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February 01, 2008

Another take on the languishing D block 700 MHz auction

The stipulations for the winning bidder for the D block in the 700 MHz auction may be daunting enough to make the whole plan sound unfeasible. Besides their own network plans, they must roll-out a nationwide system for the first responders in the public safety community utilizing the 700 MHz D block.

I was speaking earlier with Michael Rubin who was detailing me on a product by In Motion Technology that I had blogged about previously, when I asked about the D block auction problems. He said, "technology is getting way ahead of the policy makers." He went on to say that the FCC might not appreciate other options or comprehend the obstacles in building a ubiquitous network for all first responders across the country. Even the major carriers would be hard pressed to build such a network.

Also, the first responders must adapt their equipment so it can utilize the allocated 700 MHz spectrum. In Motion's product can work on any number of frequencies, which is their main selling point.

Here's Glenn Fleishman's explanation of the D block kerfuffle that he derived from a long post by Harold Feld:

In short, he writes that a one-time potential bidder moved into an advisory role to the body that will control the block for public-safety interests. He says that would allow them to set unreasonable terms for a winning bid, and that the FCC refused to set rules that would prevent unreasonable terms from being proposed. Thus, Frontline Wireless, the firm most likely to operate the D Block, shut down, as they couldn’t come up with a strategy that was financially sound. (The auction rules state that if you default, you forfeit the difference between your bid and the ultimate winning bid; Frontline could have easily been out hundreds of millions of dollars in that scenario.)

Included in the unreasonable terms set by the FCC are the ones which ensure that the winning bidder negotiates in "good faith" with the public safety community, by threatening a fine of $100 million and revoking the bidder's right to the spectrum it had acquired if a complaint is filed.

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