FCC Proposes Rules for D Block

FCC drops most items from agenda of Sept. 25 public meeting, outlines new rules for auction of D block of 700-megahertz spectrum.
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As advertised, the Federal Communications Commission Thursday took the next step in trying to create an interoperable communications network.

In its public meeting, the commission put out for comment draft rules for the reauction of the D-block of spectrum that is being reclaimed from broadcasters in the switch to digital.

The FCC failed to auction it the first time around when the minimum bid was not met.

That bid has been lowered from north of $1 billion to $750 million and some of the rules relaxed to make the spectrum more attractive. FCC chairman Kevin Martin has said that a public-private partnership is the only way for the FCC to get the network funded given that Congress did not appropriate funds to build it.

FCC Democrats Michael Copps and Jonathan Adelstein criticized various elements of the proposal. Adelstein, for example, said he could not support the $750 million floor price, suggesting that in the current economic climate, that figure might be too steep, as well. He called some of the proposals "less than cogent."

Copps said his purpose was not to delay, but he believed a more pressing goal than doing it quickly was doing it right. But he also gave Martin a shout-out for trying to get the network built. "I applaud chairman Martin for putting public safety front and center," he said. "It was a long time coming, but he was the one who did it."

Republican Robert McDowell conceded that the item was imperfect but also said the framework attempt was to move the process forward and he was not going to engage in "analysis paralysis." He added that in a better world. Congress would have appropriated the funds for the network.

Martin pointed out that the FCC did not adopt a final order, but instead provided guidance to bidders so that they could better understand what their obligations would be. He added that the rules, which he outlined earlier this month, strike a balance between the needs of the public and the commercial viability of the network.

Martin said he hoped for a vote on a final order by the end of the year. An FCC spokesman said the details of the proposal could be released as soon as close of business Thursday.

According to Martin, the FCC will try to auction the spectrum as a block, but also offer it as 58 regional licenses. If a single bidder meets the $750 million reserve price -- about one-half of the D-block reserve in the first auction -- it will have a preference over an amalgam of regional bidders unless all of those licenses are awarded.

If no national bidder emerges, the spectrum will only be doled out if at least 50% of the regional licenses have met their minimum prices. At that point, the minimums for the other 50% will be lowered to try to spur bidding.

The FCC also relaxed the build-out requirements and extended the build-out period from 10 years to 15.

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