Carriers Can Still Take Care of Business During Incentive Auction Quiet Period, Sherman Says

The FCC tried to “clarify a few things” in the competitive bidding rules the agency approved in August, Sherman said. “We tried to make sure certain things are permissible during so-called quiet periods,” he said. “We’re not trying to stop the ability of companies to engage in business discussions.” The FCC is only concerned about discussions that affect bidding strategy, he said.

“There’s a tendency to be very conservative on these questions,” Sherman said. “Some at the FCBA are very, very conservative about how they interpret this. We’re trying to provide some guidance and provide some specific examples in the competitive bidding item that may help.” The FCC’s Incentive Auction Task Force will have more to say over the next few weeks, he said.

More details would help, said Kathleen Ham, T-Mobile senior vice president. Lawyers “are very conservative in the advice they give the carriers, and carriers, I can tell you, take this very seriously,” she said. “It does have a chilling effect on everything from roaming to interconnection to siting.”

Roaming and siting discussions are the kinds of things that will be specifically allowed by the FCC during the incentive auction quiet period, Sherman said in response.

Speakers agreed the recently concluded AWS-3 auction was a huge success, though they also said getting the details right was critical. “The big hurdle” for the AWS-3 auction was the way the Congressional Budget Office values spectrum, said David Redl, GOP chief telecom counsel for the House Commerce Committee. Whether an auction will raise revenue or cost the government money is always a question Congress gets asked, he said. “Because spectrum is an asset that is really hard to put a price on … we end up having a hard time getting sort of a firm number,” Redl said. No one thought the AWS-3 auction would raise as much money as it did, he said.

Redl said “pretty serious questions remain” about the TV incentive auction. “Unfortunately,” many of the questions are coming from the wireless industry and broadcasters. “The two industries need to not only accept these rules but embrace them and participate,” he said. The FCC has put a lot of work into the auction, but needs to continue to focus on industry concerns, such as where broadcasters are placed in the repacked 600 MHz band and the level of impairments that will be faced by some licensees, he said.

Communications was critical to making the AWS-3 auction a success, Sherman said. “There was a lot more communication and a lot more sharing of information,” he said. There was more recognition in the past of the importance of spectrum sharing, he said. If “we can’t get there the way everyone wants, sometimes sharing can be the best approach,” he said.

It was also key to get engineers from companies and the government “in the same room” to get past political arguments, Sherman said. “They’re going to talk about how to fix things, not about who’s right,” he said. Spectrum policy is an issue where “Washington does work,” he said. Sherman also said the FCC is excited about the 3.5 GHz shared spectrum band. “It’s going to take a little getting used to,” he said. “It’s new and it’s innovative and it’s a whole new approach and I think that’s what makes it exciting.” At 100 MHz, 3.5 GHz is also “a lot of spectrum,” he said.

Ham said many questions remain about the 3.5 GHz band. “It is a unique approach,” she said. “Kudos to the commission for experimenting. I think the jury is still out about the level of investment that will come in.” Ham agreed 3.5 GHz does provide “a lot of spectrum.”