Subject: [NEXTEL-1] Legal Scales Tip In NextWave's Favor

From: Marcel <[email-masked]>
Date: Sat, 15 Mar 2003 22:07:57 -0500

Legal Scales Tip In NextWave's Favor

NextWave has battled it out with the FCC in the courts for years. Finally, the FCC
has given NextWave some breathing room by lifting a legal cloud that challenged
its compliance with build-out requirements.

BY MARK ROCKWELL
MARCH 15, 2003
© 2003, REED BUSINESS INFORMATION, A DIVISION OF REED ELSEVIER INC. ALL RIGHTS
RESERVED.

Washington—As expected, after years of legal imbroglio the FCC is cutting
NextWave Telecom some slack in building out its wireless networks, granting it
several more months in the coming year to install working networks in its
markets across the country.

The commission early this month said it would give the company, which has yet
to launch commercial service, another 703 days from its original Jan. 3, 2002,
deadline to meet build-out requirements needed to keep its 63 30-MHz C-block
licenses. Once the networks are built out to the FCC's specifications, NextWave
would be able to sell them, according to the FCC's order. Bottom line, the new
deadline gives NextWave until around October of this year to complete the
installations.

Foreign Issues The ruling, according to some analysts, gives NextWave a firmer
footing in both setting up viable networks or selling off some of its assets to
other carriers. "This doesn't surprise me," says Rebecca Arbogast, telecom and
media analyst at Legg Mason Wood Walker in Washington D.C. "The FCC bent
over backward to free up the titles" to the spectrum, she says, after the U.S.
Supreme Court ruled the FCC was wrong in reselling the titles.

The FCC also ruled that NextWave could sell off some of its licenses once it
meets the build-out requirements, which could mean the company could start
selling those licenses as soon as December, according to David Kaut, telecom
analyst also at Legg Mason Wood Walker.

There are some unresolved issues still at the commission regarding foreign
ownership issues. The FCC still hasn't pursued the issue, as the legal case was in
limbo and details such as the build-out requirements were ironed out. However,
FCC officials say NextWave should expect a letter on ownership issues in the
next few weeks.

After the Supreme Court ruling, FCC officials had indicated privately the
commission would be lenient in holding the company to stringent build-out
requirements, as the intervening legal wrangling and questionable licenses were
substantial obstacles.

According to NextWave, the most important thing the ruling did was to dismiss a
petition that challenged NextWave's construction compliance filings. The filings,
according to NextWave vice president Michael Wack, were submitted to the FCC
by the company in compliance with commission guidelines.

However, rival NY Telecom contested, maintaining NextWave's networks in
several sites weren't producing signals. The company said the FCC should put
NextWave's requests for additional time to meet build-out requirements out for
public comment. NY Telecom argued the licenses should be revoked and
re-auctioned for the "noncompliance."

More Time NextWave had asked the FCC for additional time to meet the full
build-out requirements in light of the ongoing court cases, license cancellation
and subsequent re-auction of those licenses. It had filed 96 construction
notifications, which, Wack has said, met the FCC's requirements at the time.

The FCC's striking down the NY Telecom request is the most notable thing in the
commission's action. "The importance isn't extra time," Wack says. "It's the
removal of a legal cloud that's the important part."

The company has argued that, although it had sought to meet the FCC's
requirements, possession of a valid license is required to build. Without clear
title to the licenses, the company couldn't really proceed with large-scale network
construction.

http://www.wirelessweek.com/index.asp?layout=story&articleid=CA284607&spacedesc=Departments&stt=000

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