Small Wireless Carriers Turn to Hill for Help on Roaming Concerns

Under the in-market exclusion, a late addition to roaming rules dating to last August (CD Aug 8/07 p1), a carrier need not honor a request by a counterpart with spectrum in a market, even if the spectrum isn’t cleared to allow network buildout. Leap Wireless, MetroPCS SpectrumCo, Sprint Nextel and T-Mobile filed petitions for reconsideration at the FCC asking it to revise its rules.

A key issue for the carriers is that they often face long waits for incumbents to leave spectrum before they can build out licenses bought during spectrum auctions. This is especially true for 2006’s advanced wireless services 1 auction, since carriers have to wait for Department of Defense and other government users to clear the spectrum. Winning bidders for 700 MHz licenses face similar delays. For PCS licenses, carriers argue they shouldn’t have to invest in cellsites in fringe areas outside the core markets they are serving just to maintain roaming rights when they have already met FCC-mandated buildout requirements.

The issue is critical to CDMA carriers concerned about the effect on roaming of the proposed Verizon Wireless-Alltel deal and other industry consolidation, said Laurie Itkin, a lobbyist for Leap Wireless, in an interview. “Alltel is a key roaming partner of ours,” Itkin said. “We can only roam with other CDMA carriers. We think this roaming market exception must be addressed before that merger proceeds.” The FCC could address the issue in its order on the merger, “but we think it would be cleaner just for the commission to deal with the roaming docket as it is, before the merger proceeds,” she said.

The roaming issue matters to consumers, Consumers Union Internet & Telecom Legislative Counsel Chris Murray said. “This is a very crisp, market specific harm,” he said. “You've got one partner, Alltel, being a relatively good corporate citizen, offering roaming to Leap. On the other hand, Verizon is using this in-market loophole to avoid roaming with Leap. If you combine those two companies without addressing this huge competitive problem you've not only combined two of the largest wireless carriers but you've hobbled the ability of other companies to compete.”

In a recent letter to Martin, Reps. Charles Gonzalez of Texas and Mike Doyle of Pennsylvania, Democratic members of the House Telecom Subcommittee, asked the FCC to address the roaming issue. Gonzalez and subcommittee Chairman Ed Markey, D-Mass., raised the home-market exception when Martin testified April 15 before the subcommittee on the 700 MHz auction.

“You mentioned in the hearing that you want to encourage buildout through the roaming policy,” the letter said. “However, consideration must be given to carriers that are currently working to build out their licenses in compliance with pre-existing FCC construction requirements. Consideration must also be given to the fact that large licenses were awarded in recent spectrum auctions, and that many licenses cannot be built out quickly due to encumbrances by federal government users.”

At the hearing, Martin defended the in-market exception, saying it “fully recognizes both the importance of roaming but also the counterbalance of making sure that people that purchased spectrum are not letting it sit idle but rather are trying to build it out to the most effective possible use.” Commissioner Michael Copps said at the hearing that the exception has “unforeseen consequences” and he’s “pushing for a reconsideration” of the rule.

“We are actively working and evaluating the petitions for reconsideration,” an FCC spokesman said Wednesday. “We cannot give any indication as to when the Commission may take further action on this issue.”