Washington

AT&T Accuses DOJ of Advising FCC to Rig Spectrum Auctions

Says picking spectrum winners and losers would be "patently unlawful" 4/26/2013 03:13:56 PM Eastern

AT&T's top attorney told the FCC this week to reject a
recommendation by the Department of Justice's new antitrust chief
that the
FCC adjust its spectrum screen to account for holdings of different kinds of
spectrum -- lower band being more attractive for wireless.

"The Department suggests that the Commission should
consider rules that would rig the upcoming 600 MHz incentive auction to
"ensure" that the "two smaller nationwide networks" i.e., Sprint and T-Mobile, can
win much of the spectrum," wrote Wayne Watts, AT&T senior executive VP
and general counsel, said in a letter to the chairman and commissioners dated
April 24, according to a copy of the letter posted on the FCC website.

The FCC voted last September to review its spectrum screen,
which potentially limits -- it triggers additional scrutiny -- the amount of
mobile wireless spectrum any one company can own in a market. Any change could
affect the ability of some companies to bid in the upcoming incentive auctions.
The FCC will use the proceeds to help compensate broadcaster who agree to give
up spectrum and pay moving expenses for those who remain behind. Limiting the
bidders could affect the final tally, a point made by AT&T and some House
Republicans.

Justice told the FCC last week that it had concluded that
"rules that ensure the smaller nationwide networks, which currently lack
substantial low-frequency spectrum, have an opportunity to acquire such
spectrum could improve the competitive dynamic among nationwide carriers and
benefit consumers."

The screen is a way to trigger further FCC scrutiny of a
spectrum acquisition based on concentration of spectrum in individual markets.
DOJ is primarily concerned that large carriers not be able to foreclose
competition by concentrating spectrum, including to deny it to competitors
(hoarding).

While FCC chairman Julius Genachowski said it was a needed
review, there was major pushback from Republican commissioners, concerned that
any tightening of that screen or capping of holdings or move away from the
current case-by-case determination could negatively affect participation in the
broadcast spectrum incentive auction.

AT&T definitely agrees. Watts said Sprint and T-Mobile
could participate if they wanted to, given their deep-pocketed parents. He
called "nonsense" any suggestion that AT&T or Verizon would use
hoarding as a weapon against Sprint and T-Mobile.

AT&T accused DOJ of "paper-thin" analysis and
on basing its recommendation on unsubstantiated and unrealistic
"musings."

A DOJ spokesperson had not returned a request
for comment at presstime.

 

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