Subject: [NEXTEL-1] Nextel seeks to reassure FCC ons pectrum-swap aka FCC Helps Nextel Make Money

From: [email-masked]
Date: Mon, 03 Nov 2003 18:40:13 -0500

Reuters
Nextel seeks to reassure FCC ons pectrum-swap
Monday November 3, 5:48 pm ET

CHICAGO, Nov 3 (Reuters) - Nextel Communications Inc. (NasdaqNM:NXTL -
News) on Monday sought to reassure U.S. regulators of its ability to pay
$850 million for an upgrade of public safety communications as part of a
wireless spectrum swap it is proposing.

The fifth-largest U.S. wireless
telephone company said it will
deposit $100 million in cash in an
escrow account and will secure the
remaining $750 million through one
or more irrevocable standby letters
of credit by internationally
recognized commercial lending
institutions.

The company said the letters of
credit will provide payments if Nextel
is not able to meet its obligations.

Nextel has sought approval from the
Federal Communications
Commission (News - Websites)
since November 2001 to create
blocks of contiguous spectrum for itself and for public safety agencies
to avoid interference, such as wireless calls crossing police and fire
department airwaves.
The Reston, Virginia-based company has offered to give up 10.5 MHz of
spectrum on the 800 MHz band for 10 MHz on the 1.9 GHz band, but its
rivals have opposed the deal since it would give Nextel a significantly
more valuable slice of spectrum.
The 800 MHz band currently carries traffic from public safety operators,
private wireless operators such as utilities and corporations and
cellular operators including Nextel, AT&T Wireless Services Inc.
(NYSE:AWE - News) and Verizon Wireless (NYSE:VZ - News; London:VOD.L -
News).
Legg Mason said in a research note earlier on Monday it believes the FCC
was contemplating a compromise, in which it would reallocate the 800 MHz
band along the lines proposed by Nextel and give Nextel a part of the
spectrum it is seeking.
It also said the commission will likely require Nextel to increase its
financial commitment to pay for the relocation of public-safety and
private wireless operators in the 800 MHz band.

Legg Mason estimates that Nextel will receive a net gain of about $3.1
billion if its proposal is fully accepted by the FCC.

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