Subject: [NEXTEL-1] FCC Likely To Reach Unanimous Decision On Nextel Spectrum

From: [email-masked]
Date: Wed, 19 May 2004 04:32:59 -0400

FCC Likely To Reach Unanimous Decision On Nextel Spectrum

May 18, 2004 9:22pm

Dow Jones Business News

By Mark Wigfield
Of DOW JONES NEWSWIRES

WASHINGTON (Dow Jones)--Federal Communciations Commission Chairman
Michael Powell is likely to get unanimous support from his fellow
commissioners on a tough decision affecting wireless provider Nextel
Communications Inc. (NXTL).
FCC commissioners appear willing to follow Powell's lead on how best to
eliminate Nextel's growing problem of creating interference with
critical public safety radio, according to several people familiar with
matter.

One reason: The decision raises none of the ideological flags that have
divided the FCC in the past, but is purely a commercial matter. A
decision hasn't been finalized.

But Powell's real problem comes from the wireless industry itself, which
has been united against a solution proposed by Nextel - a solution whose
outlines gained traction at the agency. Any plan deemed to give one side
an advantage is bound to be greeted by lawsuits.

A decision has been anticipated at the agency for months, but Powell has
been willing to wait so that the companies can come closer to a
consensus.

"In any decision-making like this, we are not going to get to a final
resting place until a certain desperation kicks in," says an FCC
official close to the matter, speaking on the condition of anonymity.
But with Powell hoping to issue a ruling by the end of May, it's not
clear how much more any of the parties are willing to give.

The problem the commission is trying to solve is that the spectrum
Nextel uses to carry its phone calls is mingled with that used by
police, fire and other emergency response radios. The result: Mobile
phone conversations interfere with emergency radio.
Nextel more than two years ago floated a plan to segregate the wireless
and public safety uses in the 800-megahertz band.
The company proposed paying some $850 million to move public safety
radio transmittors to the lower portion of the band, and giving up some
its airwaves. In return, Nextel wants 10 MHz of spectrum in the
1.9-gigahertz band - the band used by the majority of wireless carriers.

That plan has been bitterly opposed as a spectrum grab by the rest of
the industry through its trade association, the Cellular
Telecommunications and Internet Association, or CTIA. The spectrum in
the 1.9-GHz band represents the last large chunk of clear spectrum
covering the entire nation.

It is seen as so valuable for wireless voice and data that Verizon
Wireless, a partnership between Vodafone Group PLC (VOD) and Verizon
Communications Inc. (VZ), told the FCC it would pay at least $5 billion
for the airwaves. Verizon Wireless has been lobbying heavily against
Nextel.

The CTIA says Nextel should get the extra spectrum it needs in a
slightly different neighborhood, the less-valuable 2.1-GHz band. But the
trade association has moved far from its original position, which
originally called for Nextel to simply restructure the 800-MHz band
without any new spectrum.

"Look how far CTIA has come," says the FCC official. "They had to feel
the heat before they moved."

Now the pressure seems to be on Nextel. Both Powell and fellow
Republican Kathleen Abernathy have expressed interest in providing
spectrum for Nextel in the 2.1-GHz band - a move Nextel bitterly
opposes.

The company argues that calls don't carry as well at 2.1 GHz. Nextel
says it would have to special-order chips and transistors for its
handsets, rather than buy off-the-shelf components widely used by
1.9-GHz equipment.

Nextel also notes that its wireless competitors already occupy parts of
the 2.1-GHz band with so-called microwave links that transport bulk
cellphone traffic to telephone networks. The links would have to be
relocated, "giving Nextel's competitors the opportunity to directly
affect the cost of and time it takes to clear this spectrum," the
company told the FCC in a filing.
But one analyst is puzzled by Nextel's continued opposition to the
2.1-GHz compromise.

"Maybe there is a 5% difference in the fundamental propagation
characteristics" between 1.9 and 2.1 GHz, says Charles Jackson, a
telecom industry consultant, electrical engineering professor at George
Washington University, and former FCC official who worked on spectrum
issues.

Jackson also says production costs for 2.1-GHz handsets "should be very,
very close" to 1.9-GHz phones. He questioned whether Nextel's position
was simply a bargaining posture.

Another spectrum consultant, Peter Cramton who runs an auction service
called the Spectrum Exchange, says moving the microwave incumbents in
2.1 "is not a big deal."

"There are rules in place for relocation," says Cramton, who also is an
economist at the University of Maryland. "It's very do-able."

Nextel spokesman Tim O'Regan, says the company's complaints are real.

"It is not any one particular thing" about 2.1 GHz, says O'Regan. "It's
an accumulation of things that make 2.1 undesireable, and 1.9 a much
better fit."

Wireless analyst George Dellinger of the firm Washington Analysis agrees
there are disadvantages for Nextel at 2.1 GHz. And he believes the
company's willingness to both move its 800-MHz operations to eliminate
interference and pick up the tab for moving the public safety community
puts it in a powerful position at the FCC.

"I've been saying that Wall Street underestimates the premium the FCC
puts on public safety, and understimates the position Nextel is in,"
Dellinger says. "The government needs Nextel more than Nextel needs the
government."

The FCC continues to work through a number of technical issues in the
matter, including valuation of spectrum in both frequencies.

-By Mark Wigfield, Dow Jones Newswires; 202-828-3397;
[email-masked]

(END) Dow Jones Newswires
May 18, 2004 21:21 ET (01:21 GMT

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From: "Rik Rasmussen" <[email-masked]>
Date: Wed, 19 May 2004 07:04:03 -0400

Why not move Nextel to 1.9 entirely and get them off 800 entirely? This
would give them the contiguous block they want and would free up many
frequencies at 800 for use by Public safety.

Rik Rasmussen
Two Way Radio Directory
http://twowayradiodirectory.com

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From: [email-masked]
Date: Wed, 19 May 2004 07:50:49 -0400

10 mhz is not enough bandwidth (5 Up - 5 down)

 
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