Subject: [NEXTEL-1] Senators Continue Push To Nullify Auction 35

From: Marcel <[email-masked]>
Date: Fri, 01 Nov 2002 13:40:56 -0500

http://www.wirelessweek.com/index.asp?layout=print_page&doc_id=106619

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Senators Continue Push To Nullify Auction 35

By Mark Rockwell
November 1, 2002
news@2 direct

WASHINGTON -- Sponsors of legislation freeing Auction 35 bidders from
their obligations in the now-defunct spectrum sale have stepped up the pressure
on the FCC to act broadly in the matter.

Senators Ernest Hollings, D-S.C.; John Kerry, D-Mass, and Sam Brownback,
R-Kan., told FCC Chairman Michael Powell in a letter this week that the
commission should let the bidders opt out of their bid promises without penalty
and be ''relieved of all further obligations under Auction 35.'' In addition,
the letter asked the FCC ''to promptly refund to the winning bidders who opt-out
the full remaining amount of their deposits and down payments.''

At the same time, sources this morning indicate that Sen. Ted Stevens,
R-Alaska, may be getting ready to move forward with his own Auction 35 opt-out
bill to get around slow movement at the FCC on the issue. The measure could be
introduced when Congress returns from recess on Nov. 12.

The sale, completed in January 2001, brought in nearly $16 billion in bids
from wireless carriers. Since then, previous owner of the spectrum NextWave
Telecom Inc. has claimed that the FCC had no rights to sell the licenses under
current bankruptcy law. The lengthy resulting legal battle has taken its toll,
and now most analysts agree the licenses aren't worth what carriers paid for
them -- and many carriers want out of the deal. Verizon Wireless, the auction's
biggest spender with about $8 billion in bids, also has been the most forceful
contender in the battle to get the FCC to nullify the sale completely.

Instead, the FCC has kept about 15 percent of the bidders' down payments to
avoid nullfiying the auction completely. Verizon Wireless would be liable for
payment of billions if the FCC is successful in its ongoing Supreme Court battle
with NextWave over ownership of the spectrum. Senators Hollings, Kerry and
Brownback said the FCC should deliver the licenses to those who choose to remain
obligated, if the FCC ''is ultimately victorious in the ongoing litigation.''
The senators also seemed to edge toward allowing the bidders that opted out to
bid again on spectrum in the near future, something the FCC had been considering
not allowing.

Previous Stories:
Carriers Call Auction Action 'Unprecedented' 10/28/02

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