  six 
 companies  AirTV,  ARINC,  Boeing,  Inmarsat,  OnAir,  and  Row  44  are  developing  or  have  commenced  offering  broadband  air-  ground  services  using  satellite-  based  systems.  21  We  find  that  reconfiguration  of 
 the  800  MHz  air-  ground  band  will  facilitate  competition  with  these  satellite-  based  offerings  in  the  provision  of  high-  speed  air-  ground  services  to  commercial  and  other  aircraft.  We  also  note  that  other 
 spectrum  is  available  for  the  provision  of  air-  ground  communications  services.  22  Based  on  our  review  of  the  record  developed  in  this  proceeding  and  for  the  reasons  stated  below,  we  conclude  that  a  flexible 
 licensing  approach  coupled  with  flexible  technical  and  operational  rules  will  promote  the  highest  valued  use  of  the  800  MHz  air-  ground  spectrum  for  the  provision  of  air-  ground  services  that  better  meet  the 
 needs  of  the  public. 
 1.  Background 
 9.  In  1990,  the  Commission  allocated  four  megahertz  of  spectrum  for  commercial  Air-Ground  Radiotelephone  Service,  authorizing  operation  at  849-  851  MHz  (ground  stations)  and  894-  896 

 MHz  (airborne  mobile  stations).  23  Each  band  is  divided  into  ten  paired  channel  blocks,  24  which  are  allotted  to  specific  geographic  locations  (essentially  a  national  grid).  25  Each  channel  block  contains  29 
 narrowband  (6  kHz)  communications  channels  and  6  very  narrowband  (3.2  kHz)  control  channels.  26  Under  the  current  service  rules,  each  licensee  has  an  exclusive  control  channel,  shares  all  the 
 communication  channels  with  the  other  licensees  in  the  band,  27  and  must  provide  nationwide  service.  28  To  promote  interoperable  communications  and  to  manage  interference,  some  of  the  ground  station 
 locations  in  North  America  and  channel  block  assignments  have  been  predetermined  consistent  with  bilateral  agreements  with  Mexico  and  with  Canada.  29  The  number  of  communications  channels  limits  the 

 21  See  infra  paras.  14-  20. 
 22  See  infra  para.  45. 
 23  See  Amendment  of  the  Commissions  Rules  Relative  to  Allocation  of  the  849-  851/  894-  896  MHz  Bands,  Report 
 and  Order,  5  FCC  Rcd  3861  (1990)  ,  recon.  granted  in  part,  In  the  Matter  of  Amendment  of  the  Commission's  Rules  Relative  to  Allocation  of  the  849-  851/  894-  896  MHz  Bands,  Memorandum  Opinion  and  Order,  6  FCC  Rcd 

 4582  (1991).  24 
 47  C.  F.  R.    22.857.  25 
 47  C.  F.  R.    22.859.  26 
 47  C.  F.  R.    22.  857.  The  Wireless  Telecommunications  Bureau  has  granted  a  waiver  allowing  two  of  the  control  channels  to  be  combined  and  used  as  a  thirtieth  communication  channel  while  there  are  fewer  than  six  licensees. 

 See  Claircom  Licensee  Corporation  and  GTE  Airfone  Incorporated  Requests  for  Waivers  of  Air-  ground  Radiotelephone  Service  Rules,  Order,  16  FCC  Rcd  17959  (WTB,  CWD  2001). 
 27  47  C.  F.  R.    22.  865,  22.  869. 
 28  47  C.  F.  R.    22.873(  b). 
 29  See  "Arrangement  Between  the  Department  of  Communications  of  Canada  and  the  Federal  Communications 
 Commission  of  the  United  States  of  America  Concerning  the  Use  of  the  Bands  849-  851  and  894-  896  MHz,"  signed  August  18,  1992  (U.  S.  A.)  and  August  28,  1992  (Canada),  Section  4.  See  also  "Protocol  Concerning  the  Use  of  the 

 849-  851  and  894-  896  MHz  Bands  for  Public  Air-  To-  Ground  Radio  Service,"  signed  June  16,  1994  by  the  Government  of  the  United  States  and  the  Government  of  Mexico,  Article  IV. 
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 number  of  voice  calls  that  can  be  simultaneously  handled  in  a  particular  area,  and  the  narrow  bandwidth  of  these  channels  limits  a  service  provider  to  voice  and  low-  speed  data  services.  30 
 10.  The  current  800  MHz  Air-  Ground  Radiotelephone  Service  rules  contemplate  six  competing  licensees  providing  voice  and  low-  speed  data  services.  Six  entities  were  originally  licensed 
 under  these  rules,  which  required  all  systems  to  conform  to  detailed  technical  specifications  to  enable  shared  use  of  the  air-  ground  channels.  Only  three  of  the  six  licensees  built  systems  and  provided  service, 
 and  two  of  those  failed  for  business  reasons.  Only  Verizon  Airfone  remains  as  an  incumbent  in  the  band.  31  The  prescriptive  command-  and-  control  nature  of  the  current  air-  ground  service  rules,  the 
 regulatory  requirement  to  share  only  four  megahertz  of  spectrum  among  up  to  six  licensees,  and  the  limited  data  capacity  of  the  narrow  bandwidth  (6  kHz)  communications  (slow  dial-  up  modem  speed) 
 preclude  the  provision  of  broadband  services  to  the  public. 
 11.  We  note  that  Skyway  Aircraft,  Inc.  acquired  the  former  ClairCom  air-  ground  system  and  has  authority  to  operate  in  the  800  MHz  air-  ground  band  under  the  current  rules  on  a  shared  basis 

 pursuant  to  a  Special  Temporary  Authorization  (STA).  32  In  this  proceeding,  SkyWay  has  argued  that  it  has  an  expectancy  to  use  the  air-  ground  spectrum,  33  and  supported  retention  of  the  existing  800  MHz  Air-Ground 
 Radiotelephone  Service  rules.  34 
 2.  Market  for  Air-  Ground  Wireless  Communications  Services 
 12.  There  is  substantial  and  rapidly  growing  consumer,  airline,  and  service  provider  interest  in  access  to  high-  speed  Internet  and  other  wireless  services  onboard  aircraft.  35  Market  research  suggests 

 that  38  percent  of  frequent  flyers  are  willing  to  pay  for  high-  speed  access  to  the  Internet  and  their 
 30  When  the  Commission  adopted  the  rules  for  this  service,  it  implemented  policies  and  technical  constraints 
 consistent  with  the  experimental  air-  ground  system  licensed  to  Airfone,  Inc.  (now  Verizon  Airfone)  six  years  prior  to  the  order  establishing  the  service  in  Part  22.  See  Amendment  of  the  Commissions  Rules  Relative  to  Allocation 

 of  the  849-  851/  894-  896  MHz  Bands,  Report  and  Order,  5  FCC  Rcd  3861  (1990).  The  Commission  sought  to  promote  open  entry,  which  required  that  the  licensees  be  technically  compatible  and  coordinate  with  one  another. 
 31  As  noted  above,  Verizons  license  expired  in  July  2004,  and  its  renewal  application  currently  is  pending.  See  File 
 No.  0001716212  (filed  Apr.  28,  2004).  32 
 SkyWays  STA  (call  sign  WPYZ281)  expired  November  30,  2004,  and  the  company  has  filed  a  request  to  extend  the  STA,  which  is  pending.  See  File  No.  00019331747  (filed  Nov  11,  2004).  The  STA  provides  that  SkyWay  has 

 no  future  entitlement  to  hold  an  authorization  to  provide  air-  ground  telecommunications  services  as  currently  authorized  by  this  STA,  and  requires  SkyWay  to  advise  any  customers  of  the  potentially  temporary  nature  of  its 
 operating  authority.  33 
 Skyway  Comments  at  5  (filed  Apr.  1,  2004).  We  note  that  the  STA  is  explicitly  conditioned  on  the  outcome  of  this  proceeding. 

 34  Skyway  Comments  at  5  (filed  Nov.  26,  2003). 
 35  See,  e.  g.,  White  Paper,  Satellite  Competition  to  Terrestrial  Air-  to-  Ground  Service,  transmitted  by  Letter  from 
 Donald  C.  Brittingham,  Director-  Wireless/  Spectrum  Policy,  Verizon,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Sept.  7,  2004;  Letter  from  Rich  Farr,  Senior  Manager,  Radio  Communications, 

 American  Airlines,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Aug.  30,  2004,  clarified  by  Letter  from  Rich  Farr,  Senior  Manager,  Radio  Communications,  American  Airlines,  to  Marlene  H. 
 Dortch,  Secretary,  Federal  Communications  Commission,  dated  Sept.  28,  2004  (collectively,  American  Airlines  Letters);  AirCell  Ex  parte  Presentation,  Business  Structure  &  Market  Outlook  for  Inflight  Communications 
 Services  at  12-  31  (July  26,  2004);  In  Search  of  an  In-  Air  Connection,  Readers  are  Willing  to  Pay  Airlines  for  a  Good  Web  Connection  in  the  Sky,  Wall  St.  Journal,  Apr.  6,  2004,  available  at 
 http://  webreprints.  djreprints.  com/  974390656496.  html. 
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 corporate  network.  36  A  September  2003  market  study,  moreover,  indicates  that  43  percent  of  adults  who  travel  by  commercial  aircraft  are  interested  in  using  their  own  wireless  phones,  and  34  percent  would  like 
 to  connect  to  the  Internet  with  a  laptop  while  onboard  an  aircraft.  37  American  Airlines  and  Continental  Airlines  both  state  that  passenger  demand  for  in-  flight  connectivity  for  Internet  access,  email,  and  text 
 messaging  is  increasing,  and  that  passengers  expect  high-  speed  data  rates.  38 
 13.  We  see  great  potential  for  air-  ground  wireless  services  for  commercial,  government,  and  general  aviation.  These  user  markets  can  be  served  by  satellite  systems,  systems  using  the  spectrum 

 subject  to  this  rulemaking,  by  AirCell  (and  potentially  others)  using  the  cellular  or  other  CMRS  bands,  39  and  by  Air-  Ground  Radiotelephone  Automated  Service  (AGRAS)  stations  in  the  454/  459  MHz  bands 
 serving  general  aviation.  We  also  consider,  in  a  separate  Notice  of  Proposed  Rulemaking,  the  possibility  of  modifying  Section  22.925  of  our  rules,  40  which  prohibits  the  use  of  cellular  phones  onboard  airborne 
 aircraft.  41  We  intend  in  that  companion  proceeding  to  examine,  inter  alia,  the  possible  use  of  onboard  pico  cells  to  control  cellular  handsets  on  airborne  aircraft.  We  note,  however,  that  as  the  expert  agency 
 responsible  for  air  traffic  safety,  the  Federal  Aviation  Administration  (FAA)  also  regulates  the  use  of  cellular  phones  and  other  personal  electronic  devices  on  aircraft  because  of  the  potential  for  interference 
 to  aircraft  communications  and  navigation  systems.  42  Thus,  the  scope  of  use  of  cellular  phones  onboard  airborne  aircraft  remains  subject  to  FAA  regulations,  regardless  of  the  action  we  may  take  in  the 
 companion  proceeding. 
 14.  Boeing  has  been  authorized  by  the  Commission  to  deploy  up  to  800  transmit  and  receive  earth  stations  on  aircraft  in  the  14  GHz  uplink  and  the  12  GHz  downlink  bands.  43  By  the  terms  of  the 

 36  The  study  was  conducted  by  Forrester  Research.  See  Boeing  Press  Release,  Infonet  and  Connexion  by  Boeing 
 Announce  Plans  to  Deliver  Wi-  Fi  in  the  Sky  Capabilities  to  MobileXpress  TM  Customers,  available  at  http://  www.  boeing.  com/  news/  releases/  2004/  q2/  nr_  040510j.  html. 

 37  The  study,  conducted  by  telephone,  included  a  random  sample  of  1,  009  U.  S.  adults,  and  is  available  at 
 http://  www.  ce.  org/  events/  event_  info/  downloads/  Presentation_  Bates_  Wireless_  Devices_  on_  Planes.  ppt.  38 
 Comments  of  Continental  Airlines  (filed  Sept.  29,  2004);  American  Airlines  Letters,  supra  note  35.  39 
 AirCell  operates  in  the  cellular  band  under  a  Commission-  granted  waiver  of  Section  22.  925,  47  C.  F.  R.    22.  925,  which  prohibits  use  of  cellular  telephones  in  airborne  aircraft.  AirCell  received  the  waiver  based  on  its  use  of 

 technology  specifically  designed  to  avoid  interference  to  ground-  based  cellular  systems.  See  infra  note  89.  40 
 47  C.  F.  R.    22.925.  In  the  Notice,  we  asked  whether  we  should  repeal  or  modify  Section  22.  925.  See  Notice,  18  FCC  Rcd  at  8390-  8391  22.  This  prohibition  was  initially  adopted  to  prevent  harmful  interference  to  terrestrial 

 cellular  systems.  See  Amendment  of  Sections  of  Part  22  of  the  Commission's  Rules  in  the  Matter  of  Airborne  Use  of  Cellular  Telephones  and  the  Use  of  Cell  Enhancers  in  the  Domestic  Public  Cellular  Radio  Service,  Report  and 
 Order,  7  FCC  Rcd  23  (1991).  41 
 See  Amendment  of  the  Commissions  Rules  to  Facilitate  the  Use  of  Cellular  Telephones  and  other  Wireless  Devices  Aboard  Airborne  Aircraft,  WT  Dkt  No.  04-  435,  Notice  of  Proposed  Rulemaking,  FCC  04-  288  (rel.  Feb.  15, 

 2005).  42 
 See  14  C.  F.  R.    91.  21;  Federal  Aviation  Administration  Advisory  Circular  No.  91.  21-  1A,  Use  of  Portable  Electronic  Devices  aboard  Aircraft  (Oct.  2,  2000). 

 43  See  In  the  Matter  of  The  Boeing  Company,  Application  for  Blanket  Authority  To  Operate  up  to  Eight  Hundred 
 Technically  Identical  Transmit  and  Receive  Mobile  Earth  Stations  Aboard  Aircraft  in  the  14.0-  14.5  GHz  and  11.7-  12.  2  GHz  Frequency  Bands,  File  No.  SES-  LIC-  20001204-  02300,  Call  Sign:  E000723,  Order  and  Authorization,  16 

 FCC  Rcd  22645  (IB  2001)  (  Boeing  Transmit-  Receive  Order).  A  waiver  of  Section  2.  106  of  the  Commissions  rules  was  necessary  because  at  that  time  the  U.  S.  Table  of  Frequency  Allocations  did  not  include  allocations  for 
 Aeronautical  Mobile  Satellite  Service  (AMSS)  downlinks  in  the  12  GHz  band  and  AMSS  uplinks  in  the  14  GHz  band.  However,  the  Commission  has  since  added  a  secondary  allocation  in  the  14-  14.  5  GHz  band  for  AMSS, 
 (continued.) 
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 grant,  Boeings  authority  to  communicate  with  these  satellites  is  limited  geographically  to  the  airspace  above  the  United  States  and  its  territorial  waters.  44  Boeing  currently  has  pending  before  the  Commission 
 an  application  to  expand  its  authority  by  seeking  to  communicate  with  several  foreign  satellites  from  aircraft  flying  over  the  high  seas  (i.  e.,  over  international  waters).  45  Boeing  has  also  filed  a  petition  for 
 rulemaking,  which  is  pending  before  us,  seeking  establishment  of  licensing  and  service  rules  for  the  Aeronautical  Mobile  Satellite  Service  (AMSS).  46 

 15.  In  2004,  Connexion  by  Boeing  launched  a  broadband  in-  flight  Internet,  data,  and  entertainment  service  on  commercial  flights  operated  by  non-  U.  S.  airlines,  47  using  a  Ku-  band  satellite 
 system.  Boeing  states  that  it  can  provide  a  forward  link  data  rate  of  up  to  5  megabits,  and  a  reverse  link  of  512  kbps.  48  Each  plane  equipped  with  the  Connexion  service  offers  either  an  Ethernet  Local  Area 
 Network  (LAN)  connection  or  a  wireless  802.11b  network  connection,  or  both.  49  The  company  has  entered  into  agreements  with  numerous  carriers,  50  and  reportedly  expects  to  generate  service  revenues  of 
 $500,000  per  airplane  per  year  and  annual  revenues  of  $2  billion.  51  Boeing  projects  that  by  2010,  the  market  for  passenger  Internet  service  will  mature,  and  the  companys  market  share  will  range  from  4,500 
 to  5,000  of  the  14,000  aircraft  that  will  be  flying  at  that  time.  52  Boeings  Connexion  service  is  currently  available  only  on  foreign  airlines  such  as  Lufthansa;  however,  some  routes  of  these  foreign  carriers  cover 

 (Continued  from  previous  page)  following  the  addition  of  an  international  AMSS  allocation  in  that  band  at  the  2003  World  Radiocommunication 
 Conference.  See  Amendment  of  the  Parts  2,  25,  and  87  of  the  Commissions  Rules  to  Implement  Decisions  from  World  Radio  Communications  Conferences  Concerning  Frequency  Bands  Between  28  MHz  and  36  GHz  and  to 
 Otherwise  Update  the  Rules  in  this  Frequency  Range,  Report  and  Order,  18  FCC  Rcd  23426  (2003).  Under  its  current  authorization,  Boeing  is  not  permitted  to  cause  harmful  interference  to  other  allocated  services  in  the  11.  7- 
 12.  2  GHz  and  14-  14.  5  GHz  frequency  bands,  and  must  accept  all  interference  from  authorized  users  of  these  bands.  Boeing  Transmit-  Receive  Order,  16  FCC  Rcd  at  22653-  54  19. 
 44  Boeing  Transmit-  Receive  Order,  16  FCC  Rcd  at  22653-  54  19. 
 45  See  The  Boeing  Company,  Application  to  Modify  Blanket  AMSS  Earth  Station  Authorization  Call  Sign  E000723, 
 File  No.  SES-  MOD-  20040301-  00304,  filed  Mar.  1,  2004  (  Boeing  AMSS  Modification  Application).  46 
 Amendment  of  Parts  2  and  25  of  the  Commissions  Rules  to  Allocate  Spectrum  in  the  14-  14.  5  GHz  Band  to  the  Aeronautical  Mobile-  Satellite  Service  (  AMSS)  and  To  Adopt  Licensing  and  Service  Rules  for  AMSS  Operations 

 in  the  Ku-  Band,  The  Boeing  Company,  Petition  for  Rulemaking,  filed  July  21,  2003.  47 
 See  http://  www.  connexionbyboeing.  com.  48 
 See  Satcom  Shakeout,  Business  &  Commercial  Aviation,  Fred  George,  at  89  (Sept.  2004).  49 
 See  http://  www.  connexionbyboeing.  com/  index.  cfm?  p=  cbb.  aboutservice&  l=  en.  US&  ec.  Rates  for  unlimited  internet  access  through  the  Connexion  service  are  based  on  the  flight  duration:  $14.95  for  short-  haul  flights  less 

 than  three  hours,  $19.  95  for  medium-  haul  flights  between  three  to  six  hours,  and  $29.95  for  long-  haul  flights  over  six  hours.  See  http://  www.  connexionbyboeing.  com/  index.  cfm?  p=  cbb.  pricing&  l=  en.  US&  ec.  Alternatively,  users 
 can  purchase  30  minutes  of  Internet  access  for  an  initial  fee  of  $7.95  on  flights  under  three  hours  and  $9.95  for  flights  over  three  hours,  and  $0.25  per  minute  thereafter.  Id. 
 50  Connexion  has  definitive  service  agreements  with  Lufthansa,  Scandinavian  Airlines  System  (SAS),  and  Japan 
 Airlines  to  equip  their  long-  haul  fleets  with  the  Connexion  service.  In  addition,  British  Airways  has  completed  a  successful  service  demonstration,  and  both  All-  Nippon  Airways  and  Singapore  Airlines  have  announced  their  intent 

 to  install  the  Connexion  service  on  their  long-  range  aircraft.  See  http://  www.  connexionbyboeing.  com.  51 
 See  Coffee,  Tea  or  Broadband,  Quentin  Hardy,  Forbes  (June  17,  2004),  available  at  http://  www.  forbes.  com/  technology/  networks/  2004/  06/  17/  cz_  qh_  0617wifi.  html. 

 52  See  Stuck  in  the  Air?  Surf  the  Web,  Boeings  Internet  service  lands  first  airline  contract,  Kelly  Quigley,  Crains 
 Chicago  Business  (Mar.  25,  2004). 
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 U.  S.  territory.  53  Boeing  also  has  approached  a  number  of  U.  S.  airlines  regarding  installation  of  the  Connexion  service  on  their  U.  S.-  registered  aircraft.  54  Connexion  Service  currently  is  available  in  the 
 United  States  on  executive  jet  platforms  the  size  of  a  Boeing  737  and  larger,  including  Airbus  aircraft.  55  Boeing  has  also  announced  that,  in  cooperation  with  Rockwell  Collins  eXchange  service,  service  will  be 
 available  in  early  2005  on  a  majority  of  the  global  routes  flown  by  business  jet  operators,  including  the  entire  Bombardier  Global  family  of  aircraft.  56 

 16.  Aeronautical  Radio  Inc.  (ARINC)  is  currently  pursuing  several  efforts  in  order  to  bring  broadband  service  to  both  business  and  commercial  aircraft.  The  company  has  filed  an  application  with 
 the  Commission  seeking  authority  to  offer,  on  a  non-  interference  basis,  a  service  similar  to  Boeings  Connexion.  57  While  this  application  remains  pending  before  the  Commission,  ARINC  has  begun  testing 
 a  Ku-  band  satellite  system  pursuant  to  a  grant  of  experimental  authority.  58  ARINC  claims  that  its  proposed  SKYLink  service  can  offer  aircraft  passengers  uplink  speeds  between  512  kbps  and  3  Mbps  and 
 downlink  speeds  up  to  128  kbps.  59  The  company  recently  announced  that  it  is  conducting  talks  with  three  domestic  airlines  interested  in  the  service.  60  The  company  claims  that  SKYLink  is  the  only  broadband 
 Internet  solution  suited  to  95  percent  of  the  worlds  passenger  aircraft.  61  The  commercial  SKYLink  hardware  package,  which  weighs  150  pounds  (including  its  low-  profile  antenna),  reflects  advances  in 
 technology  that  enable  deployment  of  increasingly  lighter  weight  satellite-  based  air-  ground  systems.  62 
 17.  SITA  INC,  Airbus  and  Tenzing  recently  formed  OnAir,  a  company  that  intends  to  offer  a 

 53  See  id.  at  2;  Boeing  AMSS  Modification  Application,  Public  Interest  Statement  at  5. 
 54  See  Battle  of  the  Bands,  Flight  International  (Sept.  22,  2004). 
 55  See  http://  www.  connexionbyboeing.  com/  index.  cfm?  p=  cbb.  executivejet&  l=  en.  US&  ec. 
 56  See  id. 
 57  Aeronautical  Radio  Inc.,  Application  for  Blanket  Authority  to  Operate  Aboard  Aircraft  up  to  1000  Technically-Identical 
 Transmit  and  Receive  Mobile  Earth  Stations  in  the  11.7-  12.2  and  14.0-  14.5  GHz  Frequency  Bands,  File  No.  SES-  LIC-  20030910-  01261,  filed  Sept.  10,  2003,  and  Amendment,  File  No.  SES-  AMD-  20031223-  01860,  filed 

 Dec.  23,  2003.  58 
 The  Commission  recently  renewed  ARINC's  experimental  authority  to  conduct  a  limited  market  study  of  its  SKYLink  service  on  15  aircraft  until  May  1,  2006.  See  File  No.  0130-  EX-  RR-  2004  (Call  Sign  WC2XPE).  A 

 previous  grant  had  modified  ARINC's  experimental  authority  to  conduct  a  limited  market  study  on  up  to  120  aircraft  (originally  authority  was  granted  for  only  15  aircraft).  See  File  No.  0054-  EX-  PL-  2001,  modified  by  File  No.  0029-EX- 
 ML-  2003  and  File  No.  0029-  EX-  ML-  2004.  Informal  objections  challenging  the  increase  in  the  number  of  aircraft  requested  for  the  limited  market  study  were  filed  by  Boeing  and  Rockwell  Collins  Corporation.  See  In  the 
 Matter  of  Aeronautical  Radio  Inc.,  Experimental  License  Modification  to  Expand  Limited  Market  Study,  Informal  Objections  of  The  Boeing  Company  and  Rockwell  Collins  Corporation,  filed  Sept.  13,  2004.  Upon  consideration  of 
 these  objections,  the  Commission  again  modified  ARINC's  experimental  authority  to  allow  only  15  aircraft  inits  limited  market  study. 
 59  ARINC  Comments  at  1-  2. 
 60  See  Press  Release,  ARINC  Will  Show  New  Broadband  Internet  Solution  for  Commercial  Aircraft  at  WAEA 
 (Aug.  24,  2004),  available  at  http://  www.  arinc.  com/  news/  2004/  08-  24-  04.  html.  61 
 See  Press  Release,  ARINC  SKYLink  SM  Offers  Internet  for  Airline  Passengers  on  the  Compact  PEA  Entertainment  Unit  (Sept.  21,  2004)  (statement  by  Robert  Thompson,  Senior  Director  of  ARINC  Satellite 

 Services),  available  at  http://  www.  arinc.  com/  news/  2004/  09-  21-  04.  html.  62 
 See  Press  Release,  SKYLink  SM  Satellite  Broadband  Demo  Shows  Airlines  How  to  Achieve  Total  Aircraft  Communications  (Sept.  21,  2004),  available  at  http://  www.  arinc.  com/  news/  2004/  09-  21b-  04.  html. 
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 range  of  voice  and  data  broadband  services  to  both  long-  and  short-  haul  fleets  across  the  world.  63  The  company  anticipates  that  SITAs  existing  cabin  connectivity  customers  and  Tenzings  existing  customers 
 will  form  the  OnAir  customer  base.  64  OnAir  expects  to  introduce  access  to  corporate  Virtual  Private  Networks  and  Internet  browsing  capabilities  in  2005.  65 

 18.  Inmarsat  also  provides  onboard  wireless  services  to  airlines,  66  corporate  and  private  users,  67  and  governmental  entities.  68  The  company  uses  a  constellation  of  geostationary  satellites  to 
 provide  service  to  approximately  5,000  aircraft  fitted  with  Inmarsat  aeronautical  communications  systems,  including  more  than  2,000  aircraft  operated  by  major  air  carriers,  including  Air  France, 
 Continental,  Delta,  Qantas,  United,  US  Airways,  and  Virgin  Atlantic.  69  The  remaining  aircraft  are  operated  by  businesses  and  private  individuals,  and  by  a  variety  of  government  agencies,  including  the 
 military.  70  Inmarsat  delivers  services  to  aircraft  using  seven  different  systems.  71  Swift64  is  Inmarsat's  latest  service  offering  and  provides  enough  data  bandwidth  for  applications  such  as  high-  quality  voice, 
 email,  Internet  and  intranet  access,  and  videoconferencing.  72  Inmarsat  states  that  Swift64  terminals  now  offer  up  to  four  64  kbit/  s  channels  that  can  be  bonded  to  produce  a  256  kbit/  s  data  rate.  73  It  also  claims 
 that  application  of  compression  and  acceleration  techniques  can  boost  the  effective  rate  to  beyond  half  a  megabit  per  second.  74 

 19.  On  September  22,  2004,  Row  44,  LLC,  75  a  provider  of  data  communication  services  and  equipment  to  the  aviation  industry,  announced  an  agreement  with  Hughes  Network  Systems  (HNS)  76  to 
 bring  broadband  connectivity  to  North  American  commercial  and  business  aircraft.  77  The  company 
 63  See  http://  www.  sita.  com/  index.  asp?  activeDir=/  home/  News_  Centre/  Press_  releases/  Press_  releases_  -_ 
 2004/&  activeFile=  Going_  On_  Air.  html.  64 
 Over  60  airlines  use  SITAs  current  cabin  connectivity  services  on  1,100  aircraft,  including  American  Airlines,  Air  France,  Asiana  Airlines,  KLM,  Delta  Airlines,  Emirates,  Singapore  Airlines,  Qantas,  Saudi  Arabian  Airlines, 

 Alitalia  and  Malaysia  Airlines.  Tenzings  cabin  connectivity  services  are  currently  available  on  airlines  including  Cathay  Pacific  Airways,  Continental  Airlines,  Emirates,  Northwest  Airlines,  United  Airlines,  US  Airways  and 
 Virgin  Atlantic  Airways.  Tenzing  has  developed  a  system  using  software  and  existing  onboard  communications  equipment  to  deliver  text  and  data  to  and  from  aircraft.  See  http://  www.  tenzing.  com/  about/.  Tenzing  email  and 
 text-  messaging  systems  are  on  more  than  800  commercial  aircraft  flown  by  Cathay  Pacific  Airways,  Continental  Airlines,  Iberia,  Northwest  Airlines,  United  Airlines  and  Virgin  Atlantic.  Id. 
 65  See  http://  www.  onair.  aero/  en/  vision/  vision_  strategy_  en.  pdf. 
 66  See  http://  aero.  inmarsat.  com/  markets/  air_  transport.  aspx?  top_  level_  id=  5&  sub_  level_  id=  1. 
 67  See  http://  aero.  inmarsat.  com/  markets/  business_  aviation.  aspx?  top_  level_  id=  5&  sub_  level_  id=  2. 
 68  See  http://  aero.  inmarsat.  com/  markets/  government.  aspx?  top_  level_  id=  5&  sub_  level_  id=  3. 
 69  See  http://  aero.  inmarsat.  com/  markets/  default.  aspx?  top_  level_  id=  5. 
 70  Id. 
 71  See  http://  aero.  inmarsat.  com/  services/  default.  aspx?  top_  level_  id=  3. 
 72  See  http://  aero.  inmarsat.  com/  services/  swift_  64.  aspx?  top_  level_  id=  3&  sub_  level_  id=  1. 
 73  See  http://  aero.  inmarsat.  com/  technology/  enabling_  technologies.  aspx?  top_  level_  id=  6&  sub_  level_  id=  4. 
 74  See  id. 
 75  See  http://  www.  row44.  com/. 
 76  See  id. 
 77  See  Press  Release,  Row  44  Announces  Strategic  Relationship  with  Hughes  Network  Systems  (Sept.  21,  2004), 
 available  at  http://  www.  row44.  com/  press/  2004_  09_  21.  htm. 
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 intends  to  leverage  the  existing  HNS  DIRECWAY  satellite  platform,  which  it  claims  is  capable  of  high-speed  connectivity  of  up  to  30  Mbps  to  aircraft,  to  provide  in-  flight  entertainment,  consumer  services, 
 security,  flight  deck  data,  cabin  crew  operations,  operational  services,  and  emergency  medical  support.  78  The  system  supports  both  wired  and  wireless  WiFi  (802.11)  installations  and  uses  a  lightweight  low-profile 
 radome  (i.  e.,  a  dome-  shaped  antenna  enclosure)  and  steerable  antenna  (only  three  inches  thick)  that  can  simultaneously  provide  DBS  television  and  two-  way  Internet  traffic.  79  Row  44  is  in  discussions 
 with  a  number  of  major  airlines  and  owners  of  business  jet  fleets,  and  system  testing  is  targeted  to  begin  in  early  2005.  80 

 20.  On  September  23,  2004,  AirTV  announced  that  it  has  signed  a  launch  services  agreement  with  Arianespace  81  to  deliver  in-  flight  entertainment  and  connectivity  for  airlines  worldwide.  82  AirTV 
 states  that  its  system  will  provide  more  than  60  channels  of  live  television  (in  multiple  languages)  and  40  Mbps  of  Internet,  e-  mail,  and  data  services  to  aircraft.  83  AirTV  has  adopted  an  incremental  approach  for 
 rollout  of  its  system.  AirTV  plans  to  launch  its  initial  satellite  in  2007  over  the  North  Atlantic  Ocean.  This  satellite  will  cover  airline  routes  from  Europe  and  the  Middle  East  to  North  America  (roughly  one-third 
 of  all  airline  traffic).  84  AirTV's  subsequent  three  satellites  will  be  launched  soon  after,  providing  coverage  for  aircraft  flying  over  nearly  all  of  the  commercial  airline  routes  around  the  globe.  85 

 21.  Although  they  do  not  currently  provide  the  types  of  passenger-  based  phone  and  internet  access  services  that  the  Aeronautical  Mobile  Satellite  Service  is  capable  of  providing,  the  two  operating 
 Big  LEO  (Low  Earth  Orbit)  systems,  Iridium  Satellite  LLC  (Iridium)  and  Globalstar  USA  (Globalstar),  serve  the  aviation  market  for  their  private  communication  needs.  86  Aviation  users  can  access  the  Iridium 
 network  to  send  and  receive  voice,  messaging,  and  data  regardless  of  their  positions  on  or  above  the  earth.  87  Globalstar  provides  specially  designed  communication  solutions  for  in-  flight  voice  and  data 
 services  aboard  both  helicopters  and  fixed-  wing  aircraft.  88  Globalstar  also  provides  internet  connectivity 

 78  Id. 
 79  Id. 
 80  Id. 
 81  See  http://  www.  arianespace.  com/  site/  about/  about_  index.  html. 
 82  See  Press  Release,  AirTV  Signs  With  Arianespace  to  Launch  its  First  Broadband  In-  Flight 
 Entertainment/  Communications  Satellite  in  2007  (Sept.  23,  2004),  available  at  http://  www.  airtv.  net/  press_  release_  092304.  html. 

 83  Id. 
 84  See  http://  www.  airtv.  net/  overview.  html. 
 85  Id. 
 86  Big  LEO  refers  to  low  Earth  orbit  mobile-  satellite  services  above  1  GHz.  Big  LEO  systems  are  subject  to  47 
 C.  F.  R.    25.  136(  a)  (  User  transceiver  units  associated  with  the  1.  6/  2.  4  GHz  Mobile-  Satellite  Service  .  .  .  may  not  be  operated  on  civil  aircraft  unless  the  earth  station  has  a  direct  physical  connection  to  the  aircraft  cabin  or  cockpit 

 communication  system.).  For  more  detail  regarding  the  Big  LEO  licensees,  see  generally  Review  of  the  Spectrum  Sharing  Plan  Among  Non-  Geostationary  Satellite  Orbit  Mobile  Satellite  Service  Systems  in  the  1.6/  2.4  GHz  Bands, 
 Report  and  Order,  Fourth  Report  and  Order  and  Further  Notice  of  Proposed  Rulemaking,  19  FCC  Rcd  13356  (2004). 
 87  See  http://  www.  iridium.  com/  market/  iri_  market-  detail.  asp?  solutionid=  22. 
 88  See  http://  www.  globalstarusa.  com/  en/  products/  aviation.  php. 
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 for  aircraft  through  two  airborne  satellite  telephone  systems.  89 
 22.  AirCell  also  is  interested  in  providing  service  to  commercial  airline  passengers.  In  conjunction  with  its  cellular  licensee  partners,  AirCell  currently  provides,  pursuant  to  waiver,  air-  ground 

 services  to  more  than  1,400  general  aviation  aircraft  using  traditional  cellular  networks  and  frequencies.  90  The  AirCell  operations  employ  existing  ground-  based  cellular  networks  pursuant  to  agreements  with  23 
 cellular  providers.  91  While,  to  date,  AirCell  has  provided  air-  ground  service  only  to  general  aviation  aircraft  over  its  network,  it  has  announced  plans  to  begin  testing  the  service  in  commercial  aircraft.  92 
 AirCell  has  participated  extensively  in  this  proceeding  and  stated  an  interest  in  providing  services  in  the  800  MHz  air-  ground  spectrum. 

 23.  Verizon  Airfone  is  the  sole  incumbent  operating  in  the  800  MHz  air-  ground  spectrum.  The  companys  service  is  available  on  approximately  4,500  aircraft  (including  1,500  commercial 
 aircraft).  93  Verizon  Airfone  generally  charges  a  connection  fee  of  $3.99  for  each  voice  call,  plus  $3.99  per  minute  of  air  time.  94  Verizon  Airfone  has  taken  several  steps  to  enhance  its  services  in  recent  years. 
 The  company  launched  an  in-  flight  data  service  called  JetConnect(  SM)  in  September  2002  on  some  commercial  U.  S.  flights,  including  planes  operated  by  Continental  Airlines,  Inc.  95  JetConnect  service 
 includes  instant  messaging,  online  games,  and  current  news,  priced  at  $5.99  for  an  entire  flight.  96  In  2004,  the  company  introduced  two  new  pricing  plans  for  Verizon  Airfone  voice  calls  made  by  Verizon 
 Wireless  subscribers$  10.00  per  month  and  $0.10  per  minute,  or  $0.69  per  minute  with  no  monthly  fee.  97  Despite  these  efforts,  demand  for  Verizon  Airfone  Service  has  waned  in  recent  years.  American 
 Airlines,  for  example,  has  suspended  Verizon  Airfone  service  due  to  a  sharp  decline  in  passenger 

 89  Id. 
 90  AirCell  and  its  partners  have  been  granted  waivers  of  the  Commissions  rule,  47  C.  F.  R.    22.  925,  prohibiting  the 
 use  of  cellular  phones  on  planes  in  order  to  implement  an  air-  ground  service.  AirCell's  system  uses  specially  designed  mobile  units  and  ground  equipment  to  allow  users  to  access  the  existing  networks  of  AirCell's  cellular 

 licensee  partners  without  causing  the  harmful  interference  against  which  Section  22.  925  was  designed  to  protect.  See  In  the  Matter  of  AirCell,  Inc.,  Petition,  Pursuant  to  Section  7  of  the  Act,  For  a  Waiver  of  the  Airborne  Cellular 
 Rule,  Or,  in  the  Alternative,  for  a  Declaratory  Ruling,  Order,  14  FCC  Rcd  806  (WTB  1998),  recon.  granted  in  part,  denied  in  part,  Order  on  Reconsideration,  14  FCC  Rcd  18430  (WTB  1999),  app.  for  rev.  denied,  Memorandum 
 Opinion  and  Order,  15  FCC  Rcd  9622  (2000),  affirmed  in  part  and  remanded  in  part  sub  nom.,  AT&  T  Wireless  Services,  Inc.,  et  al.,  v.  FCC,  270  F.  3d  959,  968  (D.  C.  Cir.  2001),  pet.  for  rehg  denied  Jan.  29,  2002,  Order  on 
 Remand,  18  FCC  Rcd  (2003),  pet.  for  rev.  denied  sub  nom.,  AT&  T  Wireless  Services,  Inc.  v.  FCC,  365  F.  3d  1095  (D.  C.  Cir.  2004). 
 91  See  www.  Aircell.  com/  about. 
 92  See  id.  AirCell  has  indicated  that,  to  the  extent  any  additional  or  modified  waiver  authority  or  experimental 
 license  is  required  in  order  to  conduct  the  desired  tests  on  commercial  aircraft,  it  will  obtain  such  necessary  authorization.  See  In  the  Matter  of  AirCell,  Inc.,  Petition,  Pursuant  to  Section  7  of  the  Act,  for  a  Waiver  of  the 

 Airborne  Cellular  Rule,  or,  in  the  Alternative,  for  a  Declaratory  Ruling,  Order,  17  FCC  Rcd  19586,  19586-  87  2  (WTB,  CWD  2002).  Nothing  in  AirCells  current  waiver  prohibits  operation  on  commercial,  as  opposed  to  general 
 aviation,  aircraft.  93 
 Verizon  Airfone  Comments  at  12.  94 
 See  http://  www22.  verizon.  com/  airfone/  service/  af_  service_  genrates.  html.  95 
 See  http://  www22.  verizon.  com/  airfone/  service/  af_  service_  genrates.  html#  JetConnect.  96 
 Id.  97 
 See  http://  www22.  verizon.  com/  airfone/  vzw/  vzw_  airfone_  service.  html. 
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 demand.  98  The  service  has  declined  from  up  to  15  users  per  flight,  at  prices  comparable  to  todays  rates,  to  two  or  three  users  per  flight  today.  99 
 3.  Reconfiguration  of  the  800  MHz  Air-  Ground  Radiotelephone  Service  Band 
 24.  In  the  Notice,  we  asked  parties  to  assess  our  current  rules  and  policies  affecting  the  800  MHz  Air-  Ground  Radiotelephone  Service  and  identify  restrictions  or  policies  that  impede  the  competitive 

 provision  of  services  designed  to  meet  consumers  needs.  100  We  asked  whether  any  changes  to  our  rules  could  provide  greater  opportunities  for  the  competitive  provision  of  air-  ground  services,  leading  to  lower 
 prices  to  consumers  and  increased  choices  in  wireless  services  and  enhancements  while  traveling  by  plane.  101  We  specifically  asked  parties  to  make  suggestions  for  rules  and  policies  that  would  achieve 
 more  effective  consumer  choice,  102  and  whether  this  spectrum  should  be  limited  to  air-  ground  use,  or  whether  we  should  allow  for  more  flexible  use.  103  We  sought  comment  on  increasing  the  operational 
 flexibility  afforded  to  air-  ground  licensees  and  whether  such  flexibility  would  raise  any  co-  channel,  adjacent  channel,  or  other  interference  issues,  e.  g.,  with  respect  to  existing  or  future  services  in  the  800 
 MHz  band.  104  We  also  sought  comment  regarding  whether  the  800  MHz  air-  ground  spectrum  is  being  efficiently  used  and  possible  changes  to  our  rules  that  would  encourage  the  use  of  more  innovative, 
 spectrum-  efficient  technologies  that  could  be  utilized  in  this  spectrum  and  how  best  to  promote  deployment  of  such  technology.  105 

 a.  Spectrum  Reconfiguration  Proposals 
 25.  In  response  to  the  Notice,  four  parties  AirCell,  106  Boeing,  107  Space  Data,  108  and  Verizon 
 98  See  American  Airlines  Letters,  supra  note  35. 
 99  See  Joe  Sharkey,  Almost  here:  Cell  phones  at  37,  000  feet,  N.  Y.  Times,  Oct.  10,  2004,  at  C6  (statement  of 
 William  E.  Pallone,  President,  Verizon  Airfone)  .  100 
 Notice,  18  FCC  Rcd  at  8389-  8390    17-  21.  101 
 Id.  at  8389  17.  102 
 Id.  103 
 Id.  at  8390  21.  104 
 Notice,  18  FCC  Rcd  at  8390  20.  The  849-  851  MHz  air-  ground  band  is  immediately  adjacent  to  800  MHz  General  Category  land  mobile  channels  at  851-  854.75  MHz  that  are  used  by  both  public  safety  and  commercial 

 SMR  systems  and  that  are  discussed  in  our  pending  proceeding  on  800  MHz  public  safety  interference  issues.  See  Improving  Public  Safety  Communications  in  the  800  MHz  Band;  Consolidating  the  900  MHz  Industrial/  Land 
 Transportation  and  Business  Pool  Channels,  Notice  of  Proposed  Rule  Making,  17  FCC  Rcd  4873  (2002),  Erratum,  17  FCC  Rcd  7169  (2002).  The  Commission  recently  issued  an  Order  in  that  proceeding,  which  provides,  inter  alia, 
 that  the  NPSPAC  public  safety  channels  will  be  moved  to  spectrum  just  above  851  MHz.  See  Report  and  Order,  Fifth  Report  and  Order,  Fourth  Memorandum  Opinion  and  Order,  and  Order,  19  FCC  Rcd  14969,  15050  at  151 
 (2004),  as  amended  by  Erratum,  19  FCC  Rcd  19651  (2004),  and  Erratum,  19  FCC  Rcd  21818  (2004)  (  800  MHz  Order),  order  clarified  by  Supplemental  Order  and  Order  on  Reconsideration,  FCC  04-  294,  2004  WL  2973805 
 (F.  C.  C.)  (rel.  Dec.  22,  2004).  Below,  we  adopt  a  rule  that  subjects  ground  stations  that  operate  in  the  849-  851  MHz  air-  ground  band  to  the  cellular  interference  rule  adopted  in  the  800  MHz  Order.  See  infra  para.  67. 
 105  Notice,  18  FCC  Rcd  at  8390  19. 
 106  See  AirCell  Comments;  AirCell  Reply  Comments;  Letter  from  Michele  C.  Farquhar,  Hogan  &  Hartson,  to 
 Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  July  27,  2004,  transmitting  Business  Structure  &  Market  Outlook  for  Inflight  Communications  Services;  Letter  from  Michele  C.  Farquhar,  Hogan  & 

 Hartson,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Sept.  9,  2004,  transmitting  AirCell  Response  to  FCC  Questions  at  3-  7  (  AirCell  September  9  Response  to  FCC);  Letter  from  Michele  C. 
 (continued.) 
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 Airfone  109  submitted  detailed  proposals  regarding  revision  of  the  800  MHz  Air-  Ground  Radiotelephone  Service  band  plan  and  rules.  These  parties  uniformly  agree  that  the  800  MHz  air-  ground  band  should  be 
 reconfigured,  and  urge  us  to  adopt  a  band  plan  and  rules  that  would  enable  a  licensee  to  deploy  spectrally-efficient  broadband  technologies,  including  CDMA2000  1xEV-  DO  and  FLASH-  OFDM.  The  parties, 
 however,  offer  different  proposals  for  reconfiguration  of  the  band. 
 26.  AirCell  and  Boeing  jointly  propose  that  we  reconfigure  the  four  megahertz  of  spectrum  in  the  band  into  two  co-  primary,  overlapping  3.0  MHz  licenses.  110  The  parties  propose  that  each  licensee 

 would  initially  share  three  megahertz  of  spectrum  in  the  band  (1.5  MHz  at  849.000-  850.500  MHz  paired  with  1.5  MHz  at  894.000-  895.500  MHz).  111  They  propose  that  one  licensee  use  vertical  radio  wave 
 polarization  and  the  other  use  horizontal  radio  wave  polarization  in  order  to  mitigate  potential  inter-system  interference.  112  This  approach  would  provide  one  megahertz  of  spectrum  (the  upper  0.5  MHz  of 

 (Continued  from  previous  page)  Farquhar,  Hogan  &  Hartson,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Sept. 
 30,  2004,  transmitting  Passenger  Benefits  from  Competition  in  Broadband  Airline  Communications  and  Providing  Deck-  to  Deck  Coverage;  Letter  from  Michele  C.  Farquhar,  Hogan  &  Hartson,  to  Marlene  H.  Dortch, 
 Secretary,  Federal  Communications  Commission,  dated  Oct.  4,  2004,  transmitting  AirCell  October  1  Presentation  to  FCC;  Letter  from  Michele  C.  Farquhar,  Hogan  &  Hartson,  to  Marlene  H.  Dortch,  Secretary,  Federal 
 Communications  Commission,  dated  Dec.  6,  2004,  transmitting  Air-  to-  Ground  Myths  &  Realities  at  4  (  AirCell  Air-  to-  Ground  Myths  &  Realities);  Declaration  of  Paul  A.  London  on  behalf  of  AirCell,  dated  Dec.  7,  2004 
 (  AirCell  London  Declaration).  107 
 See  Connexion  by  Boeing  Proposed  Rules  Governing  Operation  of  Multiple  800  MHz  Air  to  Ground  Systems  (Sept  10,  2004);  Letter  from  Howard  J.  Symons,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications 

 Commission,  dated  Dec.  8,  2004  (  Boeing  December  8  Ex  parte).  108 
 See  Space  Data  Reply  Comments;  Space  Datas  Proposed  ATG  Rules  (June  10,  2004);  Letter  from  Cheryl  A.  Tritt,  Morrison  &  Foerster  LLP,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated 

 Sept.  9,  2004,  transmitting  Space  Data  Corporation:  Air-  to-  Ground  Analysis  (  Space  Data  September  9  Analysis);  Letter  from  Cheryl  A.  Tritt,  Morrison  &  Foerster  LLP,  to  Marlene  H.  Dortch,  Secretary,  Federal 
 Communications  Commission,  dated  Nov.  17,  2004,  transmitting  Space  Data  November  16,  2004  Presentation;  Letter  from  Cheryl  A.  Tritt,  Morrison  &  Foerster  LLP,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications 
 Commission,  dated  Nov.  29,  2004,  transmitting  AirCells  Criticisms  of  Space  Datas  ATG  Proposals  are  Inaccurate  and  Completely  Unsubstantiated  (  Space  Data  November  29  Analysis);  Ex  parte  Presentation  of  Gerald 
 Knoblach,  CEO,  Space  Data  dated  Dec.  8,  2004  (  Space  Data  December  8  Ex  parte).  109 
 See  Verizon  Airfone  Comments;  Verizon  Airfone  Reply  Comments;  Verizon  Airfone  has  Legal  and  Equitable  Rights  as  the  Only  Qualified  Licensee  Providing  In-  Flight  Services  to  the  Public  at  5-  6  (Sept.  9,  2004)  (  Verizon 

 Airfone  September  9  Statement);  Verizon  Airfone  Response  to  Air-  to-  Ground  Licensing  Scenario  Under  Consideration  by  the  FCC  at  5  (Sept.  10,  2004)  (  Verizon  Airfone  September  10  Response  to  FCC). 
 110  See  AirCell  Further  Notes  on  the  Deployment  of  Two  Cross-  Polarized  Systems  in  the  ATG  Band  and  Response 
 to  Verizon  Airfone/  Telcordia  at  3  (Nov.  23,  2004)  (  AirCell  Further  Notes  on  the  Deployment  of  Two  Cross-Polarized  Systems);  Letter  from  Michele  C.  Farquhar,  Hogan  &  Hartson,  to  Marlene  H.  Dortch,  Secretary,  Federal 

 Communications  Commission,  dated  Nov.  12,  2004,  transmitting  AirCell  Two  Cross-  Polarized  Systems  in  the  ATG  Band;  Letter  from  Michele  C.  Farquhar,  Hogan  &  Hartson,  to  Marlene  H.  Dortch,  Secretary,  Federal 
 Communications  Commission,  dated  Oct.  21,  2004,  transmitting  Deployment  of  two  Cross-  Polarized  Systems  in  the  ATG  Band  (  AirCell/  Boeing  Joint  Proposal).  See  Letter  from  Howard  J.  Symons,  to  Marlene  H.  Dortch, 
 Secretary,  Federal  Communications  Commission,  dated  Oct.  21,  2004  (confirming  Boeings  concurrence  in  joint  proposal  with  AirCell).  AirCell  and  Boeing  each  filed  several  separate  proposals  to  reconfigure  the  air-  ground 
 spectrum  during  the  course  of  this  proceeding  before  submitting  the  AirCell/  Boeing  Joint  Proposal.  111 
 See  AirCell/  Boeing  Joint  Proposal  at  4.  112 
 See  id.  at  3-  4. 
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 each  2  MHz  band)  to  accommodate  Verizon  Airfones  incumbent  system  for  a  limited  transition  period.  113  Following  the  transition  period,  the  licensee  using  horizontal  radio  wave  polarization  would  shift  its 
 operations  to  1.5  MHz  at  849.500-  851.000  MHz  paired  with  1.5  MHz  at  894.500-  896.000  MHz,  and  each  licensees  spectrum  would  overlap  the  others  spectrum  by  60  percent.  The  parties  suggest  that  the 
 Commission  specify  ground  station  spacing  based  on  the  existing  site  list  for  the  air-  ground  service.  114  The  parties  propose  that  sites  serving  the  same  airspace  be  located  within  two  miles  of  each  other  and  that 
 the  licensees  coordinate  the  location  of  new  sites.  115 
 27.  Verizon  Airfone,  the  sole  incumbent  in  the  800  MHz  air-  ground  band,  initially  proposed  that  the  four  megahertz  of  spectrum  in  the  band  be  licensed  to  one  exclusive  licensee,  and  contended  that 

 it  should  receive  the  license  without  an  auction  based  on  its  incumbent  status.  116  More  recently,  Verizon  Airfone  supports  reconfiguring  the  band  into  an  exclusive  3  MHz  license  and  an  exclusive  1  MHz 
 license.  117 
 28.  Space  Data  proposes  the  use  of  combinatorial  bidding  to  determine  configuration  of  the  800  MHz  air-  ground  band.  118  Based  on  the  outcome  of  an  auction,  Space  Datas  proposal  would 

 accommodate  one  of  three  band  configurations(  1)  a  shared  licensing  approach  with  overlapping  2.75  MHz  and  3  MHz  licenses,  (2)  exclusive  3MHz  and  1  MHz  licenses,  or  (3)  exclusive  2.75  MHz  and  1.25 
 MHz  licenses.  119  Space  Data  also  has  proposed  the  use  of  combinatorial  bidding  procedures  to  auction  three  exclusive  1.33  MHz  spectrum  blocks  or  two  exclusive  1.5  MHz  blocks  and  two  shared  1.0  MHz 
 blocks.  120  The  latter  approach  would  permit  either  exclusive  or  shared  licensing  of  the  band.  121 
 b.  Available  Air-  Ground  Band  Plans 
 29.  We  have  reviewed  the  extensive  record  in  this  proceeding  and  carefully  weighed  the  parties  competing  proposals  to  reconfigure  the  800  MHz  air-  ground  spectrum  band.  We  conclude  that 

 the  public  interest  will  be  served  by  adopting  a  flexible  framework  that  will  enable  interested  parties  to  bid  on  spectrum  licenses  according  to  the  band  configuration  that  they  believe  will  best  meet  their  needs 
 for  the  provision  of  air-  ground  services.  Interested  parties  may  bid  on  spectrum  licenses  in  any  of  the  following  three  band  plans,  122  including  two  overlapping,  shared,  cross-  polarized  spectrum  licenses  (band 
 plan  1)  as  advocated  by  AirCell  and  Boeing  and  exclusive  spectrum  licenses  (band  plans  2  and  3)  as  proposed  by  Space  Data  and  Verizon  Airfone.  Licenses  will  have  a  ten-  year  term. 

 113  See  id.  at  4. 
 114  See  id.  at  8.  See  47  C.  F.  R.    22.  859. 
 115  See  AirCell/  Boeing  Joint  Proposal  at  8. 
 116  Verizon  Airfone  Comments  at  8-  12. 
 117  See,  e.  g.,  Verizon  Airfone  September  10  Response  to  FCC. 
 118  See  Space  Data  November  16,  2004  Presentation  at  7-  9. 
 119  See  id.  at  8. 
 120  See  Space  Data  October  13  Presentation  at  3-  6. 
 121  Space  Data  also  has  proposed  two  exclusive  1.6  MHz  licenses  for  GSM,  and  a  single  0.8  MHz  license  to 
 accommodate  the  incumbent  system.  See  Space  Data  November  16,  2004  Presentation.  Alternatively,  the  company  suggested  that  an  additional  100  kilohertz  of  spectrum  be  allocated  to  accommodate  2.  5  MHz  and  1.6  MHz  spectrum 

 blocks  for  CDMA  and  GSM,  respectively.  Id.  122 
 The  band  configurations  are  illustrated  above  at  paragraph  1. 
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 Band  plan  1  two  overlapping,  shared,  cross-  polarized  3  MHz  licenses  (licenses  A  and  B,  respectively).  123 
 Band  plan  2  an  exclusive  3  MHz  license  and  an  exclusive  1  MHz  license  (licenses  C  and  D,  respectively).  124 
 Band  plan  3  an  exclusive  1  MHz  license  and  an  exclusive  3  MHz  license  (licenses  E  and  F,  respectively),  with  the  blocks  at  opposite  ends  of  the  band  from  the  third  configuration.  125 
 The  Commission  will  award  licenses  to  winning  bidders  for  the  licenses  comprising  the  band  plan  that  receives  the  highest  aggregate  gross  bid,  subject  to  long-  form  license  application  review.  In  order  to 
 further  competition  and  ensure  maximum  use  of  this  frequency  band  for  air-  ground  services,  no  party  will  be  eligible  to  hold  more  than  one  of  the  spectrum  licenses  being  made  available.  126 

 30.  We  believe  this  flexible  approach  to  configuration  of  the  band  will  promote  our  goal  in  this  proceeding  of  facilitating  the  highest  valued  use  of  this  scarce  spectrum  resource,  resulting  in  the 
 provision  of  wireless  communications  services  that  better  meet  the  needs  of  the  traveling  public  onboard  aircraft.  127  We  also  further  our  strategic  objective  to  encourage  the  growth  and  rapid  deployment  of 
 innovative  and  efficient  communications  technologies  and  services  128  by  adopting  rules  that  will  permit  licensees  to  deploy  any  current  or  future  technology  with  an  occupied  bandwidth  that  fits  within  its 
 assigned  spectrum  and  to  provide  any  kind  of  air-  ground  service  to  any  type  of  aircraft.  As  explained  below,  we  also  provide  a  transition  period  for  the  incumbent  system  currently  operated  by  Verizon 
 Airfone.  129 
 31.  The  parties  urge  us  to  reconfigure  the  air-  ground  band  to  enable  the  deployment  of  CDMA2000  1xEV-  DO  and/  or  FLASH-  OFDM  technologies  in  the  air-  ground  band  in  order  to  deliver 

 high-  speed  communications  services  to  consumers  onboard  aircraft.  130  We  conclude  that  a  3  MHz  spectrum  block  (comprised  of  1.5  MHz  paired  channels)  will  provide  sufficient  spectrum  to  deploy  these 
 technologies  in  the  air-  ground  band.  The  originators  of  these  technologies,  QUALCOMM  Incorporated 

 123  Licenses  A  and  B  would  be  vertically  and  horizontally  polarized,  respectively,  and  would  initially  share  1.  5  MHz 
 at  849.000-  850.  500  MHz  paired  with  1.5  MHz  at  894.000-  895.500  MHz.  If  band  plan  1  is  implemented,  the  parties  may  agree  to  a  different  implementation  scheme.  Once  Verizon  Airfones  incumbent  system  ceases  operations  in 

 the  upper  0.5  MHz  of  each  band,  licensee  B  would  shift  its  operations  to  1.  5  MHz  at  849.  500-  851.  000  MHz  paired  with  1.  5  MHz  at  894.  500-  896.000  MHz. 
 124  License  C  would  be  located  in  the  lower  1.5  MHz  portion  of  each  2  MHz  band  (1.5  MHz  at  849.000-  850.500 
 MHz  paired  with  1.  5  MHz  at  894.000-  895.500  MHz).  License  D  would  be  located  in  the  upper  0.5  MHz  portion  of  each  2  MHz  band  (0.5  MHz  at  850.500-  851.000  MHz  paired  with  0.5  MHz  at  895.500-  896.000  MHz). 

 125  License  E  would  be  located  in  the  lower  0.5  MHz  portion  of  each  2  MHz  band  (0.5  MHz  at  849.000-  849.500 
 MHz  paired  with  0.  5  MHz  at  894.000-  894.500  MHz).  License  F  would  be  located  in  the  upper  1.5  MHz  portion  of  each  2  MHz  band  (1.5  MHz  at  849.500-  851.000  MHz  paired  with  1.5  MHz  at  894.500-  896.000  MHz). 

 126  See  infra  paras.  39-  44. 
 127  See  Notice,  18  FCC  Rcd  at  8389  17. 
 128  Federal  Communications  Commission,  Strategic  Plan  FY  2003-  FY  2008  at  5  (2002). 
 129  See  infra  paras.  75-  76. 
 130  AirCell,  Boeing,  Space  Data,  and  Verizon  Airfone  each  urge  us  to  enable  the  deployment  of  CDMA.  See,  e.  g., 
 AirCell  October  13  Presentation  at  5;  Boeing  Proposed  Rules  at  n.  2.  Verizon  Airfone  also  urges  us  to  enable  the  deployment  of  FLASH-  OFDM.  See  Verizon  Airfone  Response  to  FCC  at  5. 
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 (CDMA)  and  Flarion  Technologies  Inc.  (OFDM),  both  state  that  125  kHz  guard  bands  are  required  on  each  side  of  a  1.25  MHz  wide  carrier  to  deploy  their  respective  technologies,  131  and  that  a  3  MHz 
 spectrum  block  (comprised  of  1.5  MHz  paired  channels)  would  provide  sufficient  spectrum  to  deploy  these  technologies  in  the  band.  AirCell,  Boeing,  and  Verizon  Airfone  concur  that  guard  bands  are 
 necessary.  132  Accordingly,  in  view  of  the  foregoing  and  our  goal  to  encourage  the  deployment  of  spectrally  efficient  technologies  in  the  air-  ground  band,  each  of  the  three  band  plans  includes  at  least  one 
 spectrum  license  of  3  MHz. 
 32.  In  addition,  future  licensees  in  the  800  MHz  air-  ground  band,  as  well  as  other  interested  parties,  will  have  the  opportunity  to  engage  in  spectrum  leasing  under  our  rules.  133  Future  licensees  will 

 also  be  permitted  to  engage  in  partitioning  and/  or  disaggregation  of  their  licenses.  134  These  regulatory  opportunities  are  intended  to  provide  the  air-  ground  marketplace  greater  flexibility  to  respond  to 
 consumer  demand. 
 33.  Below,  we  address  the  location  of  ground  stations,  the  provision  of  deck-  to-  deck  service  (i.  e.,  service  from  takeoff  to  landing),  competitive  considerations,  and  the  provision  of  services  in  the  air-ground 

 band. 
 (i)  Location  of  Ground  Stations 
 34.  Band  plans  2  and  3  provide  for  exclusive  spectrum  licensing  and  will  afford  new  licensees  significant  flexibility  to  configure  and  modify  their  systems  to  address  current  and  future  market 
 conditions.  For  example,  licensees  will  be  able  to  initially  configure  their  systems  to  best  meet  the  needs  of  their  customers,  and  may  flexibly  reconfigure  or  add  ground  stations  to  respond  to  future  demand  for 
 air-  ground  services.  135  An  exclusive  licensee  also  could  deploy  new  technologies  in  response  to  changing  market  conditions  without  having  to  coordinate  its  choice  of  technology  with  another  licensee  in  the 
 band.  136  If  the  band  is  comprised  of  two  overlapping  3  MHz  licenses  (band  plan  1),  the  new  licensees  will  be  required  to  jointly  file  a  spectrum  sharing  and  site  selection  plan  with  the  Wireless 
 Telecommunications  Bureau  within  six  months  of  the  initial  grant  of  their  spectrum  licenses,  137  and  will  be  required  to  notify  the  Bureau  of  any  changes  to  the  plan.  The  Wireless  Telecommunications  Bureau 
 will  issue  a  public  notice  prior  to  the  Commissions  auction  of  new  800  MHz  air-  ground  spectrum 

 131  See  Letter  from  Dean  R.  Brenner,  Senior  Director,  Government  Affairs,  QUALCOMM  Incorporated,  to  Marlene 
 H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Sept.  3,  2004,  at  2;  Letter  from  Michael  J.  Thornton,  Flarion  Technologies  Inc.,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated 

 Sept.  2,  2004,  at  1.  132 
 See  AirCell  October  13  Presentation  at  5;  Boeing  Proposed  Rules  at  n.  2;  Verizon  Airfone  Response  to  FCC  at  5.  Space  Data,  however,  suggests  that  CDMA  could  be  deployed  in  2.5  MHz.  See  Space  Data  December  8  Ex  parte. 

 133  See  47  C.  F.  R.    1.9005. 
 134  See  47  C.  F.  R.    1.  948(  e)  &  (f). 
 135  The  FAA  forecasts  that,  over  the  ten-  year  period  from  2005  through  2015,  aviation  passenger  traffic  is  expected 
 to  increase  by  45  percent,  to  over  one  billion  passengers.  See  Views  and  Estimates  of  the  Committee  on  Transportation  and  Infrastructure  for  FY  2005,  located  at  http://  www.  house.  gov/  transportation/  views2005.  html. 

 136  Certain  spacing  requirements  are  necessary  in  border  areas. 
 137  In  the  event  that  the  parties  determine  that  more  than  six  months  is  required  to  prepare  and  file  the  plan,  they  may 
 request  an  extension  of  the  six-  month  period. 
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 licenses  in  which  it  will  specify  the  filing  requirements  for  the  plan.  138  This  approach  would  provide  parties  with  overlapping  spectrum  licenses  flexibility  to  configure  their  systems  without  having  to  adhere 
 to  minimum  spacing  requirements  or  site  locations  dictated  by  the  Commission.  AirCell,  which  supports  spectrum  sharing  in  the  band,  observes  that  parties  with  overlapping  licenses  would  act  with  enlightened 
 self-  interest  and  cooperate  in  the  site  selection  process.  139 
 (ii)  Provision  of  Deck-  to-  Deck  Service 
 35.  The  record  reflects  that  parties  desire  deck-  to-  deck  service  (i.  e.,  service  from  terminal  to  terminal).  The  Federal  Air  Marshal  (FAM)  Service,  for  example,  urges  us  to  ensure  that  communications 
 capabilities  in  the  air-  ground  band  are  fully  operational  during  all  phases  of  a  commercial  flight.  140  We  note  that  air-  ground  communications  services  are  currently  provided  to  Federal,  State,  and  local  agencies, 
 including  the  FBI,  the  U.  S.  Department  of  Energy,  and  the  U.  S.  Customs  Service,  141  and  that  the  air-ground  spectrum  can  be  used  to  support  aircraft  management,  other  public  safety  services,  and  homeland 
 security  communications.  In  view  of  the  foregoing  and  in  light  of  our  statutory  mandate  to  promote  the  safety  of  life  and  property,  142  we  have  selected  three  band  plans  that  would  enable  licensees  to  provide 
 deck-  to-  deck  service. 
 36.  An  exclusive  licensing  approach  (band  plans  2  and  3)  would  facilitate  the  provision  of  service  continuously  because  ground  stations  can  be  located  without  inter-  system  coordination  and  would 

 not  have  to  be  limited  in  power  or  sector  orientation  by  the  presence  of  an  overlapping  licensee.  If  a  spectrum  sharing  approach  (band  plan  1)  is  selected  by  the  auction  winners,  the  record  indicates  that  the 
 parties  will  have  to  agree  on  power  limits  and  sharing  rules  to  facilitate  the  full  provision  of  deck-  to-  deck  service.  AirCell  suggests  that  a  licensee  could  deploy  a  hybrid  system  that  uses  terrestrial  spectrum  (such 
 as  cellular  or  PCS  spectrum)  to  provide  service  at  low  altitudes  in  the  vicinity  of  airports.  143  As  noted  above,  in  the  event  that  applicants  seeking  band  plan  1  win  at  auction,  the  new  licensees  will  have  to 
 jointly  file  a  spectrum  sharing  plan  with  the  Wireless  Telecommunications  Bureau,  which  may  include  terms  to  facilitate  the  provision  of  deck-  to-  deck  service. 

 (iii)  Competitive  Considerations 
 37.  AirCell  and  Boeing  urge  us  to  configure  the  800  MHz  air-  ground  band  into  two  overlapping  3.0  MHz  licenses,  claiming  that  because  shared  use  is  possible  under  rules  that  they  propose, 
 consumers  would  benefit  from  having  two  providers  in  the  band  each  with  access  to  three  megahertz  of  spectrum.  144  As  noted  above,  however,  such  a  spectrum  sharing  regime  would  require  the  Commission  to 

 138  We  note  that  the  parties  may  seek  confidential  treatment  of  the  plan  in  accordance  with  the  Commissions  rules 
 and  policies.  See,  e.  g.,  47  C.  F.  R.    0.459.  139 
 See  AirCell  Further  Notes  on  the  Deployment  of  Two  Cross-  Polarized  Systems  at  3.  140 
 See  Letter  from  Robert  S.  Bray,  Deputy  Assistant  Director,  Federal  Air  Marshal  Service,  U.  S.  Immigration  and  Customs  Enforcement,  U.  S.  Department  of  Homeland  Security,  to  Marlene  H.  Dortch,  Secretary,  Federal 

 Communications  Commission,  dated  Nov.  2,  2004.  141 
 See,  e.  g.,  AirCell  October  1  Presentation  to  FCC  at  3.  142 
 47  U.  S.  C.    151.  143 
 AirCell  states  that  a  handoff  of  traffic  between  an  air-  ground  system  and  a  terrestrial  system  at  500  feet  would  facilitate  the  provision  of  deck-  to-  deck  service.  See  AirCell  Two  Cross-  Polarized  Systems  in  the  ATG  Band  at  3-  5. 

 See  also  AirCell  Further  Notes  on  the  Deployment  of  Two  Cross-  Polarized  Systems  at  4-  7.  144 
 See  AirCell  September  9  Response  to  FCC  at  1-  2;  Boeing  Response  to  Verizon  Airfones  Ex  parte  Presentation  of  September  3  and  10,  2004  at  4-  5. 
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 dictate  rules  such  as  requiring  that  the  parties  coordinate  ground  station  locations  or  adhere  to  spacing  criteria.  AirCell,  moreover,  notes  that  if  licensees  that  share  spectrum  wish  to  deploy  incompatible 
 technologies,  one  of  the  licensees  may  have  to  acquire  spectrum  in  another  band  suitable  for  air-  ground  service.  145  We  conclude  that  adopting  only  the  spectrum  sharing  proposal  of  AirCell  and  Boeing  and 
 incorporating  it  into  our  rules  may  unnecessarily  limit  a  licensees  ability  to  respond  to  changing  market  conditions  and  provide  optimal  air-  ground  broadband  services  to  the  public.  We  therefore  make  available 
 a  sharing  plan  that  would  permit  the  licensees,  rather  than  the  Commission,  to  determine  appropriate  and  necessary  sharing  rules.  In  order  to  provide  potential  licensees  requiring  additional  flexibility  with  the 
 ability  to  operate  without  sharing  requirements,  we  also  make  available  exclusive  licensing  plans  as  well.  The  holder  of  an  exclusive  spectrum  block  could,  for  example,  flexibly  site  its  ground  stations  and  select 
 any  technology  without  having  to  coordinate  with  another  operator  in  the  band.  Accordingly,  we  provide  for  both  shared  and  exclusive  licensing  options. 

 38.  The  flexible  band  configuration  approach  that  we  adopt  today  will  enable  interested  parties  to  bid  on  overlapping  spectrum  licenses  (band  plan  1)  as  proposed  by  AirCell  and  Boeing  in  the 
 event  that  they  believe  spectrum  sharing  will  best  meet  their  needs  for  the  provision  of  air-  ground  services.  Under  this  approach,  the  individual  licensees  rather  than  the  Commission,  as  suggested  by 
 AirCell  and  Boeing  would  determine  the  criteria  for  ground  station  locations  and  other  technical  requirements  necessary  to  facilitate  the  provision  of  broadband  services  on  an  overlapped  basis. 
 Moreover,  in  lieu  of  codifying  their  sharing  plan  into  the  Commissions  rules,  any  sharing  plan  that  the  winning  bidders  develop  between  themselves  can  be  modified  at  any  time  without  their  having  to  seek  a 
 change  in  the  rules.  If  band  plan  1  is  implemented,  we  expect  the  parties  to  engage  in  good  faith  negotiations  in  developing  and  implementing  their  spectrum  sharing  plan.  If  the  two  licensees  cannot 
 agree  on  a  spectrum  sharing  plan  or  if  a  dispute  arises  under  their  initial  or  amended  agreement,  we  would  encourage  them  to  use  binding  arbitration  or  other  alternative  dispute  resolution  procedures. 
 Alternatively,  either  party  may  request  that  the  Commission  resolve  major  disputes  by  filing,  for  example,  a  petition  for  declaratory  ruling;  the  Commission  would  endeavor  to  resolve  such  matters  expeditiously. 

 39.  Eligibility  Restriction.  A  number  of  commenting  parties  urge  us  to  promote  competition  in  the  800  MHz  air-  ground  band.  146  T-  Mobile  USA,  for  example,  supports  licensing  multiple  providers  in 
 the  band  if  it  is  technically  feasible.  147  AirCell,  Boeing,  and  Space  Data  state  that  we  should  limit  eligibility  to  prevent  a  single  entity  from  obtaining  all  four  megahertz  of  spectrum  in  the  band.  148  Verizon 

 145  See  AirCell  Air-  to-  Ground  Myths  &  Realities  at  4. 
 146  See,  e.  g.,  Letter  from  the  Honorable  Fred  Upton,  Chairman,  House  Energy  and  Commerce  Subcommittee  on 
 Telecommunications  and  the  Internet,  to  Michael  Powell,  Chairman,  Federal  Communications  Commission,  dated  Dec.  10,  2004  (the  Commission  should  enable  competition  in  the  air-  to-  ground  marketplace);  Letter  from  the 

 Honorable  Conrad  Burns,  Deputy  Whip,  United  States  Senate,  to  Michael  Powell,  Chairman,  Federal  Communications  Commission,  dated  Dec.  1,  2004  (the  Commission  should  formulate  a  policy  that  promotes 
 competition  in  air-  ground  services);  Letter  from  Robert  C.  Land,  Vice  President  of  Government  Affairs  and  Associate  General  Counsel,  JetBlue  Airways,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications 
 Commission,  dated  Dec.  6,  2004;  Letter  from  Luisa  L.  Lancetti,  Vice  President,  Wireless  Regulatory  Affairs,  Sprint,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  3,  2004;  Letter  from  Edward  P. 
 Faberman,  Executive  Director,  Air  Carrier  Association  of  America,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Oct.  4,  2004. 
 147  See  Letter  from  Thomas  J.  Sugrue,  Vice  President,  Government  Affairs,  T-  Mobile  USA,  to  Marlene  H.  Dortch, 
 Secretary,  Federal  Communications  Commission,  dated  Nov.  15,  2004.  148 
 See  AirCell  Air-  to-  Ground  Myths  &  Realities  at  4;  Letter  from  Howard  J.  Symons,  Mintz  Levin  Cohn  Ferris  Glovsky  and  Popeo,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Nov.  16,  2004, 

 (continued.) 
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 Airfone,  however,  contends  that  we  should  make  available  all  four  megahertz  of  spectrum  in  the  band  to  a  single  party  on  an  exclusive  basis.  149 
 40.  In  developing  the  available  band  plan  options,  we  have  considered  the  potential  harms  and  benefits  that  may  accrue  from  the  possibility  of  a  single  provider  in  this  band  versus  opportunities  for 
 multiple  service  providers.  We  have  also  weighed  the  possible  harms  and  benefits  in  the  context  of  our  goal  in  this  proceeding  of  facilitating  the  highest  valued  use  of  this  spectrum,  resulting  in  the  provision  of 
 wireless  telecommunications  services  onboard  aircraft  that  better  meet  the  needs  of  the  traveling  public.  150  Included  in  this  balancing,  we  have  considered  not  only  the  existence  of  emerging  satellite-  based 
 competition  151  but  also  the  availability  of  other  spectrum  for  the  provision  of  air-  ground  service.  152  In  addition,  we  have  taken  into  account  the  fact  that  our  new  air-  ground  band  plan  and  rules  will  provide  an 
 adequate  amount  of  spectrum  for  the  provision  of  new  high-  speed  wireless  services  using  the  800  MHz  air-  ground  spectrum  that  cannot  be  provided  under  our  current  rules,  and  we  anticipate  that  any  future 
 provider  will  take  advantage  of  the  new  rules  to  provide  services  that  will  compete  more  directly  with  broadband  air-  ground  providers  operating  from  different  platforms.  Therefore,  we  find  that  the  air-ground 
 band  plan  and  the  flexible  service  rules  that  we  adopt  today  are  likely  to  enhance  intermodal  air-ground  competition  even  if  ultimately  only  one  entity  operates  in  the  800  MHz  air-  ground  band. 

 41.  Nevertheless,  in  light  of  the  very  limited  amount  of  spectrum  (four  megahertz)  available  in  the  800  MHz  air-  ground  band,  we  conclude  that  the  public  interest  would  be  served  by  ensuring  access 
 to  this  spectrum  by  more  than  one  entrant  by  prohibiting  any  single  party  from  controlling  more  than  three  megahertz  of  spectrum  in  the  band.  Although  other  spectrum  and  platforms  will  be  available  for  the 
 provision  of  domestic  air-  ground  service,  the  800  MHz  air-  ground  band  constitutes  the  only  four  megahertz  of  spectrum  dedicated  specifically  to  the  commercial  air-  ground  service  in  the  United  States. 
 Thus,  there  is  currently  no  guarantee  that  any  spectrum  other  than  the  800  MHz  air-  ground  band  and  the  spectrum  used  by  satellite  services  will  in  fact  be  used  for  commercial  air-  ground  service.  We 
 accordingly  conclude  that  it  is  in  the  public  interest  to  promote  competition  by  ensuring  that  at  least  two  parties  will  have  an  opportunity  to  provide  service  in  the  800  MHz  air-  ground  band.  Other  providers  will 
 be  able  to  access  the  spectrum  through  secondary  markets,  resale  or  similar  means.  153  In  addition,  the  record  demonstrates  that  no  more  than  three  megahertz  of  spectrum  is  required  to  deliver  high-  speed  air-ground 
 services  using  todays  broadband  technologies.  154  Permitting  one  party  to  control  the  entire  four  megahertz  of  spectrum  comprising  the  band  therefore  could  result  in  one  megahertz  of  spectrum  (25 
 percent  of  the  band)  lying  fallow,  which  would  undermine  our  goal  of  promoting  the  highest  valued  use  of  this  spectrum.  As  discussed  below,  we  find  that  the  holder  of  a  1  MHz  spectrum  block  could  provide  a 
 meaningful  competitive  alternative  to  air-  ground  services  currently  offered  by  Globalstar  and  Iridium,  could  offer  more  robust  applications  than  currently  provided  by  AirCell  and  Verizon  Airfone  once  the 
 latter  discontinues  its  narrowband  operations  in  the  1  MHz  spectrum  block,  and  could  offer  services  superior  to  Air-  Ground  Radiotelephone  Automated  Service  (AGRAS)  stations  in  the  454/  459  MHz  band. 
 (Continued  from  previous  page)  transmitting  Bidders  in  an  ATG  Auction  Should  Be  Limited  To  Acquiring  a  Single  License  (  Boeing  November 
 16  Ex  parte);  Space  Data  November  16,  2004  Presentation  at  7-  9.  149 
 See  Letter  from  Donald  C.  Brittingham,  Director-  Wireless/  Spectrum  Policy,  Verizon,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  8,  2004. 

 150  See  Notice,  18  FCC  Rcd  at  8389  17. 
 151  See  supra  paras.  14-  20. 
 152  See  infra  para.  45. 
 153  See  supra  para.  32. 
 154  See  supra  para.  31. 
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 A  1  MHz  spectrum  block  could  support  such  applications  as  email  service,  Internet  access,  messaging  services,  avionic  support,  and  homeland  security  services.  155  Given  the  many  potential  uses  of  a  1  MHz 
 spectrum  block,  restricting  the  access  of  any  single  party  to  three  megahertz  of  the  spectrum  not  only  will  increase  the  air-  ground  service  choices  available  to  consumers,  but  also  will  ensure  the  efficient  use  of 
 this  spectrum.  We  also  believe  that  promoting  competition  in  the  band  and  with  satellite-  based  service  providers  will  serve  the  public  interest  by  spurring  technological  innovation.  156  In  light  of  these  findings, 
 we  conclude  that  it  is  in  the  public  interest  to  have  two  licensees  in  this  band. 
 42.  The  Commission  has  previously  determined  that  an  eligibility  restriction  may  be  imposed  when  open  eligibility  poses  a  significant  likelihood  of  substantial  harm  to  competition  in  specific  markets 

 and  when  a  restriction  will  be  effective  in  eliminating  that  harm.  157  AirCell,  Boeing,  and  Space  Data  argue  that  we  should  prevent  a  single  entity  from  obtaining  all  four  megahertz  of  spectrum  in  the  800 
 MHz  air-  ground  band,  158  but  they  do  not  specifically  address  whether  open  eligibility  in  the  band  would  result  in  a  significant  likelihood  of  substantial  competitive  harm  in  the  air-  ground  market.  In  light  of  our 
 findings  above  that  three  megahertz  is  an  adequate  amount  of  spectrum  to  provide  new  services  and  that  an  eligibility  restriction  is  in  the  public  interest,  we  conclude  that  it  is  unnecessary  at  this  time  for  us  to 
 determine  whether  there  would  be  a  significant  likelihood  of  substantial  harm  to  competition  if  we  imposed  no  eligibility  restrictions  in  this  band.  Although  we  do  not  apply  the  competitive  harm 
 standard  in  this  proceeding,  as  this  market  develops  we  will,  as  in  other  contexts,  consider  a  waiver  of  the  eligibility  rule  based  on  a  showing  that  market  conditions  and  other  factors  would  favor  common  control 
 of  more  than  three  megahertz  without  resulting  in  a  significant  likelihood  of  substantial  competitive  harm.  159 

 43.  In  view  of  the  foregoing,  we  will  prohibit  any  party  from  obtaining  a  controlling  interest,  either  at  auction  or  by  a  post-  auction  transaction,  in  more  than  three  megahertz  of  spectrum  (either  shared 
 or  exclusive)  in  the  800  MHz  air-  ground  band.  Each  of  the  three  band  configurations  contains  two  licenses  and  each  includes  at  least  one  3  MHz  license.  Accordingly,  no  party  may  have  a  controlling 

 155  See  infra  para.  49. 
 156  See  AirCell  London  Declaration  at  9  16  (noting  that  [  c]  ompetition  between  providers  would  encourage 
 innovation  and  deployment  of  new  technologies).  157 
 See,  e.  g.,  Allocations  and  Service  Rules  for  the  71-  76  GHz,  81-  86  GHz  and  92-  95  GHz  Bands,  Report  and  Order,  18  FCC  Rcd  23318,  23346-  47    69-  70  (2003);  Amendment  of  Parts  2  and  25  of  the  Commission's  Rules  to  Permit 

 Operation  of  NGSO  FSS  Systems  Co-  Frequency  with  GSO  and  Terrestrial  Systems  in  the  Ku-  Band  Frequency  Range,  Amendment  of  the  Commission's  Rules  to  Authorize  Subsidiary  Terrestrial  Use  of  the  12.  2-  12.7  GHz  Band 
 by  Direct  Broadcast  Satellite  Licensees  and  Their  Affiliates,  and  Applications  of  Broadwave  USA,  PDC  Broadband  Corporation,  and  Satellite  Receivers,  Ltd.  to  Provide  a  Fixed  Service  in  the  12.2-  12.7  GHz  Band,  Memorandum 
 Opinion  and  Order  and  Second  Report  and  Order,  17  FCC  Rcd  9614,  9677-  82    159-  70  (2002);  Amendment  of  the  Commission's  Rules  Regarding  the  37.  0-  38.6  GHz  and  38.  6-  40.0  GHz  Bands,  Implementation  of  Section  309(  j)  of 
 the  Communications  Act  -  Competitive  Bidding,  37.  0-  38.  6  GHz  and  38.  6-  40.0  GHz,  Report  and  Order  and  Second  Notice  of  Proposed  Rule  Making,  12  FCC  Rcd  18600,  18619-  20    32-  35  (1997). 
 158  See,  e.  g.,  AirCell  London  Declaration  at  16  30  (  the  FCC  should  not  risk  auctioning  a  single  ATG  license); 
 Boeing  November  16  Ex  parte  at  1  (noting  that  the  benefits  of  competition  will  be  negated  if  a  single  entity  is  permitted  to  occupy  the  entire  air-  ground  band);  Space  Data  November  16,  2004  Presentation  at  4  (noting  that  a 

 holder  of  an  exclusive  4  MHz  license  would  have  no  incentive  to  provide  a  competitor  with  access  to  the  air-  ground  market). 
 159  See  2000  Biennial  Regulatory  Review,  Spectrum  Aggregation  Limits  for  Commercial  Mobile  Radio  Services, 
 Report  and  Order,  16  FCC  Rcd  22668,  22669,  22671,  22704-  705,  22708-  709    2,  7,  78,  88-  89  (2001);  1998  Biennial  Regulatory  Review,  Spectrum  Aggregation  Limits  for  Wireless  Telecommunications  Carriers,  Report  and 

 Order,  15  FCC  Rcd  9219,  9256  82  (1999). 
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 interest  in  more  than  one  license  in  the  band  plan  implemented  as  a  result  of  the  Commissions  auction  of  new  air-  ground  licenses.  For  purposes  of  this  eligibility  restriction,  individuals  and  entities  with  either  de 
 jure  or  de  facto  control  of  a  licensee  in  the  band  will  be  considered  to  have  a  controlling  interest  in  the  licensee.  160 

 44.  We  also  will  apply  the  definitions  of  controlling  interests  and  affiliate  currently  set  forth  in  Sections  1.2110(  c)(  2)  and  1.2110(  c)(  5)  of  the  Commission's  rules.  161  These  provisions  have 
 worked  well  to  identify  individuals  and  entities  that  have  the  ability  to  control  applicants  for  Commission  licenses  and  therefore  are  well-  suited  to  our  goal  here  of  ensuring  that  no  party  will  hold  a  controlling 
 interest  in  more  than  three  megahertz  of  spectrum  (shared  or  exclusive)  in  the  800  MHz  air-  ground  band.  We  note  that  Section  1.2110(  c)(  2)  includes  the  requirement  that  ownership  interests  generally  be 
 calculated  on  a  fully  diluted  basis,  162  and  also  provides  that  any  person  who  manages  the  operations  of  an  applicant  pursuant  to  a  management  agreement,  or  enters  into  a  joint  marketing  agreement  with  an 
 applicant,  shall  be  considered  to  have  a  controlling  interest  in  the  applicant  if  such  person,  or  its  affiliate,  has  authority  to  make  decisions  or  otherwise  engage  in  practices  or  activities  that  determine,  or 
 significantly  influence,  the  types  of  services  offered,  or  the  terms  or  prices  of  such  services.  163  We  find  that,  together  with  the  other  provisions  of  Sections  1.2110(  c)(  2)  and  1.2110(  c)(  5),  these  provisions  will 
 ensure  that  no  entity  will  hold  a  controlling  interest  in  more  than  three  megahertz  of  spectrum  (shared  or  exclusive)  in  the  800  MHz  air-  ground  band. 

 45.  Additional  Spectrum.  We  note  that  in  addition  to  the  800  MHz  air-  ground  band,  other  mobile  allocation  spectrum  is  available  for  the  provision  of  air-  ground  communications  services, 
 including  several  commercial  mobile  radio  service  bands.  The  allocations  for  the  frequency  blocks  698-  792  MHz,  1710-  1755  MHz,  1850-  2000  MHz,  and  2110-  2175  MHz,  for  example,  do  not  restrict 
 aeronautical  communications  and  could  be  used  to  provide  air-  ground  communications  services.  We  are  committed  to  fostering  flexible  regulatory  schemes  to  facilitate  competitive  entry  in  the  provision  of  air-ground 
 communications.  In  the  Advanced  Wireless  Services  Notice,  for  example,  we  have  sought  comment  on  whether  two  nationwide  10  MHz  licenses  (1915-  1920  MHz/  1995-  2000  MHz,  and  2020-  2025 
 MHz/  2175-  2180  MHz)  should  be  issued  for  services  such  as  air-  ground.  164  Sprint  Corporation  and  Verizon  Wireless  have  filed  comments  in  that  proceeding  noting  that  this  spectrum  would  be  particularly 
 well-  suited  for  the  provision  of  air-  ground  service,  which  would  be  consistent  with  the  bands  existing  service  allocations.  165  T-  Mobile  USA  also  notes  that  this  spectrum  could  be  used  to  provide  air-  ground 

 160  De  jure  control  is  evidenced  by  holdings  of  greater  than  50  percent  of  the  voting  stock  of  a  corporation,  or  in  the 
 case  of  a  partnership,  general  partnership  interests.  De  facto  control  is  determined  on  a  case-  by-  case  basis.  161 
 47  C.  F.  R.    1.2110(  c)(  2)  &  (5).  These  provisions  define  controlling  interests  and  affiliates  for  the  purpose  of  determining  auction  applicants  eligibility  for  small  business  provisions. 

 162  47  C.  F.  R.    1.2110(  c)(  2)(  ii)(  A)(  1). 
 163  47  C.  F.  R.    1.2105(  c)(  2)(  ii)(  H)  &  (I). 
 164  See  In  the  Matter  of  Service  Rules  for  Advanced  Wireless  Services  in  the  1915-  1920  MHz,  1995-  2000  MHz, 
 2020-  2025  MHz  and  2175-  2180  MHz  Bands,  Notice  of  Proposed  Rulemaking,  19  FCC  Rcd  19263,  19272  22  (2004)  (  Advanced  Wireless  Services  Notice).  Sprint  suggests  that  the  Commission  specifically  designate  spectrum 

 in  these  bands  for  air-  ground  service.  See  Letter  from  Luisa  L.  Lancetti,  Vice  President,  Wireless  Regulatory  Affairs,  Sprint,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  3,  2004. 
 165  See  Joints  Comments  of  Sprint  Corporation  and  Verizon  Wireless,  WT  Dkt  No.  04-  356,  at  5  (filed  Dec.  8,  2004). 
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 service.  166 
 46.  Intermodal  Competition.  We  conclude  that  satellite-  based  systems  and  terrestrial  air-ground  systems  have  the  potential  to  compete  with  one  another.  167  Satellite-  based  companies  currently 

 are  developing  or  already  providing  high-  speed  Internet  access  to  passengers  onboard  aircraft,  168  and  intend  to  provide  in-  flight  entertainment,  consumer  services,  security,  flight  deck  data,  cabin  crew 
 operations,  operational  services,  and  emergency  medical  support.  169  Boeing  notes  that  aeronautical  mobile  satellite  spectrum  is  an  appropriate  vehicle  for  the  provision  of  domestic  air-  ground 
 communications  services,  but  that  it  is  not  fully  substitutable  for  terrestrial  air-  ground  service.  170  In  its  reply  comments,  however,  Boeing  suggests  that  aeronautical  communication  services  are  composed  of  a 
 broader  class  of  services  than  ATG  operations  in  the  800  MHz  or  terrestrial  cellular  bands  and  includes  both  traditional  voice  and  limited  data  service  (currently  offered  in  the  800  MHz  and  cellular  bands)  and 
 advanced  broadband  communications  applications,  such  as  those  provided  by  Connexion  by  Boeing.  171  It  states  that  aeronautical  communication  services  can  be  provided  using  various  types  of  technologies  and 
 system  architectures,  including  terrestrial  and  satellite-  based  systems.  172  We  agree. 
 47.  Although  terrestrial  and  satellite  platforms  are  not  perfect  competitive  substitutes  from  which  to  provide  air-  ground  services,  either  platform  can  be  used  to  deliver  high-  speed  broadband 

 connectivity  to  aircraft.  Satellite  platforms  offer  an  efficient  means  to  deliver  point-  to-  multipoint  services  such  as  multi-  channel  video  services  to  aircraft.  Depending  on  the  system  configuration,  higher  data  rates 
 to  aircraft  can  be  achieved  via  satellite.  173  Boeing  states  that,  at  some  level  of  domestic  traffic,  an  air-ground  system  or  a  hybrid  air-  ground/  satellite  system  would  be  more  cost-  effective  than  a  satellite-  based 
 system.  174  On  the  other  hand,  terrestrial  systems  may  be  better  suited  for  voice  over  Internet  Protocol  (VoIP)  services  because  of  lower  latency.  175 

 166  See  Comments  of  T-  Mobile  USA,  Inc.,  WT  Dkt  No.  04-  356,  at  8  n.  17  (filed  Dec.  8,  2004).  But  cf.  Comments  of 
 Nextel  Communications,  WT  Dkt  No.  04-  356,  at  6  (filed  Dec.  8,  2004)  (asserting  that  use  of  this  spectrum  for  air-ground  service  has  the  potential  to  cause  interference  to  services  in  adjacent  spectrum  bands). 

 167  American  Airlines  urges  us  to  view  the  market  for  the  competitive  provision  of  air-  ground  services  as  including 
 services  in  the  800  MHz  air-  ground  band  and  satellite-  based  services.  See  American  Airlines  Letters,  supra  note  34.  168 
 See  supra  paras.  14-  20.  169 
 See  id.  170 
 See  Boeing  Response  to  Verizon  Airfones  Ex  parte  Presentations  of  September  3  and  10,  2004  at  3.  171 
 Boeing  Reply  Comments  at  7.  172 
 See  id.  173 
 See  Satcom  Shakeout,  Business  &  Commercial  Aviation,  Fred  George,  at  89  (Sept.  2004)  (noting  that  Ku-  band  satellite  communications  systems  have  the  potential  to  provide  10  Mbps  satellite-  to-  aircraft  download  speeds). 

 174  See  Letter  from  Carlos  M.  Nalda,  Steptoe  and  Johnson,  to  Marlene  H.  Dortch,  Secretary,  Federal 
 Communications  Commission,  dated  Dec.  11,  2003,  transmitting  Connexion  by  Boeing  Aeronautical  Broadband  at  Slide  9.  See  also  Broad  Verizon,  Shepards  Inflight,  Vol.  10,  No.  3  at  11  (Autumn  2004)  (noting  that,  according  to 

 Verizon  Airfone,  terrestrial  infrastructure  may  be  more  economical  than  satellite  infrastructure  to  serve  domestic  markets).  See  also  Amendment  of  the  Commissions  Rules  Relative  to  Allocation  of  the  849-  851/  894-  896  MHz 
 Bands,  Report  and  Order,  5  FCC  Rcd  3861,  3863  19  (1990)  (noting  that  the  cost  of  providing  air-  ground  services  via  satellite  is  likely  to  be  greater,  at  least  initially,  than  the  cost  of  such  service  over  terrestrial-  based  facilities). 
 175  Latency  refers  to  the  delay  between  when  a  TCP/  IP  packet  is  transmitted  through  the  system  and  when  it  is 
 received. 
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 48.  The  regulatory  flexibility  afforded  by  the  licensing  approach  that  we  adopt  today  will  enable  at  least  one  licensee  in  each  of  the  three  band  plans  to  deploy  advanced  broadband  technologies 
 and  thereby  provide  a  meaningful  competitive  alternative  to  services  offered  or  being  developed  by  a  number  of  satellite-  based  competitors.  176  Spectrum  blocks  A,  B,  C,  and  F  each  provide  sufficient 
 bandwidth  to  deliver  an  array  of  broadband  services  to  passengers  onboard  aircraft,  including  access  to  the  Internet,  corporate  virtual  private  networks,  personal  email  accounts,  and  VoIP  services.  These 
 spectrum  blocks  also  are  well-  suited  for  the  provision  of  homeland  security  applications  (e.  g.,  services  to  federal  air  marshals,  the  military,  and  first  responders),  communications  with  aircraft  personnel,  and 
 monitoring  of  critical  avionic  systems. 
 49.  Band  plans  2  and  3  each  include  exclusive  1  MHz  and  3  MHz  spectrum  blocks.  While  the  holder  of  a  1  MHz  spectrum  block  may  not  be  able  to  provide  the  same  level  of  broadband  services  as 

 satellite  providers  such  as  Connexion  by  Boeing,  or  the  holder  of  a  3  MHz  spectrum  block  in  the  air-ground  band,  it  could  provide  a  meaningful  competitive  alternative  to  air-  ground  services  currently 
 offered  by  Globalstar  and  Iridium,  which  use  satellite  systems.  177  Space  Data,  for  example,  notes  that  a  1  MHz  license  could  accommodate  iDEN  and  most  narrowband  technologies,  which  would  provide 
 sufficient  capacity  for  voice  and  short  messaging  services  (SMS)  that  could  compete  with  another  operator  in  the  band.  178  Once  Verizon  Airfone  discontinues  its  narrowband  operations  in  the  1  MHz 
 spectrum  block,  our  flexible  regulatory  approach  would  enable  the  holder  of  an  exclusive  1  MHz  spectrum  block  to  offer  more  robust  applications  than  currently  provided  by  AirCell  179  and  Verizon 
 Airfone.  A  1  MHz  exclusive  spectrum  block  also  would  be  superior  to  Air-  Ground  Radiotelephone  Automated  Service  (AGRAS)  stations  in  the  454/  459  MHz  band,  which  serve  the  general  aviation 
 market,  because  AGRAS  is  analog  and  limited  to  20  kHz  emissions  within  12  paired  channels  spaced  at  25  kHz.  180  Given  the  variety  of  applications  desired  by  the  various  aviation  markets,  181  a  1  MHz  spectrum 
 block  could  be  used  to  serve  niche  markets  and  customers  with  different  service  demands  than  larger  passenger  aircraft.  Such  applications  might  include  email  service,  Internet  access,  messaging  services, 
 avionic  support,  and  homeland  security  services.  Accordingly,  we  find  that  a  1  MHz  spectrum  block  would  facilitate  the  competitive  provision  of  a  variety  of  air-  ground  voice  and  data  applications. 

 50.  Competitive  Safeguards.  AirCell  expresses  concern  that  an  air-  ground  licensee  could  unfairly  favor  a  particular  class  of  subscribers  or  unreasonably  refuse  to  provide  service  to  certain 
 airlines.  182  AirCell  points  out  that  Verizon  Airfone  currently  offers  lower  service  rates  to  subscribers  of 

 176  See  supra  paras.  14-  20. 
 177  See  supra  para.  21. 
 178  Space  Data  November  29  Analysis  at  2. 
 179  See  supra  para  22.  AirCell  serves  more  than  1,400  customers  and  uses  no  more  than  six  cellular  channels  (360 
 kHz  authorized  bandwidth)  per  ground  station.  180 
 AGRAS  provides  two-  way  telephone  service  with  only  520  kHz  of  authorized  bandwidth  in  the  United  Sates  and  Canada. 

 181  We  note  there  is  a  wide  variety  of  airborne  operations  that  could  benefit  from  air-  ground  services,  such  as 
 passenger  airlines;  commercial  transport;  business  jets;  general  aviation  including  small  business,  propeller  aircraft,  pleasure  flying,  crop  dusting,  power  line  inspection,  police  and  public  safety,  emergency  medical  transport,  and 

 traffic  helicopters;  and  government  aircraft.  Many  aircraft  fly  at  5,000  to  10,  000  feet  and  would  have  service  demands  other  than  broadband  internet. 
 182  See,  e.  g.,  AirCell  Air-  to-  Ground  Myths  &  Realities  at  2  (suggesting  major  airlines  might  pressure  an  air-  ground 
 licensee  not  to  serve  some  market  segments). 
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 wireless  service  provided  by  its  affiliate,  Verizon  Wireless.  183  We  note  that,  like  other  Part  22  licensees,  800  MHz  Air-  Ground  Radiotelephone  Service  licensees  are  classified  as  commercial  mobile  radio  service 
 (CMRS)  providers  and  thus  are  subject  to  common  carrier  regulation  under  Title  II  of  the  Communications  Act.  184  While  the  Commission  has  previously  decided  to  forbear  from  applying  certain 
 provisions  of  Title  II  to  CMRS  providers,  185  it  has  determined  that  it  would  be  inappropriate  to  exempt  CMRS  providers  from  the  competitive  safeguards  embodied  in  Sections  201  and  202  of  the  Act.  186  Air-ground 
 licensees  therefore  are  required  to  provide  service  upon  reasonable  request,  187  and  their  charges,  practices,  classifications,  and  regulations  for  and  in  connection  with  service  must  be  just  and 
 reasonable.  188  Air-  ground  licensees  moreover  may  not  make  any  unjust  or  unreasonable  discrimination  in  charges,  practices,  classifications,  regulations,  facilities,  or  services  for  or  in  connection  with  a  like 
 communication  service,  and  may  not  afford  any  undue  or  unreasonable  preference  or  advantage  to  any  person  or  class  of  persons.  189  Accordingly,  if  an  air-  ground  licensee  were  to  unreasonably  discriminate  in 
 its  service  rates,  terms,  or  conditions,  it  could  be  subject  to  enforcement  action  by  the  Commission  as  well  as  a  complaint  proceeding  initiated  pursuant  to  Section  208  of  the  Communications  Act.  190 

 51.  Although  the  Commission  retains  the  authority  to  enforce  core  provisions  of  Title  II  of  the  Act,  the  Commission  previously  determined  to  forbear  from  certain  Title  II  provisions,  including  the 
 tariffing  provisions  of  Section  203,  and  to  apply  mandatory  detariffing  to  CMRS  providers  (including  800  MHz  air-  ground  licensees).  191  The  Commission  relieved  CMRS  operators  of  the  requirement  to  file 
 tariffs  and  prohibited  them  from  filing  voluntary  tariffs.  192  The  Commission  based  this  determination  on  its  finding  that  CMRS  providers,  including  those  in  the  800  MHz  air-  ground  band,  were  not  dominant  so 
 as  to  warrant  extensive  regulation.  193  The  Commission,  however,  remains  free  to  revisit  its  determination  regarding  tariffing  requirements  should  circumstances  so  warrant.  In  light  of  the  unique  characteristics  of 
 air-  ground  service,  the  Commission  will  monitor  the  development  of  the  marketplace  and  will  reserve  the  ability  to  take  corrective  action  if  necessary. 

 183  See  AirCell  London  Declaration  at  11  20. 
 184  See  47  U.  S.  C.    332(  c)(  1);  47  C.  F.  R.    20.  9(  a)(  8),  20.  15(  a). 
 185  See  In  The  Matter  of  Implementation  of  Sections  3(  n)  and  332  of  the  Communications  Act  Regulatory 
 Treatment  of  Mobile  Services,  Second  Report  and  Order,  9  FCC  Rcd  1411  (1994)  (  CMRS  Second  Report  and  Order). 

 186  See  Personal  Communications  Industry  Association's  Broadband  Personal  Communications  Services  Alliance's 
 Petition  for  Forbearance  for  Broadband  Personal  Communications  Services,  Memorandum  Opinion  and  Order  and  Notice  of  Proposed  Rulemaking,  13  FCC  Rcd  16857  (1998). 

 187  See  47  U.  S.  C.    201(  a). 
 188  See  47  U.  S.  C.    201(  b). 
 189  Verizon  Airfone  states  that,  in  the  event  it  deploys  broadband  service  in  the  air-  ground  band,  any  passenger  could 
 access  a  WiFi  hot  spot  installed  on  an  aircraft  regardless  of  their  service  provider  though  roaming  agreements  with  wireless  companies,  ISPs,  and  others  that  provide  their  customers  with  WiFi  Access.  See  Letter  from  Donald  C. 

 Brittingham,  Director-  Wireless/  Spectrum  Policy,  Verizon,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Oct.  21,  2004. 
 190  Sections  201  and  202  are  enforced  through  the  formal  complaint  process  established  in  section  208  of  the  Act,  47 
 U.  S.  C.    208.  Under  section  208,  any  aggrieved  party  may  file  a  petition  with  the  Commission  complaining  of  an  alleged  violation  of  these  provisions. 

 191  CMRS  Second  Report  and  Order,  9  FCC  Rcd  at  1418,  1480. 
 192  Id.  at  1480. 
 193  Id.  at  1469-  1470. 
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 (iv)  Air-  Ground  Services 
 52.  We  seek  to  let  marketplace  forces,  rather  than  prescriptive  regulations,  determine  the  highest  valued  air-  ground  service  applications.  Accordingly,  a  new  licensee  may  provide  any  type  of  air-ground 
 service  (i.  e.,  voice  telephony,  broadband  Internet,  data,  etc.)  to  aircraft  of  any  type,  and  serve  any  or  all  aviation  markets  (e.  g.,  commercial,  government,  and  general).  A  licensee  must  provide  service  to 
 aircraft.  We  note  that  current  bilateral  agreements  between  the  United  States,  Canada,  and  Mexico  provide  for  coordinated  use  of  air-  ground  frequencies  over  North  American  airspace  and  are  based  on  a 
 narrow  bandwidth  channel  scheme,  and  therefore  may  need  to  be  renegotiated  to  provide  for  more  flexible  use  of  this  spectrum.  194 

 53.  In  the  Notice,  we  asked  whether  the  air-  ground  spectrum  should  be  limited  to  air-  ground  use,  or  whether  we  should  allow  for  more  flexible  use.  195  At  this  time,  we  decide  not  to  permit  a  licensee 
 to  provide  ancillary  land  mobile  or  fixed  services  in  the  800  MHz  air-  ground  spectrum.  We  agree  with  T-Mobile  that  because  there  is  only  four  megahertz  of  dedicated  air-  ground  spectrum,  it  should  be  used 
 predominantly  for  the  provision  of  air-  ground  service.  196  We  also  note  that  a  number  of  parties  claim  that  adjacent  band  interference  could  arise  from  the  provision  of  ancillary  services.  197  While  we  believe  that 
 it  would  be  possible  to  address  the  potential  for  adjacent  band  interference,  we  find  that  the  public  interest  would  be  best  served  at  this  time  by  ensuring  that  this  limited  spectrum  resource  is  devoted  to  the 
 provision  of  air-  ground  service. 
 4.  Technical  Standards 
 54.  We  are  adopting  the  minimal  set  of  technical  rules  for  the  new  air-  ground  service  necessary  to  implement  the  three  alternative  band  plan  configurations  that  will  be  subject  to  auction. 

 Generally,  these  rules  provide  licensees  flexibility  to  deploy  any  type  of  transmission  technology,  provided  that  the  radio  emissions  produced  fit  within  a  licensees  assigned  spectrum.  The  new  technical 
 rules  limit  only  transmitting  power  and  the  power  level  of  unwanted  emissions. 
 55.  Under  the  new  rules,  an  air-  ground  licensee  will  be  allowed  greater  flexibility  than  under  the  current  rules  to  deploy  the  technologies,  both  now  and  in  the  future,  198  that  it  believes  will  best  enable 

 it  to  provide  services  desired  by  consumers.  As  a  general  matter,  these  new  technical  rules  are  crafted  to  allow  sufficient  power  to  provide  robust  air-  ground  services,  while  limiting  the  potential  for  harmful 
 interference  to  services  operating  in  adjacent  spectrum. 
 56.  Transmitting  power  limits.  In  considering  how  the  air-  ground  power  limit  rules  may  need  to  be  modified,  we  first  review  the  existing  air-  ground  power  limit  rules.  We  note  that  inter-  service 

 interference  has  not  been  reported  to  the  Commission  as  a  significant  problem  under  these  rules.  These 
 194  See  supra  note  29. 
 195  Notice,  18  FCC  Rcd  at  8390  21. 
 196  See  Letter  from  Thomas  J.  Sugrue,  Vice  President,  Government  Affairs,  T-  Mobile  USA,  to  Marlene  H.  Dortch, 
 Secretary,  Federal  Communications  Commission,  dated  Nov.  15,  2004.  197 
 See  AirCell  Air-  to-  Ground  Myths  &  Realities  at  1;  Boeing  December  8  Ex  parte;  Letter  from  Trey  Hanbury,  Senior  Counsel,  Nextel  Communications,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission, 

 dated  Dec.  8,  2004  (letter  regarding  ancillary  spectrum  use);  Letter  from  Luisa  L.  Lancetti,  Vice  President,  Wireless  Regulatory  Affairs,  Sprint,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  3, 
 2004.  See  also  Cingular  Wireless  Comments  at  6-  9;  AMTA  Comments  at  4.  198 
 For  example,  licensees  could  utilize  directional  or  smart  antennas  to  increase  capacity. 
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 rules  provide  maximum  transmitting  power  limits  of  100  Watts  ERP  for  ground  stations,  30  Watts  ERP  for  airborne  mobiles,  and  1  Watt  ERP  for  low  power  ground  stations.  199  These  power  limits  were 
 proposed  by  The  Goeken  Group  Corporation  in  General  Docket  No.  88-  96  as  a  part  of  a  plan  for  sharing  narrowband  air-  ground  channels.  200  The  principal  technical  elements  of  that  plan,  including  the  power 
 limits,  were  ultimately  adopted  by  the  Commission. 
 57.  In  order  to  contribute  to  our  goal  of  providing  a  viable,  competitive  terrestrial  air-  ground  service,  the  new  power  limit  rule  must  allow  transmitting  power  sufficient  to  provide  a  robust  broadband 

 service.  AirCell,  Boeing,  and  Verizon  each  seek  to  provide  high-  speed  Internet  service  using  CDMA2000  1xEV-  DO  (as  well  as  possibly  Flash-  OFDM  in  the  case  of  Verizon  Airfone)  in  the  band,  and 
 we  consider  it  likely  that  one  of  these  technologies,  or  a  similar  technology,  will  be  used  in  the  reconfigured  air-  ground  band.  We  therefore  adopt  a  transmitting  power  level  that  will  allow  these 
 broadband  technologies  to  function  efficiently.  In  the  case  of  CDMA2000  1xEV-  DO,  the  transmitting  power  has  to  be  high  enough  to  maintain  a  substantial  positive  signal  to  interference  and  noise  ratio 
 (SINR)  in  order  to  enjoy  a  high  data  rate.  When  the  SINR  drops  below  certain  values,  excessive  errors  result,  and  the  system  technology  automatically  compensates  by  changing  the  modulation  type  (e.  g.,  from 
 16QAM  to  QPSK)  and  lowering  the  data  rate.  In  other  words,  with  CDMA2000  1xEV-  DO,  transmitting  power  trades  off  against  the  data  rate.  With  FLASH-  OFDM,  high  data  rates  produce  an  emission 
 envelope  having  a  relatively  high  peak  to  average  power  ratio.  These  factors  suggest  that  a  ground  station  power  limit  higher  than  that  in  the  existing  rule  is  appropriate. 

 58.  The  studies  and  simulations  filed  in  the  record  assume  ground  station  power  levels  to  be  on  the  order  of  400  to  600  Watts  ERP.  201  AirCell  asserts  that  airborne  mobile  stations  may  operate 
 satisfactorily  with  less  than  1  Watt  ERP.  202  Verizon,  on  the  other  hand,  claims  that  an  airborne  mobile  power  level  of  12  Watts  ERP  is  necessary  to  provide  reliable  high-  speed  Internet  connectivity.  203  We 
 have  considered  the  various  proposed  air-  ground  forward  and  reverse  power  examples  in  the  record,  204  and  we  conclude  that  a  ground  station  maximum  power  limit  of  500  Watts  ERP  and  an  airborne  mobile 
 station  maximum  power  limit  of  12  Watts  ERP  will  allow  a  licensee  to  deploy  CDMA2000  1xEV-  DO  and/  or  FLASH-  OFDM  with  an  ample  margin.  Installations  will  also  be  subject  to  the  radiofrequency 
 radiation  exposure  limits  rules  set  forth  in  Section  1.1310  of  the  Commission's  rules.  205 
 59.  Potential  for  interference  with  adjacent  services.  We  next  address  the  potential  for  interference  to  existing  services  operating  in  the  spectrum  adjacent  to  the  air-  ground  service.  A  number 

 of  parties,  including  AirCell,  206  CTIA-  The  Wireless  Association  (CTIA),  207  Motorola,  208  Nextel 
 199  47  C.  F.  R.    22.867. 
 200  Comments  of  The  Goeken  Group  Corporation,  Gen.  Dkt.  No.  88-  96,  Exhibit  B,  9  (filed  Aug.  8,  1989). 
 201  See,  e.  g.,  AirCell/  Boeing  Joint  Proposal  at  3-  8. 
 202  AirCell  actually  specifies  23  dBm  EIRP,  which  is  equal  to  0.12  Watts  ERP. 
 203  See  Coexistence  Analysis  for  cross-  duplex  air-  to  ground  system,  filed  Apr.  12,  2004,  at  19.  Verizon  actually 
 specifies  43  dBm  EIRP,  which  is  equal  to  12.  2  Watts  ERP.  204 
 See,  e.  g.,  AirCell/  Boeing  Joint  Proposal  at  3-  8.  205 
 47  C.  F.  R    1.  1310.  206 
 AirCell  Response  to  Nextels  Analysis  on  Wideband  Air-  to-  Ground  Inference,  filed  Nov.  23,  2004  (  AirCell  November  23  Ex  parte). 

 207  Letter  from  Christopher  Guttman-  McCabe,  CTIA,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications 
 Commission,  dated  Dec.  6,  2004  (  CTIA  December  6  Ex  parte) 
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 Communications,  Inc.  (Nextel),  209  QUALCOMM,  210  and  The  Association  of  Public-  Safety  Communications  Officials  International,  Inc.  (APCO),  211  filed  comments  regarding  the  possibility  of 
 interference  occurring  between  stations  in  the  reconfigured  air-  ground  band  and  those  in  the  existing  radio  services  immediately  adjacent  to  the  air-  ground  allotment.  212 

 60.  Interference  to  air-  ground  from  adjacent  services.  Each  of  the  two  paired  bands  comprising  the  800  MHz  air-  ground  allocation  is  adjacent  to  and  just  above  spectrum  allocated  to  the 
 cellular  radiotelephone  service.  The  849-  851  MHz  uplink  band  is  adjacent  to  and  just  below  spectrum  allocated  to  land  mobile  services,  including  public  safety,  which  will  soon  become  all  public  safety 
 pursuant  to  the  800  MHz  Order.  The  894-  896  MHz  downlink  band  is  adjacent  to  and  just  below  spectrum  allocated  to  land  mobile  services  including  900  MHz  SMR.  These  services  are  heavily  used  in  many 
 areas.  Base  stations  in  these  adjacent  services  are  authorized  to  utilize  high  power  levels.  Nextel  argues  that  its  experience  with  cellular  out-  of-  band  emissions  (OOBE)  and  its  900  MHz  SMR  facilities  show  that 
 such  emissions  could  degrade  the  new  air-  ground  operations.  213 
 61.  The  services  adjacent  to  the  849-  851  MHz  band  are  subject  to  rules  that  limit  their  potential  to  cause  interference  to  air-  ground  service.  We  do  not,  at  this  time,  find  a  need  to  adopt 

 additional  or  more  stringent  rules  applicable  to  the  adjacent  service  licensees  to  further  limit  interference  potential  to  the  air-  ground  service.  214  It  would  be  excessively  burdensome  and  inefficient  to  apply  more 
 stringent  OOBE  limits  to  existing  adjacent  spectrum  services,  which  would  apply  to  their  transmitters  everywhere,  in  order  to  protect  a  far  smaller  number  of  air-  ground  ground  stations  that  will  be  located  in 
 several  hundred  and  generally  widely  separated  locations.  We  believe  that,  under  the  current  rules,  new  air-  ground  systems  should  be  able,  through  careful  ground  station  site  selection  and  technical 
 coordination  with  the  licensees  in  the  adjacent  services,  to  build  out  their  systems.  Potential  licensees 
 (Continued  from  previous  page)  208  Letter  from  Steve  B.  Sharkey,  Director,  Spectrum  and  Standards  Strategy,  Motorola,  Inc.,  to  Marlene  H.  Dortch, 

 Secretary,  Federal  Communications  Commission,  dated  Nov.  4,  2004  (  Motorola  November  4  Ex  parte)  209 
 See  Letter  from  Trey  Hanbury,  Senior  Counsel,  Nextel  Communications,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  8,  2004  (proposing  ten  adjacent  band  interference  mitigation 

 measures)  (  Nextel  December  8  Ex  parte);  Letter  from  Trey  Hanbury,  Senior  Counsel,  Nextel  Communications,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  8,  2004  (letter  regarding  ancillary 
 spectrum  use);  Letter  from  Trey  Hanbury,  Senior  Counsel,  Nextel  Communications,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  6,  2004,  transmitting  Harmful  Interference  from 
 Wideband  Air-  to-  Ground  Systems  into  Public  Safety,  Specialized  Mobile  Radio,  and  Cellular  Operations  (  Nextel  December  6  Ex  parte);  Wideband  Air-  to-  Ground  Interference  Analysis  of  Nextel  Communications,  Nov.  16,  2004 
 (  Nextel  November  16  Ex  parte).  210 
 See  Letter  from  Dean  R.  Brenner,  Senior  Director,  Government  Affairs,  QUALCOMM  Incorporated,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Dec.  8,  2004  (  QUALCOMM  December  8  Ex 

 parte).  211 
 See  Letter  from  Robert  M.  Gurss,  Director,  Legal  &  Government  Affairs,  APCO,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Nov.  29,  2004  (  APCO  November  29  Ex  parte) 

 212  These  services  are  the  Cellular  Radiotelephone  Service,  the  900  MHz  SMR  service,  and  miscellaneous 
 (interleaved)  land  mobile  services,  including  Business,  Industrial,  Land  Transportation  and  Public  Safety.  213 
 See  Nextel  November  16  Ex  parte  at  16.  Nextel  offers  worst-  case  calculations  indicating  that  OOBE  from  cellular  base  stations  could  increase  the  noise  floor  in  air-  ground  ground  station  receivers.  It  does  not  appear  that 

 such  an  increase  would  cause  the  effects  that  constitute  harmful  interference.  214 
 Existing  rules,  such  as  Section  22.  917,  47  C.  F.  R.    22.  917,  regarding  cellular  service,  and  Section  90.  210,  47  C.  F.  R.    90.  210,  regarding  the  land  mobile  services,  already  provide  some  interference  protection  to  the  800  MHz 

 air-  ground  band. 
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 tilted  whereas  cellular  antennas  are  often  down-  tilted,  adding  some  isolation  between  the  two.  The  rule  changes  that  we  adopt  to  permit  broadband  air-  ground  services  will  not  alter  any  of  these  factors  and, 
 consequently,  we  expect  that  these  factors  will  be  effective  in  avoiding  inter-  service  interference  under  our  new  air-  ground  band  plan. 

 64.  Furthermore,  we  do  not  believe  that  the  use  of  wider  bandwidth  technologies  in  the  800  MHz  air-  ground  spectrum  will  result  in  increased  interference  between  air-  ground  operations  and  cellular 
 operations.  Although  spread  spectrum  emissions  typically  have  broader  out-  of-  band  noise  skirts,  the  level  of  this  noise  is  subject  to  the  Commissions  OOBE  rules.  We  also  note  that  the  broadband  spread 
 spectrum  based  technologies  used  in  the  cellular  band  and  those  that  the  parties  have  proposed  for  use  in  the  air-  ground  band  are  resistant  to  small  amounts  of  out-  of-  band  noise.  222  In  summary,  we  find  that 
 applying  our  standard  OOBE  rules  here  is  adequate  to  limit  unwanted  emissions  between  ground  stations  in  the  air-  ground  service  and  base  stations  in  the  cellular  service.  We  note  that  our  standard  OOBE  rules 
 also  provide  that  the  Commission  may  require  greater  attenuation  of  unwanted  emissions  in  the  event  it  is  necessary  to  prevent  interference  to  other  services.  223 

 65.  The  airborne  mobile  transmit  band  (894-  896  MHz)  is  adjacent  on  its  lower  side  to  the  cellular  telephone  receivers  of  the  Cellular  Block  B  licensee.  There  have  been  no  reported  instances  of 
 harmful  interference  between  airborne  mobile  stations  and  cellular  telephones.  This  stems  from  the  large  distance  separation  between  aircraft  and  cellular  phones  on  the  ground,  and  our  decision  today  does  not 
 change  this  factor.  We  conclude  that  our  OOBE  limits  and  the  distance  separation  make  it  likely  that  the  mobile  units  in  these  two  services  will  continue  to  operate  in  adjacent  spectrum  without  harmful 
 interference  problems.  Nevertheless,  if  an  air-  ground  licensee  elects  to  operate  aircraft  mobile  transmitters  on  the  ground  or  during  approach  and  take-  off,  they  may  find  it  necessary  in  some  cases  to 
 provide  additional  attenuation  of  OOBE  falling  into  the  spectrum  below  894  MHz,  in  order  to  avoid  interference  to  cellular  phones  in  use  in  the  immediate  vicinity  of  airports.  224 

 66.  Interference  to  Public  Safety.  The  upper  edge  of  the  air-  ground  ground  station  transmit  band  at  849-  851  MHz  is  adjacent  to  what  are  now  mobile  receivers  for  interleaved  business,  industrial 
 and  land  transportation,  SMR,  and  public  safety  radio  channels,  but  which  will  soon  become  the  National  Public  Safety  Plan  Advisory  Committee  (NPSPAC)  public  safety  channels  pursuant  to  the  our  recent  800 
 MHz  Order.  225  Nextel  asserts  that  OOBE  from  air-  ground  ground  stations  could  produce  a  significant  amount  of  noise  energy  in  nearby  public  safety  receivers.  226  Although  we  have  found  that  emissions  from 
 cellular  base  stations  may  have  contributed  to  interference  problems  with  public  safety  and  critical  infrastructure  mobile  receivers  above  851  MHz,  there  is  no  history  of  similar  interference  being  caused  by 
 the  existing  air-  ground  ground  stations  to  mobile  receivers.  There  are  again  several  factors  that  we  believe  may  explain  why  air-  ground  caused  interference  is  rare,  including  the  fact  that  there  are  so  few 
 air-  ground  ground  stations,  as  compared  to  cellular  base  stations,  and  the  deployment  characteristics  of 
 222  These  technologies  include  GSM,  TDMA,  CDMA,  and  OFDM. 
 223  See  47  C.  F.  R.    22.  917(  d).  See  also  id.    24.  238(  d),  27.  53(  k). 
 224  AirCell  and  Boeing  propose  to  hand  off  air-  ground  service  to  terrestrial  services  (such  as  PCS)  during  take-  off, 
 landing,  and  while  on  the  ground.  See  AirCell  Further  Notes  on  the  Deployment  of  Two  Cross-  Polarized  Systems  at  4-  7. 

 225  See  800  MHz  Order,  19  FCC  Rcd  at  15050  151. 
 226  Nextel  November  16  Ex  parte  at  12.  For  example,  Nextel  calculates  a  53  dB  excess  over  the  recently  adopted 
 public  safety  protection  level  for  a  public  safety  receiver  located  50  meters  (164  feet)  away  from  a  broadband  air-ground  ground  station.  Nextels  calculations  are  based  on  worst-  case  assumptions  with  regard  to  OOBE  levels  and 

 propagation  factors. 
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 ground  stations  (e.  g.,  up-  tilted  antennas).  Further,  we  note  that  NPSPAC  operations  above  851  MHz  will  be  protected  by  our  OOBE  limit  rule,  including  the  provision  that  allows  the  Commission  to  require 
 greater  attenuation  if  necessary  to  prevent  interference. 
 67.  Nevertheless,  in  light  of  the  substantial  efforts  of  Nextel,  APCO,  public  safety  entities,  and  land  mobile  organizations  to  solve  the  interference  problems  in  the  800  MHz  band,  we  believe  that  it 

 is  prudent  to  adopt  a  rule  providing  that  ground  stations  in  the  Air-  Ground  Radiotelephone  Service  that  operate  in  the  849-  851  MHz  range  will  be  subject  to  the  same  interference  abatement  obligation  rules 
 adopted  for  the  cellular  service  in  the  800  MHz  Order.  227  We  note  that  AirCell,  APCO,  Motorola,  and  Nextel  concur  that  this  would  be  an  appropriate  safeguard  for  public  safety  and  critical  infrastructure 
 services.  228  AirCell  argues,  however,  that  we  should  not  apply  the  interference  abatement  and  resolution  procedures  established  in  the  800  MHz  Order  to  the  Air-  Ground  Radiotelephone  Service.  229  We  disagree. 
 While  we  believe  that  the  potential  for  adjacent  band  interference  is  minimal,  we  find  that  the  public  interest  would  be  served  by  applying  these  safeguards  to  air-  ground  licensees.  The  rule  we  are  adopting 
 is  essentially  the  same  as  that  adopted  for  the  cellular  service  in  the  800  MHz  Order.  We  will  not  require  air-  ground  licensees  to  participate  in  the  establishment  of  the  electronic  notification  process  because  we 
 anticipate  that  this  process  will  be  in  place  by  the  time  that  new  air-  ground  licenses  are  issued. 
 68.  In  addition  to  applying  the  800  MHz  Order  safeguards  to  the  800  MHz  Air-  Ground  Radiotelephone  Service,  Nextel  claims  that  we  should  adopt  further  adjacent  band  interference  mitigation 

 measures.  230  Nextel  states  that  we  should  require  air-  ground  licensees  to  avoid  locating  transmitters  in  public  safety  hotspots.  231  We  find  no  basis  for  imposing  this  special  requirement  in  addition  to  the  800 
 MHz  Order  safeguards  that  we  apply.  We  also  note  there  is  no  current  mechanism  for  ascertaining  the  location  of  public  safety  hotspots,  and  that  such  hotspots  could  change  over  time.  We  therefore  decline 
 to  adopt  Nextels  proposal.  Nextel  also  asserts  that  we  should  direct  air-  ground  licensees  to  submit  detailed  documentation  of  their  system  parameters  and  encourage  them  to  mediate  interference  disputes 
 with  public  safety  and  Critical  Infrastructure  Industry  (CII)  licensees.  232  We  find  that  submission  of  such  documentation  to  the  Commission  as  well  as  mandatory  mediation  procedures  are  unnecessary  in  light  of 
 our  application  of  the  interference  abatement  and  resolution  procedures  established  in  the  800  MHz  Order  to  the  air-  ground  service,  and  note  as  well  that  such  documentation  may  be  competitively  sensitive. 
 Nevertheless,  we  encourage  air-  ground,  public  safety,  and  CII  licensees  to  work  collaboratively  to  resolve  interference  using  mediation  and  other  appropriate  forms  of  alternative  dispute  resolution  procedures. 

 69.  Interference  to  900  MHz  SMR  base  receivers.  The  airborne  mobile  transmit  band  (894-  896  MHz)  is  adjacent  on  its  upper  side  to  the  base  station  receive  band  in  the  900  MHz  SMR  service. 
 Distance  separation  will  normally  serve  to  protect  900  MHz  SMR  base  station  receivers  because  airborne  stations  normally  operate  at  altitudes  well  above  900  MHz  SMR  base  stations.  Nextel,  however,  contends 
 that  there  may  be  a  problem  where  its  900  MHz  SMR  base  stations  are  located  near  airport  runways,  and 

 227  See  800  MHz  Order  at  15029-  30    105-  107  (to  be  codified  at  47  C.  F.  R.    22.  970(  b),  90.  672). 
 228  See  AirCell  November  23  Ex  parte  at  10-  11;  APCO  November  29  Ex  parte  at  1;  Motorola  November  4  Ex  parte 
 at  2-  3;  Nextel  November  16  Ex  parte  at  12.  Nextel,  however,  suggests  that  we  adopt  additional  adjacent  band  interference  mitigation  measures.  See  Nextel  December  6  Ex  parte  at  5  and  Nextel  December  8  Ex  parte. 

 229  See  Letter  from  William  J.  Gordon,  VP,  Regulatory  Affairs,  AirCell,  to  Marlene  H.  Dortch,  Secretary,  Federal 
 Communications  Commission,  dated  Dec.  7,  2004.  230 
 See  Nextel  December  8  Ex  parte;  Nextel  December  6  Ex  parte  at  5.  231 
 See  Nextel  December  8  Ex  parte  at  1.  232 
 See  id.  at  1,  3. 
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 if  there  are  several  aircraft  at  low  altitude  nearby  at  the  same  time.  233  This  possibility  appears  to  be  atypical  and  we  find  that  it  would  be  best  addressed  on  a  case-  by-  case  basis  rather  than  by  a  broad-  based 
 rule.  Air-  ground  licensees  and  900  MHz  SMR  licensees  should  cooperate  to  resolve  any  interference  problems  of  this  type. 

 70.  Miscellaneous  interference  issues.  Nextel  argues  that  the  AirCell/  Boeing  shared  spectrum  approach  would  be  less  likely  than  the  exclusive  license  approaches  supported  by  Verizon  and 
 Space  Data  to  create  interference  to  services  in  adjacent  spectrum  bands.  234  Whether  or  not  this  may  be  true  technically,  we  find  that  either  approach  can  be  deployed  without  causing  harmful  interference  to 
 adjacent  services  under  the  rules  that  we  adopt  today,  provided  that  the  licensees  are  aware  of  the  potential  for  such  interference  and  take  necessary  measures  to  comply  with  our  rules  to  prevent  such 
 interference. 
 71.  In  view  of  the  foregoing,  we  do  not  believe  the  record  justifies  adoption  of  more  stringent  OOBE  limits  for  the  Air-  Ground  Radiotelephone  Service.  Accordingly,  we  will  apply  our  harmonized 

 flexible  OOBE  limits  rule,  which  currently  applies  to  cellular  and  broadband  PCS,  235  to  the  800  MHz  Air-Ground  Radiotelephone  Service.  We  note  that,  in  the  event  that  band  plan  2  or  3  is  implemented,  the 
 exclusive  licensees  would  be  subject  to  the  OOBE  standards  between  their  spectrum  blocks,  as  well  as  outside  the  air-  ground  band. 

 72.  Miscellaneous  technical  rules.  The  existing  air-  ground  rules  have  provided  particular  limits  on  transmitter  frequency  tolerance  236  and  specifications  for  automated  operating  procedures.  237 
 We  conclude  it  is  unnecessary  to  retain  such  a  detailed  frequency  tolerance  rule.  Under  the  legacy  band  configuration,  numerous  closely  packed  air-  ground  channels  were  shared  by  multiple  licensees,  so  we 
 required  a  frequency  tolerance  rule  that  tightly  controlled  frequency  stability  to  minimize  the  possibility  of  adjacent  channel  interference.  By  contrast,  our  new  rules  establish  wider  spectrum  blocks  and  we 
 anticipate  fewer  communications  channels.  In  addition,  we  expect  that  the  advanced  technologies  likely  to  be  used  in  this  band  will  have  to  be  inherently  stable  in  order  to  work  properly  and  possibly  to 
 compensate  for  Doppler  shift  as  well.  Thus,  we  find  that  we  need  only  require  in  our  rules  that  the  frequency  stability  of  equipment  used  be  sufficient  to  ensure  that,  after  accounting  for  Doppler  frequency 
 shifts,  the  occupied  bandwidth  of  the  fundamental  emissions  remains  within  the  authorized  frequency  bands  of  operation.  In  the  event  that  band  plan  1  is  implemented  and  licenses  for  spectrum  sharing  are 
 issued,  the  licensees  may  choose  to  agree  upon  any  number  of  miscellaneous  technical  standards  that  may  be  needed  to  facilitate  shared  spectrum  operation  and  include  them  in  the  spectrum  sharing  plan  that  they 
 would  file  with  the  Wireless  Telecommunications  Bureau.  238 
 5.  Incumbent  Station  KNKG804 
 73.  Verizon  Airfone  is  the  sole  incumbent  currently  operating  in  the  800  MHz  air-  ground 

 233  See  Nextel  November  16  Ex  parte  at  15-  16.  Nextel  offers  worst-  case  calculations  indicating  that  OOBE  from 
 nearby  airborne  mobile  stations  could  increase  the  noise  floor  in  900  MHz  SMR  receivers.  It  does  not  appear  that  such  an  increase  would  cause  the  effects  that  constitute  harmful  interference. 

 234  See  Nextel  December  6  Ex  parte  at  4. 
 235  See  47  C.  F.  R.    22.  917,  24.  238. 
 236  47  C.  F.  R.    22.863. 
 237  47  C.  F.  R.    22.865. 
 238  See  supra  para.  34  &  notes  137,  138. 
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 band.  239  In  April  2004,  the  company  filed  an  application  for  renewal  of  its  authorization  to  operate  in  the  band,  Call  Sign  KNKG804.  240  For  the  reasons  stated  below,  we  grant  Verizon  Airfone  a  non-  renewable 
 license  for  a  five-  year  term  commencing  on  the  effective  date  of  this  Report  and  Order. 
 74.  At  the  outset,  we  reject  Verizon  Airfones  assertion  that  it  has  earned  the  right  to  exclusive  use  of  the  800  MHz  air-  ground  band  based  on  its  past  efforts  to  build  and  support  an  air-  ground 

 telecommunications  system.  241  Under  the  existing  800  MHz  air-  ground  band  plan  and  rules,  Verizon  Airfone  is  subject  to  sharing  the  band  with  up  to  five  additional  competing  licensees  and  is  limited  to 
 providing  voice  and  slow  speed  data  services.  Under  the  flexible  rules  that  we  adopt  today,  a  new  air-ground  licensee  may  provide  any  type  of  air-  ground  service  (i.  e.,  voice  telephony,  broadband  Internet, 
 data,  etc.)  to  aircraft  of  any  type,  and  serve  any  or  all  aviation  markets.  242  Exclusive  use  of  the  air-  ground  band  would  confer  fundamentally  greater  rights  and  access  to  substantially  more  spectrum  than  is 
 available  to  Verizon  Airfone  under  its  existing  license  and  the  current  800  MHz  air-  ground  rules.  We  note  that  the  929  Paging  Order,  243  cited  by  the  company,  lends  no  support  to  its  claim.  In  that  proceeding, 
 the  Commission  did  not  grant  flexible  spectrum  rights  or  additional  spectrum  to  existing  licensees.  Rather,  the  Commission  granted  exclusivity  to  existing  and  future  paging  licensees  to  use  existing  very-narrowband 
 channels  to  provide  paging  services,  provided  that  they  satisfied  certain  construction  and  system  loading  requirements.  244  In  view  of  the  foregoing,  we  find  that  there  is  no  justification  for 
 granting  Verizon  Airfone  exclusive  use  of  the  800  MHz  air-  ground  band,  which  would  provide  it  with  a  substantial  windfall,  and  we  conclude  that  permitting  competing  applications  for  licenses  in  this  band 
 would  better  serve  the  public  interest. 
 a.  Transition  of  Incumbent  System 
 75.  The  parties,  including  Verizon  Airfone,  state  that  a  new  broadband  air-  ground  system  could  not  operate  efficiently,  if  at  all,  in  the  same  spectrum  with  Verizon  Airfones  existing  narrowband 

 system.  245  The  record  reflects  that  paired  1.5  MHz  channels  will  provide  the  necessary  bandwidth  to  deploy  broadband  technologies  such  as  CDMA2000  1xEV-  DO.  246  In  order  to  ensure  that  the  air-  ground 
 spectrum  can  be  used  to  provide  broadband  air-  ground  services  to  the  public  in  the  near  future,  it  is  imperative  to  clear  the  incumbent  narrowband  system  from  a  minimum  of  three  megahertz  of  spectrum  as 
 soon  as  reasonably  practicable.  We  conclude  that,  given  the  declining  and  relatively  low  usage  level  of  Verizon  Airfones  system,  247  and  because  the  original  800  MHz  air-  ground  band  plan  was  intended  to 

 239  Skyway,  however,  has  an  STA  to  continue  operating  the  old  ClairCom  system  subject  to  the  outcome  of  this 
 proceeding.  See  supra  note  33.  240 
 Airfones  application  for  renewal  of  its  authorization  is  pending.  See  File  No.  0001716212  (filed  Apr.  28,  2004).  241 
 See  Verizon  Airfone  September  9  Statement  at  n.  5.  242 
 See  supra  para.  52.  243 
 See  Amendment  of  the  Commissions  Rules  to  Provide  Channel  Exclusivity  to  Qualified  Private  Paging  Systems  at  929-  930  MHz,  Report  and  Order,  8  FCC  Rcd  8318  (1993),  recon.  granted  in  part,  11  FCC  Rcd  3091  (1996)  (  929 

 Paging  Order).  244 
 Id.  245 
 See,  e.  g.,  AirCell  Response  to  FCC  Questions  at  7  (noting  that  the  incumbent  system  will  create  severe  interference  upon  the  broadband  systems);  Verizon  Comments  at  10. 

 246  See  supra  para.  31. 
 247  We  note  that  the  demand  for  Verizon  Airfone  service  has  declined  80  percent  in  recent  years,  from  an  average  of 
 15  users  to  only  three  users  per  flight.  See  Joe  Sharkey,  Almost  here:  Cell  phones  at  37,  000  feet,  N.  Y.  Times,  Oct.  10,  2004,  at  C6. 
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 accommodate  six  competing  licensees,  the  existing  system  can  be  provided  comparable  spectrum  in  one  megahertz  of  spectrum  in  the  air-  ground  band.  Verizon  Airfone  acknowledges  that  a  one  megahertz 
 spectrum  block  would  enable  it  to  continue  its  narrowband  operations.  248 
 76.  Verizon  Airfones  incumbent  system  must  cease  operations  in  the  lower  1.5  MHz  portion  of  each  2  MHz  air-  ground  band  within  24  months  of  the  initial  date  of  grant  of  any  license,  if  band  plan  1 

 or  2  is  implemented;  Verizon  Airfone  may  relocate  its  incumbent  operations  to  the  upper  0.  5  MHz  portion  of  each  2  MHz  band  249  and  may  continue  to  operate  under  the  renewal  authorization  until  the  end  of  the 
 five-  year  license  term.  If  band  plan  3  is  implemented,  Verizon  Airfones  incumbent  system  must  cease  operations  in  the  upper  1.5  MHz  portion  of  each  2  MHz  air-  ground  band  within  24  months  of  the  initial 
 date  of  grant  of  any  new  license;  Verizon  Airfone  may  relocate  its  incumbent  operations  to  the  lower  0.5  MHz  portion  of  each  2  MHz  band  250  and  may  continue  to  operate  under  the  renewal  authorization  until 
 the  end  of  the  five-  year  license  term.  We  note  that  this  transition  period  is  consistent  with  Verizon  Airfones  request  that  we  provide  it  a  limited  transitional  period  for  its  narrowband  system.  251  In 
 revising  our  current  air-  ground  rules,  we  are  eliminating  all  of  the  command  and  control  technical  rules,  which  enabled  dynamic  sharing  of  communication  channels  under  the  former  licensing  scheme.  252 
 Verizon  Airfone  may  reconfigure  the  narrowband  channelization  of  its  existing  system  in  the  upper  0.5  MHz  portion  of  each  2  MHz  band  (or  lower  0.5  MHz  portion  of  each  band  if  band  plan  3  is  implemented) 
 any  way  it  wants,  including  using  control  channel(  s)  of  any  authorized  bandwidth  less  than  6  kHz  (not  limited  to  3.2  kHz  as  they  are  now).  We  note  that  if  Verizon  Airfone  acquires  a  new  spectrum 
 authorization  as  a  result  of  competitive  bidding,  it  could  elect  to  continue  its  incumbent  operations  under  such  new  authorization. 

 b.  Reimbursement  of  Relocation  Costs 
 77.  We  conclude,  contrary  to  Verizon  Airfones  arguments,  253  that  it  would  not  be  inequitable  for  the  company  to  bear  any  costs  associated  with  relocating  its  narrowband  operations  within  the  24- 

 month  period  set  out  above  to  accommodate  a  new  entrant  in  the  air-  ground  band.  The  original  800  MHz  air-  ground  band  plan  was  intended  to  accommodate  six  competing  licensees  in  the  air-  ground  band,  and 
 Verizon  Airfone  has  never  had  a  right  to  exclusive  use  of  the  band.  The  new  license  that  we  grant  Verizon  Airfone  today,  moreover,  provides  the  company  a  substantial  period  two  years  from  the  initial 
 grant  of  any  new  air-  ground  license  to  relocate  its  narrowband  operations  to  one  megahertz  of  spectrum  in  the  band.  Assuming  an  auction  and  initial  license  grant  one  year  after  the  effective  date  of  this  order, 
 Verizon  Airfone  would  need  to  limit  its  operations  to  one  megahertz  three  years  into  its  5-  year  license  term.  We  note  that  this  approach  is  consistent  with  the  companys  request  for  a  limited  transitional 
 period  254  to  shift  its  narrowband  operations  to  a  1  MHz  spectrum  block  in  the  band.  255 

 248  Verizon  Airfone  September  10  Statement  at  20. 
 249  This  spectrum  includes  all  of  former  channel  blocks  1  and  2  and  approximately  half  of  former  channel  block  3. 
 250  This  spectrum  includes  all  of  former  channel  blocks  10  and  9  and  approximately  half  of  former  channel  block  8. 
 251  Verizon  Airfone  Comments  at  10. 
 252  Specifically,  Sections  22.  857,  22.  859,  22.  863,  22.  865,  22.  869,  and  22.  871  are  deleted.  Sections  22.  861  and 
 22.  867  are  amended  to  provide  basic  technical  parameters  for  the  new  licensees.  253 
 Verizon  Airfone  September  9  Statement  at  5-  6.  254 
 Verizon  Airfone  Comments  at  10.  255 
 Verizon  Airfone  September  10  Statement  at  20. 
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 removing  Section  22.857.  This  condition  requires  that  the  existing  system  remain  a  narrowband  system. 
 81.  Verizon  Airfone  must  coordinate  any  technical  changes  within  885  kilometers  (550  miles)  of  the  U.  S.-  Canadian  or  U.  S.-  Mexican  borders  with  the  appropriate  air-  ground  licensees  in  those 
 countries  prior  to  requesting  appropriate  governmental  approval.  257  Verizon  Airfone  may  locate  or  relocate  ground  stations  operating  at  any  power  level  (not  exceeding  100  Watts),  subject  only  to 
 international  coordination.  Verizon  Airfone  must  maintain  and  provide  to  the  FCC  and  the  new  800  MHz  air-  ground  licensee(  s)  a  current  list  of  the  locations  and  channels  used  at  all  ground  stations,  which  will 
 enable  the  licensee(  s)  to  provide  interference  protection  to  the  existing  systems  operations. 
 82.  During  the  period  that  the  existing  system  continues  to  operate  and  provide  service,  the  licensee  of  a  new  spectrum  license  must  not  cause  harmful  interference  to  it.  Protection  from  interference 

 requires  that  the  signals  of  the  new  licensee(  s)  must  not  exceed  the  current  adjacent  channel  emission  limit,  which  is  a  ground  station  received  power  of  -130  dBm  in  6  kHz,  assuming  a  0  dBi  vertically 
 polarized  antenna.  258  This  limit  will  provide  full  interference  protection  to  the  existing  system. 
 6.  Construction  Requirements 
 83.  The  record  indicates  that  an  air-  ground  system  using  broadband  technologies,  such  as  FLASH-  OFDM  and  CDMA2000  1xEV-  DO,  cannot  be  deployed  while  the  incumbent  system  operates  in 

 the  same  spectrum,  259  and  that  paired  1.5  MHz  channels  will  provide  sufficient  bandwidth  in  which  to  deploy  these  technologies.  260  As  noted  above,  in  order  to  facilitate  the  provision  of  advanced  air-  ground 
 telecommunications  services  to  the  public  in  the  near  future,  Verizon  Airfone  must  cease  operations  in  the  lower  1.5  MHz  portion  of  each  air-  ground  band  within  24  months  of  the  initial  date  of  grant  of  any  new 
 spectrum  license  if  band  plan  1  261  or  2  is  implemented.  262  If  band  plan  3  is  implemented,  Verizon  Airfone  must  cease  operations  in  the  upper  1.5  MHz  portion  of  each  air-  ground  band  within  24  months  of  the 
 initial  date  of  grant  of  a  new  spectrum  license.  263 
 84.  In  light  of  these  considerations,  we  find  that  a  five-  year  substantial  service  construction  requirement  for  any  new  spectrum  license  other  than  the  1  MHz  spectrum  licenses  D  and  E  will  serve 

 the  public  interest  and  is  consistent  with  our  statutory  mandate  to  prevent  stockpiling  or  warehousing  by  licensees,  and  to  promote  investment  in  and  rapid  deployment  of  new  technologies  and  services.  264  At 
 the  end  of  the  five-  year  construction  period,  a  licensee  must  provide  substantial  service  to  aircraft.  We 
 257  The  FCC  will  submit  coordination  requests  seeking  any  formal  approvals  needed  under  the  existing  international 
 agreements,  and  will  seek  to  update  these  agreements  with  these  countries.  258 
 47  C.  F.  R.    22.861(  b).  259 
 See,  e.  g.,  AirCell  Response  to  FCC  Questions  at  7  (noting  that  the  incumbent  system  will  create  severe  interference  upon  the  broadband  systems);  Verizon  Comments  at  10. 

 260  See  supra  para.  31. 
 261  If  band  plan  1  is  implemented,  licensees  A  and  B  initially  would  share  1.  5  MHz  at  849.  000-  850.  500  MHz  paired 
 with  1.  5  MHz  at  894.  000-  895.500  MHz.  Once  Verizon  Airfones  incumbent  system  ceases  operations  in  the  upper  0.5  MHz  of  each  band,  licensee  B  would  shift  its  operations  to  1.5  MHz  at  849.500-  851.000  MHz  paired  with  1.5 

 MHz  at  894.500-  896.  000  MHz.  262 
 See  supra  para.  76.  263 
 Id.  264 
 47  U.  S.  C.    309(  j)(  4)(  B). 
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 define  substantial  service  as  service  that  is  sound,  favorable,  and  substantially  above  a  level  of  mediocre  service  that  would  barely  warrant  renewal.  We  establish  two  safe  harbors  that  would  satisfy  this 
 substantial  service  obligation.  First,  construction  and  operation  of  20  base  stations,  with  at  least  one  base  station  in  each  of  the  ten  FAA  regions,  265  at  the  five-  year  benchmark  would  constitute  substantial  service. 
 Alternatively,  the  construction  and  operation  of  base  stations  capable  of  serving  the  airspace  of  at  least  25  of  the  50  busiest  airports  (as  measured  by  annual  passenger  boardings)  at  the  five-  year  benchmark  would 
 constitute  substantial  service.  266 
 85.  We  do  not  establish  a  construction  requirement  for  spectrum  licenses  D  and  E.  If  either  of  these  licenses  is  acquired,  the  licensee  would  have  to  share  spectrum  with  Verizon  Airfones 

 incumbent  system  until  the  expiration  of  Verizon  Airfones  non-  renewable  license  term.  Depending  on  system  configuration,  a  licensee  of  spectrum  block  D  or  E  might  not  find  it  technically  desirable  to 
 operate  an  air-  ground  system  while  sharing  spectrum  with  the  incumbent  system.  Under  these  circumstances,  a  construction  requirement  could  result  in  a  licensee  deploying  a  less  than  optimal  system. 

 B.  400  MHz  Air-  Ground  Radiotelephone  Service 
 86.  The  general  aviation  air-  ground  service  operates  in  the  454.675-  454.  975  and  459.  675-459.975  MHz  bands  and  involves  the  provision  of  telecommunications  service  to  private  aircraft  such  as 

 small  single  engine  craft  and  corporate  jets.  267  As  explained  by  one  of  the  commenters  in  this  proceeding,  the  channels  licensed  in  this  service  are  used  for  emergency  and  other  purposes.  268  These  channels  are 
 interconnected  with  the  public  switched  telephone  network.  269  Pursuant  to  our  biennial  review  of  regulations  in  the  Notice,  we  are  revising  and  eliminating  certain  rules  governing  this  service.  270  We  also 
 note  that,  to  date,  the  Commission  has  accepted  for  filing  nine  sets  of  mutually  exclusive  applications  in  this  service.  Because  the  Commission  is  required  under  Section  309(  j)  of  the  Communications  Act  to 
 resolve  this  mutual  exclusivity  by  auction,  we  propose  competitive  bidding  rules  for  the  general  aviation  air-  ground  service  in  the  Notice  of  Proposed  Rulemaking  below.  271 

 1.  Form  409,  Airborne  Mobile  Radio  Telephone  License  Application 
 87.  Background.  In  contrast  to  most  Part  22  services,  Section  22.3(  b)(  1)  requires  an  individual  authorization  to  operate  a  general  aviation  airborne  mobile  station  an  end  user  unit  in  the 

 Air-  Ground  Radiotelephone  Service.  272  This  requirement  is  also  reflected  in  Section  1.903(  c)  of  our  rules.  273  Individuals  must  file  FCC  Form  409  (Airborne  Mobile  Radio  Telephone  License  Application)  to 

 265  See  http://  www.  faa.  gov/  arp/  regions.  cfm  (FAA  regions). 
 266  See  http://  www.  faa.  gov/  arp/  planning/  stats/  2002/  CY02CommSerBoard.  pdf  (FAA  2002  passenger  boarding  data). 
 267  See  47  C.  F.  R.    22.  805-  22.819. 
 268  SkyTel  Comments  at  2. 
 269  Id. 
 270  In  addition  to  the  rules  revised  or  eliminated  as  discussed  below,  we  take  this  opportunity  to  update  and 
 reorganize  the  general  aviation  air-  ground  rules.  In  particular,  we  redesignate  current  Section  22.  803  of  the  general  rules  as  new  Section  22.  807  of  the  general  aviation  air-  ground  rules,  and  delete  certain  superfluous  language  therein 

 that  relates  to  the  Rural  Radiotelephone  Service.  271 
 See  infra  paras.  169-  178.  272 
 47  C.  F.  R.    22.3(  b)(  1).  273 
 47  C.  F.  R.    1.903(  c). 
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 apply  for  authority  to  operate  an  airborne  station  or  to  modify  or  renew  an  existing  license.  274  In  the  Notice,  we  tentatively  concluded  that  this  individual  licensing  requirement  should  be  eliminated,  although 
 we  also  asked  whether  there  might  be  any  reasons  for  retaining  this  requirement  or  adopting  a  streamlined  version  of  this  requirement.  275 

 88.  Discussion.  Despite  the  objections  of  SkyTel  and  Able  Communications,  we  do  not  believe  that  the  continued  licensing  of  individual  airborne  mobile  stations  is  warranted.  SkyTel  objects  to 
 the  elimination  of  the  licensing  requirement  because  there  will  be  no  means  of  knowing  whether  traffic  is  legitimate  or  from  a  rogue  user  on  the  system.  276  It  adds  that,  unlike  subscribers  in  the  land  mobile 
 services,  airborne  subscribers  are  not  associated  with  a  single  base  station  licensee,  so  if  individual  end  user  licensing  is  eliminated,  there  will  be  no  way  to  determine  the  identity  and  number  of  potential  users 
 for  the  Air-  Ground  System.  277 
 89.  We  have  considered  these  concerns  and  do  not  believe  they  justify  the  continued  use  of  FCC  Form  409.  At  present,  and  likely  for  the  foreseeable  future,  members  of  the  public  desiring  service 

 using  the  current  Air-  Ground  Radiotelephone  Automated  Service  (AGRAS)  system  must  first  purchase  and  install  an  AGRAS-  compatible  mobile  telephone  aboard  their  aircraft.  Such  mobile  units  are 
 considerably  more  expensive  and  not  as  readily  available  as  mobile  telephones  typically  used  with  land-based  public  mobile  systems.  Coupled  with  the  fact  that  the  number  of  general  aviation  users  is  relatively 
 small,  the  probability  of  rogue  users  is  minimal. 
 90.  More  importantly,  a  potential  air-  ground  subscriber  must  first  register  with  the  billing  service  utilized  by  the  various  air-  ground  licensees  to  obtain  an  aircraft  telephone  number  in  order  to 

 receive  service.  Therefore,  the  licensees  own  billing  service  would  know  the  number  and  identification  of  legitimate  users  of  the  air-  ground  AGRAS  system.  Presumably,  if  an  un-  registered  or  rogue  user 
 attempted  to  place  calls  over  the  AGRAS  system,  service  would  be  denied. 
 91.  In  addition,  the  Commission  has  received  few  complaints  regarding  these  stations.  As  pointed  out  in  the  Notice,  Air-  Ground  equipment  is  used  to  communicate  with  ground  facilities  that  are 

 otherwise  licensed  by  the  Commission.  278  Moreover,  we  believe  that  the  requirement  to  file  Form  409  imposes  an  unnecessary  regulatory  burden  on  end  users,  because  it  involves  preparation  of  a  form  as  well 
 as  payment  of  a  $50  fee  for  each  subscriber  unit. 
 92.  Therefore,  in  keeping  with  the  Commissions  policy  of  simplifying,  where  appropriate,  its  licensing  procedures  and  easing  the  administrative  burden  on  licensees  and  other  users  of  Wireless 

 Radio  Services,  we  eliminate,  by  revising  Sections  1.903(  c)  and  22.3(  b),  the  requirement  that  an  authorization  be  obtained  to  operate  general  aviation  airborne  mobile  stations  in  the  Air-  Ground 
 Radiotelephone  Service.  We  also  eliminate  FCC  Form  409  and  delete  references  to  that  form  in  Sections  1.1102  and  1.2003  of  our  rules.  279 

 274  FCC  Form  409  was  adopted  in  1976.  See  Amendment  of  Part  21,  Domestic  Public  Radio  Services  (Other  than 
 Maritime  Mobile)  and  Adoption  of  FCC  Form  409,  Order,  63  FCC  2d  228  (1976).  275 
 Notice,  18  FCC  Rcd  at  8391  25.  276 
 SkyTel  Comments  at  2.  See  also  Able  Communications  Comments  at  3.  277 
 SkyTel  Comments  at  3.  278 
 Notice,  18  FCC  Rcd  at  8392  27.  279 
 47  C.  F.  R.    1.1102,  1.2003. 
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 2.  Idle  Tone 
 93.  Background.  Section  22.811  provides  that,  when  a  ground  station  transmitter  authorized  to  transmit  on  any  Air-  Ground  Radiotelephone  Service  channel  listed  in  Section  22.805  (for  general 

 aviation  air-  ground  service)  is  available  for  service  but  idle,  it  must  continuously  transmit  a  modulated  signal  on  that  channel  with  a  power  between  10  and  20  dB  lower  than  the  normal  transmitting  power.  280 
 In  the  Notice,  we  pointed  out  that  all  U.  S.  Air-  Ground  stations  are  currently  required  to  operate  using  Air-Ground  Radiotelephone  Automated  Service  (AGRAS),  and  that  as  a  result,  the  idle  tone  rule,  which  was 
 intended  to  facilitate  manual  Air-  Ground  service,  appears  to  have  become  obsolete.  281  We  thus  tentatively  concluded  that  Section  22.811  should  be  eliminated.  282 

 94.  Discussion.  Both  commenters  on  this  issue  express  their  desire  to  maintain  the  idle  tone  requirement.  In  particular,  SkyTel  argues  that  the  rule  is  not  obsolete,  because  idle  tone  transmissions 
 facilitate  the  directing  of  calls  to  the  correct  channel.  283  Able  Communications  adds  that  eliminating  the  control  tone  in  the  AGRAS  air-  ground  service  would  adversely  affect  users,  as  new  AGRAS  system 
 improvements  are  backwards  compatible,  relying  on  older  protocols.  284  Despite  these  comments,  we  continue  to  believe  that  the  deletion  of  Section  22.811  from  our  rules  is  warranted.  We  take  this 
 opportunity  to  point  out  that  the  removal  of  this  rule  in  no  way  prohibits  carriers  from  employing  the  idle  control  tone.  To  the  contrary,  the  action  we  take  today  is  permissive.  To  the  extent  that  idle  tone 
 transmissions  are  deemed  valuable  by  system  operators,  they  are  free  to  continue  to  use  them.  In  light  of  todays  automated  system,  however,  we  do  not  believe  that  mandating  their  continued  use  is  warranted. 

 3.  Construction  Period  for  General  Aviation  Ground  Stations 
 95.  Background.  Section  22.815  provides  that  [  t]  he  construction  period  (see    22.142)  for  general  aviation  ground  stations  is  12  months.  285  In  the  Notice,  we  pointed  out  that  former  Section 

 22.142  286  was  consolidated  into  current  Section  1.946  287  as  part  of  the  implementation  of  the  Universal  Licensing  System  rules.  288  We  therefore  proposed  to  eliminate  the  reference  to  former  Section  22.142  in 
 Section  22.815  and  replace  it  with  a  reference  to  Section  1.946. 
 96.  Discussion.  As  proposed  in  the  Notice,  we  correct  the  reference  in  Section  22.815  to  specify  the  actual  rule  section,  Section  1.946. 

 280  47  C.  F.  R.    22.811. 
 281  Notice,  18  FCC  Rcd  at  8408  73. 
 282  Id. 
 283  SkyTel  Comments  at  4. 
 284  Able  Communications  Comments  at  2.  The  commenter  also  states  that  older  equipment  still  uses  the  idle  control 
 tones.  285 
 47  C.  F.  R.    22.815.  286 
 47  C.  F.  R.    22.  142  (1997).  287 
 47  C.  F.  R.    1.946.  288 
 Notice,  18  FCC  Rcd  at  8408    74;  see  Biennial  Regulatory  Review  Amendment  of  Parts  0,  1,  13,  22,  24,  26,  27,  80,  90,  95,  97  and  101  of  the  Commissions  Rules  to  Facilitate  the  Development  and  Use  of  the  Universal  Licensing 

 System  in  the  Wireless  Telecommunications  Services,  Report  and  Order,  13  FCC  Rcd  21027  (1998)  (  ULS  Report  and  Order);  Memorandum  Opinion  and  Order  on  Reconsideration,  14  FCC  Rcd  11145  (1998). 
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 4.  AGRAS 
 97.  Background.  Section  22.819  provides  that,  after  January  1,  1996,  stations  transmitting  on  the  general  aviation  air-  ground  service  channels  must  operate  in  compliance  with  the  requirements  set 

 forth  in  the  document,  "Technical  Reference,  Air-  ground  Radiotelephone  Automated  Service  (AGRAS),  System  Operation  and  Equipment  Characteristics,"  dated  April  12,  1985.  289  Previously,  air-  ground 
 radiotelephone  service  was  manual  in  nature,  requiring  operator  assistance  and  intervention  in  handling  all  calls.  The  AGRAS  protocols  advanced  this  service  so  that  calls  could  be  directly  dialed.  290  In 
 addition,  the  automated  system  allows  two  or  more  competing  ground  stations  in  a  location  to  share  control  channels.  291  In  the  Notice,  we  stated  that  the  industry  is  currently  developing  a  new  operating 
 technology  that  may  be  superior  to  AGRAS.  292  We  sought  comment  on  the  best  way  in  which  to  facilitate  such  technical  innovation.  293 

 98.  Discussion.  We  disagree  with  SkyTel  that  the  Commission  should  continue  to  require  this  particular  technology,  and  will  delete  Section  22.819.  294  SkyTel  comments  that  maintenance  of  the 
 AGRAS  protocol  will  ensure  that  any  nascent  standard  is  implemented  with  backwards  compatibility  and  will  therefore  protect  owners  of  existing  hardware  and  systems  that  might  not  be  able  immediately 
 to  implement  a  new  technology  when  it  arrives.  295  We  point  out  that  our  deletion  of  the  rule  does  not  mean  that  the  AGRAS  protocols  are  prohibited.  To  the  contrary,  technological  advancements  in  this  area 
 may  continue  to  utilize  AGRAS  protocols  if  developers  believe  it  would  be  appropriate.  Despite  SkyTels  concerns,  we  are  unwilling  at  this  time  to  mandate  the  use  of  a  particular  technology  when  the 
 market  is  more  suited  to  make  these  decisions.  We  also  believe  that  it  is  unlikely  that  the  industry  would  simply  forsake  the  current  users  of  these  systems. 

 C.  Revision  of  Part  22  Non-  Cellular  Rules 
 1.  Scope  and  Authority  Authorization  Required,  General  Eligibility,  and  Definitions 

 99.  Background.  Section  22.3(  b)  provides  that,  except  for  certain  stations  in  the  Rural  Radiotelephone  Service  and  the  Air-  Ground  Radiotelephone  Service,  the  operation  by  subscribers  of 
 mobile  or  fixed  stations  in  the  Public  Mobile  Services  is  covered  by  the  authorization  held  by  the  common  carrier  providing  service  to  them.  296  In  the  Notice,  we  proposed  to  eliminate  the  restriction  that 
 license  holders  in  Part  22  may  only  be  current  or  future  common  carriers.  297  We  tentatively  concluded  that  the  term  common  carrier  in  Section  22.3(  b)  should  be  replaced  with  the  term  licensee,  and  that 

 289  47  C.  F.  R.    22.819. 
 290  See  Technical  Reference,  Air-  ground  Radiotelephone  Automated  Service  (AGRAS),  System  Operation  and 
 Equipment  Characteristics,  REF:  650-  0244-  000,  dated  Apr.  12,  1985.  291 
 Id.  292 
 Notice,  18  FCC  Rcd  at  8408  74.  293 
 Id.  at  8408-  09  75.  294 
 47  C.  F.  R.    22.819.  295 
 SkyTel  Comments  at  4.  296 
 47  C.  F.  R.    22.  3(  b).  Accordingly,  end  users  do  not  file  applications  with  the  Commission  for  authority  to  use  their  mobile  phones. 

 297  Notice,  18  FCC  Rcd  at  8391  24. 
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 end  users  could  continue  to  rely  on  the  operating  authority  granted  by  the  Commission  to  their  service  provider.  298 
 100.  Part  22  also  contains  other  rules  that  use  the  term  common  carrier.  Section  22.7  states  that,  except  as  otherwise  provided  in  this  part,  existing  and  proposed  common  carriers  are  eligible  to 
 hold  authorizations  in  the  Public  Mobile  Services.  299  In  the  Notice,  we  proposed  to  delete  this  limitation.  300  We  also  pointed  out  that  several  of  the  definitions  contained  in  Section  22.99  include 
 references  to  the  term  common  carrier  that,  should  we  adopt  our  proposal  to  remove  the  common  carrier  eligibility  restriction,  should  be  replaced  with  the  term  licensee.  We  specifically  sought 
 comment  regarding  whether  elimination  of  the  common  carrier  eligibility  requirement  in  Part  22  could  have  any  detrimental  effect  for  Part  22  licensees.  301  Finally,  we  observed  that  the  distinctions  previously 
 drawn  between  a  radio  common  carrier  and  a  wireline  common  carrier  under  the  Part  22  rules  became  obsolete  in  1984.  302 

 101.  Discussion.  We  revise  Sections  22.3(  b),  22.7,  and  22.  99  as  proposed  in  the  Notice,  by  replacing  the  term  common  carrier  with  the  term  licensee,  and  thus  deleting  the  requirement  that 
 licensees  in  Part  22  services  be  common  carriers.  303  We  also  revise  Section  22.1(  b)  to  delete  the  reference  to  domestic  common  carrier,  and  Section  22.401  to  delete  the  words  Communications  common 
 carriers  and  replace  with  the  words  Eligible  entities  (see    22.7).  These  revisions  help  to  implement  the  proposal  we  adopt  to  remove  the  common  carrier  restriction  from  the  Part  22  eligibility  rules.  We 
 agree  with  Blooston  that  Section  22.351,  regarding  channel  assignments,  should  be  similarly  amended.  304  Finally,  we  delete  the  definitions  for  Radio  Common  Carrier  and  Wireline  Common  Carrier,  as  these 
 terms  are  no  longer  used  in  Part  22,  and  correct  references  to  the  term  Air-  ground  Radiotelephone  Service  contained  in  several  definitions  in  Section  22.99  to  read  Air-  Ground  Radiotelephone  Service. 

 102.  While  the  commenters  are  overwhelmingly  supportive  of  our  proposal  to  remove  the  common  carrier  restriction  from  the  Part  22  eligibility  rules,  305  Arch  Wireless  and  Able  Communications 
 have  expressed  concern  that  the  proposed  rule  change  might  alter  the  ability  of  licensees  to  retain  the  protections  and  rights  that  common  carrier  status  provides.  306  In  particular,  Arch  states  that  common 
 carrier  status  has  played  an  important  part  in  achieving  interconnection  agreements  with  incumbent  local  exchange  carriers  and  notes  that  common  carriers  are  exempt  from  Health  Insurance  Portability  and 
 Accountability  Act  of  1996  307  privacy  rules.  308  Able  Communications  expresses  similar  concerns 

 298  Id. 
 299  47  C.  F.  R.    22.7. 
 300  Notice,  18  FCC  Rcd  at  8392-  93  28. 
 301  Id.  at  8393  29. 
 302  Id.  at  8393  29  n.  79. 
 303  Id.  at  8391-  94    24-  30. 
 304  Blooston  Comments  at  8. 
 305  See,  e.  g.,  AMTA  Comments  at  6;  Cingular  Wireless  Comments  at  18;  Joint  Comments  at  3-  4;  and  NYSE&  GC 
 Reply  Comments  at  3-  4.  306 
 See  Able  Communications  Comments  at  4;  Arch  Wireless  Comments  at  6.  307 
 Health  Insurance  Portability  and  Accountability  Act  of  1996,  Pub.  L.  No.  104-  191  (1996).  308 
 Arch  Wireless  Comments  at  6-  7. 
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 regarding  privacy,  interconnection,  and  licensees  standing  in  state  and  federal  courts.  309 
 103.  Our  action  today  does  not  impact  a  licensees  ability  to  elect  common  carrier  status  under  our  Part  22  rules.  We  thus  find  that  the  commenters  concerns  that  these  rule  changes  could  mean  that 

 common  carriers  might  lose  certain  legal  and  regulatory  protections  are  unwarranted.  As  Blooston  suggests,  common  carrier  status  should  be  viewed  as  an  option,  rather  than  a  requirement  for  Part  22 
 licensees,  and  the  election  of  common  carrier  status  should  still  entail  protections  to  CMRS  providers.  310  We  agree.  Consequently,  we  emphasize  that  our  objective  here  is  to  remove  the  requirement  that  Part  22 
 licensees  be  common  carriers  (i.  e.,  remove  the  eligibility  restriction),  without  impacting  the  ability  of  licensees  to  choose  such  status  if  so  desired. 

 2.  Licensing  Requirements  and  Procedures 
 a.  Construction  Prior  to  Grant  of  Application 
 104.  Background.  Section  22.143(  d)(  4)  of  our  rules  provides  that,  for  any  pre-  grant  construction  or  alteration  that  would  exceed  the  requirements  of  Section  17.7,  311  the  licensee  must  notify 

 the  FAA  and  file  a  request  for  antenna  height  clearance  and  obstruction  and  marking  specifications  (FCC  Form  854)  with  the  FCC,  PRB,  Support  Services  Branch,  Gettysburg,  PA  17325.  312  In  the  Notice,  we 
 proposed  to  make  an  editorial  correction  to  the  Form  854  filing  location  to  WTB,  Database  Management  Division,  Analysis  and  Development  Branch,  1120  Fairfield  Road,  Gettysburg,  PA  17325.  313  We  also 
 proposed  to  amend  Section  22.143(  d)(  4)  to  specify  that  Form  854  may  be  filed  electronically  by  accessing  the  Commissions  Antenna  Structure  Registration  home  page  at  wireless.  fcc.  gov/  antenna/.  314 

 105.  Discussion.  No  comments  were  received  regarding  these  proposed  changes,  which  will  provide  the  public  with  better  information.  We  note  that  since  the  Notice  was  released,  the  Wireless 
 Telecommunications  Bureau,  in  late  2003,  was  reorganized.  315  As  a  result,  the  correct  filing  location  for  FCC  Form  854  is  WTB,  Spectrum  Management  Resources  and  Technologies  Division,  1270  Fairfield 
 Road,  Gettysburg,  PA  17325.  We  revise  this  form  accordingly,  and  we  amend  Section  22.143(  d)(  4)  of  our  rules  to  include  this  updated  address. 

 b.  Computation  of  Distance 
 106.  Background.  In  the  Notice,  we  proposed  to  recodify  Section  22.157  in  Part  1,  Subpart  F,  as  new  Section  1.958,  so  that  a  single  distance  calculation  method  would  apply  to  all  Wireless  Radio 

 Services,  providing  regulatory  certainty  and  consistency  to  service  providers  licensed  under  these  rule  parts.  316  Currently,  Section  22.157  requires  that  distance  calculations  be  rounded  to  the  nearest  whole 
 kilometer,  while  Section  90.  309(  a)(  1)  requires  that  they  be  rounded  to  the  nearest  0.1  kilometer.  317  We 
 309  Able  Communications  Comments  at  4. 
 310  Blooston  Comments  at  3,  7. 
 311  47  C.  F.  R.    17.7  (antenna  structures  requiring  notification  to  the  FAA). 
 312  47  C.  F.  R.    22.143(  d)(  4). 
 313  Notice,  18  FCC  Rcd  at  8394  31. 
 314  Id. 
 315  See  FCCs  Wireless  Bureau  Announces  Reorganization,  Public  Notice  (rel.  Nov.  24,  2003). 
 316  Notice,  18  FCC  Rcd  at  8394-  95  33. 
 317  See  Notice,  18  FCC  Rcd  at  8394  32;  47  C.  F.  R.    22.  157,  90.  309(  a)(  1). 
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 also  noted  that  the  Section  90.309(  a)(  1)  calculation  method  was  based  on  the  Section  73.611  318  calculation  method,  and  we  tentatively  concluded  that  the  reference  to  Section  73.  611  in  Section 
 90.309(  a)(  1)  should  be  deleted  and  replaced  by  a  reference  to  new  Section  1.958.  319 
 107.  Discussion.  We  recodify  Section  22.157  as  new  Section  1.958  in  Part  1,  Subpart  F.  This  will  make  the  Section  22.157  distance  calculation  method  applicable  to  all  Wireless  Radio  Services 

 described  in  Parts  1  (except  Parts  21  and  101  as  explained  below),  20,  22,  24,  27,  80,  87,  90,  95,  and  97,  320  and  supersede  any  conflicting  regulations  in  these  Parts.  321  We  note  that  software  used  by  the 
 Commission  to  process  applications  under  Parts  21  (Domestic  Public  Fixed  Radio  Services)  and  101  (Fixed  Microwave  Services)  is  programmed  to  round  the  result  of  a  distance  calculation  to  the  nearest 
 tenth  of  a  kilometer.  Accordingly,  we  include  language  in  new  Section  1.958  to  indicate  that  distance  calculations  for  applications  under  these  parts  must  be  rounded  to  the  nearest  tenth  of  a  kilometer. 

 108.  We  disagree  with  the  suggestions  of  two  commenters  that  we  adopt  the  Great  Circle  Route  method  of  computing  distance.  322  This  distance  calculation  method  inputs  the  latitudes  and 
 longitudes  of  two  points  into  formulas  derived  from  spherical  trigonometry  to  measure  the  great  circle  distance.  A  great  circle  is  the  intersection  of  a  sphere  with  a  plane  passing  through  the  center  of  the 
 sphere.  Arcs  of  great  circles  on  the  earth  represent  the  shortest  route  between  two  points  on  its  surface.  323  First,  while  this  method  can  be  more  accurate  for  longer  distances  (i.  e.,  distances  of  approximately  500 
 kilometers  or  more),  the  majority  of  distance  calculations  in  the  Public  Mobile  Services  are  for  much  shorter  distances.  Second,  we  do  not  believe  that  the  improvements  in  accuracy  resulting  from  this 
 method  are  significant.  Third,  the  mathematical  calculations  that  are  required  are  too  complex  to  warrant  its  use.  We  believe  that  recodification  of  Section  22.157  in  Part  1  is  a  more  workable,  practical  approach 
 for  applicants.  324 
 c.  Computation  of  Terrain  Elevation 
 109.  Background.  Section  22.159  sets  forth  the  method  for  computing  average  terrain  elevation  for  Part  22  services.  325  Section  90.  309(  a)(  4)  sets  forth  the  method  for  computing  average  terrain 

 elevation  for  Part  90  services  in  the  470-  512  MHz  band.  326  Calculations  for  the  470-  512  MHz  band  are  unique  because  they  must  take  into  consideration  land  mobile  and  co-  channel  and  adjacent  channel  UHF 
 TV  station  operations.  327  Parts  20,  21,  24,  27,  80,  87,  95,  97,  and  101  generally  do  not  specify  a  terrain 

 318  47  C.  F.  R.    73.611. 
 319  See  Notice,  18  FCC  Rcd  at  8394  32. 
 320  See  47  C.  F.  R.    1.901. 
 321  See  47  C.  F.  R.    1.902. 
 322  Cingular  Wireless  Comments  at  18;  Verizon  Airfone  Reply  Comments  at  7. 
 323  The  equator  is  a  great  circle  as  are  all  meridians  of  longitude.  This  distance  calculation  method  can  prove  to  be 
 more  accurate  for  longer  distances  as  it  relies  on  a  spherical,  not  flat,  earth.  However,  the  Great  Circle  Route  requires  hi-  precision  transcendental  functions  in  order  to  achieve  accuracy  at  shorter  distances. 

 324  If  an  applicant  deems  the  distance  calculation  methodology  set  forth  in  new  Section  1.958  to  not  be  accurate,  it 
 can  always  seek  a  waiver  to  use  an  alternative  methodology  under  the  applicable  Commission  waiver  standards.  325 
 47  C.  F.  R.    22.159.  326 
 47  C.  F.  R.    90.309(  a)(  4).  327 
 47  C.  F.  R.    90.309(  a)(  4). 
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 elevation  calculation  method.  328  In  the  Notice,  we  proposed  to  recodify  Section  22.159  in  Part  1,  Subpart  F,  as  new  Section  1.959.  329  We  also  proposed  to  retain  the  Section  90.  309(  a)(  4)  method  for  computing 
 average  terrain  elevation  for  the  470-  512  MHz  band  under  Part  90,  and  cross-  reference  it  in  new  Section  1.959.  330 

 110.  Discussion.  We  recodify  Section  22.159  as  new  Section  1.959  in  Part  1,  Subpart  F.  Those  commenters  that  discuss  this  issue  support  the  adoption  of  a  consistent  terrain  elevation  calculation 
 method  applicable  to  all  Wireless  Radio  Services.  331  Consequently,  we  make  the  change  as  proposed  in  the  Notice.  332  Part  90  services  in  the  470-  512  MHz  band,  due  to  their  proximity  to  TV  operations,  will 
 continue  to  be  governed  by  Section  90.  309(  a)(  4).  333  Thus,  all  wireless  services  under  Parts  1,  20,  22,  24,  27,  80,  87,  90  (except  the  470-  512  MHz  band),  95,  97  and  101  will  be  subject  to  the  same  computation 
 methodology. 
 d.  ASSB 
 111.  Background.  Section  22.161  sets  forth  application  requirements  for  base  stations  in  the  Paging  and  Radiotelephone  Service,  Rural  Radiotelephone  Service,  and  Offshore  Radiotelephone  Service 

 where  the  applicant  proposes  to  employ  amplitude  compandored  single  sideband  modulation  (ASSB).  334  In  the  Notice,  we  tentatively  concluded  that  Section  22.  161  should  be  eliminated.  335 

 112.  Discussion.  We  delete  Section  22.161.  336  No  comments  were  received  on  this  ASSB  issue.  As  pointed  out  in  the  Notice,  337  this  rule  section  is  obsolete  in  light  of  Section  22.357,  which 
 permits  Part  22  licensees  to  use  any  emission  type  that  complies  with  applicable  emission  limits.  338 

 328  Parts  20,  21,  87,  95  and  97  have  no  height  above  average  terrain  (  HAAT)  rules.  Section  24.  53,  47  C.  F.  R. 
   24.  53,  is  generally  the  same  as  Section  22.  159.  Part  27  defines  "average  terrain  elevation"  in  Section  27.  4,  47  C.  F.  R.    27.  4,  and  uses  HAAT  in  Section  27.50,  47  C.  F.  R.    27.  50,  but  does  not  specify  how  to  calculate  it.  Section 

 80.  757,  47  C.  F.  R.    80.  757,  provides  that  average  terrain  elevation  may  be  either  computer-  generated  or  derived  from  the  use  of  topographical  maps.  Section  80.  759,  47  C.  F.  R.    80.  759,  provides  details  of  the  manual  method, 
 where  height  above  average  terrain  is  determined  by  calculations  based  on  the  drawing  of  radials  away  from  the  antenna  site.  Part  101  refers  to  AAT  in  Sections  101.105  and  101.  1333,  47  C.  F.  R.    101.105,  101.1333,  but  does 
 not  specify  how  it  shall  be  calculated.  329 
 Notice,  18  FCC  Rcd  at  8395  34.  330 
 Id.  331 
 See  Verizon  Wireless  Comments  at  10;  Cingular  Wireless  Comments  at  18.  332 
 Notice,  18  FCC  Rcd  at  8395  34.  333 
 47  C.  FR.    90.  309(  a)(  4).  334 
 47  C.  F.  R.    22.161.  335 
 Notice,  18  FCC  Rcd  at  8396  35.  336 
 We  also  eliminate  the  reference  to  this  section  in  the  definition  of  Channel  in  Section  22.  99.  See  47  C.  F.  R.    22.  99. 

 337  Notice,  18  FCC  Rcd  at  8396  35. 
 338  47  C.  F.  R.    22.357. 
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 3.  Operational  and  Technical  Requirements 
 a.  Channel  Assignment  Policy 
 113.  Background.  Section  22.351  sets  forth  the  general  policy  for  the  assignment  of  PMS  channels.  339  The  third  sentence  of  this  section  uses  the  term  common  carrier.  340  In  the  Notice,  we 

 proposed  to  replace  the  term  common  carrier  with  the  term  licensee.  341 
 114.  Discussion.  Consistent  with  our  action  above,  342  we  amend  Section  22.  351  as  proposed  in  the  Notice. 

 b.  Interference  Protection 
 115.  Background.  Section  22.352  provides,  in  pertinent  part,  that  PMS  licensees  shall  be  considered  non-  interfering  if  they  operate  in  accordance  with  FCC  rules  that  provide  technical  channel 

 assignment  criteria  for  the  radio  service  or  channels  involved,  all  other  applicable  FCC  rules,  and  the  terms  and  conditions  of  their  authorizations.  343  This  rule  helps  to  alleviate  the  administrative  burden  on 
 the  Commission  of  resolving  interference  complaints  by  creating  a  presumption  that  operations  consistent  with  our  rules  and  the  applicable  authorization  are  non-  interfering.  In  the  Notice,  we  tentatively 
 concluded  that  this  provision  in  the  rule  section  could  be  streamlined  by  essentially  removing  the  language  regarding  technical  channel  assignment  criteria.  344 

 116.  Discussion.  We  modify  the  relevant  portion  of  Section  22.352  to  read  Public  Mobile  Service  stations  operating  in  accordance  with  applicable  FCC  rules  and  the  terms  and  conditions  of  their 
 authorizations  are  normally  considered  to  be  non-  interfering.  345  No  comments  were  received  on  this  topic.  The  streamlined  wording  we  adopt  more  accurately  reflects  how  the  Commission  currently 
 addresses  interference  issues,  as  we  make  clear  that  operation  consistent  with  Commission  rules  and  the  applicable  authorization  whether  on  a  site-  by-  site  basis  or  on  a  geographic  area  basis  creates  a 
 presumption  of  non-  interfering  operation. 
 c.  Emission  Types  and  Emission  Masks 
 117.  Background.  An  emission  mask  is  defined  as  [  t]  he  design  limits  imposed,  as  a  condition  or  certification,  on  the  mean  power  of  emissions  as  a  function  of  frequency  both  within  the  authorized 

 bandwidth  and  in  the  adjacent  spectrum.  346  Section  22.357  provides  that  any  authorized  PMS  station  may  use  any  type  of  emission  provided  that  it  complies  with  the  appropriate  emission  mask.  347  Section 

 339  47  C.  F.  R.    22.351. 
 340  This  sentence  provides:  Except  as  otherwise  provided  in  this  part,  each  channel  or  channel  block  is  assigned 
 exclusively  to  one  common  carrier  in  each  service  area.  47  C.  F.  R.    22.351.  341 
 Notice,  18  FCC  Rcd  at  8396  36.  342 
 See  supra  paras.  99-  103.  343 
 47  C.  F.  R.    22.352.  344 
 Notice,  18  FCC  Rcd  at  8396  37.  345 
 See  id.  346 
 47  C.  F.  R.    22.99.  347 
 47  C.  F.  R.    22.357. 
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 22.359  is  the  general  emission  mask  rule.  348  Section  22.  861  is  the  emission  limitations  and  mask  rule  for  commercial  aviation  air-  ground  systems.  349  At  the  time  the  Commission  adopted  the  Part  22  rules,  it 
 generally  used  the  emission  mask  approach  to  regulate  in-  band  energy  distribution.  Recently,  however,  the  Commission  has  been  decreasing  its  reliance  on  the  use  of  emission  masks  as  a  means  to  limit 
 interference  and,  instead,  increased  its  reliance  on  the  use  of  out-  of-  band  emission  (OOBE)  limits.  350  The  salient  difference  between  emission  masks  and  OOBE  limits  is  that  OOBE  limits  do  not  limit  emission 
 levels  within  a  particular  frequency  band.  Rather,  they  are  intended  to  limit  emissions  outside  of  the  authorized  bandwidth.  In  the  Notice,  we  sought  comment  on  possible  revision  or  elimination  of  Sections 
 22.357,  22.359,  and  22.  861  in  light  of  the  trend  toward  use  of  OOBE  limits.  351  We  also  sought  comment  on  whether  we  should  adopt  OOBE  limits  for  the  Part  22  services  that  are  the  subject  of  this 
 proceeding.  352 
 118.  Discussion.  Consistent  with  the  recent  increased  use  of  OOBE  limits,  we  replace  the  emission  mask  requirements  found  in  Sections  22.357,  22.359,  and  22.861  with  an  OOBE  limitation.  Of 

 the  commenters  that  discussed  this  issue,  Cingular  Wireless  and  Verizon  Wireless  favor  OOBE  limits  over  emission  masks  as  the  method  of  preventing  harmful  interference.  353  We  believe  that  OOBE 
 limitations  are  preferable  to  emission  masks  for  the  PMS  because  OOBE  limitations  do  not  need  to  be  revised  every  time  a  new  technology  is  implemented  (unlike  emission  masks).  Moreover,  OOBE 
 limitations  make  more  sense  with  channels  that  are  often  combined  in  blocks,  since  there  is  no  need  for  a  single  licensee  on  adjacent  channels  to  be  required  to  use  an  emission  mask  on  each  channel  to  protect 
 itself.  OOBE  limitations  protect  services  operating  beyond  the  outer  edges  of  the  channel  block.  Emission  masks  require  protection  of  each  individual  channel  within  the  block. 

 119.  The  National  Telecommunications  and  Information  Administration  (NTIA),  while  not  opposed  to  our  approach  regarding  OOBE  limitations,  recommends  that  we  clarify  the  unwanted 
 emissions  to  be  covered  by  the  term  OOBE  consistent  with  International  Telecommunication  Union  (ITU)  definitions.  354  That  entitys  main  concern  is  that  our  use  of  an  OOBE  standard  may  not  include 
 spurious  emissions,  which  it  believes  should  be  covered.  355  We  clarify  that,  for  purposes  of  this  proceeding,  we  interpret  our  OOBE  limitations  to  include  what  would  be  termed  spurious  emissions 
 under  the  ITU  standards. 

 348  47  C.  F.  R.    22.359. 
 349  47  C.  F.  R.    22.861. 
 350  See,  e.  g.,  47  C.  F.  R.    27.  53(  a)(  10)  (Wireless  Communications  Services),  22.  917  (Cellular),  and  24.  238 
 (Broadband  PCS);  Cellular  Year  2000  Biennial  Report  and  Order,  17  FCC  Rcd  at  18426  6.  351 
 Notice,  18  FCC  Rcd  at  8397  38.  352 
 Id.  353 
 Cingular  Wireless  Comments  at  18;  Verizon  Wireless  Comments  at  10.  354 
 NTIA  Comments  at  3.  Our  definitions  specifically  define  OOBE  and  spurious  emissions  separately.  See  47  C.  F.  R.    2.1.  We  recognize  that  our  usage  of  this  terminology  in  Part  22  and  other  wireless  parts  and  in  recent 

 wireless  proceedings  does  not  precisely  track  the  ITU  definitions.  We  use  the  term  OOBE  to  mean  what  the  ITU  calls  unwanted  emissions.  Although  we  agree  with  NTIA  that  it  would  be  preferable  to  harmonize  our  terms  with 
 those  of  the  ITU,  doing  so  is  beyond  the  scope  of  this  proceeding.  We  look  forward,  however,  to  addressing  this  issue  in  the  future. 
 355  NTIA  Comments  at  2-  3. 
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 d.  Standby  Facilities 
 120.  Background.  Section  22.361  permits  PMS  licensees  to  install  standby  transmitters,  without  separate  authorization,  to  continue  service  in  the  event  of  transmitter  failure  or  during  transmitter 

 maintenance.  356  In  the  Notice,  we  tentatively  concluded  that  this  section  should  be  eliminated,  as  it  is  now  universally  understood  in  the  wireless  industry  that  licensees  are  not  required  to  obtain  a  separate 
 authorization  to  install  standby  transmitters.  357 
 121.  Discussion.  We  agree  with  the  one  commenter  that  mentioned  this  issue  that  eliminating  Section  22.361  is  warranted.  358  We  also  note  that  doing  so  is  in  line  with  our  desire  to  streamline  or 

 eliminate  rules  that  are  no  longer  necessary.  359  Thus,  we  eliminate  Section  22.361. 
 e.  Directional  Antennas 
 122.  Background.  Section  22.363  and  Table  C-  2  to  Section  22.361  set  forth  directional  antenna  technical  requirements.  360  These  requirements  were  adopted  at  a  time  when  the  Commission 

 generally  considered  fixed  wireless  operations  to  be  secondary  to  mobile  operations.  As  noted  in  the  Notice,  these  regulations  appear  to  no  longer  be  necessary  because,  when  the  Commission  licenses 
 spectrum  today,  it  provides  greater  flexibility  to  licensees  to  use  the  spectrum  for  mobile  or  fixed  operations.  361  Accordingly,  we  tentatively  concluded  that  Section  22.  363  and  Table  C-  2  to  Section 
 22.361  should  be  eliminated.  362 
 123.  Discussion.  We  eliminate  the  directional  antenna  requirements  as  proposed  in  the  Notice.  The  lone  commenter  on  this  issue  endorses  our  approach  here,  363  which  we  believe  better  reflects  the 

 current  regulatory  landscape. 
 f.  Wave  Polarization 
 124.  Background.  Section  22.367  sets  forth  polarization  requirements  for  the  electromagnetic  waves  radiated  by  PMS  providers.  364  In  the  Notice,  we  observed  that,  where  fixed  and  mobile  services 

 operate  on  a  co-  channel  basis,  the  polarization  restrictions  may  no  longer  be  necessary  or  effective  in  reducing  interference.  365  We  therefore  sought  comment  on  whether  we  should  eliminate  Section 

 356  47  C.  F.  R.    22.361. 
 357  Notice,  18  FCC  Rcd  at  8397  39. 
 358  See  Verizon  Wireless  Comments  at  10. 
 359  See,  e.  g.,  Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  24,  27,  and  90  to  Streamline  and  Harmonize 
 Various  Rules  Affecting  Wireless  Radio  Services,  Notice  of  Proposed  Rule  Making,  19  FCC  Rcd  708  3  (2004).  360 
 47  C.  F.  R.    22.  363,  22.  361,  Table  C-  2.  361 
 Notice,  18  FCC  Rcd  at  8397  40.  362 
 Id.  363 
 Verizon  Wireless  Comments  at  10.  364 
 47  C.  F.  R.    22.367.  This  section  specifies  when  vertical,  horizontal,  or  circular  polarization  may  be  used  for  Part  22  Services. 

 365  Notice,  18  FCC  Rcd  at  8397-  98  41.  We  also  noted  that  other  CMRS  providers,  such  as  PCS  and  SMR 
 providers,  are  not  subject  to  a  wave  polarization  requirement,  and  that  the  Commission  recently  eliminated  the  vertical  wave  polarization  requirement  for  base,  mobile,  and  auxiliary  test  transmitters  in  the  Cellular 

 Radiotelephone  Service.  Cellular  Year  2000  Biennial  Report  and  Order,  17  FCC  Rcd  at  18427  48  (2002). 
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 22.367.  366 
 125.  Discussion.  The  only  commenter  that  mentions  this  issue  supports  the  elimination  of  the  rule,  367  and  we  agree  that  this  change  is  warranted.  Thus,  we  delete  Section  22.367. 

 g.  Access  to  Transmitters 
 126.  Background.  Section  22.373  generally  requires  PMS  transmitters  to  be  accessible  only  to  persons  authorized  by  the  licensee.  368  In  the  Notice,  we  tentatively  concluded  that  this  rule  is  not 

 necessary  to  insure  that  unauthorized  persons  are  kept  out  of  PMS  transmitter  sites,  and  consequently,  that  the  section  should  be  eliminated.  369 

 127.  Discussion.  We  remove  Section  22.373  from  our  rules.  Although  no  commenters  mention  this  issue,  we  believe  that  the  rule  is  unnecessary  due  to  the  fact  that  licensees  have  an  economic 
 self-  interest  to  prevent  unauthorized  access  to  their  transmitters. 
 h.  Replacement  of  Equipment 
 128.  Background.  Section  22.379  permits  PMS  licensees  to  replace  equipment  without  notifying  the  Commission,  provided  that  such  equipment  meets  certain  technical  requirements.  370  In  the 

 Notice,  we  tentatively  concluded  that  Section  22.379  is  no  longer  necessary,  and  should  therefore  be  eliminated,  because  licensees  have  known  since  the  rule  change  in  1994  that  applications  are  not  required 
 for  replacement  equipment.  371 
 129.  Discussion.  We  eliminate  Section  22.379.  While  no  comments  were  received  regarding  this  issue,  we  believe  that  Wireless  Radio  Service  licensees  understand  that  they  are  not  required  to  file  an 

 application  in  order  to  deploy  replacement  equipment,  provided  that  such  equipment  meets  the  technical  requirements  for  the  service  involved.  As  a  result,  the  rule  is  no  longer  necessary. 

 i.  Auxiliary  Test  Transmitters 
 130.  Background.  Section  22.381  limits  the  use  of  auxiliary  test  transmitters  to  testing  the  performance  of  fixed  receiving  equipment  located  remotely  from  the  control  point.  372  Section  22.381 

 further  provides  that  such  transmitters  may  only  transmit  on  channels  designated  for  mobile  transmitters.  373  In  the  Notice,  we  tentatively  concluded  that  this  section  should  be  eliminated,  because 
 limiting  test  transmissions  to  only  the  mobile  frequencies  appears  overly  prohibitive.  374 
 131.  Discussion.  We  believe  that  Section  22.381  unnecessarily  restricts  the  use  of  test 
 366  Notice,  18  FCC  Rcd  at  8397  41. 
 367  Verizon  Wireless  Comments  at  10. 
 368  47  C.  F.  R.    22.373. 
 369  Notice,  18  FCC  Rcd  at  8397  41. 
 370  47  C.  F.  R.    22.379. 
 371  Notice,  18  FCC  Rcd  at  8398  43. 
 372  47  C.  F.  R.    22.381. 
 373  Id. 
 374  Notice,  18  FCC  Rcd  at  8398  44. 
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 equipment,  and  therefore  we  eliminate  this  section  from  our  rules.  We  are  aware  of  no  harm  that  would  arise  from  operating  auxiliary  test  transmitters  on  any  authorized  channel,  whether  base  or  mobile,  and  no 
 commenters  have  suggested  otherwise. 
 j.  In-  building  Radiation  Systems 
 132.  Background.  Section  22.99  defines  in-  building  radiation  systems  as  [  s]  upplementary  systems  comprising  low  power  transmitters,  receivers,  indoor  antennas  and/  or  leaky  coaxial  cable 

 radiators,  designed  to  improve  service  reliability  inside  buildings  or  structures  located  within  the  service  areas  of  stations  in  the  Public  Mobile  Services.  375  Section  22.383  provides  that  PMS  licensees  may 
 install  in-  building  radiation  systems,  without  prior  Commission  approval,  within  their  protected  service  area.  376  Section  22.352(  c)(  7),  which  contains  a  cross-  reference  to  Section  22.383,  provides  that  no 
 interference  protection  is  afforded  to  in-  building  radiation  systems.  377  In-  building  radiation  systems  are  exempted  from  FAA  notification  under  Section  17.14(  a)  378  and,  under  Section  22.377,  transmitters  used 
 with  in-  building  radiation  systems  must  be  certificated  for  use  in  the  radio  services  regulated  under  Part  22.  379  In  the  Notice,  we  tentatively  concluded  that  Section  22.  383  is  no  longer  needed  and  should  be 
 eliminated.  380 
 133.  Discussion.  The  lone  commenter  that  addresses  this  issue  supports  the  approach  set  forth  in  the  Notice,  but  expresses  concern  that  readily  available  off-  the-  shelf  boosters  could  cause  harmful 

 interference  to  cellular  networks.  381  At  this  time,  we  take  no  action  on  the  proposal  set  forth  in  the  Notice.  Commission  staff  currently  is  examining  a  set  of  issues  related  to  the  appropriate  regulatory  treatment  of 
 wireless  boosters  used  to  improve  or  facilitate  service  in  a  number  of  areas,  including  buildings.  Accordingly,  we  will  address  Section  22.383  in  the  context  of  that  examination.  We  do  take  this 
 opportunity  to  clarify  that,  under  our  current  policies,  such  devices  may  only  be  operated  by  a  licensee  or  pursuant  to  the  licensees  permission  and  control,  unless  they  fall  under  the  power  limits  for  unlicensed 
 devices  under  our  Part  15  rules.  382 
 4.  Developmental  Authorizations 
 134.  Part  22,  Subpart  D  which  includes  Sections  22.401,  22.403,  22.409,  22.  411,  22.  413,  22.415,  and  22.  417  governs  grant  of  developmental  authorizations  in  the  PMS.  383  As  pointed  out  in  the 

 Notice,  a  review  of  Commission  records  indicates  that  these  rules  are  seldom  used  and,  instead,  parties  frequently  file  waiver  requests  that  are  tantamount  to  requests  for  developmental  authorizations.  384  We 
 therefore  sought  comment  regarding  how  any  of  our  Part  22  rules  governing  developmental 
 375  47  C.  F.  R.    22.99. 
 376  47  C.  F.  R.    22.383. 
 377  47  C.  F.  R.    22.352(  c)(  7). 
 378  47  C.  F.  R.    17.14(  a). 
 379  47  C.  F.  R.    22.377. 
 380  Notice,  18  FCC  Rcd  at  8399  45.  We  also  concluded  that  the  cross-  reference  to  this  section  in  Section 
 22.  352(  c)(  7)  should  be  eliminated.  381 
 Verizon  Wireless  Comments  at  11-  12.  382 
 See  id.  at  11.  383 
 47  C.  F.  R.  Pt.  22,  Subpt.  D.  384 
 Notice,  18  FCC  Rcd  at  8399  46. 
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 authorizations  could  be  improved  and  whether  any  of  these  rules  should  be  eliminated.  385 
 a.  Developmental  Authorization  of  43  MHz  Paging  Transmitters 
 135.  Background.  Sections  22.411  and  22.531(  a)  provide  that  43  MHz  channels  can  be  initially  assigned  only  as  developmental  authorizations.  386  The  requirements  of  Sections  22.411  and 

 22.531(  a)  are  intended  to  mitigate  interference  with  the  intermediate  frequency  stages  of  receivers  in  television  sets  and  video  recorders.  Section  22.  411  also  requires  licensees  to  conduct  and  file  semi-annual 
 surveys  during  the  first  two  years  of  operation  to  determine  the  extent  of  any  interference  to  broadcast  television  receivers.  387  In  the  Notice,  we  observed  that  there  have  been  significant  technical 
 improvements  in  television  and  video  recorder  receivers,  and  we  sought  comment  on  whether  such  technical  improvements  obviate  the  need  for  the  requirements  of  Sections  22.411  and  22.531(  a).  388 

 136.  Discussion.  While  no  comments  were  received  on  this  topic,  we  believe  that  Sections  22.411  and  22.  531(  a)  are  no  longer  required.  Modern  NTSC  televisions  are  no  longer  particularly 
 vulnerable  to  interference  from  the  43  MHz  paging  frequencies.  Previously,  television  sets  utilized  an  intermediate  frequency  amplifier  that  converted  the  received  channel  to  a  frequency  between  40  and  46 
 MHz.  New  television  sets,  on  the  other  hand,  no  longer  employ  this  type  of  technology.  In  addition,  the  number  of  licensees  and  new  applications  for  these  paging  channels  is  minimal.  Consequently,  it  appears 
 that  there  is  no  need  for  developmental  authorizations  for  43  MHz  paging  transmitters,  and  we  will  delete  these  sections  of  our  rules. 

 b.  Developmental  Authorization  of  928-  960  MHz  Fixed  Transmitters 
 137.  Background.  Section  22.415  provides  that  channels  in  the  928-  931  and  952-  960  MHz  ranges  may  be  assigned  to  fixed  transmitters  in  point-  to-  multipoint  systems  at  short-  spaced  locations  (i.  e., 

 those  that  do  not  meet  the  70-  mile  separation  requirement  of  Section  22.  625(  a)).  389  We  stated  in  the  Notice  that  the  Commission  cannot  issue  any  developmental  authorizations  under  Section  22.415  unless  it 
 waives  the  licensing  prohibition  of  Section  22.  621.  390  We  therefore  tentatively  concluded  that  Section  22.415  should  be  eliminated.  391  We  also  tentatively  concluded  that  Section  22.625(  a)  should  be  revised 
 by  eliminating  all  text  following  the  first  sentence  that  pertains  to  short-  spaced  developmental  authorizations  under  Section  22.  415.  392  This  language  would  no  longer  be  necessary  were  we  to  adopt 
 our  proposal  to  eliminate  Section  22.415. 
 138.  Discussion.  In  light  of  the  prohibition  in  Section  22.621  against  licensing  any  new  900 
 385  Id. 
 386  47  C.  F.  R.    22.  411,  22.  531(  a). 
 387  47  C.  F.  R.    22.411(  b). 
 388  Notice,  18  FCC  Rcd  at  8399  47. 
 389  47  C.  F.  R.    22.415. 
 390  Notice,  18  FCC  Rcd  at  8399-  40  48.  In  the  Multiple  Address  Systems  Order,  the  Commission  amended  Section 
 22.  621  to  prohibit  the  issuance  of  new  licenses  for  any  900  MHz  frequencies  listed  in  that  section.  See  In  the  Matter  of  Amendment  of  the  Commission's  Rules  Regarding  Multiple  Address  Systems,  Report  and  Order,  15  FCC  Rcd 

 11,  956  (2000)  (  Multiple  Address  Systems  Order),  corrected  by  Amendment  of  Commission's  Rules  Regarding  Multiple  Address  Systems,  Erratum,  15  FCC  Rcd  16415  (WTB,  PSPWD  2000). 
 391  Notice,  18  FCC  Rcd  at  8399-  4000  48. 
 392  Id. 
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 MHz  frequencies,  we  eliminate  Section  22.415  and  modify  Section  22.625(  a)  as  proposed  in  the  Notice.  No  comments  were  received  on  this  issue. 
 c.  Developmental  Authorization  of  Meteor  Burst  Systems 
 139.  Background.  Section  22.417  provides  that  Rural  Radiotelephone  Service  (RRS)  central  office  and  rural  subscriber  stations  in  Alaska  may  use  meteor  burst  propagation  modes.  393  Meteor  burst 

 systems  bounce  radio  signals  off  the  ionized  trails  of  evaporating  space  rocks  to  receivers  up  to  1,000  miles  away.  Meteor  burst  technology,  however,  only  works  in  brief  spurts  because  a  typical  meteor  trail 
 has  an  average  duration  of  a  few  hundred  milliseconds,  while  wait  times  between  suitable  trails  can  range  from  a  few  seconds  to  minutes.  As  such,  the  technology  is  well-  suited  for  bursty  data  transmissions  but  is 
 not  suitable  for  a  continuous  voice  call.  Section  22.725(  c)  provides  that  channels  42.40,  44.  10,  44.  20  and  45.90  MHz  may  be  used  for  such  purposes  in  Alaska.  394  Section  22.729  governs  station  operations  using 
 meteor  burst  propagation  modes  on  these  channels.  395  In  the  Notice,  we  indicated  that  there  are  no  Part  22  licensees  on  these  channels  in  Alaska,  although  there  are  some  licenses  issued  under  Part  90.  396  We 
 sought  comment  as  to  whether  Sections  22.417,  22.725(  c),  and  22.  729  should  be  eliminated  or  whether  this  licensing  option  for  RRS  should  be  maintained.  397 

 140.  Discussion.  We  do  not  believe  that  RRS  stations  in  Alaska  would  benefit  from  maintaining  the  licensing  option  under  Sections  22.417,  22.  725(  c),  and  22.729.  Currently,  there  are  no 
 licensees  taking  advantage  of  these  rules.  In  addition,  as  a  practical  matter,  meteor  burst  propagation  cannot  be  used  to  transmit  voice  calls,  which  is  at  the  core  of  the  RRS.  Therefore,  as  suggested  in  the 
 Notice,  we  delete  these  sections  from  our  rules.  We  also  delete  the  definition  of  meteor  burst  propagation  mode  in  Section  22.  99,  398  the  Section  22.313(  a)(  3)  station  identification  requirements  for 
 Rural  Radiotelephone  Service  subscriber  stations  using  meteor  burst  propagation,  399  and  the  Section  22.727(  f)  limits  on  transmitter  output  power  for  meteor  burst  stations.  400 

 5.  Paging  and  Radiotelephone  Service  Rules 
 a.  Composite  Interference  Contour  Over  Water 
 141.  Background.  Under  Section  1.929(  c)(  1),  any  increase  in  the  composite  interference  contour  (CIC)  401  of  a  site-  based  licensee  in  the  Paging  and  Radiotelephone  Service,  Rural  Radiotelephone 

 Service,  or  800  MHz  Specialized  Mobile  Radio  Service  is  a  major  modification  of  license  that  requires 

 393  47  C.  F.  R.    22.417. 
 394  47  C.  F.  R.    22.725(  c). 
 395  47  C.  F.  R.    22.729. 
 396  Notice,  18  FCC  Rcd  at  8400  49.  Moreover,  the  44.  20  MHz  channel  is  available  under  Part  22  only  on  a 
 secondary  basis  to  operations  authorized  under  Part  90.  See  47  C.  F.  R.    22.729(  a).  397 
 Notice,  18  FCC  Rcd  at  8400-  8401  50.  398 
 47  C.  F.  R.    22.99.  399 
 47  C.  F.  R.    22.313(  a)(  3).  400 
 47  C.  F.  R.    22.727(  f).  401 
 A  CIC  connects  the  outermost  points  of  the  intersecting  interference  contours  for  the  base  stations  in  a  radio  system. 
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 prior  Commission  approval.  402  In  March  2001,  the  Wireless  Telecommunications  Bureau  conditionally  waived  Section  1.929(  c)(  1)  to  permit  expansion  of  paging  CICs  over  water  on  a  secondary  basis.  403  In  the 
 Notice  in  the  instant  proceeding,  we  tentatively  concluded  that  Section  1.929(  c)(  1)  should  be  amended  to  specify  that  expansion  of  the  CIC  of  a  site-  based  licensee  in  these  services  over  water,  on  a  secondary, 
 non-  interference  basis  to  any  geographic  area  licensee  in  the  same  area,  is  not  a  major  modification  of  license.  404  We  also  tentatively  concluded  that  the  term  over  water  should  be  defined  as  over  bodies  of 
 water  that  extend  beyond  county  boundaries  including,  but  not  limited  to,  oceans,  the  Gulf  of  Mexico,  and  the  Great  Lakes.  405 

 142.  In  addition,  we  expressed  concern  that  the  incumbent  licensee  in  the  same  geographic  area  have  technical  and  engineering  information  regarding  the  site-  based  licensees  operations  over  water 
 in  order  to  guard  against  unacceptable  interference  to  its  own  operations.  406  Accordingly,  we  proposed  that  the  site-  based  licensee  be  required  to  provide  to  the  geographic  area  licensee  on  the  same  frequency 
 the  technical  and  engineering  information  necessary  for  the  latter  entity  to  understand  and  evaluate  the  site-  based  licensees  operations  over  water.  407  We  requested  comment  on  the  contents  of  such 
 notification,  the  timing  of  making  such  a  notification,  whether  such  a  requirement  is  necessary  or  excessively  burdensome,  and  whether,  instead,  any  filing  with  the  Commission  should  be  required.  408 

 143.  Discussion.  We  amend  Section  1.929(  c)(  1)  and  treat  expansions  of  the  CIC  of  a  site-based  licensee  in  the  Paging  and  Radiotelephone  Service,  Rural  Radiotelephone  Service,  or  800  MHz 
 Specialized  Mobile  Radio  Service  over  water,  on  a  secondary,  non-  interference  basis  to  any  geographic  area  licensee  in  the  same  area,  as  a  minor,  not  major,  modification  of  license.  We  also  adopt  the 
 definition  of  over  water  as  proposed  in  the  Notice.  409  As  a  result,  such  expansions  of  the  CIC  are  permissive  and  no  notification  to  the  Commission  is  required.  As  expressed  in  the  comments  of  Arch 
 Wireless,  the  classification  of  these  modifications  as  major  can  hamper  a  carriers  ability  to  respond  to  unexpected  disruptions  or  to  meet  changes  in  consumer  demand.  410  Licensees  providing  service  in  coastal 
 areas  often  need  to  relocate  or  adjust  transmitting  facilities  in  order  to  maintain  and  improve  coverage.  Moreover,  CIC  expansions  that  take  place  solely  over  water  should  pose  no  risk  of  interference  to  other 
 systems  on  land,  and  Commission  records  indicate  that  we  have  not  received  any  interference  complaints 

 402  47  C.  F.  R.    1.929(  c)(  1),  1.947.  See  Karl  A.  Rinker,  d/  b/  a  Rinkers  Communications,  Request  for  Declaratory 
 Ruling,  14  FCC  Rcd  19546  (WTB,  CWD  1999)  (any  CIC  increase,  including  an  extension  over  water,  is  a  major  filing  under  Section  1.929(  c)(  1)). 

 403  Wireless  Telecommunications  Bureau  Seeks  Comment  On  Request  For  Rule  Change  And  Conditionally  Waives 
 Section  1.929(  C)(  1)  To  Permit  Expansion  Of  Paging  Contours  Over  Water  On  A  Secondary  Basis,  Public  Notice,  16  FCC  Rcd  5563  (2001).  The  conditional  waiver  was  granted  pending  a  decision  on  a  Request  for  Rule  Change  filed 

 by  the  Personal  Communications  Industry  Association  (PCIA).  PCIAs  Request  sought  to  amend  Section  1.  929(  c)(  1)  so  that  expansions  of  paging  CICs  that  occur  solely  (1)  beyond  the  land  border  of  the  United  States,  or 
 (2)  over  large  bodies  of  water  (oceans,  gulfs,  sounds,  bays,  and  the  Great  Lakes,  but  not  rivers)  would  be  treated  as  minor  modifications. 
 404  Notice,  18  FCC  Rcd  at  8402  52. 
 405  Id. 
 406  Notice,  18  FCC  Rcd  at  8402  53. 
 407  Id. 
 408  Id. 
 409  Notice,  18  FCC  Rcd  at  8402  52. 
 410  Arch  Wireless  Comments  at  4-  5;  see  Blooston  Comments  at  9. 
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 arising  from  our  current  temporary  policy  of  conditionally  waiving  Section  1.929(  c)(  1).  We  also  note  the  benefits  to  both  licensees  and  the  Bureau  derived  from  the  removal  of  these  particular  regulatory  filing 
 requirements.  Finally,  no  commenters  opposed  this  rule  change.  We  believe  that,  under  these  circumstances,  our  action  here  will  facilitate  the  provision  of  PMS  services  to  the  public.  411 

 144.  We  will  not  require  that  site-  based  licensees  automatically  notify  incumbent  geographic  area  licensees  of  the  technical  parameters  of  a  CIC  expansion  over  water.  In  this  connection,  we  agree 
 with  Arch  Wireless  that  such  a  requirement  reduces  the  flexibility  and  efficiencies  created  by  not  requiring  pre-  approval  of  such  extensions.  412  In  contrast  to  the  objection  raised  by  Arch  Wireless,  no 
 parties  filed  comments  supporting  automatic  notification  of  this  information  to  geographic  licensees. 
 b.  Nationwide  Network  Paging  Channels 
 145.  Background.  Section  22.531(  b)  provides  that  frequencies  931.8875,  931.  9125,  and  931.9375  MHz  may  only  be  used  for  nationwide  network  paging  service.  413  Section  22.551  specifies  the 

 application  process  for  such  channels  in  the  event  one  should  become  available  for  licensing,  and  provides  additional  rules  for  nationwide  network  paging  service.  414  In  the  Notice,  we  sought  comment  on 
 whether  we  should  amend  our  rules  to  allow  licensees  on  these  channels  to  provide  services  other  than  nationwide  network  paging.  415  In  addition,  we  requested  comment  on  whether  the  specific  application 
 processing  rule  for  these  channels  remains  necessary,  or  whether  we  should  apply  our  general  paging  licensing  rules  to  license  these  channels  in  the  event  that  one  of  them  (or  a  partitioned  or  disaggregated 
 portion  thereof)  was  to  become  available  for  re-  licensing. 
 146.  Discussion.  Although  no  comments  were  received  on  this  topic,  we  believe  that  allowing  licensees  on  these  channels  to  provide  services  other  than  nationwide  network  paging  is  in  line  with  our 

 policy  to  facilitate  flexible  service  offerings,  416  our  attempts  to  achieve  regulatory  parity  among  competing  wireless  services,  and  the  highly  competitive  state  of  the  paging  industry.  Similarly,  we  will 
 apply  our  general  paging  licensing  rules,  including  competitive  bidding  procedures,  to  license  these  channels  in  the  event  that  one  becomes  available  for  licensing.  417  Therefore,  we  will  delete  Sections 
 22.313(  a)(  5),  22.531(  b)  and  22.551  from  our  rules. 
 c.  Additional  Channel  Policies 
 147.  Background.  Sections  22.539  and  22.569  govern  the  processing  of  applications  for 

 411  We  emphasize  that  any  site-  based  licensee  in  these  three  services  that  seeks  a  CIC  expansion  over  land  must 
 continue  to  obtain  prior  Commission  approval.  We  also  note  that  if  a  CIC  expansion  over  water  requires  frequency  coordination  pursuant  to  international  treaty  or  agreement,  then  such  an  extension  would  be  classified  as  major 

 under  Section  1.929(  a)(  5)  and  require  prior  Commission  approval.  412 
 Arch  Wireless  Comments  at  5.  413 
 47  C.  F.  R.    22.531(  b).  414 
 47  C.  F.  R.    22.551.  415 
 Notice,  18  FCC  Rcd  at  8403  56.  416 
 In  1996,  the  Commission  expanded  permitted  offerings  of  fixed  wireless  service  by  Commercial  Mobile  Radio  Service  providers.  See  Amendment  of  the  Commission's  Rules  to  Permit  Flexible  Service  Offerings  in  the 

 Commercial  Mobile  Radio  Services,  First  Report  and  Order  and  Further  Notice  of  Proposed  Rule  Making,  11  FCC  Rcd  8965  (1996),  Second  Report  and  Order  and  Order  on  Reconsideration,  15  FCC  Rcd  14680  (2000). 
 417  See  47  C.  F.  R.    22.  501-  22.529,    22.  201-  22.299. 
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 additional  paging  and  mobile  channels,  respectively.  418  In  particular,  these  rules  implement  the  Commissions  general  policy  to  assign  only  one  paging  or  two  mobile  channels  in  an  area  to  a  carrier  per 
 application  cycle.  419  Carriers  that  seek  to  add  channels  to  their  systems  in  the  same  geographic  service  area  may  thus  do  so  one  at  a  time  (two  for  mobile  channels).  420  Before  applying  for  another  channel, 
 carriers  must  certify  that  service  has  commenced  on  the  previously-  granted  channel(  s).  421  We  pointed  out  in  the  Notice  that  Sections  22.539  and  22.569  were  adopted  at  a  time  when  the  Commission  assigned  the 
 subject  paging  channels  on  a  site-  by-  site  basis  and  gave  close  consideration  to  the  amount  of  paging  spectrum  held  by  a  single  entity  in  a  particular  geographic  area,  and  that  our  regulatory  structure  for  the 
 licensing  of  paging  channels  has  changed.  422  We  therefore  tentatively  concluded  that  Sections  22.539  and  22.569  should  be  eliminated.  423 

 148.  Discussion.  We  delete  Sections  22.539  and  22.569  from  our  rules.  424  Today,  the  Part  22  paging  channels  set  forth  in  these  rule  sections  are  licensed  on  a  geographic  area  basis  rather  than 
 assigned  on  a  site-  by-  site  basis.  425  We  no  longer  place  a  blanket  restriction  on  the  amount  of  spectrum  that  a  single  entity  may  hold  in  one  area  (although  we  review  competitive  issues  involving  paging 
 licensees  on  a  case-  by-  case  basis).  426  Incumbents  operating  on  a  site-  by-  site  basis  may  expand  their  systems  by  assignment  or  transfer  of  a  license  or  by  participating  in  a  spectrum  auction.  In  addition, 
 under  our  current  licensing  scheme  for  paging  channels,  we  place  no  blanket  restrictions  on  the  number  of  overlapping  Part  22  paging  channels  that  a  particular  entity  may  hold  in  one  area.  Consequently,  we 
 believe  that  maintaining  these  rules  is  unnecessary. 
 d.  Provision  of  Rural  Radiotelephone  Service  on  Paging  Channels 
 149.  Background.  Section  22.563  requires  stations  in  the  Paging  and  Radiotelephone  Service  that  provide  two-  way  public  mobile  service  on  certain  channels  to  also  provide  Rural  Radiotelephone 

 Service  (RRS)  upon  request  from  a  subscriber.  427  In  the  Notice,  we  pointed  out  that  these  channels  are  now  predominantly  assigned  for  use  by  one-  way  paging  systems  that  are  technically  incapable  of 
 providing  RRS.  428  Consequently,  we  tentatively  concluded  that  Section  22.  563  is  no  longer  necessary  and 

 418  47  C.  F.  R.    22.  539,  22.  569. 
 419  47  C.  F.  R.    22.  539,  22.  569.  Section  22.  569  applies  to  applications  proposing  to  use  the  channels  listed  in 
 Section  22.  561  (one-  way  or  two-  way  mobile  operations),  except  applications  that  propose  to  use  these  channels  to  provide  paging  service  only,  which  are  subject  to  Section  22.539. 

 420  47  C.  F.  R.    22.  539,  22.  569. 
 421  47  C.  F.  R.    22.  539,  22.  569. 
 422  Notice,  18  FCC  Rcd  at  8403  57. 
 423  Id. 
 424  We  note  that  no  comments  were  filed  regarding  this  issue. 
 425  Revision  of  Part  22  and  Part  90  of  the  Commission's  Rules  to  Facilitate  Future  Development  of  Paging  Systems; 
 Implementation  of  Section  309(  j)  of  the  Communications  Act    Competitive  Bidding,  Second  Report  and  Order  and  Further  Notice  of  Proposed  Rule  Making,  12  FCC  Rcd  2732  (1997). 

 426  See  2000  Biennial  Regulatory  Review  Spectrum  Aggregation  Limits  For  Commercial  Mobile  Radio  Services, 
 Report  and  Order,  16  FCC  Rcd  22668  (2001).  427 
 47  C.  F.  R.    22.563.  The  channels  are  in  the  frequency  ranges  152.03-  152.  81,  157.  77-  158.  67,  454.  025-  454.  650,  and  459.  025-  459.650  MHz. 

 428  Notice,  18  FCC  Rcd  at  8404  60. 
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 should  be  eliminated.  429 
 150.  Discussion.  No  comments  were  received  on  this  issue,  and  we  believe  that  Section  22.563  is  no  longer  needed.  Not  only  are  most  of  these  channels  assigned  for  one-  way  paging  use,  there 

 are  now  a  number  of  wireless  telephone  service  alternatives  to  RRS  (e.  g.,  cellular,  PCS,  and  some  SMR).  430  Moreover,  consumers  in  many  areas  including  rural  areas  have  begun  to  substitute  cellular, 
 PCS,  and  some  SMR  service  for  landline  service.  This  nascent  trend  is  driven  in  part  by  wireless  service  plans  that  include  the  price  of  long  distance  service  that  may  reduce  a  consumers  aggregate  charges  for 
 local  and  toll  service.  In  light  of  these  circumstances  and  the  fact  that  rural  subscribers  may  readily  obtain  fixed  basic  telephone  services  from  a  variety  of  sources,  we  delete  Section  22.563  from  our  rules. 

 e.  Transmission  Power  Limits 
 151.  Background.  Section  22.565(  g)  limits  the  effective  radiated  power  (ERP)  of  dispatch  and  auxiliary  test  transmitters  to  100  watts.  431  In  the  Notice,  we  sought  comment  on  whether  the  100-  watt 

 limit  should  be  revised  or  eliminated,  noting  that  were  we  to  eliminate  the  rule,  Section  22.565(  a)  would  allow  for  a  150-  watt  limit.  432 

 152.  Discussion.  We  delete  Section  22.565(  g)  so  that  test  transmitters  may  operate,  pursuant  to  Section  22.  565(  a),  at  a  limit  of  150  watts.  Commenters  that  mention  this  issue  are  in  favor  of  this 
 revision.  433  We  note  that  because  we  have  decided  to  permit  auxiliary  test  transmitters  to  operate  on  both  base  and  mobile  frequencies,  434  licensees  can  now  choose  to  operate  on  either  the  base  or  the  mobile  side 
 of  the  frequency  subject  to  the  150-  watt  limit  under  Section  22.565(  a). 
 f.  Dispatch  Service 
 153.  Background.  Section  22.577  governs  the  provision  of  dispatch  service.  435  In  the  Notice,  we  suggested  that  the  limitations  placed  on  the  provision  of  dispatch  service  in  Section  22.577  may  be 

 unduly  restrictive,  and  we  therefore  sought  comment  on  whether  Section  22.577  should  be  revised  or  eliminated.  436  This  section  requires,  for  example,  that  service  providers  notify  the  Commission  every 
 time  a  dispatch  transmitter  is  installed  as  well  as  provide  the  name  and  address  of  subscribers.  437 
 154.  Discussion.  We  believe  that  the  deletion  of  Section  22.577  of  our  rules  is  warranted. 
 429  Id. 
 430  Indeed,  FCC  rules  provide  that  cellular  and  PCS  licensees  may  provide  fixed  services  on  a  co-  primary  basis.  See 
 47  C.  F.  R.    22.  901(  d)  (cellular  fixed  services);  47  C.  F.  R.    24.  3  (PCS  fixed  services).  431 
 47  C.  F.  R.    22.565(  g).  432 
 Notice,  18  FCC  Rcd  at  8405  61.  If  Section  22.  565(  g)  were  eliminated,  then  the  maximum  ERP  for  dispatch  and  auxiliary  test  transmitters  would  be  governed  by  Section  22.  565(  a).  Under  that  section,  fixed  stations  (such  as 

 dispatch  and  auxiliary  test  transmitters)  operating  on  mobile  frequencies  may  have  a  maximum  ERP  of  150  watts.  433 
 See  AMTA  Comments  at  7;  NYSE&  GC  Reply  Comments  at  12-  13.  434 
 See  supra  paras.  130-  131.  435 
 47  C.  F.  R.    22.577.  436 
 Notice,  18  FCC  Rcd  at  8405  62.  We  note  that,  in  1995,  restrictions  on  cellular  dispatch  services  were  eliminated.  See  Eligibility  for  the  Specialized  Mobile  Radio  Services  and  Radio  Services  in  the  220-  222  MHz  Land 

 Mobile  Band  and  Use  of  Radio  Dispatch  Communications,  Report  and  Order,  10  FCC  Rcd  6280,  6297  29  (1995).  437 
 47  C.  F.  R.    22.577. 
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 Commenters  were  unanimous  in  their  support  for  the  removal  of  dispatch  restrictions,  stating  generally  that  the  rule  is  outdated  and  no  longer  necessary.  438  More  specifically,  the  Joint  Commenters  believe  that 
 limits  on  output  power  and  the  functionality  of  the  dispatch  transmitter  are  out  of  line  with  the  Commissions  emphasis  on  flexible  spectrum  use.  439  Moreover,  the  Joint  Commenters  point  out  that 
 Part  90  dispatch  operations  are  not  subject  to  such  restrictions,  and  that  the  removal  of  Section  22.577  will  expand  the  choices  to  wireless  end  users.  440  We  agree,  and  therefore  delete  Section  22.577.  441 

 g.  Hawaiian  UHF  Channels  for  Point-  to-  Point  Operation 
 155.  Background.  Section  22.591  includes  a  table  of  channels  allocated  to  fixed  transmitters  that  support  other  transmitters  that  provide  PMS.  442  This  table  includes  six  UHF  channel  pairs  designated 

 for  fixed  use  in  the  State  of  Hawaii.  In  the  Notice,  we  noted  the  very  limited  usage  of  these  channels  in  Hawaii  and  sought  comment  on  possible  alternative  uses  of  this  spectrum.  443 

 156.  Discussion.  No  comments  were  received  on  this  topic.  Because  we  do  not  believe  that  the  record  supports  a  particular  approach  in  connection  with  these  channels,  we  will  revisit  the  issue  at  a 
 later  time. 
 h.  Channels  for  Point-  to-  Point  Operation  Microwave  Channels 
 157.  Background.  Section  22.591  also  includes  a  table  of  2110-  2130  and  2160-  2180  MHz  microwave  channels.  444  In  1992,  the  Commission  allocated  these  bands  for  use  by  emerging  technologies 

 (ET)  services  and  no  new  systems  may  be  authorized  on  these  channels  under  Part  22.  445  Recently,  the  Commission  allocated,  inter  alia,  the  2110-  2130  MHz  band  for  Advanced  Wireless  Services  (AWS).  446 
 At  present,  both  the  2110-  2130  and  2160-  2180  MHz  bands  are  widely  used  for  common  carrier  fixed  microwave  service.  447  In  the  Notice,  we  tentatively  concluded  that  these  microwave  channels  should  be 

 438  See  AMTA  Comments  at  6-  7;  Blooston  Comments  at  8-  9;  Joint  Commenters  Comments  at  5;  NYSE&  GC  Reply 
 Comments  at  12-  13.  439 
 Joint  Commenters  Comments  at  5.  440 
 Id.  441 
 We  note  that,  while  we  are  eliminating  Sections  22.  577  and  22.  565(  g)  of  the  rules,  operations  on  the  mobile  designated  frequencies  are  subject  to  the  power  limitations  in  Section  22.  565(  a)  and  the  channel  assignment  criteria 

 in  Section  22.  567(  h)  of  the  rules.  442 
 47  C.  F.  R.    22.591.  443 
 Notice,  18  FCC  Rcd  at  8405  63.  444 
 The  Section  22.  591  table  incorrectly  specifies  eight  microwave  channel  center  frequencies.  That  table  should  reflect  that  there  are  398  microwave  channel  center  frequencies.  See  Revision  of  Part  22  of  the  Commission's  Rules 

 Governing  the  Public  Mobile  Services,  Report  and  Order,  9  FCC  Rcd  6513,  6632  (1994).  445 
 Redevelopment  of  Spectrum  to  Encourage  Innovation  in  the  Use  of  New  Telecommunications  Technologies,  First  Report  and  Order  and  Third  Notice  of  Proposed  Rule  Making,  7  FCC  Rcd  6886,  6890  21  (1992). 

 446  Amendment  of  Part  2  of  the  Commissions  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,  Second  Report  and  Order,  17  FCC  Rcd  23193  (2002);  see  also  Amendment  of  Part  2  of  the  Commissions 

 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,  Third  Report  and  Order,  Third  Notice 
 of  Proposed  Rulemaking,  and  Second  Memorandum  Opinion  and  Order,  18  FCC  Rcd  2223  (2003).  447 
 See  47  C.  F.  R.    101.101;  Notice,  18  FCC  Rcd  at  8405  64. 
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 deleted  from  the  Section  22.591  table  and  that  Section  22.591(  b)  regarding  assignment  of  such  channels  should  be  deleted.  448 
 158.  In  addition,  Section  22.601  specifies  rules  for  modification  of  previously  authorized  Part  22  stations  on  the  2110-  2130  and  2160-  2180  MHz  channels.  449  Section  22.602  sets  forth  rules  governing 
 a  transition  period  for  Paging  and  Radiotelephone  Service  licensees  on  the  microwave  channels  listed  in  Section  22.591  to  relocate  to  other  frequencies.  450  In  the  Notice,  we  sought  comment  on  the  use  of  the 
 frequencies  under  these  licenses  and  whether  either  of  these  sections  should  be  revised.  451 
 159.  Discussion.  We  will  take  the  actions  as  proposed  in  the  Notice.  Specifically,  we  delete  the  microwave  channels  from  the  Section  22.591  table  and  delete  Section  22.591(  b)  regarding  the 

 assignment  of  such  channels.  None  of  the  entities  licensed  on  the  subject  microwave  frequencies  submitted  comments  in  this  proceeding,  and  no  other  commenter  mentions  this  issue.  Thus,  we  will  allow 
 the  licenses  to  expire  at  the  end  of  their  current  authorizations,  and  we  will  not  renew  them  for  another  license  term.  These  microwave  incumbents  will,  in  the  meantime,  continue  to  be  subject  to  Sections 
 22.601  and  22.602  (although  once  their  license  terms  end,  these  sections  will  become  superfluous).  As  discussed  in  the  Notice,  we  will  delete  the  cross-  reference  to  Section  22.591  in  Sections  22.601  and 
 22.602  and,  instead,  reference  the  2110-  2130  and  2160-  2180  MHz  channels. 
 i.  Effective  Radiated  Power  Limits 
 160.  Background.  Section  22.593  specifies  power  limits  for  the  channels  enumerated  in  Section  22.591.  452 

 161.  Discussion.  Although  we  are  deleting  the  microwave  channels  listed  in  Section  22.591,  these  microwave  licensees  are  still  subject  to  Section  22.593,  which  specifies  the  EIRP  of  the  microwave 
 channels  listed  in  Section  22.591.  453  Consequently,  we  will  not  amend  this  rule  until  after  the  subject  licenses  have  expired. 

 j.  Channel  Usage  Reports 
 162.  Background.  Section  22.655  requires  a  subcategory  of  paging  licensees  470-  512  MHz  band  licensees  to  submit  defined  channel  usage  reports  every  three  months.  454  In  the  Notice,  we  pointed 

 out  that  only  two  carriers  must  still  file  these  reports,  that  they  have  maintained  mobile  usage  of  the  channels  for  some  time,  and  that  loading  reporting  requirements  for  other  paging  operators  have  been 

 448  Notice,  18  FCC  Rcd  at  8406  64. 
 449  47  C.  F.  R.    22.601. 
 450  47  C.  F.  R.    22.602. 
 451  Notice,  18  FCC  Rcd  at  8406-  07    64-  66. 
 452  47  C.  F.  R.    22.593. 
 453  Id. 
 454  47  C.  F.  R.    22.  655.  As  explained  by  the  rule  itself,  the  reporting  requirement  was  adopted  as  part  of  the 
 Commissions  redesignation  of  the  public  mobile  channels  in  the  470-  512  MHz  band  from  trunked  mobile  operation  to  point-  to-  multipoint  operation  as  the  demand  for  trunked  mobile  service  decreased.  Only  licensees  in  this  band 

 providing  trunked  mobile  service  are  required  to  submit  reports,  based  on  the  premise  that  the  reports  would  enable  the  Commission  to  have  the  information  necessary  to  know  when  it  may  redesignate  the  channels  to  point-  to-multipoint 
 operation.  Only  this  category  of  PMS  licensees  must  file  channel  usage  reports. 
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 eliminated.  455  We  sought  comment  on  the  concerns  of  the  Association  of  Public-  Safety  Communications  Officials-  International,  Inc.  (APCO),  expressed  in  the  2002  Biennial  Review  Proceeding  (WT  Docket  No. 
 02-  310),  456  regarding  the  loss  of  these  reports,  but  we  nonetheless  tentatively  concluded  that  we  should  eliminate  Section  22.655.  457 

 163.  Discussion.  We  eliminate  Section  22.655  so  that  we  no  longer  requires  licensees  engaged  in  trunked  mobile  operations  to  measure  and  report  channel  usage.  In  this  connection,  we  agree 
 with  the  lone  commenter  on  this  topic  that  the  continuation  of  this  reporting  requirement  is  burdensome  and  no  longer  necessary.  458  Moreover,  there  are  only  two  licensees  that  currently  remain  subject  to  this 
 requirement,  while  the  majority  of  CMRS  licensees  using  the  470-  512  MHz  band  do  not  have  to  submit  these  quarterly  reports.  Given  these  circumstances,  we  do  not  believe  that  the  continued  channel  usage 
 reporting  requirements  are  warranted. 
 164.  In  the  Notice,  we  specifically  requested  comment  on  APCOs  concerns  regarding  the  continuing  value  of  the  channel  usage  reports.  459  No  comments  were  received  in  the  instant  proceeding, 

 however,  that  contradict  our  findings  regarding  the  usefulness  of  these  reports. 
 6.  Rural  Radiotelephone  Service  Rules  Channels  for  Basic  Exchange  Telephone  Radio  Systems 

 165.  Background.  Section  22.757  specifies  channels  (in  addition  to  those  listed  in  Section  22.725)  in  the  frequency  ranges  816.0125-  820.2375  MHz  and  861.  0125-  865.  2375  MHz  that  are  allocated 
 for  paired  assignment  to  basic  exchange  telephone  radio  systems  (BETRS).  460  In  the  Notice,  we  pointed  out  that  the  Commission  auctioned  these  channels  on  a  geographic  area  basis  in  Auction  16,  and  that  they 
 are  no  longer  available  for  assignment  to  BETRS.  461  We  therefore  tentatively  concluded  that  Section  22.757  should  be  eliminated  and  that  the  first  sentence  of  Section  22.  725  should  be  amended  to  provide 
 that  the  channels  listed  therein  are  available  for  paired  assignment  to  BETRS.  462 
 166.  Discussion.  We  amend  Sections  22.757  and  22.725  as  proposed  in  the  Notice.  Because  the  channels  listed  in  Section  22.757  are  no  longer  available  for  assignment  to  BETRS,  these  rules  are 

 outdated.  No  comments  were  received  regarding  this  topic. 
 7.  Offshore  Radiotelephone  Service  Rules 
 167.  Background.  Subpart  I  of  Part  22  which  includes  Sections  22.1001,  22.  1003,  22.1005,  22.1007,  22.1009,  22.1011,  22.1013,  22.  1015,  22.  1025,  22.  1031,  22.  1035,  and  22.  1037  governs  the 

 455  Notice,  18  FCC  Rcd  at  8407    68-  70. 
 456  See  Reply  Comments  of  APCO,  WT  Dkt.  No.  02-  310,  at  3  (filed  Nov.  4,  2002).  In  that  proceeding,  APCO 
 questioned  Westels  proposal  to  eliminate  the  requirements  that  Part  22  licensees  report  channel  usage  in  the  470-  512  MHz  band,  stating  that  the  reports  are  necessary  to  determine  whether  spectrum  in  the  470-  512  MHz  band  is 

 underutilized  and  could  be  made  available  for  other  uses.  457 
 Notice,  18  FCC  Rcd  at  8407  70.  458 
 Westel  Comments  at  3-  4.  459 
 Notice,  18  FCC  Rcd  at  8407  70.  460 
 47  C.  F.  R.    22.757.  461 
 Notice,  18  FCC  Rcd  at  8408  71.  462 
 Id. 
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 licensing  and  operation  of  Offshore  Radiotelephone  Service  (ORS)  stations.  These  stations  provide  telephone  service  to  subscribers  located  on  oil  exploration  and  production  platforms  in  the  Gulf  of 
 Mexico.  In  the  Notice,  we  stated  that,  to  date,  we  have  received  no  requests  for  revising  the  rules  governing  ORS  to  provide  increased  flexibility.  463  We  nonetheless  requested  comment  as  to  whether  any 
 of  the  Subpart  I  rules  warrant  review  as  a  result  of  meaningful  economic  competition  among  providers  of  wireless  services,  or  on  any  other  basis.  464  We  also  proposed  to  revise  Section  22.1003,  465  to  revise  the 
 eligibility  requirements  to  eliminate  references  to  common  carriers  and  instead  to  rely  on  language  similar  to  that  used  in  Parts  24  and  27  ([  a]  ny  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). 

 168.  Discussion.  No  comments  were  received  in  connection  with  this  Subpart  in  response  to  the  Notice.  Therefore,  at  this  time,  we  take  no  action  on  the  majority  of  the  rules  in  this  Subpart,  and  we 
 will  revisit  the  ORS  rules  at  another  time.  We  do,  however,  remove  the  reference  to  common  carriers  in  Section  22.1003  in  order  to  maintain  consistency  among  the  Part  22  Public  Mobile  Services.  466 

 III.  NOTICE  OF  PROPOSED  RULEMAKING    COMPETITIVE  BIDDING 
 169.  If  mutually  exclusive  applications  are  filed  for  the  commercial  air-  ground  licenses  that  comprise  the  three  band  configurations  defined  in  the  Report  and  Order,  the  Commission  will  be  required 

 to  resolve  such  applications  by  competitive  bidding  pursuant  to  the  requirements  of  Section  309(  j)  of  the  Communications  Act.  467  Similarly,  the  Commission  is  required  to  resolve  by  competitive  bidding 
 mutually  exclusive  general  aviation  air-  ground  applications.  468  To  date,  the  Commission  has  accepted  for  filing  nine  groups  of  mutually  exclusive  general  aviation  applications,  which  are  currently  pending. 
 Therefore,  the  Wireless  Telecommunications  Bureau  (  WTB)  will,  pursuant  to  its  delegated  authority,  schedule  an  auction  to  resolve  these  applications.  469  Accordingly,  in  this  Notice  of  Proposed  Rulemaking, 
 we  request  comment  on  a  number  of  issues  relating  to  competitive  bidding  procedures  for  both  commercial  air-  ground  and  general  aviation  licenses. 

 A.  Incorporation  by  Reference  of  the  Part  1  Standardized  Auction  Rules 
 170.  We  propose  to  conduct  auctions  of  both  commercial  and  general  aviation  air-  ground 

 463  Notice,  18  FCC  Rcd  at  8409  77. 
 464  Id. 
 465  47  C.  F.  R.    22.1003. 
 466  See  supra  paras.  99-  103. 
 467  47  U.  S.  C.    309(  j). 
 468  The  Balanced  Budget  Act  of  1997,  Pub.  L.  No.  105-  33,  Title  III,  111  Stat.  251  (1997),  amended  Section  309(  j)  to 
 require  the  Commission  to  award  mutually  exclusive  applications  for  initial  licenses  or  permits  using  competitive  bidding  procedures,  with  very  limited  exceptions.  These  exceptions  are  licenses  and  construction  permits  for  public 

 safety  radio  services,  digital  television  service  licenses  and  permits  given  to  existing  terrestrial  broadcast  licensees  to  replace  their  analog  television  service  licenses,  and  licenses  and  construction  permits  for  noncommercial  educational 
 broadcast  stations  and  public  broadcast  stations  under  47  U.  S.  C.    397(  6).  See  47  U.  S.  C.    309(  j)(  1)  &  (2).  469 
 This  auction  will  be  limited  to  the  parties  in  each  of  the  nine  groups  of  applicants  that  have  filed  mutually  exclusive  applications,  which  constitute  closed  filing  groups.  See  47  C.  F.  R.    22.  131.  These  parties  will  be  required 

 to  file  short-  form  applications  (FCC  Form  175)  and  submit  upfront  payments  to  participate  in  the  auction.  See  47  C.  F.  R.    1.2105(  a)  &  (b),  1.  2106. 
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 licenses  in  conformity  with  the  general  competitive  bidding  rules  set  forth  in  Part  1,  Subpart  Q,  of  the  Commission's  Rules,  and  substantially  consistent  with  the  bidding  procedures  that  have  been  employed  in 
 previous  Commission  auctions.  470  Specifically,  we  propose  to  employ  the  Part  1  rules  governing,  among  other  things,  designated  entities,  application  and  payment  procedures,  collusion  issues,  and  unjust 
 enrichment.  Under  this  proposal,  such  rules  would  be  subject  to  any  modifications  that  the  Commission  may  adopt  in  its  Part  1  Competitive  Bidding  proceeding.  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  WTB  pursuant  to  its  delegated  authority.  471  We  seek  comment  on  this 
 proposal.  In  particular,  we  request  comment  on  whether  any  of  our  Part  1  competitive  bidding  rules  would  be  inappropriate,  or  should  be  modified,  for  auctions  of  either  commercial  or  general  aviation  air-ground 
 licenses. 
 171.  With  respect  to  the  commercial  air-  ground  licenses  we  are  making  available,  we  are  providing  applicants  with  the  opportunity  to  bid  on  licenses  constituting  different  band  configurations. 

 Accordingly,  the  determination  of  whether  individual  commercial  air-  ground  license  applications  are  mutually  exclusive  for  purposes  of  Section  309(  j)  will  be  based  on  whether  different  applicants  have 
 applied  for  licenses  in  different  band  plan  license  configurations  as  well  as  on  whether  different  applicants  have  applied  for  the  same  licenses.  In  other  words,  because  only  one  band  configuration  will 
 be  implemented,  applicants  that  apply  for  licenses  in  different  configurations  will  be  considered  to  have  filed  mutually  exclusive  applications.  We  tentatively  conclude,  however,  that  this  and  any  other 
 differences  from  our  past  auctions  do  not  necessitate  any  changes  to  our  Part  1  competitive  bidding  rules,  and  that  WTB  can  address  such  differences  through  its  standard  practice  of  seeking  comment  on  and 
 adopting  procedures  for  specific  auctions.  We  seek  comment  on  this  tentative  conclusion. 
 B.  Provisions  for  Designated  Entities 
 172.  In  authorizing  the  Commission  to  use  competitive  bidding,  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.  472  In  addition,  Section  309(  j)(  3)(  B)  of  the  Communications  Act  requires  that  in  establishing 
 eligibility  criteria  and  bidding  methodologies,  the  Commission  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."  473  One  of  the  principal  means  by  which  the  Commission 
 furthers  these  statutory  goals  is  the  award  of  bidding  credits  to  small  businesses.  The  Commission 
 470  See  47  C.  F.  R.    1.2101-  1.  2113. 
 471  See  Amendment  of  Part  1  of  the  Commissions  Rules    Competitive  Bidding  Procedures,  Allocation  of  Spectrum 
 Below  5  GHz  Transferred  from  Federal  Government  Use,  4660-  4685  MHz,  Third  Report  and  Order  and  Second  Further  Notice  of  Proposed  Rule  Making,  13  FCC  Rcd  374,  448    124-  125  (1997)  (  Part  1  Third  R&  O)  (directing 

 WTB  to  seek  comment  on  specific  mechanisms  related  to  day-  to-  day  auction  conduct  such  as  the  structure  of  bidding  rounds  and  stages,  establishment  of  minimum  opening  bids  or  reserve  prices,  minimum  accepted  bids, 
 activity  requirements  for  each  stage  of  the  auction,  and  stopping  rules);  Amendment  of  Part  1  of  the  Commissions  Rules    Competitive  Bidding  Procedures,  Order,  Memorandum  Opinion  and  Order  and  Notice  of  Proposed  Rule 
 Making,  12  FCC  Rcd  5686,  5697  16  (1997)  (clarifying  that,  pursuant  to  Section  0.131  of  the  Commissions  Rules,  47  C.  F.  R.    0.131,  the  Chief,  Wireless  Telecommunications  Bureau,  has  delegated  authority  to  implement  all  of  the 
 Commissions  rules  pertaining  to  auctions  procedures).  472 
 See  47  U.  S.  C.    309(  j)(  4)(  D).  Such  entities  are  collectively  described  as  designated  entities.  See  47  C.  F.  R.    1.2110(  a). 

 473  47  U.  S.  C.    309(  j)(  3)(  B). 
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 defines  eligibility  requirements  for  small  business  bidding  credits  on  a  service-  specific  basis,  taking  into  account  the  capital  requirements  and  other  characteristics  of  the  particular  service.  474 
 173.  In  considering  small  business  bidding  credits  for  the  commercial  air-  ground  licenses  we  make  available  in  today's  Report  and  Order,  we  note  that  in  the  past  the  Commission  has  declined  to 
 adopt  provisions  for  designated  entities  for  certain  services,  such  as  the  direct  broadcast  satellite  service  and  the  digital  audio  radio  service,  which  have  extremely  high  implementation  costs.  475  The  Commission 
 reached  this  conclusion  in  those  instances  in  large  part  because  it  was  unclear  whether  small  businesses  could  attract  the  capital  necessary  to  implement  and  provide  a  nationwide  service.  476  We  also  note  that  in 
 previous  auctions  of  nationwide  licenses  in  which  the  Commission  offered  bidding  credits  to  designated  entities,  none  of  the  licenses  was  won  by  a  designated  entity.  477  Moreover,  the  legislative  history  of  the 
 designated  entity  provisions  of  Section  309(  j)  demonstrates  that  Congress  did  not  necessarily  intend  that  the  Commission  adopt  special  measures  for  designated  entities  in  nationwide  services.  The  House  Report 
 to  the  Omnibus  Budget  Reconciliation  Act  of  1993  states  that  "[  t]  he  characteristics  of  some  services  are  inherently  national  in  scope,  and  are  therefore  ill-  suited  for  small  businesses."  478 

 174.  Notwithstanding  these  facts,  we  tentatively  conclude  that  small  business  bidding  credits  are  appropriate  for  the  commercial  air-  ground  service.  We  base  this  conclusion  on  the  fact  that  no 
 commercial  air-  ground  license  will  authorize  the  use  of  as  much  spectrum  as  other  nationwide  services  for  which  the  Commission  has  declined  to  adopt  small  business  bidding  credits.  In  addition,  we  believe 
 that  the  operation  of  a  commercial  air-  ground  service  may  require  lower  capital  expenditures  than  other  nationwide  services,  such  as  satellite  services,  because  the  necessary  infrastructure  may  be  less  costly.  479 
 Thus,  we  tentatively  conclude  that  small  businesses  may  be  able  to  attract  the  necessary  capital  to  provide  commercial  air-  ground  service,  particularly  if  they  are  assisted  by  bidding  credits.  480  We  seek  comment 

 474  47  C.  F.  R.    1.2110(  c)(  1);  see  also  Part  1  Third  R&  O,  13  FCC  Rcd  at  388  18;  Implementation  of  Section  309(  j) 
 of  the  Communications  Act    Competitive  Bidding,  Second  Memorandum  Opinion  and  Order,  9  FCC  Rcd  7245,  7269  145  (1994). 

 475  See  Revision  of  Rules  and  Policies  for  the  Direct  Broadcast  Satellite  Service,  Report  and  Order,  11  FCC  Rcd 
 9712  (1995)  (  DBS  Auction  Order);  Establishment  of  Rules  and  Policies  for  the  Digital  Audio  Radio  Satellite  Service  in  the  2310-  2360  MHz  Band,  Report  and  Order,  Memorandum  Opinion  and  Order  and  Further  Notice  of 

 Proposed  Rulemaking,  12  FCC  Rcd  5754  (1997)  (  DARS  Auction  Order).  476 
 See  DBS  Auction  Order,  11  FCC  Rcd  at  9799  217;  DARS  Auction  Order,  12  FCC  Rcd  at  5824-  25    174-  76.  477 
 See  Announcing  the  High  Bidders  in  the  Auction  of  Ten  Nationwide  Narrowband  PCS  Licenses,  Public  Notice,  PNWL  94-  4  (rel.  Aug.  2,  1994).  In  the  nationwide  narrowband  PCS  auction  (Auction  No.  1),  bidding  credits  on  ten 

 nationwide  licenses  were  offered  to  women-  and  minority-  owned  businesses.  See  also  1670-  1675  MHz  Band  Auction  Closes,  Winning  Bidder  Announced,  Public  Notice,  18  FCC  Rcd  9089  (2003).  In  the  1670-  1675  MHz 
 Band  auction  (Auction  No.  46),  the  Commission  offered  a  bidding  credit  on  a  nationwide  license  in  the  1670-  1675  MHz  band  to  small  businesses  with  average  annual  revenues  not  exceeding  $40  million  and  very  small  businesses 
 with  average  annual  revenues  not  exceeding  $15  million.  478 
 H.  R.  Rep.  No.  103-  111,  at  254  (1993).  479 
 Air-  ground  service  may  also  require  fewer  ground  (base)  stations  than  other  terrestrial  services  that  are  provided  on  a  nationwide  basis,  such  as  broadband  PCS. 

 480  In  ex  parte  comments,  AirCell  and  Space  Data  urge  the  Commission  to  adopt  small  business  bidding  credits  for 
 commercial  air-  ground  licenses,  arguing  that  they  are  small  businesses  that  have  the  resources  and  expertise  to  provide  air-  ground  service  but  may  not  be  able  to  compete  for  a  license  without  bidding  credits.  Letter  from 

 Michele  C.  Farquhar,  Counsel  to  AirCell,  Inc.,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Sept.  17,  2004  (AirCell  Sept.  17  Ex  parte  letter);  Letter  from  Jerry  Knoblach,  CEO,  Space  Data 
 (continued.) 
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 on  these  tentative  conclusions. 
 175.  Having  tentatively  concluded  that  small  businesses  may  be  able  to  provide  commercial  air-  ground  service,  we  nonetheless  recognize  that  such  operations  may  be  very  capital-  intensive  relative 

 to  other  services  provided  to  smaller  geographic  areas.  We  therefore  propose  to  use  the  same  small  business  definitions  we  have  adopted  for  other  capital-  intensive  services  that  serve  large  geographic  areas. 
 Specifically,  we  propose  to  define  a  small  business  as  an  entity  with  average  annual  gross  revenues  for  the  three  preceding  years  not  exceeding  $40  million,  and  to  define  a  very  small  business  as  an  entity  with 
 average  annual  gross  revenues  for  the  three  preceding  years  not  exceeding  $15  million.  481  We  also  propose  a  15  percent  bidding  credit  for  small  businesses  and  a  25  percent  bidding  credit  for  very  small 
 businesses,  as  set  forth  in  our  standardized  schedule  at  47  C.  F.  R.    1.2110(  f)(  2).  These  are  the  same  tiered  small  business  definitions  and  bidding  credits  that  we  adopted,  for  example,  for  EAG-  based 
 licenses  in  the  upper  and  lower  700  MHz  bands.  482  We  note  also  that  AirCell  and  Space  Data,  in  ex  parte  comments,  support  these  small  business  definitions  and  bidding  credits  as  appropriate  for  commercial  air-ground 
 service.  483 
 176.  We  request  comment  on  these  proposals.  In  particular,  we  invite  commenters  to  discuss  the  expected  capital  requirements  and  other  characteristics  of  the  commercial  air-  ground  operations  that 

 may  be  provided  using  the  licenses  made  available  by  todays  Report  and  Order,  and  the  relationship  of  such  requirements  and  characteristics  to  small  business  definitions  and  bidding  credits.  We  invite 
 commenters  to  provide  comparisons  with  other  services  for  which  the  Commission  has  established  bidding  credits.  To  the  extent  commenters  support  a  different  bidding  credit  regime  than  the  one 
 proposed  here,  they  should  support  their  proposals  with  relevant  information.  Such  comments  should  provide  information  on,  for  example,  the  technology  that  a  commercial  air-  ground  licensee  is  likely  to 
 employ,  the  cost  of  deployment,  and  other  factors  that  may  affect  capital  requirements  for  commercial  air-ground  operations. 

 177.  We  also  seek  comment  on  whether  our  proposed  designated  entity  provisions,  if  applied  to  the  commercial  air-  ground  service,  would  promote  participation  by  businesses  owned  by  minorities  and 
 by  women,  as  well  as  participation  by  rural  telephone  companies.  To  the  extent  that  commenters  propose  additional  provisions  to  enhance  participation  by  minority-  owned  or  women-  owned  businesses, 
 commenters  should  address  how  we  should  craft  such  provisions  to  meet  the  relevant  standards  of  judicial  review.  484 

 178.  In  contrast  to  the  commercial  air-  ground  licenses  made  available  by  today's  Report  and  Order,  general  aviation  air-  ground  licenses  are  specialized  licenses  that  are  generally  valued  by  relatively 
 small  businesses.  For  this  reason,  we  expect  that  small  businesses  interested  in  acquiring  these 
 (Continued  from  previous  page)  Corporation,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Oct.  28,  2004  (Space 

 Data  Oct.  28  Ex  parte  letter).  481 
 We  are  coordinating  these  size  standards  with  the  U.  S.  Small  Business  Administration.  482 
 See  Reallocation  and  Service  Rules  for  the  698-  746  MHz  Spectrum  Band  (Television  Channels  52-  59),  Report  and  Order,  17  FCC  Rcd  2153  (2002);  Service  Rules  for  the  746-  764  and  776-  794  MHz  Bands,  and  Revisions  of 

 Part  27  of  the  Commissions  Rules,  First  Report  and  Order,  15  FCC  Rcd  25495  (2000).  The  country  is  divided  into  six  Economic  Area  Groupings  (EAGs);  thus,  EAGs  are  very  large  geographic  areas. 
 483  AirCell  Sept.  17  Ex  parte  letter,  at  2;  Space  Data  Oct.  28  Ex  parte  letter,  at  2-  3.  AirCell  and  Space  Data  also 
 suggest  that  the  Commission  consider  higher  bidding  credits.  However,  neither  company  makes  a  specific  proposal  or  supplies  specific  facts  to  support  such  a  proposal. 

 484  See  United  States  v.  Virginia,  518  U.  S.  515  (1996);  Adarand  Constructors  v.  Pena,  515  U.  S.  200  (1995). 
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 F.  Paperwork  Reduction  Act  of  1995 
 184.  This  document  does  not  contain  any  proposed,  new,  or  modified  information  collection  subject  to  the  Paperwork  Reduction  Act  of  1995  (PRA),  Public  Law  104-  13.  In  addition,  therefore,  it 

 does  not  contain  any  new  or  modified  information  collection  burden  for  small  business  concerns  with  fewer  than  25  employees,  pursuant  to  the  Small  Business  Paperwork  Relief  Act  of  2002,  Public  Law 
 107-  198.  See  44  U.  S.  C.  3506(  c)(  4). 
 G.  Contact  Information 
 185.  The  primary  Wireless  Telecommunications  Bureau  contact  for  this  proceeding  is  Richard  Arsenault,  Chief  Counsel  of  the  Wireless  Telecommunications  Bureau  Mobility  Division  (202-  418-  0920, 

 Richard.  Arsenault@  fcc.  gov).  For  auctions-  related  issues,  contact  Lynne  Milne  (202-  418-  7055,  Lynne.  Milne@  fcc.  gov).  Press  inquiries  should  be  directed  to  Lauren  Patrich,  Wireless 
 Telecommunications  Bureau,  at  (202)  418-  7944,  TTY  at  (202)  418-  7233,  or  e-  mail  at  Lauren.  Patrich@  fcc.  gov. 

 V.  ORDERING  CLAUSES 
 186.  Accordingly,  IT  IS  ORDERED  THAT,  pursuant  to  the  authority  contained  in  Sections  1,  4(  i),  11,  303(  r)  and  (y),  308,  309,  and  332  of  the  Communications  Act  of  1934,  as  amended,  47  U.  S.  C. 

   151,  154(  i),  161,  303(  r),  303(  y),  308,  309,  and  332,  this  REPORT  AND  ORDER  AND  NOTICE  OF  PROPOSED  RULEMAKING  is  hereby  ADOPTED,  and  Parts  1,  22,  and  90  of  the  Commissions  rules 
 are  amended  accordingly. 
 187.  IT  IS  FURTHER  ORDERED  that,  pursuant  to  Sections  4(  i),  301,  and  307  of  the  Communications  Act,  as  amended,  47  U.  S.  C.    154(  i),  301,  and  307,  a  new  license  for  Station 

 KNKG804,  BE  GRANTED  to  Verizon  Airfone  Inc.  for  a  five-  year  non-  renewable  term  in  accordance  with  the  terms  and  conditions  set  forth  above  (file  no.  0001716212).  490 

 188.  IT  IS  FURTHER  ORDERED  THAT  the  Commissions  Consumer  Information  Bureau,  Reference  Information  Center,  SHALL  SEND  a  copy  of  this  REPORT  AND  ORDER  AND  NOTICE  OF 
 PROPOSED  RULEMAKING,  including  the  Final  Regulatory  Flexibility  Analysis  and  the  Initial  Regulatory  Flexibility  Analysis,  to  the  Chief  Counsel  for  Advocacy  of  the  Small  Business 
 Administration. 

 FEDERAL  COMMUNICATIONS  COMMISSION 

 Marlene  H.  Dortch  Secretary 

 490  See  supra  paras.  79-  82. 
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 APPENDIX  A 
 COMMENTING  PARTIES 
 (WT  Docket  No.  03-  103) 
 A.  Comments 
 AirCell,  Inc.  (AirCell)  Able  Communications  Ltd.  (Able  Communications) 

 American  Mobile  Telecommunications  Association,  Inc.  (AMTA)  Arch  Wireless  Operating  Company,  Inc.,  the  Allied  National  Paging  Association,  the  American 
 Association  of  Paging  Carriers,  Metrocall  Holdings  Inc.,  and  Weblink  Wireless  I,  L.  P.  (collectively,  Arch  Wireless) 
 Blooston,  Mordkofsky,  Dickens,  Duffy  &  Prendergast  (Blooston)  Cingular  Wireless  LLC  (Cingular  Wireless) 
 Joint  Comments  of  Emergency  Radio  Service,  Inc.,  Saia  Communications,  Inc.,  and  Texas  License  Consultants  (collectively,  Joint  Commenters) 
 Matt  Edwards  (Edwards)  Motorola,  Inc.  (Motorola) 
 QUALCOMM  Incorporated  (QUALCOMM)  SkyTel  Corp.  (SkyTel) 
 Societe  Internationale  de  Telecommunications  Aeronautiques  (SITA)  Tony  Drake  (Drake) 
 Verizon  Airfone  Verizon  Wireless 
 Westel  Communications,  Inc.  (Westel) 
 B.  Reply  Comments 
 Able  Communications  Ltd.  AirCell,  Inc. 
 Blooston,  Mordkofsky,  Dickens,  Duffy  &  Prendergast  The  Boeing  Company  (Boeing) 
 New  York  State  Electric  &  Gas  Corporation  (NYSE&  GC)  QUALCOMM  Incorporated 
 SkyTel  Corp.  Societe  Internationale  de  Telecommunications  Aeronautiques 
 Space  Data  Corporation  (Space  Data)  Stratophone  LLC  (Stratophone) 
 Texas  License  Consultants  (TLC)  Verizon  Airfone 
 Verizon  Wireless 
 C.  Ex  partes 
 Air  Carrier  Association  of  America  AirCell,  Inc. 
 AirTran  Airways  American  Airlines 
 American  Association  of  Paging  Carriers  (AAPC) 
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 Association  of  American  Railroads  Association  of  Public  Safety  Communications  Officials  International,  Inc.  (APCO) 
 Blooston,  Mordkofsky,  Dickens,  Duffy  &  Prendergast  The  Boeing  Company 
 Cellular  Telecommunications  &  Internet  Association  The  Wireless  Association  (CTIA)  The  Honorable  Conrad  Burns,  Deputy  Whip,  United  States  Senate 
 Continental  Airlines,  Inc.  Federal  Bureau  of  Investigation  and  U.  S.  Drug  Enforcement  Administration  (FBI/  DEA) 
 Flarion  Technologies  Inc.  (Flarion)  The  Honorable  Fred  Upton,  Chairman,  House  Energy  and  Commerce  Subcommittee  on 
 Telecommunications  and  the  Internet  Frontier  Airlines,  Inc. 
 JetBlue  Airways  Metrocall  Holdings,  Inc.  (Metrocall) 
 Motorola,  Inc.  National  Telecommunications  and  Information  Administration  (NTIA) 
 Nextel  Communications,  Inc.  (Nextel)  Northwest  Airlines,  Inc. 
 QUALCOMM  Incorporated  Skyway  Aircraft,  Inc.  (Skyway) 
 Space  Data  Corporation  Sprint  Corporation 
 T-  Mobile  USA  United  Airlines 
 U.  S.  Department  of  Homeland  Security,  Immigrations  and  Customs  Enforcement,  Federal  Air  Marshal  Service 
 Verizon  Airfone 
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 APPENDIX  B 
 FINAL  RULES 
 Title  47,  Part  1  of  the  Code  of  Federal  Regulations,  47  CFR  Part  1,  is  amended  as  follows: 
 1.  The  authority  citation  for  Part  1  continues  to  read  as  follows: 
 Authority:  47  U.  S.  C.  151,  154(  i),  154(  j),  155,  225,  303(  r),  309  and  325(  e). 
 2.  In  Section  1.903,  revise  paragraph  (c)  to  read  as  follows: 
   1.903  Authorization  required. 
 *  *  *  *  * 
 (c)  Subscribers.  Authority  for  subscribers  to  operate  mobile  or  fixed  stations  in  the  Wireless  Radio  Services,  except  for  certain  stations  in  the  Rural  Radiotelephone  Service,  is  included  in  the 
 authorization  held  by  the  licensee  providing  service  to  them.  Subscribers  are  not  required  to  apply  for,  and  the  Commission  does  not  accept,  applications  from  subscribers  for  individual 
 mobile  or  fixed  station  authorizations  in  the  Wireless  Radio  Services.  Individual  authorizations  are  required  to  operate  rural  subscriber  stations  in  the  Rural  Radiotelephone  Service,  except  as 
 provided  in    22.703  of  this  chapter.  Individual  authorizations  are  required  for  end  users  of  certain  Specialized  Mobile  Radio  Systems  as  provided  in    90.655  of  this  chapter.  In  addition, 
 certain  ships  and  aircraft  are  required  to  be  individually  licensed  under  Parts  80  and  87  of  this  chapter.  See    80.13,  87.18  of  this  chapter. 

 3.  In  Section  1.929,  revise  paragraph  (c)(  1)  to  read  as  follows: 
   1.929  Classification  of  filings  as  major  or  minor. 
 *  *  *  *  * 
 (c)  *  *  * 
 (1)  In  the  Paging  and  Radiotelephone  Service,  Rural  Radiotelephone  Service  and  800  MHz  Specialized  Mobile  Radio  Service  (SMR),  any  change  that  would  increase  or  expand  the 
 applicant's  existing  composite  interference  contour,  except  extensions  of  a  composite  interference  contour  over  bodies  of  water  that  extend  beyond  county  boundaries  (i.  e.,  including 
 but  not  limited  to  oceans,  the  Gulf  of  Mexico,  and  the  Great  Lakes)  on  a  secondary  basis. 
 *  *  *  *  * 
 4.  Add  a  new  Section  1.958  to  read  as  follows: 
   1.958  Distance  computation. 
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 (h)  Terms  used  in  this  section  are  defined  as  follows: 
 (1)  LAT1dd  and  LON1dd  are  the  coordinates  of  the  first  location  in  degree-  decimal  format. 
 (2)  LAT2dd  and  LON2dd  are  the  coordinates  of  the  second  location  in  degree-  decimal  format. 
 (3)  ML  is  the  mean  geodetic  latitude  in  degree-  decimal  format. 
 (4)  KPDlat  is  the  number  of  kilometers  per  degree  of  latitude  at  a  given  mean  geodetic  latitude. 

 (5)  KPDlon  is  the  number  of  kilometers  per  degree  of  longitude  at  a  given  mean  geodetic  latitude. 
 (6)  NS  is  the  North-  South  distance  in  kilometers. 
 (7)  EW  is  the  East-  West  distance  in  kilometers. 
 (8)  DIST  is  the  distance  between  the  two  locations,  in  kilometers. 
 5.  Add  new  Section  1.959  to  read  as  follows: 
   1.959  Computation  of  average  terrain  elevation. 
 Except  as  otherwise  specified  in    90.309(  a)(  4)  of  this  chapter,  average  terrain  elevation  must  be  calculated  by  computer  using  elevations  from  a  30  second  point  or  better  topographic  data 
 file.  The  file  must  be  identified.  If  a  30  second  point  data  file  is  used,  the  elevation  data  must  be  processed  for  intermediate  points  using  interpolation  techniques;  otherwise,  the  nearest  point 
 may  be  used.  In  cases  of  dispute,  average  terrain  elevation  determinations  can  also  be  done  manually,  if  the  results  differ  significantly  from  the  computer  derived  averages. 

 (a)  Radial  average  terrain  elevation  is  calculated  as  the  average  of  the  elevation  along  a  straight  line  path  from  3  to  16  kilometers  (2  and  10  miles)  extending  radially  from  the  antenna 
 site.  If  a  portion  of  the  radial  path  extends  over  foreign  territory  or  water,  such  portion  must  not  be  included  in  the  computation  of  average  elevation  unless  the  radial  path  again  passes  over 
 United  States  land  between  16  and  134  kilometers  (10  and  83  miles)  away  from  the  station.  At  least  50  evenly  spaced  data  points  for  each  radial  should  be  used  in  the  computation. 

 (b)  Average  terrain  elevation  is  the  average  of  the  eight  radial  average  terrain  elevations  (for  the  eight  cardinal  radials). 
 (c)  For  locations  in  Dade  and  Broward  Counties,  Florida,  the  method  prescribed  above  may  be  used  or  average  terrain  elevation  may  be  assumed  to  be  3  meters  (10  feet). 
 6.  In  the  table  in  Section  1.1102,  remove  row  entry  16.  h.  Air  Ground  Individual. 
 7.  In  Section  1.2003,  remove  the  phrase  FCC  409  Airborne  Mobile  Radio  Telephone  License  Application;. 
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 Title  47,  Part  22  of  the  Code  of  Federal  Regulations,  47  CFR  Part  22,  is  amended  as  follows: 
 8.  The  authority  citation  for  Part  22  continues  to  read  as  follows: 
 Authority:  47  U.  S.  C.  154,  222,  303,  309  and  332. 
 9.  Revise  paragraph  (b)  of  Section  22.1,  to  read  as  follows: 
   22.1  Basis  and  purpose. 
 *  *  *  *  * 
 (b)  Purpose.  The  purpose  of  these  rules  is  to  establish  the  requirements  and  conditions  under  which  radio  stations  may  be  licensed  and  used  in  the  Public  Mobile  Services. 

 10.  In  Section  22.3,  revise  the  text  of  paragraph  (b)  and  remove  paragraphs  (b)(  1)  and  (b)(  2),  to  read  as  follows: 
   22.3  Authorization  required. 
 *  *  *  *  * 
 (b)  Authority  for  subscribers  to  operate  mobile  or  fixed  stations  in  the  Public  Mobile  Services,  except  for  certain  stations  in  the  Rural  Radiotelephone  Service,  is  included  in  the  authorization 
 held  by  the  licensee  providing  service  to  them.  Subscribers  are  not  required  to  apply  for,  and  the  FCC  does  not  accept  applications  from  subscribers  for,  individual  mobile  or  fixed  station 
 authorizations  in  the  Public  Mobile  Services,  except  that  individual  authorizations  are  required  to  operate  rural  subscriber  stations  in  the  Rural  Radiotelephone  Service  under  certain 
 circumstances.  See    22.703. 
 11.  Revise  Section  22.7  in  its  entirety  to  read  as  follows: 
   22.7  General  eligibility. 
 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.  Applications  are  granted 
 only  if  the  applicant  is  legally,  financially,  technically  and  otherwise  qualified  to  render  the  proposed  service. 

 12.  In  Section  22.  99,  remove  the  terms  Meteor  burst  propagation  mode,  Radio  Common  Carrier,  and  Wireline  Common  Carrier  and  their  definitions. 
 13.  In  Section  22.99,  in  the  definition  of  the  term  Channel,  remove  the  words  See,  for  example,    22.161. 
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 14.  In  Section  22.  99,  in  the  definitions  of  the  terms  Air-  Ground  Radiotelephone  Service,  Cellular  Radiotelephone  Service,  Offshore  Radiotelephone  Service,  Public  Mobile 
 Services,  and  Rural  Radiotelephone  Service,  remove  the  words  common  carrier  and  add,  in  their  place,  the  word  licensee. 

 15.  In  Section  22.99,  correct  Air-  ground  Radiotelephone  Service  to  read  Air-  Ground  Radiotelephone  Service  in  the  definitions  of  Communications  channel,  Control 
 channel,  and  Ground  station. 
 16.  Revise  paragraph  (d)(  4)  of  Section  22.143  to  read  as  follows: 
   22.143  Construction  prior  to  grant  of  application. 
 *  *  *  *  * 
 (d)  *  *  * 
 (4)  For  any  construction  or  alteration  that  would  exceed  the  requirements  of    17.7  of  this  chapter,  the  licensee  has  notified  the  appropriate  Regional  Office  of  the  Federal  Aviation 
 Administration  (FAA  Form  7460-  1),  filed  a  request  for  antenna  height  clearance  and  obstruction  marking  and  lighting  specifications  (FCC  Form  854)  with  the  FCC  at  WTB,  Spectrum 
 Management  Resources  and  Technologies  Division,  1270  Fairfield  Road,  Gettysburg,  PA  17325,  or  electronically  via  the  FCC  Antenna  Structure  Registration  home  page, 
 wireless.  fcc.  gov/  antenna/. 
 *  *  *  *  * 
 17.  Remove  Section  22.157. 
 18.  Remove  Section  22.159. 
 19.  Remove  Section  22.161. 
 20.  Remove  and  reserve  paragraphs  (a)(  3)  and  (a)(  5)  of  Section  22.313. 
 21.  Revise  Section  22.351  in  its  entirety  to  read  as  follows: 
   22.351  Channel  assignment  policy. 
 The  channels  allocated  for  use  in  the  Public  Mobile  Services  are  listed  in  the  applicable  subparts  of  this  part.  Channels  and  channel  blocks  are  assigned  in  such  a  manner  as  to  facilitate 
 the  rendition  of  service  on  an  interference-  free  basis  in  each  service  area.  Except  as  otherwise  provided  in  this  part,  each  channel  or  channel  block  is  assigned  exclusively  to  one  licensee  in 
 each  service  area.  All  applicants  for,  and  licensees  of,  stations  in  the  Public  Mobile  Services  shall  cooperate  in  the  selection  and  use  of  channels  in  order  to  minimize  interference  and  obtain 
 the  most  efficient  use  of  the  allocated  spectrum. 
 22.  In  Section  22.352,  revise  the  first  sentence  of  the  introductory  text,  as  follows: 
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   22.352  Protection  from  interference. 
 Public  Mobile  Service  stations  operating  in  accordance  with  applicable  FCC  rules  and  the  terms  and  conditions  of  their  authorizations  are  normally  considered  to  be  non-  interfering.  *  *  * 

 *  *  *  *  * 
 23.  Revise  Section  22.357  in  its  entirety  to  read  as  follows: 
   22.357  Emission  types. 
 Any  authorized  station  in  the  Public  Mobile  Services  may  transmit  emissions  of  any  type(  s)  that  comply  with  the  applicable  emission  rule,  i.  e.    22.  359,    22.861  or    22.  917. 

 24.  Revise  Section  22.359  in  its  entirety  to  read  as  follows: 
   22.359  Emission  limitations. 
 The  rules  in  this  section  govern  the  spectral  characteristics  of  emissions  in  the  Public  Mobile  Services,  except  for  the  Air-  Ground  Radiotelephone  Service  (see    22.861,  instead)  and  the 
 Cellular  Radiotelephone  Service  (see    22.917,  instead). 
 (a)  Out  of  band  emissions.  The  power  of  any  emission  outside  of  the  authorized  operating  frequency  ranges  must  be  attenuated  below  the  transmitting  power  (P)  by  a  factor  of  at  least 
 43  +  10  log  (P)  dB. 
 (b)  Measurement  procedure.  Compliance  with  these  rules  is  based  on  the  use  of  measurement  instrumentation  employing  a  resolution  bandwidth  of  30  kHz  or  more.  In  the  60  kHz  bands 
 immediately  outside  and  adjacent  to  the  authorized  frequency  range  or  channel,  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.,  30  kHz  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. 

 (c)  Alternative  out  of  band  emission  limit.  Licensees  in  the  Public  Mobile  Services  may  establish  an  alternative  out  of  band  emission  limit  to  be  used  at  specified  frequencies  (band 
 edges)  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. 

 (d)  Interference  caused  by  out  of  band  emissions.  If  any  emission  from  a  transmitter  operating  in  any  of  the  Public  Mobile  Services  results  in  interference  to  users  of  another  radio 
 service,  the  FCC  may  require  a  greater  attenuation  of  that  emission  than  specified  in  this  section. 
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 25.  Remove  Section  22.361  and  Table  C-  2  thereto. 
 26.  Remove  Section  22.363. 
 27.  Remove  Section  22.367. 
 28.  Remove  Section  22.373. 
 29.  Remove  Section  22.379. 
 30.  Remove  Section  22.381. 
 31.  In  Section  22.401,  remove  the  words  Communications  common  carriers  in  the  first  sentence  of  the  introductory  text,  and  add,  in  their  place,  the  words  Eligible  entities  (see 
   22.7). 
 32.  Remove  Section  22.411. 
 33.  Remove  Section  22.415. 
 34.  Remove  Section  22.417. 
 35.  Remove  and  reserve  paragraphs  (a)  and  (b)  of  Section  22.531. 
 36.  Remove  Section  22.539. 
 37.  Remove  Section  22.551. 
 38.  Remove  Section  22.563. 
 39.  Remove  paragraph  (g)  of  Section  22.565. 
 40.  Remove  Section  22.569. 
 41.  Remove  Section  22.577. 
 42.  In  Section  22.591,  remove  from  the  table  in  the  introductory  text,  the  portion  of  that  table  which  is  entitled  Microwave  channels,  and  remove  and  reserve  paragraph  (b). 

 43.  Revise  Section  22.593  in  its  entirety,  to  read  as  follows: 
   22.593  Effective  radiated  power  limits. 
 The  effective  radiated  power  of  fixed  stations  operating  on  the  channels  listed  in    22.591  must  not  exceed  150  Watts.  The  equivalent  isotropically  radiated  power  of  existing  fixed 
 microwave  stations  (2110-  2130  and  2160-  2180  MHz)  licensed  under  this  part  (pursuant  to  former  rules)  must  not  exceed  the  applicable  limits  set  forth  in    101.113  of  this  chapter. 
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 44.  Revise  the  heading  and  introductory  text  of  Section  22.601  to  read  as  follows: 
   22.601  Existing  microwave  stations  licensed  under  this  part. 
 Existing  microwave  stations  (2110-  2130  and  2160-  2180  MHz)  licensed  under  this  part  (pursuant  to  former  rules)  are  subject  to  the  transition  rules  in    22.602.  No  new  microwave 
 systems  will  be  authorized  under  this  part. 
 *  *  *  *  * 
 45.  Revise  the  introductory  paragraph  of  Section  22.602  to  read  as  follows: 
   22.602  Transition  of  the  2110-  2130  and  2160-  2180  MHz  channels  to  emerging  technologies. 

 The  2110-  2130  and  2160-  2180  MHz  microwave  channels  formerly  listed  in    22.591  have  been  re-  allocated  for  use  by  emerging  technologies  (ET)  services.  No  new  systems  will  be 
 authorized  under  this  part.  The  rules  in  this  section  provide  for  a  transition  period  during  which  existing  Paging  and  Radiotelephone  Service  (PARS)  licensees  using  these  channels  may  relocate 
 operations  to  other  media  or  to  other  fixed  channels,  including  those  in  other  microwave  bands.  For  PARS  licensees  relocating  operations  to  other  microwave  bands,  authorization  must  be 
 obtained  under  Part  101  of  this  chapter. 
 *  *  *  *  * 
 46.  Revise  paragraph  (a)  of  Section  22.625  to  read  as  follows: 
   22.625  Transmitter  locations. 
 *  *  *  *  * 
 (a)  928-  960  MHz.  In  this  frequency  range,  the  required  minimum  distance  separation  between  co-  channel  fixed  transmitters  is  113  kilometers  (70  miles). 

 *  *  *  *  * 
 47.  Remove  Section  22.655. 
 48.  In  Section  22.725,  revise  the  heading  and  the  first  sentence  of  the  introductory  text  and  remove  paragraph  (c),  to  read  as  follows: 

   22.725  Channels  for  conventional  rural  radiotelephone  stations  and  basic  exchange  telephone  radio  systems. 
 The  following  channels  are  allocated  for  paired  assignment  to  transmitters  that  provide  conventional  rural  radiotelephone  service  and  to  transmitters  in  basic  exchange  telephone  radio 
 systems.  *  *  * 
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 *  *  *  *  * 
 (c)  [deleted] 
 49.  Remove  paragraph  (f)  of  Section  22.727. 
 50.  Remove  Section  22.729. 
 51.  Revise  Section  22.757  in  its  entirety  to  read  as  follows: 
   22.757  Channels  for  basic  exchange  telephone  radio  systems. 
 The  channels  listed  in    22.725  are  also  allocated  for  paired  assignment  to  transmitters  in  basic  exchange  telephone  radio  systems. 

 52.  Revise  Section  22.801  in  its  entirety  to  read  as  follows: 
   22.801  Scope. 
 The  rules  in  this  subpart  govern  the  licensing  and  operation  of  air-  ground  stations  and  systems.  The  licensing  and  operation  of  these  stations  and  systems  is  also  subject  to  rules 
 elsewhere  in  this  part  and  in  part  1  of  this  chapter  that  generally  apply  to  the  Public  Mobile  Services.  In  case  of  conflict,  however,  the  rules  in  this  subpart  govern. 

 53.  Redesignate  Section  22.803  as  Section  22.807,  revise  the  heading,  introductory  text,  and  paragraph  (b),  and  remove  paragraph  (c),  to  read  as  follows: 
   22.807  General  aviation  air-  ground  station  application  requirements. 
 In  addition  to  the  information  required  by  Subparts  B  and  D  of  this  part,  FCC  Form  601  applications  for  authorization  to  operate  a  general  aviation  air-  ground  station  must  contain  the 
 applicable  supplementary  information  described  in  this  section. 
 (a)  *  *  * 
 (b)  Technical  information.  The  following  information  is  required  by  FCC  Form  601. 
 (1)  Location  description,  city,  county,  state,  geographic  coordinates  (NAD83)  correct  to    1  second,  site  elevation  above  mean  sea  level,  proximity  to  adjacent  market  boundaries  and 
 international  borders; 
 (2)  Antenna  height  to  tip  above  ground  level,  antenna  gain  in  the  maximum  lobe,  the  electric  field  polarization  of  the  wave  emitted  by  the  antenna  when  installed  as  proposed; 

 (3)  *  *  * 
 54.  Remove  Section  22.811. 
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 55.  Revise  Section  22.815  in  its  entirety  to  read  as  follows: 
   22.815  Construction  period  for  general  aviation  ground  stations. 
 The  construction  period  (see    1.946)  for  general  aviation  ground  stations  is  12  months. 
 56.  Remove  Section  22.819. 
 57.  Add  a  new  Section  22.853  to  read  as  follows: 
   22.853  Eligibility  to  hold  interest  in  licenses  limited  to  3  MHz  of  spectrum. 
 No  individual  or  entity  may  hold,  directly  or  indirectly,  a  controlling  interest  in  licenses  authorizing  the  use  of  more  than  three  megahertz  of  spectrum  (either  shared  or  exclusive)  in  the 
 800  MHz  commercial  aviation  Air-  Ground  Radiotelephone  Service  frequency  bands  (see    22.857).  Individuals  and  entities  with  either  de  jure  or  de  facto  control  of  a  licensee  in  these 
 bands  will  be  considered  to  have  a  controlling  interest  in  its  license(  s).  For  purposes  of  this  rule,  the  definitions  of  controlling  interests  and  affiliate  set  forth  set  forth  in  paragraphs  (c)(  2)  and 
 (c)(  5)  of    1.2110  of  this  chapter  shall  apply. 
 58.  Revise  Section  22.857  in  its  entirety  to  read  as  follows: 
   22.857  Frequency  bands. 
 The  849-  851  MHz  and  894-  896  MHz  frequency  bands  are  designated  for  paired  nationwide  exclusive  assignment  to  the  licensee  or  licensees  of  systems  providing  radio  telecommunications 
 service,  including  voice  and/  or  data  service,  to  persons  on  board  aircraft.  Air-  ground  systems  operating  in  these  frequency  bands  are  referred  to  in  this  chapter  as  commercial  aviation 
 systems. 
 59.  Revise  Section  22.859  in  its  entirety  to  read  as  follows: 
   22.859  Incumbent  commercial  aviation  air-  ground  systems. 
 This  section  contains  rules  concerning  continued  operation  of  commercial  aviation  air-  ground  systems  that  were  originally  authorized  prior  to  January  1,  2004  to  provide  radiotelephone 
 service  using  narrowband  (6  kHz)  channels,  and  that  have  been  providing  service  continuously  since  the  original  commencement  of  service  (hereinafter  incumbent  systems). 

 (a)  An  incumbent  system  may  continue  to  operate  under  its  authorization,  for  the  remaining  term  of  such  authorization,  subject  to  the  terms  and  conditions  attached  thereto.  Wherever  such 
 technical  and  operational  conditions  differ  from  technical  and  operational  rules  in  this  subpart,  those  conditions  shall  govern  its  operations. 

 (b)  Notwithstanding  any  other  provision  in  this  chapter,  the  licensee  of  an  incumbent  system  shall  not  be  entitled  to  an  expectation  of  renewal  of  said  authorization. 
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   22.863  Frequency  stability. 
 The  frequency  stability  of  equipment  used  under  this  subpart  shall  be  sufficient  to  ensure  that,  after  accounting  for  Doppler  frequency  shifts,  the  occupied  bandwidth  of  the  fundamental 
 emissions  remains  within  the  authorized  frequency  bands  of  operation. 
 62.  Remove  Section  22.865. 
 63.  Revise  Section  22.867  in  its  entirety  to  read  as  follows: 
   22.867  Effective  radiated  power  limits. 
 The  effective  radiated  power  (ERP)  of  ground  and  airborne  stations  operating  on  the  frequency  ranges  listed  in    22.857  must  not  exceed  the  limits  in  this  section. 

 (a)  The  peak  ERP  of  airborne  mobile  station  transmitters  must  not  exceed  12  Watts. 
 (b)  The  peak  ERP  of  ground  station  transmitters  must  not  exceed  500  Watts. 
 64.  Remove  Section  22.869. 
 65.  Remove  Section  22.871. 
 66.  Revise  Section  22.873  to  read  as  follows: 
   22.873  Construction  requirements  for  commercial  aviation  air-  ground  systems. 
 Licensees  authorized  to  use  more  than  one  megahertz  (1  MHz)  of  the  800  MHz  commercial  aviation  air-  ground  spectrum  allocation  (see    22.857)  must  make  a  showing  of  substantial 
 service'  as  set  forth  in  this  section.  Failure  by  any  such  licensee  to  meet  this  requirement  will  result  in  forfeiture  of  the  license  and  the  licensee  will  be  ineligible  to  regain  it.  Licensees 
 authorized  to  use  one  megahertz  or  less  of  the  800  MHz  commercial  aviation  air-  ground  spectrum  allocation  are  not  subject  to  the  requirements  in  this  section. 

 (a)  Substantial  service  is  defined  as  service  that  is  sound,  favorable,  and  substantially  above  a  level  of  mediocre  service  that  just  might  minimally  warrant  renewal. 
 (b)  Each  commercial  aviation  air-  ground  system  subject  to  the  requirements  of  this  section  must  demonstrate  substantial  service  within  5  years  after  grant  of  the  authorization.  Substantial 
 service  may  be  demonstrated  by,  but  is  not  limited  to,  either  of  the  following  safe  harbor  provisions: 

 (1)  construction  and  operation  of  20  ground  stations,  with  at  least  one  ground  station  located  in  each  of  the  10  Federal  Aviation  Administration  regions;  or, 
 (2)  provision  of  service  to  the  airspace  of  25  of  the  50  busiest  airports  (as  measured  by  annual  passenger  boardings). 
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 67.  Remove  Section  22.875. 
 68.  Add  a  new  Section  22.877  to  read  as  follows: 
   22.877  Unacceptable  interference  to  Part  90  non-  cellular  800  MHz  licensees  from  commercial  aviation  air-  ground  systems. 

 The  definition  of  unacceptable  interference  to  non-  cellular  Part  90  licensees  in  the  800  MHz  band  from  commercial  aviation  air-  ground  systems  is  the  same  as  the  definition  set  forth  in 
   22.970  of  this  part,  which  is  applicable  to  Cellular  Radiotelephone  Service  systems. 
 69.  Add  a  new  Section  22.878  to  read  as  follows: 
   22.878  Obligation  to  abate  unacceptable  interference. 
 This  section  applies  only  to  commercial  aviation  ground  stations  transmitting  in  the  849-  851  MHz  band,  other  than  commercial  aviation  ground  stations  operating  under  the  authority  of 
 a  license  originally  granted  prior  to  January  1,  2004. 
 (a)  Strict  Responsibility.  Any  licensee  who,  knowingly  or  unknowingly,  directly  or  indirectly,  causes  or  contributes  to  causing  unacceptable  interference  to  a  non-  cellular  Part  90  licensee  in 
 the  800  MHz  band,  as  defined  in    22.877,  shall  be  strictly  accountable  to  abate  the  interference,  with  full  cooperation  and  utmost  diligence,  in  the  shortest  time  practicable.  Interfering  licensees 
 shall  consider  all  feasible  interference  abatement  measures,  including,  but  not  limited  to,  the  remedies  specified  in  the  interference  resolution  procedures  set  forth  in    22.879.  This  strict 
 responsibility  obligation  applies  to  all  forms  of  interference,  including  out-  of-  band  emissions  and  intermodulation. 

 (b)  Joint  and  Several  Responsibility.  If  two  or  more  licensees,  whether  in  the  commercial  aviation  air-  ground  radiotelephone  service  or  in  the  Cellular  Radiotelephone  Service  (see   
 22.971),  knowingly  or  unknowingly,  directly  or  indirectly,  cause  or  contribute  to  causing  unacceptable  interference  to  a  non-  cellular  Part  90  licensee  in  the  800  MHz  band,  as  defined  in 
   22.877,  such  licensees  shall  be  jointly  and  severally  responsible  for  abating  interference,  with  full  cooperation  and  utmost  diligence,  in  the  shortest  practicable  time. 

 (1)  This  joint  and  several  responsibility  rule  requires  interfering  licensees  to  consider  all  feasible  interference  abatement  measures,  including,  but  not  limited  to,  the  remedies  specified  in 
 the  interference  resolution  procedures  set  forth  in    22.879(  c).  This  joint  and  several  responsibility  rule  applies  to  all  forms  of  interference,  including  out-  of-  band  emissions  and 
 intermodulation. 
 (2)  Any  licensee  that  can  show  that  its  signal  does  not  directly  or  indirectly  cause  or  contribute  to  causing  unacceptable  interference  to  a  non-  cellular  Part  90  licensee  in  the  800  MHz 
 band,  as  defined  in    22.877,  shall  not  be  held  responsible  for  resolving  unacceptable  interference.  Notwithstanding,  any  licensee  that  receives  an  interference  complaint  from  a  public 
 safety/  CII  licensee  shall  respond  to  such  complaint  consistent  with  the  interference  resolution  procedures  set  forth  in    22.879. 
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 70.  Add  a  new  Section  22.879  to  read  as  follows: 
   22.879  Interference  resolution  procedures. 
 This  section  applies  only  to  commercial  aviation  ground  stations  transmitting  in  the  849-  851  MHz  band,  other  than  commercial  aviation  ground  stations  operating  under  the  authority  of 
 a  license  originally  granted  prior  to  January  1,  2004. 
 (a)  Initial  Notification.  Commercial  aviation  air-  ground  system  licensees  may  receive  initial  notification  of  interference  from  non-  cellular  Part  90  licensees  in  the  800  MHz  band  pursuant  to 
   90.674(  a)  of  this  chapter. 
 (1)  Commercial  aviation  air-  ground  system  licensees  shall  join  with  Part  90  ESMR  licensees  and  Cellular  Radiotelephone  Service  licensees  in  utilizing  an  electronic  means  of  receiving  the 
 initial  notification  described  in    90.674(  a)  of  this  chapter.  See    22.972. 
 (2)  Commercial  aviation  air-  ground  system  licensees  must  respond  to  the  initial  notification  described  in    90.674(  a)  of  this  chapter  as  soon  as  possible  and  no  later  than  24  hours  after 
 receipt  of  notification  from  a  Part  90  public  safety/  CII  licensee.  This  response  time  may  be  extended  to  48  hours  after  receipt  from  other  Part  90  non-  cellular  licensees  provided  affected 
 communications  on  these  systems  are  not  safety  related. 
 (b)  Interference  Analysis.  Commercial  aviation  air-  ground  system  licensees    who  receive  an  initial  notification  described  in    90.674(  a)  of  this  chapter    shall  perform  a  timely  analysis  of 
 the  interference  to  identify  the  possible  source.  Immediate  on-  site  visits  may  be  conducted  when  necessary  to  complete  timely  analysis.  Interference  analysis  must  be  completed  and  corrective 
 action  initiated  within  48  hours  of  the  initial  complaint  from  a  Part  90  public  safety/  CII  licensee.  This  response  time  may  be  extended  to  96  hours  after  the  initial  complaint  from  other  Part  90 
 non-  cellular  licensees  provided  affected  communications  on  these  systems  are  not  safety  related.  Corrective  action  may  be  delayed  if  the  affected  licensee  agrees  in  writing  (which  may  be,  but  is 
 not  required  to  be,  recorded  via  e-  mail  or  other  electronic  means)  to  a  longer  period. 
 (c)  Mitigation  Steps.  Any  commercial  aviation  air-  ground  system  that  is  responsible  for  causing  unacceptable  interference  to  non-  cellular  Part  90  licensees  in  the  800  MHz  band  shall 
 take  affirmative  measures  to  resolve  such  interference. 
 (1)  Commercial  aviation  air-  ground  system  licensees  found  to  contribute  to  unacceptable  interference,  as  defined  in    22.877,  shall  resolve  such  interference  in  the  shortest  time 
 practicable.  Commercial  aviation  air-  ground  system  licensees  must  provide  all  necessary  test  apparatus  and  technical  personnel  skilled  in  the  operation  of  such  equipment  as  may  be  necessary 
 to  determine  the  most  appropriate  means  of  timely  eliminating  the  interference.  However,  the  means  whereby  interference  is  abated  or  the  technical  parameters  that  may  need  to  be  adjusted  is 
 left  to  the  discretion  of  the  commercial  aviation  air-  ground  system  licensee,  whose  affirmative  measures  may  include,  but  not  be  limited  to,  the  following  techniques: 

 (i)  increasing  the  desired  power  of  the  public  safety/  CII  signal; 
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 (ii)  decreasing  the  power  of  the  commercial  aviation  air-  ground  system  signal; 
 (iii)  modifying  the  commercial  aviation  air-  ground  system  antenna  height; 
 (iv)  modifying  the  commercial  aviation  air-  ground  system  antenna  characteristics; 
 (v)  incorporating  filters  into  the  commercial  aviation  air-  ground  system  transmission  equipment; 

 (vi)  changing  commercial  aviation  air-  ground  system  frequencies;  and 
 (vii)  supplying  interference-  resistant  receivers  to  the  affected  public  safety/  CII  licensee(  s).  If  this  technique  is  used,  in  all  circumstances,  commercial  aviation  air-  ground  system  licensees 
 shall  be  responsible  for  all  costs  thereof. 
 (2)  Whenever  short-  term  interference  abatement  measures  prove  inadequate,  the  affected  Part  90  non-  cellular  licensee  shall,  consistent  with  but  not  compromising  safety,  make  all  necessary 
 concessions  to  accepting  interference  until  a  longer-  term  remedy  can  be  implemented. 
 (3)  When  a  Part  90  public  safety  licensee  determines  that  a  continuing  presence  of  interference  constitutes  a  clear  and  imminent  danger  to  life  or  property,  the  licensee  causing  the 
 interference  must  discontinue  the  associated  operation  immediately,  until  a  remedy  can  be  identified  and  applied.  The  determination  that  a  continuing  presence  exists  that  constitutes  a 
 clear  and  imminent  danger  to  life  or  property,  must  be  made  by  written  statement  that: 
 (i)  is  in  the  form  of  a  declaration,  notarized  affidavit,  or  statement  under  penalty  or  perjury,  from  an  officer  or  executive  of  the  affected  public  safety  licensee; 

 (ii)  thoroughly  describes  the  basis  of  the  claim  of  clear  and  imminent  danger; 
 (iii)  was  formulated  on  the  basis  of  either  personal  knowledge  or  belief  after  due  diligence; 
 (iv)  is  not  proffered  by  a  contractor  or  other  third  party;  and, 
 (v)  has  been  approved  by  the  Chief  of  the  Wireless  Telecommunication  Bureau  or  other  designated  Commission  official.  Prior  to  the  authorized  official  making  a  determination  that  a 
 clear  and  imminent  danger  exists,  the  associated  written  statement  must  be  served  by  hand-delivery  or  receipted  fax  on  the  applicable  offending  licensee,  with  a  copy  transmitted  by  the 
 fastest  available  means  to  the  Washington,  D.  C.  office  of  the  Commissions  Wireless  Telecommunications  Bureau. 

 71.  Add  a  new  Section  22.880  to  read  as  follows: 
   22.880  Information  exchange. 
 (a)  Prior  Notification.  Public  safety/  CII  licensees  may  notify  a  commercial  aviation  air-ground  system  licensee  that  they  wish  to  receive  prior  notification  of  the  activation  or 
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 modification  of  a  commercial  aviation  air-  ground  system  ground  station  site  in  their  area.  Thereafter,  the  commercial  aviation  air-  ground  system  licensee  must  provide  the  following 
 information  to  the  public  safety/  CII  licensee  at  least  10  business  days  before  a  new  ground  station  is  activated  or  an  existing  ground  station  is  modified: 

 (1)  location; 
 (2)  effective  radiated  power; 
 (3)  antenna  manufacturer,  model  number,  height  above  ground  level  and  up  tilt  angle,  as  installed; 

 (4)  channels  available  for  use. 
 (b)  Purpose  of  Prior  Notification.  The  prior  notification  of  ground  station  activation  or  modification  is  for  informational  purposes  only:  public  safety/  CII  licensees  are  not  afforded  the 
 right  to  accept  or  reject  the  activation  of  a  proposed  ground  station  or  to  unilaterally  require  changes  in  its  operating  parameters.  The  principal  purposes  of  prior  notification  are  to: 

 (1)  allow  a  public  safety  licensee  to  advise  the  commercial  aviation  air-  ground  system  licensee  whether  it  believes  a  proposed  ground  station  will  generate  unacceptable  interference; 
 (2)  permit  commercial  aviation  air-  ground  system  licensee(  s)  to  make  voluntary  changes  in  ground  station  parameters  when  a  public  safety  licensee  alerts  them  to  possible  interference;  and 
 (3)  rapidly  identify  the  source  if  interference  is  encountered  when  the  ground  station  is  activated. 
 72.  Revise  Section  22.1003  in  its  entirety  to  read  as  follows: 
   22.1003  Eligibility. 
 Any  eligible  entity  (see    22.7)  may  apply  for  central  station  license(  s)  and/  or  offshore  subscriber  licenses  under  this  subpart. 

 Title  47,  Part  90  of  the  Code  of  Federal  Regulations,  47  CFR  Part  90,  is  amended  as  follows: 
 73.  The  authority  citation  for  Part  90  continues  to  read  as  follows: 
 Authority:  Sections  4(  i),  11,  303(  g),  303(  r),  and  332(  c)(  7)  of  the  Communications  Act  of  1934,  as  amended,  47  U.  S.  C.  154(  i),  161,  303(  g),  303(  r),  332(  c)(  7). 

 74.  Revise  Section  90.309(  a)(  1)  to  read  as  follows: 
   90.309  Tables  and  figures. 
 (a)  Directions  for  using  the  tables.  (1)  Using  the  method  specified  in    1.958  of  this  chapter,  determine  the  distances  (i)  between  the  proposed  land  mobile  base  station  and  the  protected 
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 cochannel  television  station  and  (ii)  between  the  proposed  land  mobile  base  station  and  the  protected  adjacent  channel  television  station.  If  the  exact  mileage  does  not  appear  in  table  A  for 
 protected  cochannel  television  stations  (or  table  B  for  channel  15  in  New  York  and  Cleveland  and  channel  16  in  Detroit)  or  table  E  for  protected  adjacent  channel  television  stations,  the  next 
 lower  mileage  separation  figure  is  to  be  used. 
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 APPENDIX  C  FINAL  REGULATORY  FLEXIBILITY  ANALYSIS 
 1.  As  required  by  the  Regulatory  Flexibility  Act  of  1980,  as  amended  (RFA),  1  an  Initial  Regulatory  Flexibility  Analysis  (IRFA)  was  incorporated  in  the  Notice  of  Proposed  Rulemaking  (Notice) 
 in  this  proceeding,  WT  Docket  No.  03-  103.  2  The  Commission  sought  written  public  comment  on  the  proposals  in  the  Notice,  including  comment  on  the  IRFA.  This  present  Final  Regulatory  Flexibility 
 Analysis  (FRFA)  conforms  to  the  RFA.  3 
 A.  Need  for,  and  Objectives  of,  the  Report  and  Order 
 2.  The  Report  and  Order  addresses  revision  of  the  rules  and  spectrum  band  plan  for  the  800  MHz  commercial  Air-  Ground  Radiotelephone  Service  spectrum.  A  total  of  four  megahertz  of  spectrum  is 

 currently  allocated  for  this  service.  Although  the  Commission  originally  licensed  six  operators  to  provide  service  in  this  band  on  a  shared  basis  using  narrowband  channels,  only  one  licensee  (Verizon  Airfone) 
 continues  to  operate  in  the  band.  Its  operations  are  subject  to  a  number  of  specific  technical  requirements  designed  to  facilitate  sharing  among  licensees.  Given  the  constraints  on  current  operations  in  this  band 
 and  the  changing  demands  of  the  public  with  respect  to  wireless  telecommunications  services,  the  Notice  requested  comment  on  how  best  to  reconfigure  this  band  and  revise  the  related  service  rules  in  order  to 
 meet  consumer  needs  and  promote  flexible,  competitive  use  of  this  spectrum. 
 3.  The  Report  and  Order  makes  available  new  nationwide  air-  ground  licenses  in  three  band  configurations:  (1)  band  plan  1,  comprised  of  two  overlapping,  shared,  cross-  polarized  3  MHz  licenses 

 (licenses  A  and  B,  respectively),  4  (2)  band  plan  2,  comprised  of  an  exclusive  3  MHz  license  and  an  exclusive  1  MHz  license  (licenses  C  and  D,  respectively),  5  and  (3)  band  plan  3,  comprised  of  an  exclusive 
 1  MHz  license  and  an  exclusive  3  MHz  license  (licenses  E  and  F,  respectively),  with  the  blocks  at  opposite  ends  of  the  band  from  the  second  configuration.  6  Licenses  will  be  awarded  to  winning  bidders 
 for  the  licenses  comprising  the  configuration  that  receives  the  highest  aggregate  gross  bid,  subject  to  long-form  license  application  review.  Licenses  will  have  a  ten-  year  term. 

 4.  The  Report  and  Order  also  takes  action  on  a  range  of  proposals  for  updating  the  Commissions  Part  1,  22,  and  90  rules.  Some  of  these  steps  are  taken  pursuant  to  the  Commissions 
 1  See  5  U.  S.  C.    603.  The  RFA,  see  5  U.  S.  C.    601  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).  2 
 Amendment  of  Part  22  of  the  Commission's  Rules  to  Benefit  the  Consumers  of  Air-  Ground  Telecommunications  Services,  Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  and  90  of  the  Commission's  Rules,  Notice  of 

 Proposed  Rule  Making,  18  FCC  Rcd  8380,  8412  App.  A  (2003).  3 
 See  5  U.  S.  C.    604.  4 
 Licenses  A  and  B  would  authorize  transmission  of  radio  waves  that  are  vertically  and  horizontally  polarized,  respectively,  and  would  initially  share  1.  5  MHz  at  849.  000-  850.  500  MHz  paired  with  1.  5  MHz  at  894.000-  895.  500 

 MHz.  Once  Verizon  Airfones  incumbent  system  ceases  operations  in  the  upper  0.5  MHz  of  each  band,  licensee  B  would  shift  its  operations  to  1.5  MHz  at  849.500-  851.  000  MHz  paired  with  1.5  MHz  at  894.  500-  896.  000  MHz.  If 
 band  plan  1  is  implemented,  the  parties  may  agree  to  a  different  implementation  scheme.  5 
 License  C  would  be  located  in  the  lower  1.5  MHz  portion  of  each  2  MHz  band  (1.5  MHz  at  849.000-  850.500  MHz  paired  with  1.  5  MHz  at  894.000-  895.  500  MHz).  License  D  would  be  located  in  the  upper  0.  5  MHz  portion  of  each 

 2  MHz  band  (0.  5  MHz  at  850.500-  851.  000  MHz  paired  with  0.5  MHz  at  895.  500-  896.  000  MHz).  6 
 License  E  would  be  located  in  the  lower  0.5  MHz  portion  of  each  2  MHz  band  (0.5  MHz  at  849.000-  849.500  MHz  paired  with  0.5  MHz  at  894.  000-  894.500  MHz).  License  F  would  be  located  in  the  upper  1.5  MHz  portion  of  each  2 

 MHz  band  (1.  5  MHz  at  849.500-  851.  000  MHz  paired  with  1.  5  MHz  at  894.  500-  896.  000  MHz). 
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 biennial  review  obligations  as  well  as  to  implement  the  results  of  staff  review  of  the  Part  22  non-  cellular  rules.  The  Report  and  Order  revises  and  eliminates  many  rule  sections  in  light  of  technological  change, 
 increased  competition  in  Commercial  Mobile  Radio  Services,  supervening  changes  to  the  Commissions  rules,  or  a  combination  of  factors.  These  rule  changes  also  include  actions  to  harmonize  the  treatment  of 
 various  wireless  services. 
 B.  Summary  of  Significant  Issues  Raised  by  Public  Comments  in  Response  to  the  IRFA 
 5.  We  received  no  comments  in  response  to  the  IRFA.  As  described  in  section  E  below,  we  have  nonetheless  considered  potential  significant  economic  impacts  of  our  actions  on  small  entities. 

 C.  Description  and  Estimate  of  the  Number  of  Small  Entities  to  Which  Rules  Will  Apply 
 6.  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  rules  adopted  herein.  7  The  RFA  generally 
 defines  the  term  small  entity  as  having  the  same  meaning  as  the  terms  small  business,  small  organization,  and  small  governmental  jurisdiction.  8  In  addition,  the  term  small  business  has  the 
 same  meaning  as  the  term  small  business  concern  under  the  Small  Business  Act.  9  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  Small  Business  Administration  (SBA).  10 

 7.  Wireless  Service  Providers.  The  SBA  has  developed  a  small  business  size  standard  for  wireless  firms  within  the  two  broad  economic  census  categories  of  Paging  11  and  Cellular  and  Other 
 Wireless  Telecommunications.  12  Under  both  SBA  categories,  a  wireless  business  is  small  if  it  has  1,500  or  fewer  employees.  For  the  census  category  of  Paging,  Census  Bureau  data  for  1997  show  that  there 
 were  1,320  firms  in  this  category,  total,  that  operated  for  the  entire  year.  13  Of  this  total,  1,303  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  17  firms  had  employment  of  1,000  employees 
 or  more.  14  Thus,  under  this  category  and  associated  small  business  size  standard,  the  great  majority  of  firms  can  be  considered  small.  For  the  census  category  Cellular  and  Other  Wireless  Telecommunications, 
 Census  Bureau  data  for  1997  show  that  there  were  977  firms  in  this  category,  total,  that  operated  for  the 

 7  5  U.  S.  C.    604(  a)(  3). 
 8  5  U.  S.  C.    601(  6). 
 9  5  U.  S.  C.    601(  3)  (incorporating  by  reference  the  definition  of  small-  business  concern  in  the  Small  Business 
 Act,  15  U.  S.  C.    632).  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. 
 10  15  U.  S.  C.    632. 
 11  13  C.  F.  R.    121.  201,  NAICS  code  513321  (changed  to  517211  in  October  2002). 
 12  Id. 
 13  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms 
 Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513321  (issued  Oct.  2000).  14 
 Id.  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500  or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 
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 entire  year.  15  Of  this  total,  965  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  12  firms  had  employment  of  1,000  employees  or  more.  16  Thus,  under  this  second  category  and  size  standard, 
 the  great  majority  of  firms  can,  again,  be  considered  small. 
 8.  Cellular  Licensees.  The  SBA  has  developed  a  small  business  size  standard  for  wireless  firms  within  the  broad  economic  census  category  Cellular  and  Other  Wireless  Telecommunications.  17 

 Under  this  SBA  category,  a  wireless  business  is  small  if  it  has  1,500  or  fewer  employees.  For  the  census  category  Cellular  and  Other  Wireless  Telecommunications  firms,  Census  Bureau  data  for  1997  show  that 
 there  were  977  firms  in  this  category,  total,  that  operated  for  the  entire  year.  18  Of  this  total,  965  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  12  firms  had  employment  of  1,000  employees 
 or  more.  19  Thus,  under  this  category  and  size  standard,  the  great  majority  of  firms  can  be  considered  small.  According  to  the  most  recent  Trends  in  Telephone  Service  data,  719  carriers  reported  that  they 
 were  engaged  in  the  provision  of  cellular  service,  personal  communications  service,  or  specialized  mobile  radio  telephony  services,  which  are  placed  together  in  the  data.  20  We  have  estimated  that  294  of  these  are 
 small,  under  the  SBA  small  business  size  standard.  21 
 9.  Common  Carrier  Paging.  The  SBA  has  developed  a  small  business  size  standard  for  wireless  firms  within  the  broad  economic  census  categories  of  Cellular  and  Other  Wireless 

 Telecommunications.  22  Under  this  SBA  category,  a  wireless  business  is  small  if  it  has  1,500  or  fewer  employees.  For  the  census  category  of  Paging,  Census  Bureau  data  for  1997  show  that  there  were  1,320 
 firms  in  this  category,  total,  that  operated  for  the  entire  year.  23  Of  this  total,  1,303  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  17  firms  had  employment  of  1,000  employees  or  more.  24 
 Thus,  under  this  category  and  associated  small  business  size  standard,  the  great  majority  of  firms  can  be  considered  small. 

 10.  In  the  Paging  Second  Report  and  Order,  the  Commission  adopted  a  size  standard  for  small  businesses  for  purposes  of  determining  their  eligibility  for  special  provisions  such  as  bidding 

 15  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms 
 Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513322  (issued  Oct.  2000).  16 
 Id.  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500  or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 

 17  13  C.  F.  R.    121.  201,  NAICS  code  513322  (changed  to  517212  in  October  2002). 
 18  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms 
 Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513322  (issued  Oct.  2000).  19 
 Id.  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500  or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 

 20  FCC,  Wireline  Competition  Bureau,  Industry  Analysis  and  Technology  Division,  Trends  in  Telephone  Service 
 at  Table  5.3,  page  5-  5  (August  2003).  This  source  uses  data  that  are  current  as  of  December  31,  2001.  21 
 Id.  22 
 13  C.  F.  R.    121.  201,  NAICS  code  513322  (changed  to  517212  in  October  2002).  23 
 U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms  Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513321  (issued  Oct.  2000). 

 24  Id.  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500 
 or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 
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 credits  and  installment  payments.  25  A  small  business  is  an  entity  that,  together  with  its  affiliates  and  controlling  principals,  has  average  gross  revenues  not  exceeding  $15  million  for  the  preceding  three 
 years.  26  The  SBA  has  approved  this  definition.  27  An  auction  of  Metropolitan  Economic  Area  (MEA)  licenses  commenced  on  February  24,  2000,  and  closed  on  March  2,  2000.  Of  the  2,499  licenses 
 auctioned,  985  were  sold.  28  Fifty-  seven  companies  claiming  small  business  status  won  440  licenses.  29  An  auction  of  MEA  and  Economic  Area  (EA)  licenses  commenced  on  October  30,  2001,  and  closed  on 
 December  5,  2001.  Of  the  15,514  licenses  auctioned,  5,323  were  sold.  30  One  hundred  thirty-  two  companies  claiming  small  business  status  purchased  3,724  licenses.  A  third  auction,  consisting  of  8,874 
 licenses  in  each  of  175  EAs  and  1,328  licenses  in  all  but  three  of  the  51  MEAs  commenced  on  May  13,  2003,  and  closed  on  May  28,  2003.  Seventy-  seven  bidders  claiming  small  or  very  small  business  status 
 won  2,093  licenses.  31  Currently,  there  are  approximately  74,000  Common  Carrier  Paging  licenses.  According  to  the  most  recent  Trends  in  Telephone  Service,  608  private  and  common  carriers  reported  that 
 they  were  engaged  in  the  provision  of  either  paging  or  other  mobile  services.  32  Of  these,  we  estimate  that  589  are  small,  under  the  SBA-  approved  small  business  size  standard.  33  We  estimate  that  the  majority 
 of  common  carrier  paging  providers  would  qualify  as  small  entities  under  the  SBA  definition. 
 11.  Offshore  Radiotelephone  Service.  This  service  operates  on  several  ultra  high  frequency  (UHF)  television  broadcast  channels  that  are  not  used  for  television  broadcasting  in  the  coastal  areas  of 

 states  bordering  the  Gulf  of  Mexico.  34  There  are  currently  approximately  55  licensees  in  this  service.  We  are  unable  to  estimate  at  this  time  the  number  of  licensees  that  would  qualify  as  small  under  the  SBAs 
 small  business  size  standard  for  Cellular  and  Other  Wireless  Telecommunications  services.  35  Under  that  SBA  small  business  size  standard,  a  business  is  small  if  it  has  1,500  or  fewer  employees.  36 

 12.  Rural  Radiotelephone  Service.  The  Commission  has  not  adopted  a  size  standard  for  small  businesses  specific  to  the  Rural  Radiotelephone  Service.  37  A  significant  subset  of  the  Rural 
 Radiotelephone  Service  is  the  Basic  Exchange  Telephone  Radio  System  (BETRS).  38  The  Commission 
 25  Revision  of  Part  22  and  Part  90  of  the  Commissions  Rules  to  Facilitate  Future  Development  of  Paging  Systems, 
 Second  Report  and  Order,  12  FCC  Rcd  2732,  2811-  2812    178-  181  (  Paging  Second  Report  and  Order);  see  also  Revision  of  Part  22  and  Part  90  of  the  Commissions  Rules  to  Facilitate  Future  Development  of  Paging  Systems, 

 Memorandum  Opinion  and  Order  on  Reconsideration,  14  FCC  Rcd  10030,  10085-  10088    98-  107  (1999).  26 
 Paging  Second  Report  and  Order,  12  FCC  Rcd  at  2811,  179.  27 
 See  Letter  to  Amy  Zoslov,  Chief,  Auctions  and  Industry  Analysis  Division,  Wireless  Telecommunications  Bureau,  from  Aida  Alvarez,  Administrator,  Small  Business  Administration,  dated  Dec.  2,  1998. 

 28  See  929  and  931  MHz  Paging  Auction  Closes,  Public  Notice,  15  FCC  Rcd  4858  (WTB  2000). 
 29  See  id. 
 30  See  Lower  and  Upper  Paging  Band  Auction  Closes,  Public  Notice,  16  FCC  Rcd  21821  (WTB  2002). 
 31  See  Lower  and  Upper  Paging  Bands  Auction  Closes,  Public  Notice,  18  FCC  Rcd  11154  (WTB  2003). 
 32  See  Trends  in  Telephone  Service,  Industry  Analysis  Division,  Wireline  Competition  Bureau,  Table  5.  3  (Number 
 of  Telecommunications  Service  Providers  that  are  Small  Businesses)  (May  2002).  33 
 13  C.  F.  R.    121.  201,  NAICS  code  517211.  34 
 This  service  is  governed  by  Subpart  I  of  Part  22  of  the  Commissions  Rules.  See  47  C.  F.  R.    22.  1001-  22.1037.  35 
 13  C.  F.  R.    121.  201,  NAICS  code  513322  (changed  to  517212  in  October  2002).  36 
 Id.  37 
 The  service  is  defined  in  Section  22.  99  of  the  Commissions  Rules,  47  C.  F.  R.    22.  99.  38 
 BETRS  is  defined  in  Sections  22.  757  and  22.  759  of  the  Commissions  Rules,  47  C.  F.  R.    22.  757,  22.  759. 
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 uses  the  SBAs  small  business  size  standard  applicable  to  Cellular  and  Other  Wireless  Telecommunications,  i.  e.,  an  entity  employing  no  more  than  1,500  persons.  39  There  are  approximately 
 1,000  licensees  in  the  Rural  Radiotelephone  Service,  and  the  Commission  estimates  that  there  are  1,000  or  fewer  small  entity  licensees  in  the  Rural  Radiotelephone  Service  that  may  be  affected  by  the  rules  and 
 policies  adopted  herein. 
 13.  Air-  Ground  Radiotelephone  Service.  The  Commission  has  not  adopted  a  small  business  size  standard  specific  to  the  Air-  Ground  Radiotelephone  Service.  40  We  will  use  SBAs  small  business 

 size  standard  applicable  to  Cellular  and  Other  Wireless  Telecommunications,  i.  e.,  an  entity  employing  no  more  than  1,500  persons.  41  There  are  approximately  100  licensees  in  the  Air-  Ground  Radiotelephone 
 Service,  and  we  estimate  that  almost  all  of  them  qualify  as  small  under  the  SBA  small  business  size  standard. 

 14.  Wireless  Communications  Equipment  Manufacturers.  Some  of  the  actions  in  the  Report  and  Order  could  also  benefit  equipment  manufacturers.  The  SBA  has  established  a  small  business  size 
 standard  for  Radio  and  Television  Broadcasting  and  Wireless  Communications  Equipment  Manufacturing.  Examples  of  products  in  this  category  include  transmitting  and  receiving  antennas, 
 cable  television  equipment,  GPS  equipment,  pagers,  cellular  phones,  mobile  communications  equipment,  and  radio  and  television  studio  and  broadcasting  equipment  42  and  may  include  other  devices  that 
 transmit  and  receive  IP-  enabled  services,  such  as  personal  digital  assistants  (PDAs).  Under  the  SBA  size  standard,  firms  are  considered  small  if  they  have  750  or  fewer  employees.  43  According  to  Census  Bureau 
 data  for  1997,  there  were  1,215  establishments  44  in  this  category  that  operated  for  the  entire  year.  45  Of  those,  there  were  1,150  that  had  employment  of  under  500,  and  an  additional  37  that  had  employment  of 
 500  to  999.  The  percentage  of  wireless  equipment  manufacturers  in  this  category  was  approximately  61.35  percent  46  so  we  estimate  that  the  number  of  wireless  equipment  manufacturers  with  employment  of 
 under  500  was  actually  closer  to  706,  with  an  additional  23  establishments  having  employment  of  between  500  and  999.  Consequently,  we  estimate  that  the  majority  of  wireless  communications 
 equipment  manufacturers  are  small  entities  that  may  be  affected  by  our  action. 

 39  13  C.  F.  R.    121.  201,  NAICS  code  513322  (changed  to  517212  in  October  2002). 
 40  The  service  is  defined  in  Section  22.  99  of  the  Commissions  Rules,  47  C.  F.  R.    22.  99. 
 41  13  CFR    121.  201,  NAICS  codes  513322  (changed  to  517212  in  October  2002). 
 42  Office  of  Management  and  Budget,  North  American  Industry  Classification  System,  pages  308-  09  (1997)  (NAICS 
 code  334220).  43 
 13  C.  F.  R.    121.  201,  NAICS  code  334220.  44 
 The  number  of  establishments  is  a  less  helpful  indicator  of  small  business  prevalence  in  this  context  than  would  be  the  number  of  firms  or  companies,  because  the  latter  take  into  account  the  concept  of  common  ownership  or 

 control.  Any  single  physical  location  for  an  entity  is  an  establishment,  even  though  that  location  may  be  owned  by  a  different  establishment.  Thus,  the  numbers  given  may  reflect  inflated  numbers  of  businesses  in  this  category, 
 including  the  numbers  of  small  businesses.  In  this  category,  the  Census  breaks  out  data  for  firms  or  companies  only  to  give  the  total  number  of  such  entities  for  1997,  which  was  1,089. 
 45  U.  S.  Census  Bureau,  1997  Economic  Census,  Industry  Series:  Manufacturing,  Industry  Statistics  by 
 Employment  Size,  Table  4,  NAICS  code  334220  (issued  Aug.  1999).  46 
 Id.  Table  5. 
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 D.  Description  of  Projected  Reporting,  Recordkeeping  and  Other  Compliance  Requirements 
 15.  In  this  Report  and  Order,  we  are  not  adopting  any  new  rules  that  would  add  reporting,  recordkeeping,  or  other  compliance  requirements.  47  We  only  modify  or  eliminate  certain  rules,  thereby 
 eliminating  economic  burdens  for  small  and  other  sized  entities.  For  example,  we  amend  Section  1.929(  c)(  1)  of  our  rules  to  specify  that  expansion  of  a  composite  interference  contour  (CIC)  of  a  site-based 
 licensee  in  the  Paging  and  Radiotelephone  Service  as  well  as  the  Rural  Radiotelephone  Service  and  800  MHz  Specialized  Mobile  Radio  Service  over  water  on  a  secondary,  non-  interference  basis 
 should  be  classified  as  a  minor  (rather  than  major)  modification  of  license.  See  para.  143,  supra.  Such  reclassification  should  substantially  reduce  the  filing  requirements  associated  with  these  license 
 modifications. 
 E.  Steps  Taken  To  Minimize  Significant  Economic  Impact  On  Small  Entities,  And  Significant  Alternatives  Considered 

 16.  The  RFA  requires  an  agency  to  describe  any  significant  alternatives  that  it  has  considered  in  developing  its  approach,  which  may  include  the  following  four  alternatives  (among  others):  (  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 
 and  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  such  small 
 entities.  48 
 17.  We  do  not  anticipate  any  adverse  impact  on  small  entities  resulting  from  either  reconfiguration  of  the  800  MHz  Air-  Ground  Radiotelephone  Service  band  plan  or  revision  of  the  related 

 service  rules,  see  paras.  1-  85,  supra.  Currently,  there  is  only  one  licensee  in  this  band  and  demand  for  its  service  has  markedly  declined,  see  para.  23,  supra.  The  flexible  approach  to  reconfiguration  of  the  800 
 MHz  air-  ground  band  adopted  in  the  Report  and  Order  will  promote  our  goal  of  facilitating  the  highest  valued  use  of  this  spectrum,  resulting  in  the  provision  of  wireless  communications  services  that  better 
 meet  the  needs  of  the  traveling  public  onboard  aircraft. 
 18.  In  order  to  promote  competition  in  the  800  MHz  air-  ground  band,  the  Report  and  Order  prohibits  any  party  from  obtaining  a  controlling  interest,  either  at  auction  or  by  a  post-  auction  transaction, 

 in  more  than  three  megahertz  of  spectrum  (either  shared  or  exclusive)  in  the  band,  see  paras.  39-  44,  supra.  No  single  entity,  therefore,  may  hold  more  than  one  license  in  any  of  the  available  band  configurations. 
 The  Report  and  Order  adopts  limited  technical  constraints  in  order  to  provide  the  eventual  licensees  with  significant  operational  flexibility  to  provide  broadband  telecommunications  services  to  commercial  airline 
 passengers  and  others  while  onboard  aircraft,  see  paras.  54-  72,  supra.  We  note  that  the  technical  rules  will,  among  other  things,  ensure  that  operations  in  this  band  do  not  cause  harmful  interference  to  adjacent 
 bands,  including  cellular,  SMR,  and  public  safety.  The  Report  and  Order  provides  that  future  licensees  in  the  800  MHz  air-  ground  band,  as  well  as  other  interested  parties,  will  have  the  opportunity  to  engage  in 
 spectrum  leasing  under  the  Commissions  rules,  see  para.  32,  supra.  Future  licensees  will  also  be  permitted  to  engage  in  partitioning  and/  or  disaggregation  of  their  licenses,  id.  These  regulatory 

 47  If  band  plan  1  is  implemented  as  a  result  of  the  Commissions  auction  of  new  800  MHz  commercial  Air-  Ground 
 Radiotelephone  Service  licenses  (see  supra  FRFA  n.  4),  the  new  licensees  will  be  required  to  jointly  file  a  spectrum  sharing  and  site  selection  plan  with  the  Wireless  Telecommunications  Bureau.  See  supra  Report  and  Order  at  para. 

 34.  48 
 5  U.  S.  C.    603(  c)(  1)(  c)(  4). 
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 opportunities  are  intended  to  provide  the  air-  ground  marketplace  greater  flexibility  to  respond  to  consumer  demand.  The  regulatory  approach  adopted  in  the  Report  and  Order  will  benefit  both  small  and 
 large  entities. 
 19.  Regarding  the  modification  or  elimination  of  rules  stemming  from  our  Biennial  Regulatory  Review  responsibilities,  see  paras.  86-  168,  supra,  we  do  not  anticipate  any  adverse  impact  on 

 small  entities.  To  the  contrary,  to  the  extent  that  there  is  any  direct  impact  at  all,  streamlining  and  harmonizing  technical  and  operational  rules  should  result  in  decreasing  regulatory  burdens  that  benefit 
 both  small  and  large  entities. 
 20.  Report  to  Congress:  The  Commission  will  send  a  copy  of  the  Report  and  Order  and  Notice  of  Proposed  Rulemaking,  including  this  FRFA,  in  a  report  to  be  sent  to  Congress  pursuant  to  the 

 Congressional  Review  Act.  49  In  addition,  the  Commission  will  send  a  copy  of  the  Report  and  Order  and  Notice  of  Proposed  Rulemaking,  including  this  FRFA,  to  the  Chief  Counsel  for  Advocacy  of  the  SBA.  A 
 summary  of  the  Report  and  Order  and  Notice  of  Proposed  Rulemaking  and  this  FRFA  will  also  be  published  in  the  Federal  Register.  50 

 49  See  5  U.  S.  C.    801(  a)(  1)(  A). 
 50  See  5  U.  S.  C.    604(  b). 
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 APPENDIX  D 
 INITIAL  REGULATORY  FLEXIBILITY  ANALYSIS 

 1.  As  required  by  the  Regulatory  Flexibility  Act  of  1980,  as  amended  (RFA),  1  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  the  Notice  of  Proposed  Rulemaking  (Notice),  WT  Docket  No.  05-  42.  2  Written  public  comments  are 
 requested  on  this  IRFA.  Comments  must  be  identified  as  responses  to  the  IRFA  and  must  be  filed  by  the  deadlines  for  comments  on  the  Notice  provided  in  paragraph  179  of  the  item.  The  Commission  will  send 
 a  copy  of  the  Notice,  including  this  IRFA,  to  the  Chief  Counsel  for  Advocacy  of  the  Small  Business  Administration  (SBA).  3  In  addition,  summaries  of  the  Notice  and  IRFA  will  be  published  in  the  Federal 
 Register.  4 
 A.  Need  for,  and  Objectives  of,  the  Proposed  Rules 
 2.  The  Report  and  Order  addresses  revisions  to  the  rules  and  spectrum  band  plan  for  the  800  MHz  commercial  Air-  Ground  Radiotelephone  Service  spectrum.  The  Report  and  Order  makes  available 

 new  nationwide  air-  ground  licenses  in  three  band  configurations:  (1)  band  plan  1,  comprised  of  two  overlapping,  shared,  cross-  polarized  3  MHz  licenses  (licenses  A  and  B,  respectively),  5  (2)  band  plan  2, 
 comprised  of  an  exclusive  3  MHz  license  and  an  exclusive  1  MHz  license  (licenses  C  and  D,  respectively),  6  and  (3)  band  plan  3,  comprised  of  an  exclusive  1  MHz  license  and  an  exclusive  3  MHz 
 license  (licenses  E  and  F,  respectively),  with  the  blocks  at  opposite  ends  of  the  band  from  the  second  configuration.  7  Licenses  will  be  awarded  to  winning  bidders  for  the  licenses  comprising  the  configuration 
 that  receives  the  highest  aggregate  gross  bid,  subject  to  long-  form  license  application  review.  Licenses  will  have  a  ten-  year  term. 

 3.  If  mutually  exclusive  applications  are  filed  for  the  commercial  air-  ground  licenses  that  comprise  the  three  band  configurations  defined  in  the  Report  and  Order,  the  Commission  will  be  required 
 to  resolve  such  applications  by  competitive  bidding  pursuant  to  the  requirements  of  Section  309(  j)  of  the 

 1  See  5  U.  S.  C.    603.  The  RFA,  see  5  U.  S.  C.    601-  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).  2 
 See  Notice,  Section  III,  supra.  3 
 See  5  U.  S.  C.    603(  a).  4 
 See  id.  5 
 Licenses  A  and  B  would  authorize  transmission  of  radio  waves  that  are  vertically  and  horizontally  polarized,  respectively,  and  would  initially  share  1.  5  MHz  at  849.  000-  850.  500  MHz  paired  with  1.  5  MHz  at  894.000-  895.  500 

 MHz.  Once  Verizon  Airfones  incumbent  system  ceases  operations  in  the  upper  0.5  MHz  of  each  band,  licensee  B  would  shift  its  operations  to  1.5  MHz  at  849.500-  851.  000  MHz  paired  with  1.5  MHz  at  894.  500-  896.  000  MHz.  If 
 band  plan  1  is  implemented,  the  parties  may  agree  to  a  different  implementation  scheme.  6 
 License  C  would  be  located  in  the  lower  1.5  MHz  portion  of  each  2  MHz  band  (1.5  MHz  at  849.000-  850.500  MHz  paired  with  1.  5  MHz  at  894.000-  895.  500  MHz).  License  D  would  be  located  in  the  upper  0.  5  MHz  portion  of  each 

 2  MHz  band  (0.  5  MHz  at  850.500-  851.  000  MHz  paired  with  0.5  MHz  at  895.  500-  896.  000  MHz).  7 
 License  E  would  be  located  in  the  lower  0.5  MHz  portion  of  each  2  MHz  band  (0.5  MHz  at  849.000-  849.500  MHz  paired  with  0.5  MHz  at  894.  000-  894.500  MHz).  License  F  would  be  located  in  the  upper  1.5  MHz  portion  of  each  2 

 MHz  band  (1.  5  MHz  at  849.500-  851.  000  MHz  paired  with  1.  5  MHz  at  894.  500-  896.  000  MHz). 
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 Communications  Act.  8  Similarly,  the  Commission  is  required  to  resolve  by  competitive  bidding  mutually  exclusive  general  aviation  air-  ground  applications.  9  To  date,  the  Commission  has  accepted  for  filing  nine 
 groups  of  mutually  exclusive  general  aviation  applications,  which  are  currently  pending.  Therefore,  the  Wireless  Telecommunications  Bureau  (  WTB)  will,  pursuant  to  its  delegated  authority,  schedule  an 
 auction  to  resolve  these  applications.  10 
 4.  In  the  Notice,  we  request  comment  on  a  number  of  issues  relating  to  competitive  bidding  procedures  for  both  commercial  air-  ground  and  general  aviation  licenses.  We  propose  to  conduct 

 auctions  of  both  commercial  and  general  aviation  air-  ground  licenses  in  conformity  with  the  general  competitive  bidding  rules  set  forth  in  Part  1,  Subpart  Q,  of  the  Commission's  Rules,  and  substantially 
 consistent  with  the  bidding  procedures  that  have  been  employed  in  previous  Commission  auctions.  11  Specifically,  we  propose  to  employ  the  Part  1  rules  governing,  among  other  things,  designated  entities, 
 application  and  payment  procedures,  collusion  issues,  and  unjust  enrichment.  Under  this  proposal,  such  rules  would  be  subject  to  any  modifications  that  the  Commission  may  adopt  in  its  Part  1  Competitive 
 Bidding  proceeding.  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 
 WTB  pursuant  to  its  delegated  authority.  12  We  seek  comment  on  this  proposal  as  well  as  on  whether  any  of  our  Part  1  competitive  bidding  rules  would  be  inappropriate,  or  should  be  modified,  for  auctions  of 
 either  commercial  or  general  aviation  air-  ground  licenses. 
 5.  With  respect  to  the  commercial  air-  ground  licenses  we  are  making  available,  we  are  providing  applicants  with  the  opportunity  to  bid  on  licenses  constituting  different  band  configurations. 

 Accordingly,  the  determination  of  whether  individual  commercial  air-  ground  license  applications  are  mutually  exclusive  for  purposes  of  Section  309(  j)  will  be  based  on  whether  different  applicants  have 
 applied  for  licenses  in  different  band  plan  license  configurations  as  well  as  on  whether  different  applicants  have  applied  for  the  same  licenses.  In  other  words,  because  only  one  band  configuration  will 
 be  implemented,  applicants  that  apply  for  licenses  in  different  configurations  will  be  considered  to  have 
 8  47  U.  S.  C.    309(  j). 
 9  The  Balanced  Budget  Act  of  1997,  Pub.  L.  No.  105-  33,  Title  III,  111  Stat.  251  (1997),  amended  Section  309(  j)  to 
 require  the  Commission  to  award  mutually  exclusive  applications  for  initial  licenses  or  permits  using  competitive  bidding  procedures,  with  very  limited  exceptions.  These  exceptions  are  licenses  and  construction  permits  for  public 

 safety  radio  services,  digital  television  service  licenses  and  permits  given  to  existing  terrestrial  broadcast  licensees  to  replace  their  analog  television  service  licenses,  and  licenses  and  construction  permits  for  noncommercial  educational 
 broadcast  stations  and  public  broadcast  stations  under  47  U.  S.  C.    397(  6).  See  47  U.  S.  C.    309(  j)(  1),  (2).  10 
 This  auction  will  be  limited  to  the  parties  in  each  of  the  nine  groups  of  applicants  that  have  filed  mutually  exclusive  applications,  which  constitute  closed  filing  groups.  See  47  C.  F.  R.    22.  131.  These  parties  will  be  required 

 to  file  short-  form  applications  (FCC  Form  175)  and  submit  upfront  payments  to  participate  in  the  auction.  See  47  C.  F.  R.    1.2105(  a)  &  (b),  1.  2106. 
 11  See  47  C.  F.  R.    1.2101-  1.  2113. 
 12  See  Amendment  of  Part  1  of  the  Commissions  Rules    Competitive  Bidding  Procedures,  Allocation  of  Spectrum 
 Below  5  GHz  Transferred  from  Federal  Government  Use,  4660-  4685  MHz,  Third  Report  and  Order  and  Second  Further  Notice  of  Proposed  Rule  Making,  13  FCC  Rcd  374,  448    124-  125  (1997)  (  Part  1  Third  R&  O)  (directing 

 WTB  to  seek  comment  on  specific  mechanisms  related  to  day-  to-  day  auction  conduct  such  as  the  structure  of  bidding  rounds  and  stages,  establishment  of  minimum  opening  bids  or  reserve  prices,  minimum  accepted  bids, 
 activity  requirements  for  each  stage  of  the  auction,  and  stopping  rules);  Amendment  of  Part  1  of  the  Commissions  Rules    Competitive  Bidding  Procedures,  Order,  Memorandum  Opinion  and  Order  and  Notice  of  Proposed  Rule 
 Making,  12  FCC  Rcd  5686,  5697  16  (1997)  (clarifying  that,  pursuant  to  Section  0.131  of  the  Commissions  Rules,  47  C.  F.  R.    0.131,  the  Chief,  Wireless  Telecommunications  Bureau,  has  delegated  authority  to  implement  all  of  the 
 Commissions  rules  pertaining  to  auctions  procedures). 
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 filed  mutually  exclusive  applications.  We  tentatively  conclude,  however,  that  this  and  any  other  differences  from  our  past  auctions  do  not  necessitate  any  changes  to  our  Part  1  competitive  bidding  rules, 
 and  that  WTB  can  address  such  differences  through  its  standard  practice  of  seeking  comment  on  and  adopting  procedures  for  specific  auctions.  We  seek  comment  on  this  tentative  conclusion. 

 6.  We  tentatively  conclude  that  small  business  bidding  credits  are  appropriate  for  the  commercial  air-  ground  service.  13  We  base  this  conclusion  on  the  fact  that  no  commercial  air-  ground 
 license  will  authorize  the  use  of  as  much  spectrum  as  other  nationwide  services  for  which  the  Commission  has  declined  to  adopt  small  business  bidding  credits.  In  addition,  we  believe  that  the 
 operation  of  a  commercial  air-  ground  service  may  require  lower  capital  expenditures  than  other  nationwide  services,  such  as  satellite  services,  because  the  necessary  infrastructure  may  be  less  costly.  14 
 Thus,  we  tentatively  conclude  that  small  businesses  may  be  able  to  attract  the  necessary  capital  to  provide  commercial  air-  ground  service,  particularly  if  they  are  assisted  by  bidding  credits.  15  We  seek  comment  on 
 these  tentative  conclusions. 
 7.  Having  tentatively  concluded  that  small  businesses  may  be  able  to  provide  commercial  air-  ground  service,  we  nonetheless  recognize  that  such  operations  may  be  very  capital-  intensive  relative 

 to  other  services  provided  to  smaller  geographic  areas.  We  therefore  propose  to  use  the  same  small  business  definitions  we  have  adopted  for  other  capital-  intensive  services  that  serve  large  geographic  areas. 
 Specifically,  we  propose  to  define  a  small  business  as  an  entity  with  average  annual  gross  revenues  for  the  three  preceding  years  not  exceeding  $40  million,  and  to  define  a  very  small  business  as  an  entity  with 
 average  annual  gross  revenues  for  the  three  preceding  years  not  exceeding  $15  million.  We  also  propose  a  15  percent  bidding  credit  for  small  businesses  and  a  25  percent  bidding  credit  for  very  small  businesses, 
 as  set  forth  in  our  standardized  schedule  at  47  C.  F.  R.    1.2110(  f)(  2).  These  are  the  same  tiered  small  business  definitions  and  bidding  credits  that  we  adopted,  for  example,  for  EAG-  based  licenses  in  the 
 upper  and  lower  700  MHz  bands.  16  We  note  also  that  AirCell  and  Space  Data,  in  ex  parte  comments,  support  these  small  business  definitions  and  bidding  credits  as  appropriate  for  commercial  air-  ground 
 service.  17 
 8.  We  request  comment  on  these  proposals.  In  particular,  we  invite  commenters  to  discuss  the  expected  capital  requirements  and  other  characteristics  of  the  commercial  air-  ground  operations  that 

 13  We  are  coordinating  these  size  standards  with  the  U.  S.  Small  Business  Administration. 
 14  Air-  ground  service  may  also  require  fewer  ground  (base)  stations  than  other  terrestrial  services  that  are  provided 
 on  a  nationwide  basis,  such  as  broadband  PCS.  15 
 In  ex  parte  comments,  AirCell  and  Space  Data  urge  the  Commission  to  adopt  small  business  bidding  credits  for  commercial  air-  ground  licenses,  arguing  that  they  are  small  businesses  that  have  the  resources  and  expertise  to 

 provide  air-  ground  service  but  may  not  be  able  to  compete  for  a  license  without  bidding  credits.  Letter  from  Michele  C.  Farquhar,  Counsel  to  AirCell,  Inc.,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications 
 Commission,  dated  Sept.  17,  2004  (AirCell  Sept.  17  Ex  parte  letter);  Letter  from  Jerry  Knoblach,  CEO,  Space  Data  Corporation,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  dated  Oct.  28,  2004  (Space 
 Data  Oct.  28  Ex  parte  letter).  16 
 See  Reallocation  and  Service  Rules  for  the  698-  746  MHz  Spectrum  Band  (Television  Channels  52-  59),  Report  and  Order,  17  FCC  Rcd  2153  (2002);  Service  Rules  for  the  746-  764  and  776-  794  MHz  Bands,  and  Revisions  of 

 Part  27  of  the  Commissions  Rules,  First  Report  and  Order,  15  FCC  Rcd  25495  (2000).  The  country  is  divided  into  six  Economic  Area  Groupings  (EAGs);  thus,  EAGs  are  very  large  geographic  areas. 
 17  AirCell  Sept.  17  Ex  parte  letter,  at  2;  Space  Data  Oct.  28  Ex  parte  letter,  at  2-  3.  AirCell  and  Space  Data  also 
 suggest  that  the  Commission  consider  higher  bidding  credits.  However,  neither  company  makes  a  specific  proposal  or  supplies  specific  facts  to  support  such  a  proposal. 
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 may  be  provided  using  the  licenses  made  available  by  todays  Report  and  Order,  and  the  relationship  of  such  requirements  and  characteristics  to  small  business  definitions  and  bidding  credits.  We  invite 
 commenters  to  provide  comparisons  with  other  services  for  which  the  Commission  has  established  bidding  credits.  To  the  extent  commenters  support  a  different  bidding  credit  regime  than  the  one 
 proposed  here,  they  should  support  their  proposals  with  relevant  information.  Such  comments  should  provide  information  on,  for  example,  the  technology  that  a  commercial  air-  ground  licensee  is  likely  to 
 employ,  the  cost  of  deployment,  and  other  factors  that  may  affect  capital  requirements  for  commercial  air-ground  operations. 

 9.  We  also  seek  comment  on  whether  our  proposed  designated  entity  provisions,  if  applied  to  the  commercial  air-  ground  service,  would  promote  participation  by  businesses  owned  by  minorities  and 
 by  women,  as  well  as  participation  by  rural  telephone  companies.  To  the  extent  that  commenters  propose  additional  provisions  to  enhance  participation  by  minority-  owned  or  women-  owned  businesses, 
 commenters  should  address  how  we  should  craft  such  provisions  to  meet  the  relevant  standards  of  judicial  review.  18 

 10.  In  contrast  to  the  commercial  air-  ground  licenses  made  available  by  today's  Report  and  Order,  general  aviation  air-  ground  licenses  are  specialized  licenses  that  are  generally  valued  by  relatively 
 small  businesses.  For  this  reason,  we  expect  that  small  businesses  interested  in  acquiring  these  licenses  are  unlikely  to  have  difficulty  obtaining  the  capital  needed  to  participate  in  an  auction.  19  We  seek 
 comment  on  whether  small  business  bidding  credits  would  be  appropriate  for  the  general  aviation  air-ground  service. 

 B.  Legal  Basis 
 11.  The  proposed  action  is  authorized  under  Sections  1,  4(  i),  11,  303(  r)  and  (y),  308,  309,  and  332  of  the  Communications  Act  of  1934,  as  amended,  47  U.  S.  C.    151,  154(  i),  161,  303(  r),  303(  y),  308, 

 309,  and  332. 
 C.  Description  and  Estimate  of  the  Number  of  Small  Entities  to  Which  the  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  rules  adopted  herein.  20  The  RFA  generally 
 defines  the  term  small  entity  as  having  the  same  meaning  as  the  terms  small  business,  small  organization,  and  small  governmental  jurisdiction.  21  In  addition,  the  term  small  business  has  the 
 same  meaning  as  the  term  small  business  concern  under  the  Small  Business  Act.  22  A  small  business 
 18  See  United  States  v.  Virginia,  518  U.  S.  515  (1996);  Adarand  Constructors  v.  Pena,  515  U.  S.  200  (1995). 
 19  We  note  that  the  Commission  did  not  adopt  small  business  bidding  credits  for  cellular  unserved  area 
 authorizations,  which  it  found  were  valued  primarily  by  a  discrete  group  of  small  businesses.  See  Implementation  of  Section  309(  j)  of  the  Communications  Act    Competitive  Bidding,  Ninth  Report  and  Order,  11  FCC  Rcd  14769, 

 14791  45  (1996).  20 
 5  U.  S.  C.    603.  21 
 5  U.  S.  C.    601(  6).  22 
 5  U.  S.  C.    601(  3)  (incorporating  by  reference  the  definition  of  small-  business  concern  in  the  Small  Business  Act,  15  U.  S.  C.    632).  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. 
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 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  Small  Business  Administration 
 (SBA).  23 
 13.  Wireless  Service  Providers.  The  SBA  has  developed  a  small  business  size  standard  for  wireless  firms  within  the  two  broad  economic  census  categories  of  Paging  24  and  Cellular  and  Other 

 Wireless  Telecommunications.  25  Under  both  SBA  categories,  a  wireless  business  is  small  if  it  has  1,500  or  fewer  employees.  For  the  census  category  of  Paging,  Census  Bureau  data  for  1997  show  that  there 
 were  1,320  firms  in  this  category,  total,  that  operated  for  the  entire  year.  26  Of  this  total,  1,303  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  17  firms  had  employment  of  1,000  employees 
 or  more.  27  Thus,  under  this  category  and  associated  small  business  size  standard,  the  great  majority  of  firms  can  be  considered  small.  For  the  census  category  Cellular  and  Other  Wireless  Telecommunications, 
 Census  Bureau  data  for  1997  show  that  there  were  977  firms  in  this  category,  total,  that  operated  for  the  entire  year.  28  Of  this  total,  965  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  12 
 firms  had  employment  of  1,000  employees  or  more.  29  Thus,  under  this  second  category  and  size  standard,  the  great  majority  of  firms  can,  again,  be  considered  small. 

 14.  Cellular  Licensees.  The  SBA  has  developed  a  small  business  size  standard  for  wireless  firms  within  the  broad  economic  census  category  Cellular  and  Other  Wireless  Telecommunications.  30 
 Under  this  SBA  category,  a  wireless  business  is  small  if  it  has  1,500  or  fewer  employees.  For  the  census  category  Cellular  and  Other  Wireless  Telecommunications  firms,  Census  Bureau  data  for  1997  show  that 
 there  were  977  firms  in  this  category,  total,  that  operated  for  the  entire  year.  31  Of  this  total,  965  firms  had  employment  of  999  or  fewer  employees,  and  an  additional  12  firms  had  employment  of  1,000  employees 
 or  more.  32  Thus,  under  this  category  and  size  standard,  the  great  majority  of  firms  can  be  considered  small.  According  to  the  most  recent  Trends  in  Telephone  Service  data,  719  carriers  reported  that  they 
 were  engaged  in  the  provision  of  cellular  service,  personal  communications  service,  or  specialized  mobile  radio  telephony  services,  which  are  placed  together  in  the  data.  33  We  have  estimated  that  294  of  these  are 

 23  15  U.  S.  C.    632. 
 24  13  C.  F.  R.    121.  201,  NAICS  code  513321  (changed  to  517211  in  October  2002). 
 25  Id. 
 26  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms 
 Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513321  (issued  Oct.  2000).  27 
 Id..  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500  or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 

 28  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms 
 Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513322  (issued  Oct.  2000).  29 
 Id.  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500  or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 

 30  13  C.  F.  R.    121.  201,  NAICS  code  513322  (changed  to  517212  in  October  2002). 
 31  U.  S.  Census  Bureau,  1997  Economic  Census,  Subject  Series:  Information,  Table  5,  Employment  Size  of  Firms 
 Subject  to  Federal  Income  Tax:  1997,  NAICS  code  513322  (issued  Oct.  2000).  32 
 Id.  The  census  data  do  not  provide  a  more  precise  estimate  of  the  number  of  firms  that  have  employment  of  1,500  or  fewer  employees;  the  largest  category  provided  is  Firms  with  1000  employees  or  more. 

 33  FCC,  Wireline  Competition  Bureau,  Industry  Analysis  and  Technology  Division,  Trends  in  Telephone  Service 
 at  Table  5.3,  page  5-  5  (August  2003).  This  source  uses  data  that  are  current  as  of  December  31,  2001. 
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 small,  under  the  SBA  small  business  size  standard.  34 
 15.  Air-  Ground  Radiotelephone  Service.  The  Commission  has  not  adopted  a  small  business  size  standard  specific  to  the  Air-  Ground  Radiotelephone  Service.  35  We  will  use  SBAs  small  business 

 size  standard  applicable  to  Cellular  and  Other  Wireless  Telecommunications,  i.  e.,  an  entity  employing  no  more  than  1,500  persons.  36  There  are  approximately  100  licensees  in  the  Air-  Ground  Radiotelephone 
 Service,  and  we  estimate  that  almost  all  of  them  qualify  as  small  under  the  SBA  small  business  size  standard. 

 D.  Description  of  Projected  Reporting,  Recordkeeping,  and  Other  Compliance  Requirements  for  Small  Entities 
 16.  The  Notice  does  not  propose  any  new  reporting,  recordkeeping,  or  other  compliance  requirements  but  merely  proposes  to  extend  the  Commissions  existing  Part  1  competitive  bidding  and 
 application  requirements  to  the  commercial  and  general  aviation  Air-  Ground  Radiotelephone  Service. 
 E.  Steps  Taken  to  Minimize  Significant  Economic  Impact  on  Small  Entities,  and  Significant  Alternatives  Considered 

 17.  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  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.  37 

 18.  Specifically  to  assist  small  businesses,  the  Notice  proposes  to  establish  the  same  small  business  size  standards  and  associated  small  business  bidding  credits  for  the  commercial  Air-  Ground 
 Radiotelephone  Service  as  the  Commission  has  adopted  for  a  number  of  other  wireless  services,  and  also  asks  whether  those  small  business  size  standards  and  associated  small  business  bidding  credits  would  be 
 appropriate  for  the  general  aviation  Air-  Ground  Radiotelephone  Service.  38  The  Commission  will  continue  to  examine  alternatives  in  the  future  with  the  objectives  of  eliminating  unnecessary  regulations 
 and  minimizing  any  significant  economic  impact  on  small  entities.  We  invite  comment  on  any  additional  significant  alternatives  parties  believe  should  be  considered  and  on  how  the  approach  outlined  in  the 
 Notice  will  impact  small  entities,  including  small  non-  profits  and  small  governmental  entities. 
 F.  Federal  Rules  that  May  Duplicate,  Overlap,  or  Conflict  with  the  Proposed  Rules 
 19.  None. 

 34  Id. 
 35  The  service  is  defined  in  Section  22.  99  of  the  Commissions  Rules,  47  C.  F.  R.    22.  99. 
 36  13  CFR    121.  201,  NAICS  codes  513322  (changed  to  517212  in  October  2002). 
 37  5  U.  S.  C.    603(  c)(  1)-(  c)(  4). 
 38  See  Notice  at    175  &  178,  supra. 
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 STATEMENT  OF  CHAIRMAN  MICHAEL  K.  POWELL 
 In  the  Matter  of  Amendment  of  Part  22  of  the  Commissions  Rules  To  Benefit  the  Consumers  of  Air-Ground  Telecommunications  Services;  Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  and 
 90  of  the  Commissions  Rules,  WT  Docket  No.  03-  103 
 Amendment  of  Parts  1  and  22  of  the  Commission's  Rules  To  Adopt  Competitive  Bidding  Rules  for  Commercial  and  General  Aviation  Air-  Ground  Radiotelephone  Service,  WT  Docket  No.  05-  42 

 Application  of  Verizon  Airfone  Inc.  for  Renewal  of  800  MHz  Air-  Ground  Radiotelephone  License,  Call  Sign  KNKG804,  File  No.  0001716212 
 Report  and  Order  and  Notice  of  Proposed  Rulemaking,  adopted  December  15,  2004. 
 The  world  of  wireless  telecommunications  has  seen  immense  technological  and  marketplace  developments  in  the  last  decade.  During  that  time,  however,  the  800  MHz  commercial  air-  ground  service 
 has  been  locked  in  a  narrowly  defined  technological  and  regulatory  box.  With  this  action  today,  we  take  important  steps  to  bring  this  service  up-  to-  date  as  both  a  technical  and  marketplace  matter.  We  adopt  an 
 innovative  new  licensing  approach  that  will  allow  the  marketplace  to  help  direct  the  most  highly  valued  use  of  the  commercial  air-  ground  spectrum.  We  grant  future  licensees  significant  flexibility  to  meet 
 consumer  demand  for  broadband  and  other  wireless  services  onboard  aircraft  while  providing  a  reasonable  transition  period  for  the  single  remaining  incumbent  system.  We  lift  the  archaic  technical 
 constraints  currently  imposed  on  the  800  MHz  service,  while  implementing  the  requirements  and  procedures  necessary  to  ensure  that  public  safety  and  other  operations  in  adjacent  bands  are  protected 
 from  harmful  interference.  We  thus  bring  the  800  MHz  commercial  air-  ground  service  into  the  21  st  century  and  lay  the  groundwork  for  its  continued  growth  and  expansion  as  well  as  its  participation  in  the 
 marketplace  of  air-  ground  services  provided  to  airplane  passengers  via  multiple  modes. 
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 STATEMENT  OF  COMMISSIONER  MICHAEL  J.  COPPS 
 APPROVING  IN  PART,  DISSENTING  IN  PART 
 In  the  Matter  of  Amendment  of  Part  22  of  the  Commissions  Rules  To  Benefit  the  Consumers  of  Air-Ground  Telecommunications  Services;  Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  and 
 90  of  the  Commissions  Rules,  WT  Docket  No.  03-  103 
 Amendment  of  Parts  1  and  22  of  the  Commission's  Rules  To  Adopt  Competitive  Bidding  Rules  for  Commercial  and  General  Aviation  Air-  Ground  Radiotelephone  Service,  WT  Docket  No.  05-  42 

 Application  of  Verizon  Airfone  Inc.  for  Renewal  of  800  MHz  Air-  Ground  Radiotelephone  License,  Call  Sign  KNKG804,  File  No.  0001716212 
 Report  and  Order  and  Notice  of  Proposed  Rulemaking,  adopted  December  15,  2004. 
 There  is  good  and  bad  in  todays  Air-  to-  Ground  Order.  On  the  one  hand,  our  actions  have  the  potential  to  give  airlines  and  passengers  new  communications  technologies.  The  current  air-  to-  ground 
 narrowband  service  surely  has  not  fulfilled  expectations.  There  are  few  calls  made  each  day  and  the  service  is  high-  priced  and  limited  to  voice.  A  new  broadband  air-  to-  ground  service  could  allow  a  far 
 greater  diversity  of  services,  including  the  ability  to  check  email,  access  the  Web,  enhance  avionic  support,  and  improve  homeland  security  communications. 

 On  the  other  hand,  the  way  the  FCC  has  decided  to  launch  this  new  service  risks  creating  a  monopoly  for  broadband  air-  to-  ground  services.  The  Order  creates  an  auction  where  one  company  can 
 lock  up  the  only  license  that  can  support  a  true  broadband  air-  to-  ground  service.  That  means  that  if  a  company  bids  enough,  it  can  exclude  all  other  competitors,  leaving  airlines  with  only  one  possible 
 supplier  and  passengers  with  no  choice.  Experience  shows  that  if  a  company  has  the  chance  to  buy  a  monopoly  license,  it  will  pay  a  premium  for  it.  That  is  because  it  allows  them,  with  one  fell  swoop,  to 
 ensure  that  competitors  will  not  be  able  to  keep  prices  down  or  force  them  to  innovate. 
 That  result  might  be  a  feast  for  the  monopolist,  but  its  famine  for  consumers.  Airlines  will  have  to  do  business  with  the  monopolist  at  any  price.  That  is  why  so  many  airlines  stated  on  the  record  that  we 
 should  ensure  competition.  It  also  means  that  when  passengers  want  to  access  the  Internet  using  a  broadband  service  they  will  have  to  pay  what  the  monopolist  charges  or  have  no  broadband  service  at  all 
 on  the  airplane.  It  also  means  that  when  the  Department  of  Homeland  Security  wants  broadband  service  for  Air  Marshals,  there  will  be  no  chance  for  a  competitive  bidding  process,  because  only  one  company 
 can  offer  the  service.  This  could  lead  to  taxpayers  paying  far  more  for  this  DHS  no-  competition  contract  than  necessary.  Historically,  the  risks  of  creating  a  monopoly  led  the  Commission  to  create  multiple 
 licenses  when  it  started  the  cellular  service,  PCS,  satellite  TV,  satellite  radio  and  in  every  other  auction  initiating  a  new  service  that  I  can  think  of.  But  we  dont  do  so  here. 

 While  I  am  pleased  that  we  include  the  chance  for  competing  companies  to  use  the  auction  to  win  two  overlapping  three  MHz  licenses  in  the  Order,  history  doesnt  indicate  this  will  provide  the 
 competition  consumers  want.  Some  of  my  colleagues  argue  this  provides  the  potential  for  competition.  But  I  fear  that  this  possibility  is  unlikely  to  be  realized.  There  is  substantial  record  evidence  that  two 
 companies  bidding  for  overlapping  three  MHz  licenses  will  find  it  exceedingly  difficult  to  defeat  a  company  bidding  on  a  monopoly  license,  whether  that  license  is  for  4  MHz  or  for  3  MHz.  The  potential 
 monopolist  has  far  more  to  gain  and  will  pay  a  significant  premium  to  eliminate  competition.  My  colleagues  also  point  to  the  fact  that  if  a  company  buys  the  exclusive  3  MHz  license,  a  second  company 
 will  be  able  to  compete  with  them  using  the  remaining  1  MHz  license.  But  this  remainder  license  seems 
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 unlikely  to  provide  real  competition.  The  1  MHz  licensee  will  have  1/  3  the  spectrum  resources  and  the  service  it  offers  will  likely  have  only  1/  4  of  the  throughput.  The  1  MHz  licensee  may  be  able  to  offer 
 voice,  but  it  will  not  be  a  real  broadband  competitor.  Likewise,  even  the  Order  itself  concludes  that  satellite  services,  while  useful  and  important,  are  not  similar  enough  to  terrestrial  air-  to-  ground  services  to 
 provide  adequate  competition.  So  the  unwieldy  combinatorial  auction,  the  orphaned  1  MHz  narrowband  licensee,  and  the  dissimilar  satellite  service  are  all  unlikely  to  protect  consumers.  I  therefore  must  dissent 
 to  the  decision  not  to  ensure  two  competitive  licenses  in  this  Order. 
 Thanks  to  WTB  and  OET  for  their  hard  and  good  work. 
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 STATEMENT  OF  COMMISSIONER  JONATHAN  ADELSTEIN 
 APPROVING  IN  PART,  DISSENTING  IN  PART 
 In  the  Matter  of  Amendment  of  Part  22  of  the  Commissions  Rules  To  Benefit  the  Consumers  of  Air-Ground  Telecommunications  Services;  Biennial  Regulatory  Review  Amendment  of  Parts  1,  22,  and 
 90  of  the  Commissions  Rules,  WT  Docket  No.  03-  103 
 Amendment  of  Parts  1  and  22  of  the  Commission's  Rules  To  Adopt  Competitive  Bidding  Rules  for  Commercial  and  General  Aviation  Air-  Ground  Radiotelephone  Service,  WT  Docket  No.  05-  42 

 Application  of  Verizon  Airfone  Inc.  for  Renewal  of  800  MHz  Air-  Ground  Radiotelephone  License,  Call  Sign  KNKG804,  File  No.  0001716212 
 Report  and  Order  and  Notice  of  Proposed  Rulemaking,  adopted  December  15,  2004. 
 The  prospect  of  high  speed  Internet  services  in  the  airplane  cabin  should  be  met  with  great  support.  As  we  jet  off  to  our  latest  destination,  we  all  have  an  interest  in  downloading  or  uploading  a 
 presentation  on  the  way  to  a  conference,  catching  up  on  personal  and  corporate  e-  mail  accounts  for  a  couple  of  hours,  or  maybe  even  doing  some  on-  line  shopping  for  a  childs  upcoming  birthday. 

 It  seems  the  stuff  of  Buck  Rogers,  but  we  already  are  seeing  the  deployment  of  satellite-  based  high-  speed  Internet  services  on  international  long-  distance  routes.  And  with  todays  decision,  we  take  an 
 important  step  towards  promoting  terrestrial-  based  broadband  services  for  domestic  air  travel.  We  configure  our  rules  to  allow  for  next-  generation  broadband  air-  ground  services.  Equally  as  significant,  we 
 rightly  conclude  that  these  broadband  services  can  be  provided  with  three  megahertz  of  spectrum,  and  that  it  is  technically  feasible  for  two  licensees  to  provide  broadband  air-  ground  service  with  overlapping  three 
 megahertz  licenses. 
 I  am  pleased  that  these  technical  decisions  have  allowed  us  to  move  away  from  only  making  available  a  single  four  megahertz  license  and  to  put  in  place  restrictions  that  ensure  that  one  licensee  does 
 not  control  all  of  the  800  MHz  air-  ground  spectrum.  Such  an  outcome  would  not  have  matched  up  with  technical  realities,  and  would  in  no  way  have  served  the  public  interest. 

 But  we  lost  a  golden  opportunity  here  to  guarantee  true  broadband  competition.  While  a  future  auction  likely  will  result  in  two  unique  licensees,  it  is  agreed  that  a  licensee  with  one  megahertz  of 
 spectrum  will  be  unable  to  compete  against  a  licensee  with  three  megahertz  for  a  true  broadband  service.  We  could  have  easily  made  a  change  to  the  item  to  ensure  that  the  broadband  air-  ground  market  would 
 have  been  served  by  two  competitors.  The  item  already  concludes  that  a  licensing  approach  with  two  overlapping  broadband  licenses  is  technically  feasible.  For  me,  the  benefits  of  competition  in  the 
 broadband  air-  ground  market  far  outweigh  any  minor  restrictions  that  possibly  would  arise  out  of  the  overlapping  license  option.  A  competitive  market  ensures  price  discipline  and  technical  innovation  that 
 simply  may  not  flow  from  a  single  provider  market. 
 The  Commission  has  historically  tried  to  ensure  a  minimum  of  two  similarly  situated  licensees  given  the  obvious  problems  with  sole  provider  situations.  I  disagree  with  the  decision  to  allow  a 
 single  air-  ground  broadband  license  and  dissent  from  that  portion  of  the  item. 
104