[Federal Register Volume 79, Number 246 (Tuesday, December 23, 2014)]
[Rules and Regulations]
[Pages 76903-76914]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-29687]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 73

[GN Docket No. 12-268; ET Docket Nos. 13-26 and 14-14; FCC 14-157]


Expanding the Economic and Innovation Opportunities of Spectrum 
Through Incentive Auctions

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This document addresses several outstanding issues related to 
the Incentive Auction. The Commission addresses and rejects proposals 
for additional limits on any new interference between television 
stations as a result of the repacking process. The Commission 
establishes a methodology and the associated input values to predict 
inter-service interference between television and wireless services in 
certain areas for use during the incentive auction (ISIX Methodology).

DATES: Effective January 22, 2015, except for Sec. Sec.  
73.3700(b)(1)(iv)(B), 73.3700(b)(2)(i) introductory text, and 
73.3700(b)(2)(ii) of the rules which contain new or modified 
information collection requirements subject to the Paperwork Reduction 
Act of 1995, Public Law 104-13, that are not effective until approved 
by the Office of Management and Budget (OMB). The Federal 
Communications Commission will publish a document in the Federal 
Register announcing OMB approval and the effective date of this rule.

FOR FURTHER INFORMATION CONTACT: Aspasia Paroutsas, (202) 418-7285, 
<a href="/cdn-cgi/l/email-protection#bbfac8cbdac8d2da95ebdac9d4cecfc8dac8fbddd8d895dcd4cd"><span class="__cf_email__" data-cfemail="4504363524362c246b1524372a3031362436052326266b222a33">[email protected]</span></a>, Office of Engineering and Technology.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second 
Report and Order and Further Notice of Proposed Rulemaking, GN Docket 
No. 12-268; ET Docket Nos. 13-26 and 14-14, FCC 14-157, adopted October 
16, 2014 and released October 17, 2014. The full text of this document 
is available for inspection and copying during normal business hours in 
the FCC Reference Center (Room CY-A257), 445 12th Street SW., 
Washington, DC 20554. The complete text of this document also may be 
purchased from the Commission's copy contractor, Best Copy and 
Printing, Inc., 445 12th Street SW., Room, CY-B402, Washington, DC 
20554. The full text may also be downloaded at: www.fcc.gov. People 
with Disabilities: To request materials in accessible formats for 
people with disabilities (braille, large print, electronic files, audio 
format), send an email to <a href="/cdn-cgi/l/email-protection#7c1a1f1f494c483c1a1f1f521b130a"><span class="__cf_email__" data-cfemail="264045451316126640454508414950">[email protected]</span></a> or call the Consumer & 
Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 
(tty).

Summary of Second Report and Order

Requested Additional Limits on New Interference in the Repacking 
Process

    1. The Commission declined to establish a one-percent cap on the 
amount of total or aggregate new interference that a broadcast station 
will be allowed to receive from other stations, as requested by the 
National Association of Broadcasters (NAB) and others. In the Incentive 
Auction R&O, 79 FR 48442, August 15, 2014, the Commission adopted a 0.5 
percent limit on new interference that will be applied on a pairwise or 
station-to-station basis. The Commission concludes that broadcasters' 
concerns regarding the potential for new interference in the absence of 
a separate one-percent cap on aggregate interference are exaggerated: 
the vast majority of stations are unlikely to experience aggregate new 
interference of more than one percent. The Commission also adopted 
measures that will effectively address broadcasters' concerns about 
such interference in exceptional cases where there may be aggregate new 
interference of more than one percent. In addition to being 
unnecessary, the proposed cap is not practical or realistic, because 
even if the broadcasters had identified a means of implementing it 
(they have not), an aggregate interference cap would deprive the 
reverse auction bidding process of its speed and, therefore, compromise 
the success of the incentive auction. The Commission concludes that it 
can fulfill Congress's mandate to make ``all reasonable efforts'' to 
preserve the population served of stations that will remain on the air 
after the incentive auction without imposing an aggregate interference 
cap. Crucially, the Commission can do so in a manner that ensures an 
efficient channel assignment scheme, minimizes repacking costs and 
disruption to broadcasters and viewers, and furthers the goal of a 
successful auction. The Commission also declined to adopt an additional 
limit on new interference to stations that are currently experiencing 
ten percent or more interference within their service areas.

[[Page 76904]]

Background

    2. Section 6403(b)(2) of the Spectrum Act requires the Commission, 
in reorganizing or ``repacking'' the broadcast television bands, to 
``make all reasonable efforts to preserve, as of [February 22, 2012], 
the coverage area and population served'' of eligible television 
stations. In the Incentive Auction R&O, the Commission interpreted this 
mandate to require ``that we use all reasonable efforts to preserve 
each station's coverage area and population served without sacrificing 
the goal of using market forces to repurpose spectrum for new, flexible 
uses.'' Consistent with that interpretation, the Commission adopted an 
approach to preserving population served under which no channel 
assignment, ``considered alone, may reduce another station's specific 
population served by more than 0.5 percent.'' The Commission's rules 
treat 0.5 percent interference or less as de minimis or no new 
interference, as this amount rounds to zero at integer precision. Under 
this approach, the Commission will only consider station-to-station (or 
``pairwise'') interference when determining whether a particular 
channel assignment is permissible.
    3. While most commenters, including the broadcast industry, 
supported the Commission's approach to pairwise interference, NAB, 
supported by other broadcasters, urged the Commission to adopt two 
additional measures. First, NAB asked that the Commission cap the 
amount of total new interference that a station may receive at one 
percent. According to NAB, ``while an individual station can only cause 
a maximum addition of 0.5 percent interference . . . , `stations 
repacked during the incentive auction process . . . , would likely 
receive interference from multiple stations' which, in the aggregate, 
could `lead to significant viewer losses.' '' Second, noting that some 
stations currently receive up to ten percent interference, NAB 
requested that the Commission prevent any new interference to these 
stations. The Commission deferred a decision on these proposals, 
explaining that FCC staff would be ``releasing a Public Notice inviting 
comment on a staff analysis of the potential impact of aggregate 
interference on television stations as a result of the repacking 
process,'' and that the Commission would resolve the issue in a 
subsequent order.
    4. The staff released its analysis on June 2, 2014. The Aggregate 
Interference PN explained that the staff analysis was based on updated 
``constraint files'' for each station developed using the repacking 
approach adopted in the Incentive Auction R&O, including the pairwise 
approach to preserving population served. Using these constraint files, 
the staff conducted 100 simulations of the repacking process, based on 
two different spectrum recovery scenarios (84 MHz and 120 MHz) and 
applying several different approaches to select which stations went off 
the air as a result of the reverse auction, producing a channel 
assignment plan for each simulation. The staff then calculated the 
aggregate or total predicted new interference from all stations to each 
station's population served for every channel plan. Across all of the 
simulations, no station was predicted to receive aggregate new 
interference of two percent or more. One percent of stations were 
predicted to receive aggregate new interference between one and two 
percent, while the vast majority of stations (approximately 88 percent) 
were predicted to receive aggregate new interference of well under the 
0.5 percent de minimis threshold.

Stations Are Highly Unlikely To Experience Aggregate Interference of 
More Than One Percent

    5. Broadcasters' concerns regarding the potential for aggregate new 
interference to more than one percent of their viewers in the absence 
of a cap are overstated: The vast majority of stations are unlikely to 
experience significant new interference as a result of the repacking 
process. NAB points to a sample New York station which has seven 
stations causing some unique, non-overlapping interference, arguing 
that without a cap this station could receive new aggregate 
interference of two to three percent as a result of the repacking 
process. However, NAB's analysis includes existing patterns of 
interference--that is, areas in which viewers do not currently receive 
service from a station due to interference from other stations--which 
the repacking approach does not consider in seeking to preserve 
population served. Staff analysis applying the repacking approach 
adopted in the Incentive Auction R&O predicts that the overwhelming 
majority of stations (approximately 99 percent) will not experience new 
interference above the proposed cap. Only one percent of all stations 
were predicted to receive aggregate new interference between one and 
two percent, with no station predicted to receive two percent or 
greater. In addition, the vast majority of stations (approximately 88 
percent) across all 100 simulations conducted by the staff were 
predicted to receive new interference from all stations of well under 
the 0.5 percent de minimis threshold. These results indicate that the 
station-to-station or pairwise approach to preserving population served 
that the Commission adopted in the Incentive Auction R&O is 
sufficiently conservative to prevent the crowded market scenario that 
concerns NAB.
    6. Accuracy of the Underlying Data. NAB questions the accuracy of 
the staff analysis based on purported anomalies in the underlying data. 
The updated constraint files underlying the staff analysis consist of 
two files for each television station: A ``domain'' file that lists all 
of the channels to which the station could be assigned considering 
fixed constraints, and an ``interference-paired'' file that lists all 
of the other stations that could not be assigned to operate on the same 
or on an adjacent channel with that station (because the stations' 
interference relationship would violate the 0.5 percent new pairwise 
interference threshold). NAB points to two examples in which the files 
reflect that two or more stations cannot be assigned to the same 
channel on certain frequencies, but may be assigned to the same channel 
on nearby frequencies. According to NAB, these ``results appear highly 
unlikely given that . . . the change in the amount of interference 
caused between assigning closely spaced channels . . . is not 
significant.'' The examples NAB identifies represent neither an error 
nor an inconsistency in the underlying data. These results simply 
demonstrate that predicted interference will change slightly as 
stations move from one channel to another because radio waves propagate 
differently on different frequencies. The slight variations may result 
in situations where stations cannot operate on one channel under the 
applicable constraints, but may operate on a nearby channel, because 
such variations cause the interference relationship between two 
stations to go above or below the 0.5 percent interference threshold. 
Thus, NAB's examples do not reflect inconsistencies or errors in the 
updated constraint files underlying the staff analysis.
    7. Robustness of the Studies. The Commission also rejected NAB's 
claims that the staff analysis is skewed by the spectrum recovery 
scenarios studied and understates the potential for new aggregate 
interference. Arguments that lower levels of broadcaster participation 
in the reverse auction (resulting in less spectrum recovered) increase 
the potential for new aggregate interference in crowded markets are 
based on a misunderstanding of the repacking

[[Page 76905]]

process. In the 84 and 120 MHz scenarios studied by the staff, higher 
levels of participation are required because more stations would have 
to voluntarily relinquish their spectrum usage rights in order for the 
Commission to be able to repack the remaining stations consistent with 
the constraints adopted in the Incentive Auction R&O. In other words, 
more stations would have to go off the air because fewer channels would 
be available in the TV spectrum to repack broadcasters. If, on the 
other hand, fewer broadcasters choose to participate, as NAB contends 
is likely, the pairwise constraints would prevent the auction from 
repurposing as much spectrum, leaving more television channels 
available to assign to stations. Regardless of how much spectrum is 
recovered, the constraints remain static throughout the auction, and 
provide limits to whether and how stations may be repacked.
    8. The results of the staff's analysis were consistent across 
broadcaster participation rates, which ranged from 80 to 100 percent, 
and across a large (36 MHz) difference in the two spectrum recovery 
scenarios studied. This consistency confirms that lower levels of 
broadcaster participation--and scenarios in which less spectrum is 
recovered--will not have a significant impact on new aggregate 
interference. The staff's approach to selecting the stations to 
voluntarily go off the air in the simulations also ensured that 
virtually every station was part of at least one simulation in which 
that station remained on the air. Accordingly, we reject NAB's 
contention that the results of the staff analysis are unreliable.
    9. Release of Simulation Software. The Commission rejects 
contentions that the Aggregate Interference PN comment period was too 
short and that meaningful comment on the staff analysis was impossible 
without access to the simulation software that the staff used to 
generate constraint files and perform feasibility checks. The Aggregate 
Interference PN provided 30 days for comments and an additional 20 days 
for reply comments, and parties have had additional time to analyze the 
study (and to submit ex parte filings) since the comment period closed. 
Ample information has been made publicly available to allow for 
meaningful input on the staff analysis and its results, including the 
methodology, data, and assumptions underlying the analysis. Moreover, 
in the interest of transparency and encouraging meaningful input, the 
Commission and its staff have made extensive information about the 
repacking process publicly available over the course of this 
proceeding. The data and methodology required to simulate repacking 
scenarios were first detailed more than a year ago in the Repacking 
Data PN. The staff provided technical detail about how software could 
be used to perform ``feasibility checks'' (that is, to determine 
whether channels can be assigned to all of the stations eligible for 
protection in the repacking process consistent with the constraints 
imposed by the Spectrum Act) in January 2014, and further detailed the 
staff's repacking simulation software in a subsequent workshop. Thus, 
interested parties have had sufficient time and information to comment 
meaningfully on the staff analysis.

Measures To Address Aggregate Interference of More Than One Percent in 
Exceptional Cases

    10. The Commission adopted two measures to address exceptional 
cases where a station is predicted to receive aggregate new 
interference in excess of one percent. First, it will use optimization 
techniques that seek to avoid final channel assignments that would 
result in aggregate new interference of more than one percent. After 
the incentive auction bidding closes and the set of stations that will 
remain on the air in each band is established, the Commission plans to 
employ optimization techniques to determine a final channel assignment 
scheme from the provisional channel assignments identified during the 
reverse auction bidding process. During this final channel assignment 
process, the Commission can take time to account for factors in 
addition to feasibility, such as aggregate new interference, without 
compromising the speed of the reverse auction bidding process. Among 
other objectives, it intends to seek a final channel assignment that 
minimizes new aggregate interference above one percent. Although the 
current rules do not provide broadcasters with complete protection from 
aggregate interference caused by other broadcast stations, the 
Commission chose a one percent threshold in light of broadcasters' 
stated concerns about aggregate interference exceeding this amount.
    11. Although the Commission anticipates that this final channel 
assignment optimization procedure will further reduce the already-small 
number of stations that are predicted to receive new interference 
greater than one percent, it cannot guarantee this result in every 
case. The optimization procedure can identify the best final channel 
assignment scheme given the station-to-band assignments produced by the 
reverse auction. However, the Commission cannot change these 
assignments after the bidding stops and the final stage rule is met 
without undoing the entire auction. Accordingly, as an additional 
safeguard, if a station is predicted to receive new interference above 
one percent on the final channel assigned to it following the repacking 
process, the Commission will provide it with the opportunity to file an 
application proposing an alternate channel or expanded facilities in a 
priority filing window, along with a limited number of other stations 
that have been assigned the same priority. This opportunity will be 
available to any station entitled to protection in the repacking 
process that is predicted to experience aggregate new interference in 
excess of one percent, regardless of whether that station was 
reassigned to a new channel in the repacking process. Taken together, 
the final channel assignment optimization procedure and post-assignment 
facilities modification processes will provide a ``safety valve'' in 
the exceptional cases where new aggregate interference above one 
percent has occurred or is likely to occur.

An Aggregate Cap Would Deprive the Reverse Auction Bidding Process of 
Its Speed and Threaten the Success of the Auction

    12. In addition to being unnecessary for the reasons described 
above, imposition of an aggregate interference cap would compromise the 
central objective of a successful auction that allows market forces to 
determine the highest and best use for spectrum. Speed is critical to 
the successful implementation of the incentive auction: The repacking 
methodology must be capable of analyzing complex technical issues fast 
enough to not unduly slow down the bidding process. Under the repacking 
approach adopted in the Incentive Auction R&O, only one provisional 
channel assignment scheme that meets all of the constraints need be 
identified for the reverse auction bidding to proceed. Tens of 
thousands of individual ``feasibility checks'' may need to be run in 
each bidding round, and examining interference relationships only on a 
``pairwise'' or station-to-station basis is the only way to identify a 
``feasible'' repack analysis quickly enough to meet the Commission's 
objectives for the reverse auction. As discussed, the Commission 
intends to account for factors beyond mere feasibility without 
compromising the bidding process by seeking to optimize provisional 
channel

[[Page 76906]]

assignments after the bidding stops: Once the set of stations that will 
remain on the air in each band after the auction is complete has been 
established, the Commission intends to use optimization techniques to 
determine a channel assignment that limits the amount of aggregate new 
interference for any station.
    13. It would be significantly more complicated and, as a result, 
time-consuming to consider the amount of aggregate interference from 
all sources that a station may receive on its provisional channel 
during the bidding process, as would be necessary to implement a cap on 
aggregate interference. Specifically, after the repacking process 
identifies a provisional channel assignment for a station that is 
feasible--based on the pairwise constraints--the aggregate interference 
of the provisional assignments for all of the other stations that may 
need to be assigned a channel (non-participating stations and stations 
that continue to participate in the bidding) would have to be 
determined in a separate step. If the cap were exceeded, then the 
assignment would have to be disallowed and a new assignment identified. 
This iterative process would have to be repeated until either a 
provisional channel assignment were found that satisfies the cap or all 
possible assignments were eliminated. The same analysis would need to 
be performed repeatedly for each station that continues to participate 
in the bidding process, leading to possibly an exponential number of 
feasibility checks for each round of the auction. Such an approach 
would deprive the repacking feasibility checker of its speed and 
threaten the success of the incentive auction.
    14. Despite the results of the staff analysis discussed, 
broadcasters argue that the Commission must adopt the proposed cap 
under the ``all reasonable efforts'' mandate because doing so would not 
significantly increase repacking constraints. The Commission disagrees. 
As explained in the Incentive Auction R&O, the Commission interprets 
the statutory mandate in light of the other objectives of the Spectrum 
Act, including the goal of repurposing spectrum for new, flexible uses. 
Requiring steps that would impede the Commission's ability to conduct a 
successful auction would sacrifice this goal and therefore is not 
``reasonable'' within the meaning of the statute given the results of 
the staff analysis. The Commission adopted measures that will 
effectively address broadcasters' concerns regarding aggregate new 
interference. The Commission has not identified, and no commenter has 
suggested, a means of implementing the proposed cap without 
compromising the speed of the bidding process, which is critical to 
conducting a successful auction. Under the circumstances, the 
Commission concludes that the statute does not require adoption of the 
proposed cap.
    15. The Commission also rejects NAB's assertion that failure to 
adopt the proposed cap would undermine the voluntariness of the reverse 
auction. The Commission does not believe--and NAB has not demonstrated 
through record evidence--that the possibility of an increase in 
aggregate new interference, such as the remote possibility predicted in 
the staff study, would so devalue a broadcaster's license (or increase 
its costs) that it would coerce a broadcaster to participate in the 
auction.

Proposed Cap on Any New Interference to Certain Stations

    16. The Commission also declined NAB's suggestion to adopt a cap on 
any new interference to stations that are currently experiencing ten 
percent or more interference within their service areas. As explained 
in the Incentive Auction R&O, the Commission interprets section 
6403(b)(2) of the Spectrum Act ``to require efforts to preserve service 
to those viewers who had access to a station's signal within its 
protected coverage area as of'' the statutory date. Accordingly, it 
base comparative evaluations of interference on the population that a 
station was predicted to serve as of the statutory date. Thus, the 
interference level that the stations in question were experiencing as 
of the statutory date is their baseline for repacking purposes. 
Adopting NAB's suggestion would increase the constraints on the 
repacking process, hindering the Commission's ability to repack TV 
spectrum. In addition, the Commission does not believe the statutory 
``all reasonable efforts'' mandate warrants granting these stations 
greater interference protection than the current rules. The Commission 
therefore declines to treat these stations differently from other 
stations in the repacking process.

Requested Cap on Viewer Losses Due to Channel Reassignments

    17. In a recent ex parte filing, NAB criticizes the staff's 
analysis for ignoring potential terrain losses due to channel 
reassignments that could cause some stations to lose viewers, and 
argues for the first time that the Commission must adopt ``an aggregate 
cap on . . . the percentage decrease in population served as a result 
of repacking during the incentive auction process.'' The Commission 
declines to address NAB's new requested cap here. Prior to NAB's recent 
filing, no commenter proposed such a cap. Rather, NAB and others 
advocated a cap on aggregate interference between stations, and the 
purpose of the staff's analysis was to study the potential for such 
interference. The interference cap that NAB previously advocated would 
have no effect whatsoever on terrain losses, because such losses are 
not caused by interference between stations. Thus, NAB's request for an 
aggregate cap on population loss is outside the scope of this item.
    18. Although the Commission declines to address NAB's requested new 
cap here, consistent with the Commission's decision above to use 
optimization techniques to seek to avoid final channel assignments that 
would result in aggregate new interference of more than one percent, 
the Commission concludes that it should use optimization techniques to 
seek to avoid final channel assignments that would result in 
significant viewer losses due to terrain losses. The Commission did not 
decide now on an optimization technique to carry out this objective, 
because unlike interference between stations, terrain losses can be 
avoided by optimizing for various factors. For example, minimizing 
channel moves will avoid terrain losses while also reducing broadcaster 
relocation costs, because a station that stays on the same channel will 
not experience terrain losses. Similarly, preferring moves to channels 
lower in the UHF band will avoid terrain losses while also serving the 
Commission's goal of repurposing UHF spectrum contiguously from channel 
51 down. The Commission will seek comment on optimization factors for 
the final channel assignment scheme, including factors that would help 
both directly and indirectly to avoid final channel assignments that 
would result in significant viewer losses due to terrain losses, in the 
forthcoming Incentive Auction Comment PN. Although different measures 
may be necessary to protect viewers from loss of service due to terrain 
losses and interference, consistent with the statutory mandate we will 
make all reasonable efforts to preserve television service to all 
existing viewers.

[[Page 76907]]

ISIX Methodology and Input Values To Determine 600 MHz Band Wireless 
License Area Impairments During the Incentive Auction

    19. The Commission adopts here the ISIX Methodology and input 
values proposed in the ISIX PN, see Office of Engineering and 
Technology Seeks to Supplement the Incentive Auction Proceeding Record 
Regarding Potential Interference Between Broadcast Television and 
Wireless Services, Public Notice, 29 FCC Rcd 712 (2014) with certain 
modifications, for use during the incentive auction. The ISIX 
Methodology is set forth in detail in Appendix A (Technical Appendix) 
of the Second R&O. The ISIX Methodology and input values will be used 
during the auction to estimate the extent to which 600 MHz Band 
wireless license areas may be ``impaired'' due to predicted 
interference to, or from, broadcast television stations assigned to the 
600 MHz Band as a result of market variation. ``Impaired'' license 
areas may include ``infringed'' and/or ``restricted'' areas. An 
``infringed'' area is one where wireless operation is predicted to 
receive harmful interference from a television station that is placed 
in the 600 MHz Band. Wireless licensees will be free to operate in 
infringed areas but will assume the risk of receiving interference from 
a television station. A ``restricted'' area is one where wireless 
operations would be predicted to cause harmful interference to a 
television station that is placed in the 600 MHz Band, depending on how 
the wireless operations are deployed.
    20. Because new 600 MHz Band wireless operations will not be 
deployed until after the incentive auction, the ISIX Methodology and 
input values the Commission adopted in this Order necessarily rely on a 
number of assumptions, all of which are described in the ISIX PN and 
the Technical Appendix. To the extent that the Commission changed any 
of the assumptions proposed in the ISIX PN, the basis for such changes 
is explained below. The Commission also addressed commenters' 
objections to certain aspects of the ISIX Methodology and input values. 
The results of the ISIX Methodology and input values adopted in the 
Second Report and Order may be used for several purposes during the 
incentive auction. The Commission will address these uses in the 
forthcoming Comment PN on auction procedures. Importantly, the 
Commission does not determine in this Order how the ISIX Methodology 
and input values will be applied following the incentive auction.
    21. Although the ISIX Methodology may be characterized as more 
complex than the distance-based approach advocated by some commenters, 
the Commission concludes that the ISIX Methodology's ability to account 
for different inter-service interference scenarios, local terrain 
obstacles and other factors make it significantly more spectrally 
efficient than a distance-based approach, and these benefits outweigh 
the costs of greater complexity. Also, its granularity is better suited 
to the requirements of conducting the incentive auction than a 
distance-based approach. Accordingly, the Commission adopts the ISIX 
Methodology.

Background

    22. In the Incentive Auction R&O, the Commission adopted a flexible 
band plan framework that accommodates market variation. Market 
variation occurs where broadcast stations remain on spectrum that is 
repurposed for wireless broadband under the 600 MHz Band Plan. The 
Commission explained that accommodating market variation is necessary 
because the amount of spectrum recovered along the Canadian and Mexican 
borders and in some markets may vary from that recovered in most 
markets nationwide. Accommodating market variation will allow for 
avoiding limits to the amount of spectrum repurposed across the nation 
to what is available in the most constrained market.
    23. Broadcasters and several other industry participants raised 
concerns over the potential for inter-service interference created by 
market variation. This potential interference results because, in 
constrained markets where broadcast television stations are assigned to 
channels within the 600 MHz Band, television services and wireless 
services will be operating in close geographic proximity on either the 
same or adjacent frequencies. Some commenters proposed fixed geographic 
separation distances to mitigate such potential interference.
    24. On January 29, 2014, the Commission's Office of Engineering and 
Technology (OET) released a Public Notice seeking comment on an 
alternative to the fixed separation distance methodology to address 
inter-service interference. The ISIX Methodology is intended to 
accommodate market variation in a more spectrally efficient manner than 
fixed separation distances. The rationale underlying the proposed ISIX 
Methodology was that a fixed geographic separation distance approach 
would be spectrally inefficient because it would group together 
different inter-service interference scenarios (e.g., wireless base 
station to television receiver, television transmitter to wireless user 
equipment, etc.) and apply separation distances based on the worst case 
scenario, without considering factors such as technical characteristics 
(i.e. antenna height, power), terrain variability, and density of 
population.
    25. The ISIX PN discussed the varying degrees of spectral overlap 
between broadcast television and wireless services will impact to 
different degrees the potential for harmful interference between the 
two services. Under the 600 MHz Band Plan adopted in the Incentive 
Auction R&O, six megahertz broadcast television channels will be 
repurposed as five megahertz wireless blocks. The difference in channel 
bandwidth (six vs. five megahertz) means that the wireless spectrum 
blocks will not perfectly align with the existing television channels 
and, where market variation exists, there will be varying degrees of 
spectral overlap between the channels. As the wireless spectrum block 
moves from complete overlap in frequency with a television channel to 
an edge-to-edge separation of five megahertz, the level of undesired 
signal that the victim receiver can tolerate without experiencing 
interference increases. The ISIX PN proposed to define ``co-channel 
operations'' as any spectral overlap between a wireless spectrum block 
and a television channel in one megahertz increments ranging from +5 
(complete overlap) to +1 megahertz, and ``adjacent channel operations'' 
as a wireless spectrum block and television channel that do not overlap 
but are separated by less than five megahertz (edge to edge separation 
of five megahertz or less).
    26. The ISIX PN outlined four scenarios of potential interference 
when broadcast television and wireless operations are co-channel or 
adjacent channel in nearby markets: (1) Digital television (DTV) 
transmitter to wireless base station (Case 1); (2) DTV transmitter to 
wireless user equipment (Case 2); (3) wireless base station to DTV 
receiver (Case 3); and (4) wireless user equipment to DTV receiver 
(Case 4).

Digital Television to Wireless Interference (Cases 1 and 2)

    27. The Commission adopted the ISIX Methodology and input values as 
proposed in the ISIX PN for use during the incentive auction to predict 
interference from DTV transmitters to wireless base stations (Case 1) 
and wireless user equipment (Case 2), except that it will not consider 
clutter loss for Case 2. While wireless commenters

[[Page 76908]]

support the proposed consideration of clutter loss for Case 2, the 
Commission determined that considering clutter loss would not improve 
the accuracy of the ISIX Methodology. The resolution of the clutter 
database is 30 meters and, therefore, every grid cell would have more 
than 4,000 associated clutter values. The one clutter value selected in 
each cell would not be representative of the entire cell and thus would 
fail to provide for an accurate assessment of the interference 
environment.
    28. The Commission will use the proposed F(50,50) statistical 
measure to predict the strength of an interfering television signal 
within the wireless license area for Cases 1 and 2 rather than the 
F(50,10) measure advocated by broadcasters. The F(50,50) measure 
assumes that the DTV signal will be strong enough to interfere with the 
wireless base station or wireless user equipment in 50 percent of the 
locations within the wireless license area 50 percent of the time; the 
F(50,10) measure would assume that the interfering signal will be 
strong enough to interfere in 50 percent of the locations 10 percent of 
the time. The Joint Broadcasters support use of the F(50,10) measure as 
more conservative and more consistent with Commission practice. The 
Commission concludes that the F(50,50) measure is more appropriate for 
use in predicting interference from DTV signals to wireless operations 
during the auction. First, the F(50,50) measure will not risk harming 
broadcasters because it will be applied only during the incentive 
auction and only to predict interference to wireless operations from 
television stations for auction-related purposes, not to protect 
television signals. Second, the majority of wireless providers, who 
have the greatest stake in the accuracy of predicted inter-service 
interference to wireless operations, support use of the F(50,50) 
measure, supporting the conclusion that it will provide a reasonably 
accurate assessment of such interference. Third, use of the F(50,50) 
measure is appropriate in this context because various techniques are 
available to wireless operators to avoid harmful interference to 
wireless base stations that are not available to television stations or 
viewers. Accordingly, the Commission disagrees with the Joint 
Broadcasters that use of the F(50,50) measure is inconsistent with 
Commission practice in predicting interference between DTV stations. 
Under the circumstances, the Commission concludes that use of the more 
conservative F(50,10) measure is neither necessary nor consistent with 
the Commission's goals for the incentive auction.
    29. The Commission declines to adopt Qualcomm's suggested 
parameters for wireless user equipment in lieu of the parameters 
proposed in the ISIX PN. While the antenna gain value suggested by 
Qualcomm may reflect today's smartphones, the Commission expects other 
wireless devices to be used in the 600 MHz Band, like tablets or 
personal Wi-Fi hotspots, that could have either a higher antenna gain 
or a better antenna efficiency and thus be more susceptible to harmful 
interference. The Commission finds it appropriate to account for the 
types of devices that will most likely be used in the 600 MHz Band. 
Qualcomm also claims that the proposed parameter value for noise figure 
should be increased from 7.5 dB to 9 dB. However, the proposed value 
accounts for factors in addition to receiver noise that should be 
considered when calculating an effective noise figure. Therefore, the 
Commission declines to adopt Qualcomm's suggested values for wireless 
user equipment.
    30. The Commission declines to adopt the Joint Broadcasters' 
suggested fixed distance-based approach for Cases 1 and 2. The Joint 
Broadcasters' approach for Case 1 (television transmitter to wireless 
base station) would create unreasonably large zones where wireless 
operations would be deemed ``impaired'' by interference because their 
approach does not account for specific terrain obstacles that mitigate 
the potential for interference from television stations to wireless 
operations. As a result, it would significantly increase the predicted 
impairments to wireless license areas and exclude from the forward 
auction spectrum that could otherwise be offered for wireless services 
if impairments were assessed more accurately. For example, under the 
Joint Broadcasters' proposal, a television station in Los Angeles could 
be predicted to interfere with wireless operations in Las Vegas. In 
contrast, the ISIX Methodology would evaluate the effect of terrain on 
the propagation of the interfering television signal. As a result, 
areas shielded by terrain, such as mountains, would not be identified 
as impaired by potential interference that is not likely to occur in 
those locations. Applying the ISIX Methodology in the example above, 
wireless operations in Las Vegas would not be considered impaired 
because of the shielding provided by the San Gabriel and San Bernardino 
mountain ranges. As a result, a wireless license in Las Vegas would be 
deemed unimpaired because of this terrain shielding and can therefore 
be auctioned even when there is a television station co-channel or 
adjacent channel in Los Angeles. The approach the Commission adopted 
will assess the interference environment and wireless license area 
impairments significantly more accurately in Case 1 than the Joint 
Broadcasters' suggested approach of a generic separation distance.
    31. For Case 2 (television transmitter to wireless user equipment), 
the Joint Broadcasters' proposed five-kilometer separation distance 
would not adequately reflect the potential impairment to a wireless 
license area. The Joint Broadcasters conflate their proposed separation 
distances for Case 1 with those for Case 2 and assume that the Case 1 
distances will preclude wireless user equipment from operating near a 
television station. As stated, however, the Case 1 interference 
scenario will only occur if a television station is placed in the 600 
MHz uplink spectrum, while Case 2 will only occur if a television 
station is placed in the 600 MHz downlink spectrum. In addition, 
wireless user equipment is more sensitive than television receivers, 
and the high power and height of typical DTV transmitters require 
separation distances that can be much greater than five kilometers. 
However, adopting a generic distance-based separation to provide 
additional protection for wireless user equipment would raise the same 
concerns discussed with regard to Case 1. Therefore, the approach of 
predicting the specific locations (on a two-kilometer grid) where the 
interfering DTV field strength exceeds the thresholds will provide 
wireless providers with more accurate information as to wireless 
license area impairments.
    32. Although the Commission recognizes that the ISIX Methodology it 
adopts may be more complex than a fixed distance-based approach, the 
Commission concludes that the added complexity of this approach is 
justified by its benefits. The ISIX Methodology's granularity, tailored 
approach to different interference scenarios, and ability to account 
for factors that will mitigate interference in individual cases will 
generally lead to more accurate interference predictions. This is 
critical to meeting the Commission's goals for the incentive auction 
because overestimating the extent of wireless license area impairments 
may limit the ability to repurpose spectrum for new uses through the 
auction. Moreover, more accurate predictions and more granular data 
will allow for more informed decisions, both for the Commission in 
determining whether to

[[Page 76909]]

auction certain licenses and for auction participants in making bidding 
decisions. The Commission also notes that, contrary to the Joint 
Broadcasters, most commenters support the ISIX Methodology. For Cases 1 
and 2, the Commission therefore concludes that the benefits of the ISIX 
Methodology's increased accuracy over an oversimplified fixed distance-
based approach outweigh its costs in terms of additional complexity.

Wireless Base Station to Digital Television Receiver (Case 3)

    33. The Commission adopted the ISIX Methodology and input values as 
proposed in the ISIX PN for use during the incentive auction to predict 
interference from wireless base stations to DTV receivers (Case 3), 
except that (1) the Commission adopted slightly higher D/U ratios (by 1 
dB) for co-channel operations based on the measurements conducted by 
the staff and CEA, and (2) the Commission will not consider clutter 
loss.
    34. D/U ratios. The ISIX PN was premised on the assumption that 
ATSC DTV and LTE signals are sufficiently similar that the D/U ratios 
in the rules for television-to-television interference can be used in 
predicting interference from wireless base stations to television 
receivers. In response to concerns raised by some commenters, OET 
measured the susceptibility of a number of DTV receivers to 
interference from LTE signals, and CEA conducted additional 
measurements with six different DTV receivers. The Commission concluded 
that the record supports the D/U ratios proposed in the ISIX PN for 
adjacent channel interference based on the measurements conducted by 
staff and CEA. However, based on the measurement data, LTE signals 
create slightly more co-channel interference to DTV reception than 
other DTV signals. The Commission concludes that the D/U ratios 
proposed in the ISIX PN for co-channel interference should be increased 
by 1dB from 15 dB to 16 dB in light of this data. Therefore, the 
Commission adopted the following D/U ratios for different degrees of 
spectral overlap in Case 3. This adjustment will result in a more 
accurate determination of impairments to co-channel wireless operations 
to any broadcast television stations that are assigned to the downlink 
600 MHz Band spectrum as a result of market variation. The D/U ratios 
are accordingly adjusted as shown in Table 1, paragraph 43 of the 
Second Report and Order.
    35. While one receiver OET measured was predicted to receive 
interference at the D/U ratios the Commission adopted in this Order, it 
concludes that this result does not undermine the Commission's 
decision. This receiver is a digital-to-analog converter box. While the 
Commission recognizes that such converter boxes remain in use and are 
still commercially available, the analog-only television receivers they 
are used with are reaching the end of their life cycles. Television 
receivers with digital tuners have no need of such converter boxes, and 
new television receivers have been required to include digital tuners 
since July 2004. Thus, most television receivers purchased since then 
have no need for a converter box. The Commission declines to adjust the 
D/U ratios it adopted based on the susceptibility to LTE signal 
interference of obsolete analog-to-digital converter boxes, the vast 
majority of which will no longer be in service during and after the 39-
month Post Auction Transition Period.
    36. Although broadcasters argue for more measurements, no commenter 
disagrees that DTV and LTE signals behave similarly because both have 
noise-like emission characteristics. The measurement data from OET and 
CEA encompasses most new models of DTV receivers, as well as a 
representative sample of older models. With the exception of the one 
digital-to-analog converter box that is no longer likely to be in use 
within a few years, none of the DTV receivers OET tested was 
susceptible to LTE signal interference at the D/U ratios adopted in 
this Order. Testing additional receivers under different conditions, as 
broadcasters advocate, would delay this proceeding, and therefore the 
auction, without contributing meaningfully to the data in the record. 
Accordingly, the Commission concludes that the D/U ratios it adopted 
are sufficient to protect DTV receivers from LTE signal interference.
    37. The Commission rejects claims that the measurement data in the 
record is not reliable because it does not consider factors such as 
multiple LTE interferers, third-order intermodulation (IM3) or taboo 
interference, and splatter. The Commission's rules governing DTV-to-DTV 
interference do not address these factors, yet there is no evidence 
that the rules fail to adequately protect DTV signals as a result. 
Likewise, OET-69 does not consider taboo interference in its 
calculations but only considers the interference protections provided 
in the rules. Equipment manufacturers are aware of these factors and 
are expected to consider them when designing their receiver products. 
Because the Commission's existing rules do not include provisions to 
protect DTV signals from the effects of multiple DTV interferers, IM3 
or splatter, the Commission declines to account for such factors in the 
D/U ratios adopted for Case 3, and concludes that the measurement data 
in the record is reliable despite the lack of information regarding 
these factors.
    38. While the Commission recognizes the asymmetry in the 
performance of DTV receivers, the D/U values adopted in the ISIX 
Methodology are sufficiently conservative to protect against 
interference from wireless signals on co-channel and adjacent-channel 
frequencies above or below a received television channel. In addition, 
the adopted values will protect adjacent-channel operations, by several 
dB or more. Accordingly, the Commission adopts the values for OFR set 
forth in Table 9 of the ISIX PN.
    39. Clutter Loss. The Commission declined to adopt the proposed use 
of clutter loss for Case 3 for reasons similar to those set forth above 
with regard to Case 2. Clutter loss has not been used in the context of 
interference between television stations, and the Commission concluded 
that application of a single clutter value in a four-square kilometer 
area would not improve the accuracy of the ISIX Methodology.
    40. Propagation Model. The Commission rejects suggestions that the 
ISIX Methodology use the Hata or the free space propagation model for 
Case 3 instead of the Longley-Rice model. The Commission has relied on 
the Longley-Rice model to predict television coverage and interference 
for more than fifteen years, and that model is widely accepted for use 
at the frequencies in the 600 MHz Band.
    41. Fixed Distance-Based Approach. The Commission also rejects 
Joint Broadcasters' fixed distance-based approach for Case 3. Their 
approach predicts wireless license area impairments greater than those 
predicted by the ISIX Methodology in some cases, whereas in others it 
would produce similar results or result in smaller impairments. The 
critical difference between the two approaches for Case 3, however, is 
the granularity of the data. The fixed geographic distances under the 
Joint Broadcasters' approach are not easily converted to the ``grid-by-
grid'' data needed to evaluate potential harmful interference to 
television stations in the initial optimization process during the 
auction. The ISIX Methodology provides for a cell-by-cell determination 
of license impairments which will allow the Commission to make more 
informed decisions about the appropriate clearing targets for the 
reverse auction and

[[Page 76910]]

which wireless spectrum blocks to auction in the forward auction, and 
also provide additional certainty to bidders in the forward auction. 
Therefore, the Commission concludes that the ISIX Methodology is better 
suited to the requirements of conducting the incentive auction than a 
distance-based approach for Case 3.
    42. Technical Parameters. The Commission rejected broadcasters' 
claims that the parameter values for wireless base station power and 
height proposed for Case 3 in the ISIX PN are inconsistent with real-
world wireless facilities. These typical values were obtained from 
advisory committees and industry submissions in the record. The 
Commission has previously considered typical operating parameters in 
predicting interference, rather than assuming the maximum permissible 
levels authorized under the Commission's rules. As Sprint notes, the 
typical parameters may not precisely reflect the parameters that a 
wireless provider would use in actual deployment, but they are 
reasonable for purposes of modeling. The Commission emphasizes that the 
use of typical values for Case 3 will be restricted to the incentive 
auction, when actual values will not be available because 600 MHz Band 
services will not be deployed yet.
    43. For purposes of the auction, the ISIX Methodology assumes an 
Effective Radiated Power (ERP) level of 120 W/MHz for a wireless base 
station. This power level, which is supported by data in the record, is 
based on a wireless base station operating with two LTE transmitters, 
rated at 40 watts (W) each and transmitting at their maximum capable 
output power (ignoring network effects such as power control) and an 
antenna gain of 15 dBi. The 15 dBi value is based on manufacturer data 
on panel antennas designed for operation in frequency bands above and 
below the 600 MHz Band. An antenna with 15 dBi gain used with two 40 W 
transmitters and a line loss of 1 dB produces an ERP of 1200 W in a 10 
MHz LTE channel, or 120 W/MHz ERP. To simulate the effect on one 6 MHz 
television channel of wireless operations transmitting across 
contiguous adjacent 5 MHz wireless blocks, OET multiplied the ERP/MHz 
by 6, so that the ERP in a 6 MHz channel would be 720 watts.
    44. The antenna Height Above Average Terrain (HAAT) value of 30 
meters adopted for use in the ISIX Methodology is consistent with real-
world network information incorporated in the Commerce Spectrum 
Management Advisory Committee (CSMAC) Final Report. This report 
specifies 30 meters as the typical HAAT for base stations in urban/
suburban areas where inter-service interference would most likely 
occur. The wireless industry also supports this assumption. The Joint 
Broadcasters' analysis overestimates the typical wireless base station 
antenna height because it is based on the overall height above ground 
level for the towers hosting a wireless antenna, rather than the height 
at which the wireless antennas are actually mounted on each tower. 
Wireless antennas are typically side-mounted on platforms or other 
supporting structures, resulting in a much lower antenna height than 
the overall tower height. Moreover, while the Joint Broadcasters' 
analysis relies on data from American Tower, one of the largest tower 
management entities in the United States, it excludes rooftop, on-
building, and broadcast tower mounted sites. The Commission believes 
that the typical values adopted are appropriate for modeling a 600 MHz 
Band wireless network.
    45. ``Error Code 3'' Messages. The Commission disagrees with the 
Joint Broadcasters that it should assume service in cells where an 
``error code 3'' message appears, rather than using the predicted field 
strength at such locations. The Joint Broadcasters' claim that the 
proposed approach departs from the Commission's treatment of error 
warnings ignores the fact that the Commission has treated error 
warnings differently depending on context. In the Incentive Auction 
R&O, the Commission decided to assume service in cells where an ``error 
code 3'' message appears, because doing so is consistent with the 
traditional assumption for purposes of applying the OET-69 methodology 
that service is available throughout a station's coverage area and that 
broadcasters locate and configure their transmitters to maximize 
coverage. In predicting Case 3 interference, however, the Commission 
found that different treatment of ``error code 3'' messages is 
appropriate. If service were to be assumed in the presence of an error 
warning, the cell in question would be treated as having interference-
free service, meaning that potential inter-service interference would 
be ignored. The result would be a failure to check for inter-service 
interference at locations where the DTV signal could be subject to 
interference. Instead by using the predicted field strength at such 
locations, the Commission ensures that the ISIX Methodology evaluates 
service and potential interference in the flagged cells just as it 
would in non-flagged cells. The Commission's approach does not alter or 
otherwise affect the treatment of error warnings in applying the OET-69 
methodology as set forth in the Incentive Auction R&O.
    46. Aggregate Wireless Interference to DTV. The Commission declines 
to consider the potential impact of interference from multiple wireless 
base stations on DTV reception when applying the ISIX Methodology for 
Case 3 during the incentive auction. Broadcasters express concern that 
LTE signals could combine at the point of DTV signal reception, 
increasing the potential for interference. They urge the Commission to 
use either a simple direct summation of signals or the Root Square Sum 
(RSS) method for calculating interference from multiple DTS 
transmitters under the current rules. The Commission concludes that 
neither of these approaches is appropriate here because the ISIX 
Methodology necessarily relies on hypothetical placement of wireless 
base stations every ten kilometers with no regard to whether actual 
operation on those locations is desirable or possible. First, the 
hypothetical wireless base stations are placed even within the contours 
of television stations--a situation that will not occur in reality. 
Therefore, aggregating the interference from those hypothetical base 
stations would not provide any meaningful information and would not 
improve the accuracy of the ISIX Methodology. The Commission also 
observes that in order to manage interference within their systems, 
wireless providers may not operate on a given frequency block 
simultaneously at all of their cell sites. Thus, aggregating signals 
from all of the hypothetical base stations would not improve the 
estimates of impairments, would tend to produce a ``worst case'' 
scenario, and overestimate potential interference. Moreover, the 
patterns of frequency use that would be optimal for wireless providers 
are not clear because they would vary with terrain and other 
considerations. As a result, it would not improve the accuracy of the 
impairment estimates to assume a standard frequency re-use pattern for 
the ISIX methodology. The Commission also notes that aggregating the 
signal strengths from each hypothetical wireless base station within 
the 500 kilometer culling distances of a co-channel or adjacent channel 
television station could result in impairing all, or nearly all, of the 
locations considered. That is because locations whose own contributions 
to interference would be below the D/U threshold could be considered 
sources of interference when interference is aggregated with other 
hypothetical base stations. Also it might

[[Page 76911]]

be more useful for wireless providers to have impairment information 
based on the individual wireless base station. Finally, the plan to 
consider a whole county impaired if even one of the hypothetical ten-
by-ten kilometer cells located in that county is predicted to cause 
interference will provide a conservative approach in establishing 
impairments that should address Joint Broadcasters' concerns. 
Therefore, because the RSS method would not improve the accuracy of the 
estimates of interference potential during the auction, it will not be 
used when determining impairments to the wireless licenses during the 
auction.

Wireless User Equipment to Digital Television Receiver (Case 4)

    47. The Commission adopted fixed geographic separation distances 
for Case 4. Specifically, wireless user equipment (i.e. mobile and 
portable devices) will be prohibited from co-channel or adjacent-
channel operations within a television station's contour and within a 
set distance from the station's contour. The Commission determined that 
the appropriate distance is five kilometers for co-channel operations, 
and one-half kilometer for adjacent-channel operations.
    48. The Commission finds that a simple, fixed-distance approach is 
warranted for Case 4 because it involves short distances only. Wireless 
user equipment transmits at relatively low power and its location is 
usually closely bound to the vicinity of its associated base station. 
In addition, outdoor operation of wireless user equipment usually 
involves heights above ground on the order of 1.5 meters, resulting in 
significant attenuation of signals by ground clutter. Wireless user 
equipment operating in buildings may be significantly higher than 1.5 
meters, but signals are significantly attenuated by walls indoors. As a 
result of these factors, the potential for wireless user equipment to 
cause harmful interference to television service operating co-channel 
or adjacent channel occurs only at short distances of a few kilometers. 
At these distances, the number of grid cells in a television station's 
coverage area that could be affected by wireless user equipment is 
limited to a few cells in the interference range of the devices rather 
than all of the cells in the station's coverage area. In addition, the 
Longley-Rice Model is not designed for distances less than a kilometer 
and relies on either free-space or line-of-sight predictions for such 
distances. The Commission also observed that use of site-by-site 
Longley-Rice evaluations for Case 4 would necessitate the development 
of complex and detailed maps of locations where user equipment can 
operate.
    49. In view of these considerations, the Commission finds that a 
separation distance approach can adequately protect that station's 
service. Such an approach is also more administratively efficient for 
wireless service licensees because it will avoid the need for 
computerized evaluations required by the Longley-Rice model and maps of 
locations where wireless user equipment may operate. Instead, wireless 
providers will be able to design their networks to avoid operation of 
wireless end user equipment within the contour of television station 
and within the specified separation distances. For these reasons, the 
Commission concludes that applying the Longley-Rice propagation model 
is not warranted for Case 4, because it would increase the ISIX 
Methodology's complexity without resulting in more accurate 
interference predictions. The Commission therefore will use a 
straightforward distance separation approach for Case 4. As described 
in the Technical Appendix of the Second Report and Order, the 
Commission finds that the appropriate model for the short distances 
associated with Case 4 is the OET TM91-1 propagation model. Using this 
model the Commission calculated that broadcast television service will 
be protected from interference from wireless user equipment if such 
devices are not permitted to operate within the contours of the 
television station and within five kilometers if co-channel or a half 
kilometer if operating on the adjacent channel.

The Spectrum Act Does Not Preclude Use of the ISIX Methodology and 
Input Values To Predict or Prevent Inter-Service Interference

    50. The Commission rejects the Joint Broadcasters' claim that 
section 6403(b)(2) of the Spectrum Act limits its authority to adopt 
the ISIX Methodology and input values to address inter-service 
interference. Section 6403(b)(2) requires the Commission, in ``making 
any reassignments or reallocations,'' to ``make all reasonable efforts 
to preserve, as of [February 22, 2012], the coverage area and 
population served of each broadcast television licensee, as determined 
using the methodology described in OET Bulletin 69. . . .'' The Joint 
Broadcasters argue that the Commission's efforts ``to preserve'' 
broadcasters' coverage area and population served from inter-service 
interference will violate section 6403(b)(2) unless it used ``the 
methodology described in OET Bulletin 69. . . .''
    51. The Commission disagrees. As explained in the Incentive Auction 
R&O, the coverage area and population served of broadcasters, including 
any assigned to spectrum in the 600 MHz Band, must be ``determined'' 
using ``the methodology described in OET Bulletin 69,'' as required by 
section 6403(b)(2). The ISIX Methodology and input values the 
Commission adopted in this Order (for use during the auction) will not 
be used to ``determine[]'' coverage area and population served. Rather, 
they will be used ``to preserve'' the coverage area and population 
served that has already been ``determined'' through the methodology set 
forth in the Incentive Auction R&O. These efforts are not restricted by 
the statute's reference to ``the methodology described in OET Bulletin 
69.

Procedural Matters

Final Regulatory Flexibility Analysis

    52. As required by Sec.  603 of the Regulatory Flexibility Act of 
1980 (RFA), 5 U.S.C. 603, the Commission has prepared a Final 
Regulatory Flexibility Analysis of the possible economic impact on 
small entities of the policies and rules adopted in the Second Report 
and Order. This Final Regulatory Flexibility Analysis is set forth in 
Appendix F of the Second Report and Order.
    53. The Second Report and Order contains modified information 
collection requirements subject to the Paperwork Reduction Act of 1995 
(PRA), Public Law 104-13. It will be submitted to the Office of 
Management and Budget (OMB) for review under section 3507(d) of the 
PRA. OMB, the general public, and other federal agencies are invited to 
comment on the modified information collection requirements contained 
in this proceeding. In addition, pursuant to the Small Business 
Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 
3506(c)(4), we previously sought specific comment on how the Commission 
might further reduce the information collection burden for small 
business concerns with fewer than 25 employees.
    54. The Commission has assessed the effects of the policies adopted 
in the Second Report and Order with regard to information collection 
burdens on small business concerns, and find that these policies will 
benefit companies with fewer than 25 employees by providing them with a 
safeguard in the unlikely event of aggregate new interference in excess 
of one percent. In addition, we

[[Page 76912]]

have described impacts that might affect small businesses, which 
includes most businesses with fewer than 25 employees, in the FRFA 
attached to the Second Report and Order as Appendix F.

Final Regulatory Flexibility Analysis

    55. 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 (NPRM) in ET Docket 
No. 12-268.\2\ The Commission sought written public comment on the 
proposals in the NPRM, including comment on the IRFA.\3\ This present 
Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.\4\
---------------------------------------------------------------------------

    \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), Public Law 104-121, Title II, 110 Stat. 857 (1996), 
and the Small Business Jobs Act of 2010, Public Law 111-240, 124 
Stat. 2504 (2010).
    \2\ See Expanding the Economic and Innovation Opportunities of 
Spectrum through Incentive Auctions, GN Docket No. 12-268, Notice of 
Proposed Rulemaking, 27 FCC Rcd 12357 (2012).
    \3\ Additional comment on the specific proposals addressed in 
the Second Report & Order was sought with the issuance of three 
separate Public Notices. See Incentive Auction Task Forces Releases 
Updated Constraint File Data Using Actual Channels and Staff 
Analysis Regarding Pairwise Approach to Preserving Population 
Served, GN Docket No. 12-268, ET Docket No. 13-26, Public Notice, 29 
FCC Rcd 5687 (2014). See also Office of Engineering and Technology 
Seeks to Supplement the Incentive Auction Proceeding record 
Regarding Potential Interference Between Broadcast Television and 
Wireless Services, GN Docket No. 12-268, ET Docket No. 14-14, Public 
Notice, 29 FCC Rcd 712 (2014); Office of Engineering and Technology 
Seeks Comment on Measurements of LTE into DTV Interference, Public 
Notice, GN Docket No. 12-268, ET Docket No. 14-14, DA 14-852 (2014).
    \4\ See 5 U.S.C. 604.
---------------------------------------------------------------------------

Need for, and Objective of, the Second Report and Order

    56. In the Second Report and Order, the Commission addresses 
several outstanding issues related to the Incentive Auction R&O.\5\ 
First, we address and reject proposals for additional limits on any new 
interference between television stations as result of the repacking 
process.\6\ Second, we establish a methodology and the associated input 
values to predict inter-service interference between television and 
wireless services in certain areas for use during the incentive auction 
(ISIX Methodology).\7\
---------------------------------------------------------------------------

    \5\ See Expanding the Economic and Innovation Opportunities of 
Spectrum Through Incentive Auctions, GN Docket No. 12-268, Report 
and Order, 29 FCC Rcd 6567 (2014) (Incentive Auction R&O).
    \6\ See id. at 6651, para. 182. The Commission adopted a 0.5 
percent ``pairwise'' or station-to-station limit on any new 
interference as a result of the repacking process in the Incentive 
Auction R&O. See id. at 6649-51, paras. 179-81.
    \7\ See id. at 6605-6, paras. 82-84. The Commission will address 
the specific uses to be made of the interference predictions in the 
forthcoming Comment PN on final auction procedures. See note 79, 
para. 23 of the Second Report and Order.
---------------------------------------------------------------------------

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

    57. No comments were filed in direct response to the IRFA.

Response to Comments by the Chief Counsel for Advocacy of the Small 
Business Administration

    58. Pursuant to the Small Business Jobs Act of 2010, the Commission 
is required to respond to any comments filed by the Chief Counsel for 
Advocacy of the Small Business Administration (SBA), and to provide a 
detailed statement of any change made to the proposed rules as a result 
of those comments. The Chief Counsel did not file any comments in 
response to the proposed rules in this proceeding.

Description and Estimate of the Number of Small Entities to Which the 
Rules Will Apply

    59. The RFA directs agencies to provide a description of and, where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted.\8\ The RFA generally 
defines the term ``small entity'' as having the same meaning as the 
terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' 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 
SBA.\10\
---------------------------------------------------------------------------

    \8\ Id. at 603(b)(3).
    \9\ 5 U.S.C. 601(3) (incorporating by reference the definition 
of ``small business concern'' in 15 U.S.C. 632). Pursuant to the 
RFA, the statutory definition of a small business applies ``unless 
an agency, after consultation with the Office of Advocacy of the 
Small Business Administration and after opportunity for public 
comment, establishes one or more definitions of such term which are 
appropriate to the activities of the agency and publishes such 
definition(s) in the Federal Register.'' 5 U.S.C. 601(3).
    \10\ Small Business Act, 15 U.S.C. 632 (1996).
---------------------------------------------------------------------------

    60. Television Broadcasting. This economic census category 
``comprises establishments primarily engaged in broadcasting images 
together with sound. These establishments operate television 
broadcasting studios and facilities for the programming and 
transmission of programs to the public.''\11\ The SBA has created the 
following small business size standard for Television Broadcasting 
firms: Those having $38.5 million or less in annual receipts.\12\ The 
Commission has estimated the number of licensed commercial television 
stations to be 1,388.\13\ In addition, according to Commission staff 
review of the BIA Advisory Services, LLC's Media Access Pro Television 
Database on March 28, 2012, about 950 of an estimated 1,300 commercial 
television stations (or approximately 73 percent) had revenues of $38.5 
million or less.\14\ We therefore estimate that the majority of 
commercial television broadcasters are small entities.
---------------------------------------------------------------------------

    \11\ U.S. Census Bureau, 2012 NAICS Definitions: 515120 
Television Broadcasting, http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=515120&search=2012 (last visited Mar. 6, 2014).
    \12\ 13 CFR 121.201 (NAICS code 515120) (updated for inflation 
in 2010).
    \13\ See FCC News Release, Broadcast Station Totals as of 
December 31, 2013 (rel. Jan. 8, 2014), http://transition.fcc.gov/Daily_Releases/Daily_Business/2014/db0108/DOC-325039A1.pdf.
    \14\ We recognize that BIA's estimate differs slightly from the 
FCC total given the information provided above.
---------------------------------------------------------------------------

    61. We note, however, that in assessing whether a business concern 
qualifies as small under the above definition, business (control) 
affiliations must be included.\15\ Our estimate, therefore, likely 
overstates the number of small entities that might be affected by our 
action because the revenue figure on which it is based does not include 
or aggregate revenues from affiliated companies. In addition, an 
element of the definition of ``small business'' is that the entity not 
be dominant in its field of operation. We are unable at this time to 
define or quantify the criteria that would establish whether a specific 
television station is dominant in its field of operation. Accordingly, 
the estimate of small businesses to which rules may apply does not 
exclude any television station from the definition of a small business 
on this basis and is therefore possibly over-inclusive to that extent.
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    \15\ ``[Business concerns] are affiliates of each other when one 
concern controls or has the power to control the other, or a third 
party or parties controls or has the power to control both.'' 13 CFR 
121.103(a)(1).
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    62. In addition, the Commission has estimated the number of 
licensed noncommercial educational (``NCE'') television stations to be 
396.\16\ These stations are non-profit, and therefore considered to be 
small entities.\17\
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    \16\ See FCC News Release, Broadcast Station Totals as of 
December 31, 2013 (rel. Jan. 8, 2014), http://transition.fcc.gov/Daily_Releases/Daily_Business/2014/db0108/DOC-325039A1.pdf.
    \17\ See generally 5 U.S.C. 601(4), (6).
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    63. There are also 2,414 LPTV stations, including Class A stations, 
and 4,046 TV translator stations.\18\ Given the

[[Page 76913]]

nature of these services, we will presume that all of these entities 
qualify as small entities under the above SBA small business size 
standard.
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    \18\ See FCC News Release, Broadcast Station Totals as of 
December 31, 2013 (rel. January 8, 2014), http://transition.fcc.gov/Daily_Releases/Daily_Business/2014/db0108/DOC-325039A1.pdf.
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    64. Radio and Television Broadcasting and Wireless Communications 
Equipment Manufacturing. The Census Bureau defines this category as 
follows: ``This industry comprises establishments primarily engaged in 
manufacturing radio and television broadcast and wireless 
communications equipment. Examples of products made by these 
establishments are: transmitting and receiving antennas, cable 
television equipment, GPS equipment, pagers, cellular phones, mobile 
communications equipment, and radio and television studio and 
broadcasting equipment.'' The SBA has developed a small business size 
standard for Radio and Television Broadcasting and Wireless 
Communications Equipment Manufacturing, which is: all such firms having 
750 or fewer employees. According to Census Bureau data for 2007, there 
were a total of 939 establishments in this category that operated for 
part or all of the entire year. Of this total, 912 had less than 500 
employees and 17 had more than 1000 employees. Thus, under that size 
standard, the majority of firms can be considered small.
    65. Audio and Video Equipment Manufacturing. The SBA has classified 
the manufacturing of audio and video equipment under in NAICS Codes 
classification scheme as an industry in which a manufacturer is small 
if it has less than 750 employees. Data contained in the 2007 U.S. 
Census indicate that 492 establishments operated in that industry for 
all or part of that year. In that year, 488 establishments had fewer 
than 500 employees; and only 1 had more than 1000 employees. Thus, 
under the applicable size standard, a majority of manufacturers of 
audio and video equipment may be considered small.
    66. Wireless Telecommunications Carriers (except satellite). The 
Census Bureau defines this category as follows: ``This industry 
comprises establishments engaged in operating and maintaining switching 
and transmission facilities to provide communications via the airwaves. 
Establishments in this industry have spectrum licenses and provide 
services using that spectrum, such as cellular phone services, paging 
services, wireless Internet access, and wireless video services.'' \19\ 
The appropriate size standard under SBA rules is for the category 
Wireless Telecommunications Carriers (except Satellite). The size 
standard for that category is that a business is small if it has 1,500 
or fewer employees.\20\ For this category, census data for 2007 show 
that there were 1,383 firms that operated for the entire year.\21\ Of 
this total, 1,368 firms had employment of 999 or fewer employees and 15 
had employment of 1000 employees or more.\22\ Similarly, according to 
Commission data, 413 carriers reported that they were engaged in the 
provision of wireless telephony, including cellular service, PCS, and 
Specialized Mobile Radio (``SMR'') Telephony services.\23\ Of these, an 
estimated 261 have 1,500 or fewer employees and 152 have more than 
1,500 employees.\24\ Consequently, the Commission estimates that 
approximately half or more of these firms can be considered small. 
Thus, using available data, we estimate that the majority of wireless 
firms can be considered small.
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    \19\ U.S. Census Bureau, 2012 NAICS Definitions: 517210 Wireless 
Telecommunications Carriers (except Satellite), http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517210&search=2012 
(last visited Mar. 6, 2014).
    \20\ 13 CFR 121.201 (NAICS code 517210).
    \21\ U.S. Census Bureau, Table No. EC0751SSSZ5, Information: 
Subject Series--Establishment and Firm Size: Employment Size of 
Firms for the United States: 2007 (NAICS code 517210), http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5.
    \22\ Id. Available 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 for firms with 
1000 employees or more.
    \23\ See Trends in Telephone Service at Table 5.3.
    \24\ See id.
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Description of Projected Reporting, Recordkeeping, and Other Compliance 
Requirements for Small Entities

    67. The Second Report and Order provides that, if a full power or 
Class A station is predicted to receive aggregate new interference 
above one percent on the final channel assigned to it following the 
repacking process, it may file an application proposing an alternate 
channel or expanded facilities in a priority filing window, along with 
a limited number of other stations that have been assigned the same 
priority. This opportunity will be available to any station entitled to 
protection in the repacking process that is predicted to experience 
aggregate new interference in excess of one percent, regardless of 
whether that station was reassigned to a new channel in the repacking 
process.

Steps Taken To Minimize Significant Economic Impact on Small Entities, 
and Significant Alternatives Considered

    68. 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 (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 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.\25\
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    \25\ 5 U.S.C. 603(c).
---------------------------------------------------------------------------

    69. The Commission believes that applying the same rules equally to 
all entities in this context promotes fairness. The Commission does not 
believe that the costs and/or administrative burdens associated with 
the rules will unduly burden small entities. Moreover, the revisions 
the Commission adopts should benefit small entities by providing them 
with a safeguard in the event of aggregate new interference above one 
percent.

Report to Congress

    70. The Commission will send a copy of the Second Report and Order, 
including this FRFA, in a report to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act.\26\ In 
addition, the Commission will send a copy of the Second Report and 
Order, including this FRFA, to the Chief Counsel for Advocacy of the 
SBA.
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    \26\ See 5 U.S.C. 801(a)(1)(A).
---------------------------------------------------------------------------

    71. The Commission will send a copy of the Second Report and Order 
to Congress and the Government Accountability Office pursuant to the 
Congressional Review Act.
    72. Pursuant to the authority found in sections 1, 4, 301, 303, 
307, 308, 309, 310, 316, 319, 332, and 403 of the Communications Act of 
1934, as amended, and sections 6004, 6402, 6403, 6404, and 6407 of 
Middle Class Tax Relief and Job Creation Act of 2012, Public Law 112-
96, 126 Stat. 156, 47 U.S.C. 151, 154, 301, 303, 307, 308, 309, 310, 
316, 319, 332, 403, 1404, 1452, and 1454, and Sec.  1.2 of the 
Commission's rules, 47 CFR 1.2, the Second Report and Order, is 
adopted. It is further ordered that the Commission's rules are hereby 
amended as set forth in Appendix B of the Second Report and Order.

[[Page 76914]]

    73. The rules adopted herein will become effective January 22, 
2015, except for Sec. Sec.  73.3700(b)(1)(iv)(B), 73.3700(b)(2)(i) 
introductory text, and 73.3700(b)(2)(ii) of the rules which contain new 
or modified information collection requirements subject to the 
Paperwork Reduction Act of 1995, Public Law 104-13, that are not 
effective until approved by the Office of Management and Budget (OMB). 
The Federal Communications Commission will publish a document in the 
Federal Register announcing OMB approval and the effective date of this 
rule.
    74. The Commission's Consumer and Governmental Affairs Bureau, 
Reference Information Center, shall send a copy of this Second Report 
and Order in GN Docket No. 12-268, including the Final Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration.
    75. The Commission shall send a copy of this Second Report and 
Order in GN Docket No. 12-268 in a report to be sent to Congress and 
the Government Accountability Office pursuant to the Congressional 
Review Act, see 5 U.S.C. 801(a)(1)(A).

List of Subjects in 47 CFR Part 73

    Communications equipment, Education, Reporting and recordkeeping 
requirements.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Final Rules
    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR part 73 as follows:

PART 73--RADIO BROADCAST SERVICES

0
1. The authority citation for part 73 continues to read as follows:

    Authority: 47 U.S.C. 154, 303, 334, 336, and 339.


0
2. Section 73.3700 is amended by revising paragraphs (b)(1)(iv), 
(b)(2)(i) introductory text, and (b)(2)(ii) to read as follows:


Sec.  73.3700  Post-incentive auction licensing and operation.

* * * * *
    (b) * * *
    (1) * * *
    (iv) Priority filing window. (A) The licensee of a reassigned 
station, a UHF-to-VHF station, or a High-VHF-to-Low-VHF station that, 
for reasons beyond its control, is unable to construct facilities that 
meet the technical parameters specified in the Channel Reassignment 
Public Notice, or the permissible contour coverage variance from those 
technical parameters specified in paragraph (b)(1)(ii) or (iii) of this 
section, may request a waiver of the construction permit application 
deadline specified in paragraph (b)(1)(i) no later than 30 days prior 
to the deadline. If its waiver request is granted, the licensee will be 
afforded an opportunity to submit an application for a construction 
permit pursuant to paragraph (b)(2)(i) or (ii) of this section in a 
priority filing window to be announced by the Media Bureau by public 
notice.
    (B) The licensee of any broadcast television station that the 
Commission makes all reasonable efforts to preserve pursuant to section 
6403(b)(2) of the Spectrum Act that is predicted to experience 
aggregate new interference to population served in excess of one 
percent as a result of the repacking process will be afforded an 
opportunity to submit an application for a construction permit pursuant 
to paragraph (b)(2)(i) or (ii) of this section in the priority filing 
window required by paragraph (b)(1)(iv)(A).
* * * * *
    (2) * * *
    (i) Alternate channels. The licensee of a reassigned station, a 
UHF-to-VHF station, a High-VHF-to-Low-VHF station, or a broadcast 
television station described in paragraph (b)(1)(iv)(B) of this section 
will be permitted to file a major change application for a construction 
permit for an alternate channel on FCC Form 301, 301-CA, or 340 during 
a filing window to be announced by the Media Bureau by public notice, 
provided that:
* * * * *
    (ii) Expanded facilities. The licensee of a reassigned station, a 
UHF-to-VHF station, a High-VHF-to-Low-VHF station, or a broadcast 
television station described in paragraph (b)(1)(iv)(B) of this section 
will be permitted to file a minor change application for a construction 
permit on FCC Form 301, 301-CA, or 340 during a filing window to be 
announced by the Media Bureau by public notice, in order to request a 
change in the technical parameters specified in the Channel 
Reassignment Public Notice (or, in the case of a broadcast television 
station described in paragraph (b)(1)(iv)(B) that is not reassigned to 
a new channel, a change in its authorized technical parameters) with 
respect to height above average terrain (HAAT), effective radiated 
power (ERP), or transmitter location that would be considered a minor 
change under Sec. Sec.  73.3572(a)(1),(2) or 74.787(b) of this chapter.
* * * * *
[FR Doc. 2014-29687 Filed 12-22-14; 8:45 am]
BILLING CODE 6712-01-P


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