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Daily Rules, Proposed Rules, and Notices of the Federal Government

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 27 and 90

[WT Docket No. 06-150; PS Docket No. 06-229; FCC 08-230]

Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band

AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
SUMMARY: In this document, the Commission seeks comment on its tentative conclusions and proposals on how the Commission might modify its rules governing the public/private partnership, the D Block licensee, and the public safety broadband licensee. This Third Further Notice of Proposed Rulemaking (Third FNPRM) seeks comment on its tentative conclusion that it should continue to mandate a public/private partnership between the D block licensee and the public safety broadband licensee on a number of proposals and tentative conclusions regarding the terms and conditions for the partnership.
DATES: Written comments are due on or before November 3, 2008, and reply comments are due on or before November 12, 2008.
ADDRESSES: *Federal eRulemaking Portal: http://www.regulations.gov.Follow the instructions for submitting comments.

*Federal Communications Commission's Web site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.

*Mail:Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (although the Commission continues to experience delays in receiving U.S. Postal Service mail). All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission.

*People with Disabilities:Contact the Commission to request reasonable accommodations (accessible format documents, sign language interpreters, CART, etc.) by e-mail:FCC504@fcc.govor phone: 202-418-0530 or TTY: 202-418-0432.

For detailed instructions for submitting comments and additional information on the rulemaking process, see theSUPPLEMENTARY INFORMATIONsection of this document.

FOR FURTHER INFORMATION CONTACT: Peter Trachtenberg at (202) 418-7369, atpeter.trachtenberg@fcc.gov, Spectrum and Competition Policy Division, Wireless Telecommunications Bureau; Jeffrey S. Cohen at (202) 418-0799,jeff.cohen@fcc.gov, Public Safety and Homeland Security Bureau.
SUPPLEMENTARY INFORMATION:

This is a summary of the Commission'sThird FNPRM, WT Docket No. 06-150, PS Docket No. 06-229, adopted on September 25, 2008 and released September 25, 2008. The full text of theThird FNPRMis available for public inspection and copying during business hours in the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. It also may be purchased from the Commission's duplicating contractor at Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554; the contractor's Web site,http://www.bcpiweb.com; or by calling (800) 378-3160, facsimile (202) 488-5563, or e-mailFCC@BCPIWEB.com. Copies of the public notice also may be obtained via the Commission's Electronic Comment Filing System (ECFS) by entering the docket numbers, WT Docket No. 06-150 and PS Docket No. 06-229. Additionally, the complete item is available on the Federal Communications Commission's Web site athttp://www.fcc.gov.

Synopsis

In theSecond Report and Order,72 FR 48814, August 24, 2007, the Commission adopted rules for the establishment of a mandatory public/private partnership (the 700 MHz Public/Private Partnership) in the upper portions of the 698-806 MHz band (700 MHz Band) as the means for promoting the rapid construction and deployment of a nationwide, interoperable broadband public safety network that would serve public safety and homeland security needs. Specifically, the Commission required that the winning bidder of the commercial license in the Upper 700 MHz D Block (758-763/788-793 MHz) (D Block) enter into the 700 MHz Public/Private Partnership with the nationwide licensee of the public safety broadband spectrum (763-768/793-798 MHz) (Public Safety Broadband Licensee) to enable construction of this interoperable broadband network, which would span both the commercial D Block and public safety spectrum. In the recently concluded auction of commercial 700 MHz licenses, bidding for the D Block license did not meet the applicable reserve price of $1.33 billion and, pursuant to the Commission's rules, there was no winning bid for that license. In theSecond Further Notice of Proposed Rulemaking,22 FCC Rcd 8047 (2008) (Second FNPRM), the Commission revisited its decisions concerning the 700 MHz Public/Private Partnership, including revisions to this partnership as well as alternative rules the Commission should adopt in the event the D Block licensee is no longer required to enter into a mandatory public/private partnership.

In theThird FNPRM,the Commission seeks comment on the tentative conclusions and proposals presented in thisThird FNPRM,and on whether these proposals will lead to a successful auction and, more importantly, a successful partnership or partnerships that will fulfill the Commission's goal of making interoperable broadband wireless service available to public safety entities across the nation. The Commission tentatively concludes that it should continue to require that the D Block licensee enter into a public/private partnership with the Public Safety Broadband Licensee, and proposes to use competitive bidding to resolve two critical issues: (1) The appropriate geographic license area for the D Block, and (2) the need for a common broadband technology platform nationwide. The Commission also proposes significant clarifications and revisions of the parties' obligations regarding the construction and operation of the shared wireless broadband network as well as modifications to certain rules governing the establishment of the Network Sharing Agreement and the licensing of the D Block following bidding for D Block licenses. The Commission also addresses certain additional issues related to the auction process and the rules governing public safety users and the Public Safety Broadband Licensee, including narrowband relocation issues. ThisThird FNPRMis another step in the Commission's ongoing efforts to develop a regulatory framework that will address current and future public safety communications needs.

Discussion I. Introduction

1. In this Third Further Notice of Proposed Rulemaking (Third FNPRM), the Commission takes the next step toward achieving the goal of a nationwide interoperable broadband wireless network for public safety entities. The Commission previously sought to achieve this goal through an innovative public/private partnership,which required the winning bidder of the commercial license in the Upper 700 MHz D Block (758-763/788-793 MHz) (D Block) to partner with the nationwide licensee of the public safety broadband spectrum (763-768/793-798 MHz) (Public Safety Broadband Licensee or PSBL) to enable construction of an interoperable broadband network that would serve both commercial and public safety users.1 Because the auction of the D Block did not result in a winning bid, the Commission issued theSecond FNPRMrevisiting the rules governing the mandatory public/private partnership, the D Block licensee, and the Public Safety Broadband Licensee, seeking comment broadly on how the Commission might modify those rules to achieve the Commission goals, whether the Commission should continue to mandate a public/private partnership between the D Block licensee and Public Safety Broadband Licensee, and if so, under what terms and conditions.2 The Commission further indicated that, prior to adopting final rules, the Commission would present for public comment a detailed proposal regarding specific proposed rules to address these issues.3 In this Third FNPRM, the Commission now offers and seeks comment on the following proposals and tentative conclusions.

1 SeeService Rules for the 698-746, 747-762 and 777-792 MHz Bands, WT Docket No. 06-150, Revision of the Commission's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Systems, CC Docket No. 94-102, Section 68.4(a) of the Commission's Rules Governing Hearing Aid-Compatible Telephones, WT Docket No. 01-309, Biennial Regulatory Review—Amendment of Parts 1, 22, 24, 27, and 90 to Streamline and Harmonize Various Rules Affecting Wireless Radio Services, WT Docket 03-264, Former Nextel Communications, Inc. Upper 700 MHz Guard Band Licenses and Revisions to Part 27 of the Commission's Rules, WT Docket No. 06-169, Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, PS Docket No. 06-229, Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, WT Docket No. 96-86, Declaratory Ruling on Reporting Requirement under Commission's Part 1 Anti-Collusion Rule, WT Docket No. 07-166,Second Report and Order,22 FCC Rcd 15289 (2007) (Second Report and Order)recon. pending.

2 SeeService Rules for the 698-746, 747-762 and 777-792 Bands; Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, WT Docket No. 06-150, PS Docket No. 06-229, 22 FCC Rcd 8047 (2008) (Second FNPRM).

3 See id.at 8052 para. 7.

2. As an initial matter, the Commission tentatively concludes that it should continue to require, as a license condition, that the D Block licensee enter into a public/private partnership with the Public Safety Broadband Licensee for the purpose of constructing a wireless broadband network that will operate over both D Block spectrum and public safety broadband spectrum and provide broadband services to both commercial users and public safety entities (shared wireless broadband network).4 The Commission finds that a public/private partnership condition on the D Block remains the best option to achieve nationwide build-out of an interoperable broadband network for public safety entities, given the current absence of legislative appropriations for this purpose and the limited funding available to the public safety sector. The Commission also proposes to retain those current rules that will support this relationship. For example, the Commission proposes to continue requiring the parties to enter into a Network Sharing Agreement (NSA), and to make the NSA a condition of the grant of the D Block license(s). The Commission also proposes, however, to clarify and revise the rules to clearly establish the obligations of the parties to the partnership with greater specificity and detail. These clarifications and revisions address whether the D Block will be licensed on a nationwide or regional basis, the obligations of the parties regarding the construction and operation of the shared wireless broadband network, the rules governing the process for establishing an NSA between the parties, certain auction issues, and issues related to public safety users and the Public Safety Broadband Licensee. The Commission anticipates that, by establishing the rules governing the public/private partnership in a more comprehensive and detailed fashion, the Commission will enhance the certainty of bidders regarding their potential obligations as D Block licensees, and facilitate the rapid and successful negotiation of NSAs as the Commission would be significantly reducing the scope of issues that need to be negotiated.5 Equally important, the Commission seeks in its proposals to meet the needs of the public safety community in a commercially viable manner. With these goals in mind, the Commission makes the following proposals.

4Under the Commission proposal, it is possible that there will be multiple regional D Block licenses or a single nationwide D Block license. Accordingly, references herein to “the” D Block license and licensee should be understood to incorporate reference to any of multiple D Block licenses or licensees, as appropriate. The Commission proposed rules should be interpreted in similar fashion.

5The Commission has appended an NSA term sheet, which provides a summary of major terms that the parties must include in their agreement(s).See, supra,Appendix D.

3. First, the Commission tentatively concludes that it should resolve two critical issues through the use of competitive bidding: (1) The appropriate geographic license area for the D Block, and (2) the need for a common broadband technology platform nationwide. The Commission tentatively concludes that it can resolve these issues through competitive bidding by offering alternative sets of D Block licenses with different license areas and broadband technology conditions. With regard to the appropriate geographic area, the Commission proposes to offer the D Block both as a single nationwide license and on a regional basis, using geographic areas that the Commission will refer to as Public Safety Regions (PSRs). PSRs would be comprised of fifty-five regions that mirror the geographic boundaries of the fifty-five 700 MHz Regional Planning Committee (RPC) regions, and three additional areas (for a total of 58 PSRs) to cover the whole country and match the geographic area of the nationwide license.6 With regard to the broadband technology platform, the Commission proposes to establish rules that will ensure that a single broadband air interface is used nationwide regardless of whether there is a single licensee or multiple regional licensees, to ensure that public safety users may communicate when they roam outside their home regions.

6The three additional regions will cover (1) the Gulf of Mexico; (2) the Territory of Guam (Guam) and the Commonwealth of Northern Mariana Islands (Northern Mariana Islands); and (3) the Territory of American Samoa (American Samoa), and will be identical to the current Economic Area (EA) licensing areas for those same regions.SeeAppendix A.

4. To resolve both of these issues, the Commission therefore proposes to offer simultaneously three alternative sets of licenses that vary by geographic license area and by conditions regarding the technology platform that must be used by the licensee(s). Specifically, under this proposal, the Commission would offer (1) a single license for service nationwide with the technology platform to be determined by the licensee; (2) a nationwide set of PSR licenses conditioned on the use of Long Term Evolution (LTE) by the licensees; and (3) a nationwide set of PSR licenses conditioned on the use of Worldwide Interoperability for Microwave Access (WiMAX) by the licensees. The Commission will then award the D Block license(s) in the set that receives bids on licenses covering the greatest aggregate population, subject to the requirement that the license(s) mustauthorize service in areas covering at least half of the nation's population. If more than one set of licenses meeting these requirements cover the same population, the Commission will award the D Block licenses in the set that receives the highest aggregate gross bid. The Commission also proposes to establish auction procedures that will encourage bidding on licenses covering as much population as possible, including procedures to reduce minimum opening bids on unsold regional licenses during bidding under circumstances the Commission specifically describes below. The Commission also tentatively concludes that package bidding on licenses in the regional sets would serve the public interest and that it should direct the Wireless Telecommunications Bureau to propose and implement detailed package bidding procedures prior to bidding. The Commission tentatively concludes that this method of assigning D Block licenses will be most likely to result in the successful development of a nationwide interoperable broadband network for public safety use, and provides a better means of addressing these issues than by specifying a single geographic licensing area or broadband technology in advance of competitive bidding. At the same time, it will provide all interested bidders with the necessary certainty at the time they make their bids of what conditions will be applicable to them should their bids be successful.

5. The Commission proposes significant clarifications and revisions of the parties' obligations regarding the construction and operation of the shared wireless broadband network. These clarifications and revisions address (1) the use of spectrum in the shared wireless broadband network, including requirements regarding public safety priority access to commercial capacity in emergencies; (2) the technical requirements of the shared wireless broadband network; (3) the performance requirements of the D Block licensee(s); and (4) the respective operational roles of the D Block licensee(s) and the Public Safety Broadband Licensee. With regard to spectrum use, the Commission first tentatively concludes that a D Block licensee may construct and operate its shared wireless broadband network using the entire 20 megahertz of D Block spectrum and public safety broadband spectrum as a combined, blended resource. Under this proposal, public safety users will still be guaranteed unconditionally preemptive access to 10 megahertz of capacity at all times, but the shared wireless broadband network may flexibly and dynamically assign frequencies from either the D Block or public safety spectrum to provide that capacity. Second, the Commission proposes to revise the rules governing public safety priority access to D Block spectrum capacity in emergencies. The Commission proposed revisions include: (1) Specifying in detail the circumstances that trigger public safety priority access to commercial spectrum capacity; (2) providing that, in this context, “priority access” means only that a public safety user would be assigned the next available channel within the commercial spectrum over a commercial user, and does not include a right to preempt any ongoing commercial calls being carried over commercial spectrum capacity; (3) limiting the additional capacity that must be provided to public safety users in emergencies to a specified percentage of the D Block spectrum capacity; (4) requiring that public safety priority access to D Block spectrum capacity be limited to the time and geographic scope affected by the emergency; and (5) specifying the procedures for requesting and obtaining such access. Third, the Commission tentatively concludes that the current rules for commercial access to public safety spectrum should remain the same subject to the Commission's clarification regarding blended use. Thus, the Commission proposes that commercial users will have secondary access to public safety's 10 megahertz of spectrum capacity subject to unconditional and immediate preemption when the spectrum capacity is needed by public safety users. Fourth, the Commission finds that the Commission tentative proposals regarding spectrum use are consistent with the requirements of Section 337 of the Communications Act, as amended.

6. With regard to the technical requirements of the network, in addition to the Commission's proposal regarding the broadband technology platform, it makes detailed proposals regarding (1) interoperability and public safety roaming; (2) availability, robustness, and hardening of the network; (3) capacity, throughput, and quality of service; (4) security and encryption; (5) power limits, power flux density limits, and related notification and coordination requirements; and (6) ensuring the availability of a satellite-capable handset.

7. With regard to the D Block license term and performance requirements, the Commission proposes to extend the license term to fifteen years and to adopt performance benchmarks applicable at the fourth, tenth, and fifteenth years following the license grant date. For the first two benchmarks, the Commission proposes to require D Block licensees to provide signal coverage and offer service to at least 40 percent of the population in each PSR by the end of the fourth year, and at least 75 percent by the end of the tenth year. For the final benchmark at the fifteenth year, the Commission proposes to adopt a “tiered” approach, applying one of three different population coverage requirements depending on the population density of the PSR: (1) For PSRs with an average population density of less than 100 people per square mile, the licensee would be required to provide signal coverage and offer service to at least 90 percent of the population within that PSR; (2) for PSRs with an average population density of at least 100 people per square mile and less than 500 people per square mile, the licensee would be required to provide signal coverage and offer service to at least 94 percent of the population within that PSR; and (3) for PSRs with an average population density of at least 500 people per square mile, the licensee would be required to provide signal coverage and offer service to at least 98 percent of the population within that PSR.

8. The Commission also proposes modifications to certain rules governing the establishment of the Network Sharing Agreement and the licensing of the D Block following bidding for D Block licenses, in order to increase the likelihood of successful, rapid deployment of the shared wireless broadband network. First, the Commission tentatively proposes that it shall be able to offer any D Block license to a second highest bidder in the event that the original winning bidder is not assigned the license, either due to a failure to enter into an NSA or for any reason. Second, the Commission tentatively concludes that a winning bidder for a D Block license that is otherwise qualified will be liable for default payments only if it chooses not to execute a Commission-approved NSA. Thus, an otherwise-qualified winning bidder for a D Block license will not be liable for default payments if the lack of a Commission-approved NSA results from any other party's failure to execute the agreement or a Commission determination that there is no acceptable resolution to a dispute regarding terms to be included in the agreement. Finally, given the Commission decision to offer alternative D Block licenses by auction, the Commission tentatively concludes that it should adopt a D Block-specific rule regarding the amount of additionalpayments owed by any defaulting bidder. The Commission proposes a rule equivalent to the Commission's standard rule with respect to non-package bidding auctions,i.e., that the Commission will provide that the additional payment will be between 3 and 20 percent of the applicable bid.

9. The Commission also addresses certain additional issues related to the auction process. In particular, in order to further facilitate applications from potentially qualified parties, the Commission tentatively concludes that it will not restrict the eligibility to bid of any party that may qualify to hold a D Block license and that no reserve price beyond the minimum opening bid(s) will apply. Furthermore, given the oversight that already applies to the D Block, the Commission will codify an existing exception to the Commission's designated entity eligibility rules with respect to the spectrum capacity of D Block licenses, so that a designated entity applicant or licensee with lease or resale (including wholesale) arrangement(s) for more than 50% of the spectrum capacity of any D Block license will not on that basis alone lose its eligibility for designated entity benefits.7

7Because this exception does not extend to arrangements for use of the spectrum capacity of licensesother thanthe D Block license, if an applicant or licensee has an impermissible material relationship with respect to the spectrum capacity of any other license(s), the normal operation of the Commission's rules will continue to render it ineligible for designated entity benefits for the D Block license.

10. The Commission also makes a number of tentative conclusions and proposals with regard to the rules governing public safety users and the Public Safety Broadband Licensee. The Commission tentatively concludes that eligible users of the public safety broadband spectrum capacity must be providers of “public safety services” as defined in the Act.8 The Commission also proposes to reaffirm the Commission prior decision to grant the Public Safety Broadband Licensee sole discretion regarding whether to permit Federal public safety agency use of the public safety broadband spectrum capacity. Further, the Commission tentatively concludes not to require eligible public safety users to subscribe to the shared broadband network.

8 See47 U.S.C. 337(f)(1).

11. With respect to the Public Safety Broadband Licensee, the Commission tentatively concludes that it should remain a non-profit entity, and proposes certain restrictions on its business relationships to avoid the potential for conflicts of interest. Specifically, the Commission proposes that an entity serving as an advisor, agent, or manager of the Public Safety Broadband Licensee will be ineligible to become a D Block licensee unless such entity completely severs its business relationship with the Public Safety Broadband Licensee no later than thirty days following release of an oder adopting final rules in this proceeding. Further, the Commission proposes to prohibit advisors, agents, or managers of the Public Safety Broadband Licensee from establishing business relationships with third party entities having a financial interest in the decisions of the Public Safety Broadband Licensee.

12. With respect to the mechanism of funding the Public Safety Broadband Licensee, the Commission tentatively concludes that the nationwide D Block licensee or, if the D Block is licensed on a regional basis, each regional D Block licensee, will make an annual payment to the Public Safety Broadband Licensee, which would constitute the sole allowable source of funding for the Public Safety Broadband Licensee's annual operating and administrative costs. The Commission further tentatively concludes that the Public Safety Broadband Licensee must establish an audited annual budgeting process, and must submit its proposed annual budget to the Commission for approval. The Commission also reserves the right to request an audit of the Public Safety Broadband Licensee's expenses at any time. The Commission further tentatively concludes that it should establish fixed nationwide service fees that the D Block licensee may charge to public safety users based on a discounted rate schedule.

13. The Commission proposes several changes to the Public Safety Broadband Licensee's articles of incorporation and by-laws. Specifically, the Commission proposes replacing the Public Safety Broadband Licensee board of directors position currently held by the National Emergency Management Association (NEMA) with the National Regional Planning Council (NRPC). The Commission also tentatively concludes that the positions of Chairman of the Board and Chief Executive Officer must be filled by separate individuals; that the Public Safety Spectrum Trust Corporation (PSST) may not hire a new individual to fill the CEO position until the D Block licensee(s) has made funding available to the PSST for its administrative and operational costs; and that any individual appointed as CEO cannot have served on the Public Safety Broadband Licensee executive committee during the period three years prior to his or her appointment as CEO. The Commission also tentatively concludes that the PSST board should elect a new executive committee with proposed new conditions on term limits, consecutive terms, and committee size. Further, the Commission tentatively concludes that it will require three-fourths supermajority voting on all major decisions by the board, that board meetings be open to the public (with some exceptions), that the minutes of each board meeting must be made publicly available (again with some exceptions), and several other conditions. The Commission tentatively declines to rescind the present PSST's license and reissue the license to a new licensee.

14. In relation to narrowband relocation issues, the Commission tentatively concludes that the Commission will extend the current February 17, 2009 deadline for completing such relocation twelve months from the date upon which narrowband relocation funding is made available by the D Block licensee(s). The Commission also proposes that the current $10 million cap on narrowband relocation costs should be increased to $27 million. The Commission also tentatively concludes that the existing August 30, 2007 cut-off date for narrowband deployments outside of the consolidated narrowband spectrum should not be changed, and propose conditions under which waiver relief may be granted for deployment of narrowband equipment beyond that date.

15. The Commission seeks comment on all of the tentative conclusions and proposals presented in this Third FNPRM, and on whether these proposals will lead to a successful auction and, more importantly, a successful partnership or partnerships that will fulfill the Commission's goal of making interoperable broadband wireless service available to public safety entities across the Nation.

II. Background

16. In this section, the Commission reviews the history of its efforts to establish a public/private partnership to address the need for nationwide interoperable public safety communications and to promote public safety access to advanced broadband communication systems and technologies. The Commission first describes the rules it promulgated in theSecond Report and Order,which established two nationwide 700 MHz licenses, the Public Safety Broadband License and the commercial D Block license, and required the licensees toenter into a public/private partnership for the purpose of constructing and operating a nationwide wireless broadband network meeting specified terms. The Commission reviews petitions for reconsideration of theSecond Report and Orderthat raised issues related to this proceeding. The Commission briefly discusses Auction 73, the auction of commercial 700 MHz licenses concluded earlier this year in which the Commission auctioned the D Block under the public/private partnership rules but did not receive a winning bid. Finally, the Commission summarizes theSecond FNPRM,which commenced the process of revisiting and reconsidering the public/private partnership rules that the Commission continues now in the present Third FNPRM.

A. 700 MHz Second Report and Order

17. The commercial and public safety spectrum bands at issue in this proceeding are part of the 700 MHz Band (698-806 MHz), which is currently occupied by television broadcasters, but which must be cleared of such transmissions and made available for wireless services by February 17, 2009, as part of the digital television (DTV) transition.9 Pursuant to Congress's direction in the Balanced Budget Act of 1997 (Balanced Budget Act), codified at section 337(a) of the Act, the Commission has allocated, in the Upper 700 MHz Band (746-806 MHz), 24 megahertz of spectrum for public safety services and 36 megahertz for commercial services.10

9 SeeDeficit Reduction Act of 2005, Public Law No. 109-171, 120 Stat. 4 (2006).

10 SeeBalanced Budget Act of 1997, Public Law No. 105-33, 111 Stat. 251 sec. 3004 (1997) (adding new sec. 337 of the Communications Act); Reallocation of Television Channels 60-69, the 746-806 MHz Band, ET Docket No. 97-157,Report and Order,12 FCC Rcd 22953, 22955 para. 5 (1998),recon.13 FCC Rcd 21578 (1998) (Upper 700 MHz Reallocation Order).

18. In theSecond Report and Order,the Commission established, among other rules regarding the 700 MHz Band, rules for the 700 MHz public safety spectrum and one block of the Upper 700 MHz commercial spectrum that would promote the creation of a nationwide, interoperable broadband public safety network. With regard to the public safety spectrum, the Commission designated the lower half of the spectrum (the 763-768 MHz and 793-798 MHz bands) for public safety broadband communications, and consolidated existing narrowband allocations, previously located in both the lower and upper ends of the public safety spectrum, in the upper half of the spectrum (the 769-775 MHz and 799-805 MHz bands) exclusively.11 The Commission also created a single nationwide license for the public safety broadband spectrum, the Public Safety Broadband License, and the Commission specified the criteria, selection process, and responsibilities of the licensee assigned this spectrum, including a requirement that the licensee must be a non-profit organization.12

11 See Second Report and Order,22 FCC Rcd at 15406 para. 322. The Commission also created an internal guard band in the 768-769 MHz and 798-799 MHz bands located between the broadband and narrowband allocations.Id.

12 See Second Report and Order,22 FCC Rcd at 15406 para. 322.

19. With regard to the commercial spectrum in the 700 MHz Band, and as described in greater detail below, the Commission created a nationwide license in the D Block (the 758-763 MHz and 788-793 MHz bands, located adjacent to the public safety broadband spectrum), and required the D Block licensee, working with the Public Safety Broadband Licensee in a public/private partnership (the 700 MHz Public/Private Partnership) and using the spectrum associated with both licenses, to construct and operate a nationwide network that would be shared by commercial and public safety users.13

13 Id.at 15428 para. 386.

20.700 MHz Public/Private Partnership.The Commission mandated the 700 MHz Public/Private Partnership between two nationwide licensees to promote the rapid deployment of a nationwide, interoperable, broadband public safety network that was robust, cost effective, spectrally efficient, and based on a flexible IP-based, modern architecture.14 The Commission found that nationwide licensing would best serve these goals by centralizing the responsibilities for implementing and administering a broadband network across the entire country, creating economies of scale, and avoiding a fragmented approach to network construction. The Commission further determined that the public/private partnership, by promoting commercial investment in the build-out of a shared network infrastructure for both commercial and public safety users, would address “the most significant obstacle to constructing a public safety network—the limited availability of public funding.”15 The Commission concluded that providing for a shared infrastructure using the D Block and the public safety broadband spectrum would help achieve significant cost efficiencies. The Commission noted that this would allow public safety agencies “to take advantage of commercial, off-the-shelf technology and otherwise benefit from commercial carriers' investments in research and development of advanced wireless technologies.”16 The Commission stated that this approach would also benefit the public safety community by providing it with access to an additional 10 megahertz of broadband spectrum during emergencies.17 Most importantly, the Commission anticipated that this particular public/private partnership approach would provide all of these public safety benefits on a nationwide basis.18 The Commission noted that the 700 MHz Public/Private Partnership would also provide the D Block licensee with benefits, including the right to operate commercial services in the 10 megahertz of public safety broadband spectrum on a secondary, preemptible basis, which would both help to defray the costs of build-out and ensure that the spectrum is used efficiently.19

14 Id.at 15420 para. 369, 15431 para. 396.See alsoImplementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, PS Docket No. 06-229, WT Docket No. 96-86,Ninth Notice of Proposed Rulemaking,21 FCC Rcd 14837, 14842-43 (2006) (700 MHz Public Safety Ninth Notice).

15 Second Report and Order,22 FCC Rcd at 15431 para. 396.

16 Id.

17 Id.

18 Id.

19 Id.

21. To ensure that the 700 MHz Public/Private Partnership would serve the needs of the public safety community and to address concerns about its success, the Commission specified certain mandatory features. First, the Commission specified requirements regarding the shared network to be constructed and the timing for that construction. In particular, the Commission established certain technical requirements for the shared network, including requirements relating to the network technology platform, signal coverage, robustness and reliability, capacity, security, operational capabilities and control, and certain equipment specifications.20 With regard to the spectrum shared by the common network, the Commission required that the Public Safety Broadband Licensee lease the public safety broadband spectrum for commercial use by the D Block licensee on a secondary, preemptible basis, and that the public safety entities have priority access to the D Block spectrumduring emergencies.21 To ensure timely construction and nationwide coverage, the Commission specified performance requirements, including three population-based build-out benchmarks requiring the D Block licensee to provide signal coverage and offer service to (1) at least 75 percent of the population of the nationwide D Block license area by the end of the fourth year after the DTV transition date, (2) at least 95 percent of the population of the nationwide license area by the end of the seventh year, and (3) at least 99.3 percent of the population of the nationwide license area by the end of the tenth year.22

20 Id.at 15433-34 para. 405.

21 Id.at 15432 para. 399, 15434-43 paras. 407-31.

22 Id.at 15432 para. 399, 15433-44 paras. 403-06, 15443-46 paras. 432-43.

22. Next, while finding it appropriate to establish these mandatory terms, the Commission also concluded that many details of the 700 MHz Public/Private Partnership should be left to the parties to negotiate.23 Accordingly, the Commission established that the terms of the 700 MHz Public/Private Partnership would be governed both by Commission rules and by a Network Sharing Agreement (NSA) between the winning bidder for the D Block license and the Public Safety Broadband Licensee.24 The Commission further provided rules governing the process by which the parties would establish the NSA, requiring among other things that negotiations begin by a date certain and conclude within six months, and providing that the D Block license application would not be granted until the parties obtained Commission approval of the agreement, executed the approved agreement, and then filed it with the Commission.25 The Commission further specified rules to govern in the event of a negotiation dispute. Specifically, the Commission provided that if, at the end of the six month negotiation period, or on their own motion at any time, the Chiefs of the Public Safety and Homeland Security Bureau (PSHSB) and the Wireless Telecommunications Bureau (WTB) found that negotiations had reached an impasse, they could take actions including but not limited to issuing a decision on the disputed issues and requiring the submission of a draft agreement consistent with their decision.26 The Commission also provided that if the D Block winning bidder failed to comply with the procedures the Commission established for negotiation or dispute resolution, failed to receive final Commission approval of an NSA, or failed to execute an approved NSA, it would be deemed to have defaulted on its license and would be subject to the default payments required by Section 1.2109 of the Commission rules.27

23 Id.at 15488 para. 447.

24 Id.at 15432 paras. 399-400, 15447-49 paras. 444-54.

25 Id.at 15448 para. 447.

26 Id.at 15465 para. 508.

27 Id.at 15466 para. 511.

23. The Commission also established a number of measures to safeguard the interests of public safety on an ongoing basis after the NSA is executed. These measures included: (1) Requirements related to the organization and structure of the 700 MHz Public/Private Partnership, intended to protect the D Block license and network assets from being drawn into a bankruptcy proceeding; (2) a prohibition on discontinuance of service provided to public safety entities; (3) special remedies in the event that the D Block licensee or Public Safety Broadband Licensee fails to comply with either the Commission's rules or the terms of the NSA; (4) a special, exclusive process for resolving any disputes related to the execution of the terms of the NSA; and (5) ongoing reporting obligations.28

28 Id.at 15466-71 para. 513-30.

24.Reserve Price for the Auction of the D Block.In theSecond Report and Order,the Commission also concluded that block-specific aggregate reserve prices should be established for each commercial license block—the A, B, C, D, and E Blocks—to be auctioned in Auction 73, and directed WTB to adopt and publicly disclose those reserve prices prior to the auction, pursuant to its existing delegated authority and consistent with the Commission directions.29 For the D Block, the Commission concluded that WTB should consider certain factors in setting the D Block reserve price, including the 700 MHz Public/Private Partnership conditions, which might suggest a reserve price of $1.33 billion. The Commission provided that, in the event that bids for the D Block license did not meet the reserve price, the Commission would leave open the possibility of offering the license on the same terms or re-evaluating the D Block license conditions.30

29 See id.at 15400 para. 301.

30 See id.at 15404 para. 314.

25.Narrowband Relocation. As discussed above, to promote public safety access to a nationwide, interoperable broadband network, the Commission designated the lower half of the public safety spectrum for public safety broadband communications, and consolidated existing narrowband allocations, previously located in both the lower and upper ends of the public safety spectrum, in the upper half of the spectrum.31 The Commission also shifted the entire public safety band down one megahertz, so that it would be immediately adjacent to the D Block spectrum, to further facilitate the development of a shared wireless broadband network over both D Block and public safety broadband spectrum.32 Both the 1-megahertz shift and the narrowband consolidation, however, left certain existing public safety narrowband operations outside of the spectrum now designated for narrowband services.

31 See id. at 15406 para. 322. The Commission also created an internal guard band in the 768-769 MHz and 798-799 MHz bands located between the broadband and narrowband allocations.Id.

32 See id. at 15333 para. 111.

26. The Commission provided in theSecond Report and Orderthat all 700 MHz narrowband public safety operations outside of the newly consolidated narrowband spectrum must be relocated to that spectrum no later than the DTV transition date.33 To effectuate the consolidation of the narrowband channels, the Commission required the D Block licensee to pay the costs of relocating narrowband radios and capped the disbursement amount for such relocation costs at $10 million.34 The Commission also cautioned that any narrowband equipment deployed in the 764-770 MHz and 794-800 MHz bands (channels 63 and 68), or in the 775-776 MHz and 805-806 MHz bands (the upper one megahertz of channels 64 and 69), more than 30 days following the adoption date of theSecond Report and Orderwould be ineligible for relocation funding.35 In addition, the Commission prohibited authorization of any new narrowband operations in that spectrum, as of 30 days following the adoption date of theSecond Report and Order.36 Subsequent to the release of theSecond Report and Order, the Commission granted limited waivers to two parties that permitted them to continue to deploy new narrowband operations outside the consolidated narrowband spectrum after August 30, 2007.37 The Commission deferreddecision on other issues raised by their requests, however, including the appropriate duration of the relief and whether the parties would be entitled to reimbursement for the costs of relocating narrowband operations deployed after August 30, 2007.

33 Id. at 15410 para. 332.

34 Id. at 15412 para. 341.

35 Id. at 15412 para. 339.

36 Id.

37 SeeImplementation of a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, PS Docket No. 06-229, WT Docket No. 96-86,Order, 22 FCC Rcd 20290 (2007); Implementing a Nationwide, Broadband, Interoperable PublicSafety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010; Request for Waiver of Pierce Transit, PS Docket No. 06-229, WT Docket No. 96-86,Order, 23 FCC Rcd 433 (PSHSB 2008).

B. Petitions for Reconsideration

27. Ten parties filed petitions for reconsideration seeking review of various aspects of theSecond Report and Order.38 Three of the petitions sought reconsideration of the rules governing the 700 MHz Public/Private Partnership specifically.39 All three of these petitioners argued that the application of the default payment rules to the D Block winner in the event of a failure to establish an NSA should be modified, for example, by imposing such payment obligations only if the D Block winner is found to have negotiated in bad faith.40 One petitioner also argued that network requirements should be specified more precisely for potential bidders prior to auction.41 Conversely, another of these petitioners argued that, in some respects, the technical requirements in the rules were too specific, and that the Commission should “not prematurely rule on specific technical issues, [and] should instead allow the [Public Safety Broadband Licensee] and D Block winner to develop those details as they negotiate the NSA * * * .”42

38AT&T Inc. Petition for Reconsideration and Clarification, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (AT&T Petition for Reconsideration); Blooston Rural Carriers Petition for Partial Reconsideration and/or Clarification, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Blooston Petition for Reconsideration); Petition for Reconsideration of the Ad Hoc Public Interest Spectrum Coalition, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (PISC Petition for Reconsideration); Cyren Call Communications Corporation Petition for Reconsideration and for Clarification, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Cyren Call Petition for Reconsideration); Frontline Wireless, LLC Petition for Reconsideration (filed Sept. 24, 2007); Pierce Transit Petition for Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Pierce Transit Petition for Reconsideration); Rural Telecommunications Group, Inc. Petition for Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (RTG Petition for Reconsideration); Commonwealth of Virginia Petition for Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Virginia Petition for Reconsideration); NTCH, Inc. Petition for Partial Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 21, 2007) (NTCH Petition for Reconsideration); MetroPCS Communications, Inc. Petition for Clarification and Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 20, 2007) (MetroPCS Petition for Reconsideration).

39 SeeAT&T Petition for Reconsideration; Cyren Call Petition for Reconsideration; Frontline Petition for Reconsideration. The Frontline September 20, 2007 Request also seeks changes to the rules governing the 700 MHz Public/Private Partnership.SeeRequest to Further Safeguard Public Safety Service by Frontline Wireless, WT Docket No. 06-150 (filed Sept. 20, 2007) (Frontline September 20, 2007 Request).

40 SeeAT&T Petition for Reconsideration at 7-9; Cyren Call Petition for Reconsideration at 5-7; Frontline Petition for Reconsideration at 23-25.

41 SeeAT&T Petition for Reconsideration at 5.

42 SeeFrontline Petition for Reconsideration at 22.See alsoCyren Call Petition for Reconsideration at 7.

28. Two of the ten petitioners sought reconsideration of the aggregate reserve prices set for the commercial license blocks, including the reserve price for the D Block.43 These petitioners presented related arguments in the pre-auction process.44 After considering the arguments, WTB established reserve prices consistent with the direction of theSecond Report and Order, including setting a $1.33 billion reserve price for the D Block.45

43 See, generally, Frontline Petition for Reconsideration; MetroPCS Petition for Reconsideration.

44 SeeAuction of 700 MHz Band Licenses Scheduled for January 24, 2008; Notice and Filing Requirements, Minimum Opening Bids, and other Procedures for Auctions 73 and 76,Public Notice, 22 FCC Rcd 18141, 18194-95 paras. 197-90 (2007) (Auction 73/76 Procedures Public Notice).

45 See id. at 18193-96 paras. 194-200.

29. Finally, two other parties filed petitions seeking reconsideration of some or all of the requirements regarding public safety narrowband relocation, as well as requests for waiver of some of these requirements.46 The requests for waiver have since been granted in part.47 The two petitions, however, together with the other petitions seeking reconsideration of theSecond Report and Order, remain pending.

46 SeeVirginia Petition for Reconsideration; Pierce Transit Petition for Reconsideration.

47 SeeImplementation of a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, PS Docket No. 06-229, WT Docket No. 96-86,Order, 22 FCC Rcd 20290 (2007); Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010; Request for Waiver of Pierce Transit, PS Docket No. 06-229, WT Docket No. 96-86,Order, 23 FCC Rcd 433 (PSHSB 2008).

C. Auction 73

30.Results of the Auction. The auction of the D Block and other 700 MHz Band licenses, designated Auction 73, commenced on January 24, 2008, and closed on March 18, 2008.48 While the bids for licenses associated with the other 700 MHz Band blocks offered at Auction 73 (the A, B, C, and E Blocks) exceeded the applicable aggregate reserve prices for those blocks, the nationwide D Block license received only a single bid that did not meet its reserve price of $1.33 billion and thus did not become a winning bid.49 On March 20, 2008, the Commission determined that the Commission would not proceed immediately to re-auction the D Block license in order to provide us additional time to consider the Commission options.50

48 SeeAuction 73, 700 MHz Band, athttp://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=73.

49 See id.;see also Auction of 700 MHz Band Licenses Closes, Public Notice, DA 08-595 (rel. Mar. 20, 2008) (700 MHz Auction Closing Public Notice).http://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=73.Specifically, a bid of $472 million was entered by Qualcomm in Round 1 of the auction.

50 SeeAuction of the D Block License in the 758-763 and 788-793 Bands, AU Docket No. 07-157,Order,23 FCC Rcd 5421, para. 5 (2008) (D Block Post-Auction Order).

31.Inspector General's Report. On April 25, 2008, the Office of Inspector General (OIG) issued a report on its investigation of allegations that certain statements made by an advisor to the Public Safety Broadband Licensee to potential bidders for the D Block license in Auction 73, particularly those regarding the spectrum lease payments that the Public Safety Broadband Licensee would request from the D Block licensee for use of public safety spectrum, had the effect of deterring various companies from bidding on the D Block.51 The OIG determined that the statements in question were “not the only factor in the companies' decision not to bid on the D Block.” Rather, it concluded that “the uncertainties and risks associated with the D Block, including, but not limited to, the negotiation framework with [the Public Safety Broadband Licensee], the potential for default payment if negotiations failed, and the costs of the build-out and the operations of the network, taken together, deterred each of the companies from bidding on the D Block.”52

51 See Office of Inspector General Report, from Kent R. Nilsson, Inspector General, to Chairman Kevin J. Martin (OIG rel. Apr. 25, 2008) (OIG Report).

52 OIG Reportat 2.

D. Second Further Notice of Proposed Rulemaking

32. On May 14, 2008, to begin the process of reconsidering the appropriate rules for the D Block and the PublicSafety Broadband License, the Commission released theSecond Further Notice of Proposed Rulemaking (Second FNPRM). In theSecond FNPRM, the Commission enumerated the following goals and principles for this rulemaking proceeding:

• To facilitate public safety access to a nationwide, interoperable broadband network in a timely manner;

• To identify concerns in the existing structure of the 700 MHz Public/Private Partnership to inform the Commission decision making going forward;

• To promote wireless innovation and broadband network penetration while meeting the communications needs of the first responder community in a commercially viable manner;

• To identify funding opportunities for the public safety community to realize the promise of a broadband communications infrastructure with a nationwide level of interoperability; and

• To maximize the commercial and public safety benefits of the D Block spectrum.53

53 See Second FNPRM, 23 FCC Rcd at 8052 para. 6.

33. With these goals and principles in mind, the Commission sought comment first on whether and how to clarify or revise the rules governing the public safety component of the 700 MHz Public/Private Partnership, including rules governing the Public Safety Broadband Licensee, the entities eligible to obtain access to the public safety broadband network,54 and the relocation of public safety narrowband operations.

54 See id. at 8058-8062 paras. 24-32. The term “public safety broadband network,” which the Commission has used in theSecond FNPRMand again in thisThird FNPRM, refers to those functions and services of the shared network to which the Public Safety Broadband Licensee will administer access.

34. With regard to the Public Safety Broadband Licensee, the Commission sought comment on (1) whether to revise or clarify the structure and criteria of the Public Safety Broadband Licensee as adopted in theSecond Report and Order, including whether to clarify the requirement that the Public Safety Broadband Licensee must be a non-profit organization;55 (2) how the Public Safety Broadband Licensee should be funded;56 (3) whether to adopt additional measures to better enable Commission or Congressional oversight of the Public Safety Broadband Licensee's activities;57 and (4) whether, in light of these and other possible changes, the Commission should rescind the current Public Safety Broadband License and seek new applicants.58

55 See id. at 8064 para. 40, 8067 para. 48.

56 See id. at 8065-8065 paras. 42-45

57 See id. at 8067 para. 48, 8068 para. 51.

58 See id. at 8068 para. 53.

35. Regarding access to the public safety broadband network, the Commission sought comment on (1) whether to clarify which entities are eligible to use the public safety broadband network; (2) whether to adopt measures requiring or promoting use of the public safety broadband network by eligible public safety entities;59 (3) whether State governments should have a role in coordinating the participation of public safety entities in the public safety broadband network;60 and (4) whether to revise the rules regarding use of the public safety broadband network by Federal public safety agencies.61

59 See id. at 8063 para. 37.

60 See id. at 8068 para. 52.

61 See id. at 8092-93 para. 126.

36. With regard to the relocation of public safety narrowband operations, the Commission sought comment on issues including (1) whether to revise or eliminate the cap on relocation expenses; (2) whether, in light of the proposed re-auction of the D Block and associated timing issues, the Commission should continue to require relocation to be completed by the DTV transition date; (3) whether to amend the process for accomplishing the relocation; and (4) whether the Commission should extend the August 30, 2007 cut-off date for new nar