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    4 <DL!<4].UV ,  X !X   ,   4 <DL!<4.WX `   !   `   4 <DL!<4]-YZ   !     4 <DL!21(1Y11<4-[\   !     4 <DL!<4],]^  4!4    4 <DL!<4,_` ; g!g  ;  4 <DL!<4]+ab | !  |  4 <DL!2|/TηZ"<4+cd!  4 <DL!4EKM]L:ef7 #XN\  PXP# 6CCMGF-g hn  2 #&G\  P&P# ; #&R2P&P#  #XZ2PXP# #Xj\  PG;XP#6CCMGF],i jq  2 #XN\  PXP# : #XZ2PXP#   #XZ2P XP# #Xj\  P!G;XP# 2T`Zs6CCMGF,k ln  2 #XN\  P"XP# : #XZ2P#XP#  #XZ2P$XP# #Xj\  P%G;XP#6CCQE mn !  4 <DL!6CCMGF]+o pt  2 #XN\  P&XP# : #XZ2P'XP#   #XZ2P(XP# #Xj\  P)G;XP# 6CCMGF+q rq  2 #[\  P*P# 9 #i2P+P#   #XZ2P,XP# #Xj\  P-G;XP# 2s p r 5SJQE st !  4 <DL!UpdateInitial Codes for Update Module) uv#XN\  P.XP# dn  #  [ b, oT9 !#XN\  P/XP# ## b, oT9 !#XN\  P0XP# ## b, oT9 !#XN*f9 x1XX#` "Legal WordPerfect 5.0 Update Class Learning Guide   #XN\  P2XP# ## b, oT9 !#XN\  P3XP# ## b, oT9 !#XN*f9 x4XX#Legal WordPerfect 5.0 Update Class Learning Guide   v#XN\  P5XP# ## b, oT9 !#XN\  P6XP# ## b, oT9 !#XN*f9 x7XX#   Copyright  Portola Systems, Inc. 1987, 1988` APage  v#XN\  P8XP# ## b, oT9 !#XN\  P9XP# ## b, oT9 !#XN*f9 x:XX#   Page `9 &Copyright  Portola Systems, Inc. 1987, 1988 Style 9Initial Codes for Intermediate wx#XN\  P;XP# dn  ## b, oT9 Њ [ #XN\  P<XP# ## b, oT9 #XN\  P=XP# ## b, oT9 #XN*f9 x>XX#`m %Intermediate Legal WordPerfect Learning Guide   #XN\  P?XP# ## b, oT9 #XN\  P@XP# ## b, oT9 #XN*f9 xAXX#Intermediate Legal WordPerfect Learning Guide   #XN\  PBXP# ## b, oT9 #XN\  PCXP# ## b, oT9 #XN*f9 xDXX#   Copyright  Portola Systems, Inc.` APage  #XN\  PEXP# ## b, oT9 #XN\  PFXP# ## b, oT9 #XN*f9 xGXX#   Page `9 &Copyright  Portola Systems, Inc. 1987, 1988 Style 8Initial Codes for Beginning yz#XN\  PHXP# dn  ## b, oT9  [ #XN\  PIXP# ## b, oT9 #XN\  PJXP# ## b, oT9 #XN*f9 xKXX#`3 &Beginning Legal WordPerfect Learning Guide   #XN\  PLXP# ## b, oT9 #XN\  PMXP# ## b, oT9 #XN*f9 xNXX#Beginning Legal WordPerfect Learning Guide   #XN\  POXP# ## b, oT9 #XN\  PPXP# ## b, oT9 #XN*f9 xQXX#   Copyright  Portola Systems, Inc. 1987, 1988` APage  #XN\  PRXP# ## b, oT9 #XN\  PSXP# ## b, oT9 #XN*f9 xTXX#   Page `9 &Copyright  Portola Systems, Inc. 1987, 1988 2_ O?"5^2BTdd+BBd2B28ddddddddddBBdzzzzBYozzdozzooN8NTdBddYdY8dd88Y8ddddNN8dYYYNP7Pl2BBBBPBddzdzdzdzdzdYzYzYzYzYB8B8B8B8dddddddddoYzddddoYdzdzdzdzdYYzYzYzYdddddPdBdBBBdYddNNF2hdNdddddd7>d<d<BBoodBBddBoBddzzzzzzzzzzBBBBozdddddddYYYYY8888dddddddndddddYd"5^(1< (P-4)4)dd""Ԍ S0 ` q24.` ` We will continue our policy of authorizing the use of other digital modulation formats  `where such use can be demonstrated to be within the confines of the interference protection standards for  `the MDS and ITFS services. Given the large numbers of existing stations and the sizeable financial  investments in these services, we do not want to authorize routinely the use of untested emissions that  Pcould possibly result in harmful interference. As licensees and system operators gain experience in digital  system design and operation, we expect that test data will be submitted leading to a further expansion in  permitted modulation types. However, we also seek to facilitate, to the extent possible, the variety of  pservice offerings available to MDS and ITFS licensees through use of different digital emissions.  Moreover, we wish to create opportunities for such emissions to be tested through actual operations, but without risking unwanted interference.  S0 ` q25.` ` Accordingly, we will permit licensees and system operators to use any digital emission  in circumstances where interference is unlikely, or where all parties potentially affected by interference  Phave consented to such use. In such cases, licensees and operators could choose emission or emissions  most suitable for their particular system architecture and message traffic, so long as these have channel  edge power rolloff characteristics which conform to the general emission masks required for all MDS and  S 0 ITFS operations) ] {O8 #C\  P6Q/P#э #C\  P6Q/P# See 26, et seq., supra.Ħ, and meet the requirements for uniform power spectral density set out in the Digital  S 0 Declaratory Ruling. Specifically, we will permit the use of any such emission in the following  @circumstances: (1) at any  7% B main 7% B  or booster transmitter located more than 100 miles from the nearest  boundary of all co and adjacent channel ITFS and MDS protected service areas, including Basic Trading  @Areas and partitioned service areas (as these protected areas are specified in Section 21.938 of the  Commission's Rules); (2) at response stations within a response service area whose boundary is, at all  points, at least 100 miles from the nearest boundary of all co and adjacent channel ITFS and MDS  protected service areas, including Basic Trading Areas and partitioned service areas; or alternatively, (3)  S:0 @where all parties potentially affected by interference in an area (i.e., parties at lesser distances than those set out in (1) and (2), above) have consented to use of the emission(s).  S0 q` ` 3. Spectral Mask  S<0 ` Pq26.` ` In the Digital Declaratory Ruling, the Commission determined that the spectral mask*<Z] yO   #C\  P6Q/P#э The spectral mask establishes the amount attenuation which is required for the portions of the transmitted signal which fall beyond the upper and lower edges of the channel in use. for  pdigital signals should be different than that applied to analog signals of the same bandwidth because the  digital signals had been demonstrated to have less interference potential, given that their power is  uniformly distributed across occupied bandwidth, rather than concentrated in one or more segments of the  Sq0 bandwidth. This principle was applied in the spectral mask proposed for digital signals in the NPRM,  where the proposed edgeofchannel and outofchannel power suppression requirements for digital signals  are less stringent than those for analog signals. Specifically, we proposed that the outofband power of  Peach  7% B main 7% B  station transmitter, booster transmitter (with EIRP>9 dBW) and response station transmitter  pusing digital emissions and operating on a single 6 MHz channel must be attenuated (relative to the  average power level within the channel) by at least 38 dB at the channel edges, increasing linearly to an  attenuation of 60 dB at all frequencies more than 3 MHz above the upper edge and below the lower edge  S 0 Pof the channel.>+ ] yO''  #C\  P6Q/P#э In addition, only for response station transmitters, we proposed to permit the occurrence of a limited number of discrete spurious emissions above and below the channel edges so long as these are attenuated by at least 40 dB.> For booster transmitters using analog or digital modulation and capable of operating on" +P-4)4)dd@#"  S0 multiple channels simultaneously carrying separate signals (i.e., broadband booster), similar attenuation  requirements with slightly relaxed parameters were proposed. For low power booster transmitters (EIRP   9 dBW) using analog or digital modulation, no attenuation requirements were proposed. Instead, a  @requirement was proposed that such transmitters be shut down if it is determined that they are causing  harmful interference. For response stations utilizing digital modulation on the 125 kHz channels, we  proposed to require 35 dB of attenuation at the channel edges, increasing to 60 dB of attenuation at all frequencies more than 125 kHz above the upper edge and below the lower edge of the channel.  Si0 ` 0q27.` ` For  7% B main 7% B , booster and response stations utilizing digital emissions on more than one  S60  contiguous channel (i.e., a superchannel), we proposed that the outofband power suppression  requirements be applied only at the upper and lower edges of the superchannel. For example, if three 6  MHz channels were combined to form an 18 MHz superchannel, then 38 dB of attenuation would be  Prequired at the upper and lower edges of the superchannel, as would the 60 dB attenuation requirement  for frequencies more than 3 MHz removed from the upper and lower edges of the superchannel. If the  P18 MHz superchannel were redivided into two 9 MHz channels, the outofband attenuation requirements  would still apply only at the upper and lower edges (and beyond) of the superchannel, and would not  apply at the intrachannel boundary which forms between the upper edge of one 9 MHz channel and the  lower edge of the other 9 MHz channel. Similarly, when a 6 MHz channel is subchannelized, the outof band power suppression requirements would only be applicable at the upper and lower edges (and beyond)  Pof the 6 MHz channel. For example, if the 6 MHz channel were divided into 120 channels of 50 kHz  S0 bandwidth, the lowermost channel (i.e., 50 kHz channel No. 1) and the uppermost channel (i.e., 50 kHz  pchannel No. 120) would be the only channels to which any explicit attenuation standards would apply,  as required to meet the overall standards applicable to the edges of the 6 MHz channel. In this example,  the lower edge of channel No. 1 and the upper edge of channel No. 120 would have to meet the  attenuation requirements, while no particular requirements would apply to channels 2 through 119, so long  S0 as all of the power from these channels was contained within the 6 MHz bandwidth.,] yOp  #C\  P6Q/P#э The EIRP limit per 50 kHz channel would be the same for each channel and would be 1/120 of the power limit  for the 6 MHz channel. For a subchannel of any bandwidth B (in kHz), the maximum permissible power is (B/6000)  `x (6 MHz EIRP limit). For a superchannel composed of N 6 MHz channels, the maximum permissible power is N   x (6 MHz EIRP limit), and if the superchannel is redivided into subchannels, then a subchannel of bandwidth B (in kHz) would have a power limit of (B/6000) x (6 MHz power limit). As a practical   matter, licensees may choose not to utilize a few of the lowermost and uppermost narrowband  subchannels, in effect creating a guardband that isolates the outofband power of the inner subchannels  from the edges of the 6 MHz channel. In this circumstance, the power spectral density requirement for  S<0 0the 6 MHz channel would still be applied as if the entire bandwidth were in use, i.e., the creation of intra channel guardbands or unused interior subchannels does not alter the calculation for power spectral density  S0over the entire channel.  S0  Sq0 ` @q28.` ` In response to the spectral mask proposals, CTN argued that the exception in the mask  which permitted response stations to emit discrete spurious emissions with a suppression of only 40 dB  S 0 presented an unacceptable interference threat to ITFS receivers.- x] yO# #C\  P6Q/P#э Comments of Catholic Television Network ("CTN"). In certain circumstances, CTN stated  that these emissions will be present as cochannel interference at ITFS receive sites at signal levels as great  as +23 dBm for response stations operating at an EIRP of +63 dBm. CTN suggested that greater  Psuppression of these emissions is needed, on the order of 60 dB for response stations operating at +48  dBm, up to 75 dB for response stations operating at +63 dBm. Replying to CTN's concerns, Petitioners  `stated that "as a result of technological advances in the year since the Petition was filed, the proposed" l-P-4)4)dd@#"  S0 @exception to the emission mask for discrete spurious signals is no longer necessary.".] {Oh #C\  P6Q/P#э Petitioners' ex parte letter of March 6, 1998. Petitioners   proposed that it be eliminated when final rules are adopted "so as to provide a more interferencefree  0operating environment." The General Instrument Corporation ("General Instrument") (formerly NextLevel  pSystems, Inc.) suggested that the digital emission mask "be modified to incorporate a maximum  S40 attenuation for spurious emissions of 43 + 10 log(power) or 60 dB, whichever is less stringent."p/4Z] yO #C\  P6Q/P#э Comments of General Instrument.p General  @Instrument calculated that this mask cutoff would result "in an absolute emission power limit of 43 dBW  in a 100 kHz reference bandwidth." General Instrument's proposal was supported by Gulf Coast, which  0said that this change would "conform the MDS/ITFS rules with the rules of other radio services, including  Sh0PCS."0hN] yO #C\  P6Q/P#э Reply Comments of Gulf Coast MDS Service Company.  S0 ` 0q29.` ` General Instrument requested that the Commission clarify its specification of the proposed  emission mask for digital emissions, in particular asking for confirmation that the references to 38 dB and  60 dB attenuation "mean that the measured power in the measurement bandwidth at an outofband   channel frequency is to be attenuated by those amounts with respect to the total inchannel power in a 6  S6 0 MHz bandwidth."p16 B] yO| #C\  P6Q/P#э Comments of General Instrument.p Spike Technologies, Inc. ("Spike") sought a similar clarification.i26 6] yOp #C\  P6Q/P#э Reply Comments of Spike.i Petitioners  S 0 paddressed this issue in both their Comments and Reply Comments to the NPRM. z3 * ] yO1 #C\  P6Q/P#э Petitioners' Comments and Reply Comments.z Petitioners argued that  the emission mask interpretation put forward by General Instrument "would result in shifting the emission  0mask by 17.78 dB from the mask used in all of the testing done in support of the Petition that led to the  Sk0 `Digital Declaratory Ruling and upon which the currently proposed rules are based," an outcome which  "would result in increased interference from digital transmissions absent a corresponding reduction in the  average power utilized." Petitioners stated that the best way to clarify the specification and measurement  procedures for the attenuations required by the emission masks is to utilize the formulas which they  provided in their Comments, which take into account the spectrum analyzer resolution bandwidth used and whether the transmitter power output measurement is absolute or relative.  S0 ` q30.` ` General Instrument also suggested that the emission mask power suppression requirement  should be slightly modified within the first 250 kHz beyond the upper edge and lower edge of the 6 MHz  S0 channel.p4 ] yO# #C\  P6Q/P#э Comments of General Instrument.p Specifically, General Instrument proposed that, rather than 38 dB attenuation at the channel  edges, there should be 25 dB of attenuation at the edges, increasing linearly to 40 dB of attenuation at 250  kHz above and below the edges, and then increasing linearly to 60 dB at 3 MHz above and below the  edges. General Instrument argued that the transmitters used for the tests performed in connection with  S0 the Digital Declaratory Ruling actually produced an occupied bandwidth pattern conforming to their  S0 0proposed revised emission mask, rather than to that proposed in the NPRM. This occurred, according to"4P-4)4)dd"  `NextLevel, because the actual occupied bandwidth of the test signal was 6.5 MHz, not 6 MHz, thus  creating a discrepancy of 500 kHz, or 250 kHz on each side of the 6 MHz channel. Petitioners supported  General Instrument's proposal, saying that General Instrument "correctly notes that the testing that  Sg0 supported the initial Petition for Declaratory Ruling used some equipment that essentially followed the  mask proposed by General Instrument." Petitioners also agreed with General Instrument's conclusion that  such an amendment to the emission mask would have no practical effect on the MDS/ITFS interference  environment because it would not alter in any way the actual interference test results using this gear, which demonstrated its limited interference potential.  S60 ` q31.` ` With respect to the spectral mask for digital emissions, the Commission emphasized in  S0 Pthe Digital Declaratory Ruling that the essential requirement is that the power spectral density of the  digital signal be as uniform as possible across the bandwidth in use, no matter what that bandwidth might  S 0 be.5 ] {O #C\  P6Q/P#э Declaratory Ruling and Order, 11 FCC Rcd at 18857 For the purposes of this proceeding, because we will permit the routine use of channels of essentially   any bandwidth, we believe it is important to specify the maximum permissible transmitter power in units  of bandwidth, something which, until now, has been implicit in the rules for discrete emissions within  fixed bandwidths. For example, the maximum power for a  7% B main 7% B  station transmitter is 33 dBW EIRP for  S 0 an NTSC video signal within a standard 6 MHz channel.6 Z] yO0 #C\  P6Q/P#э Slightly higher EIRP is permitted if a directional antenna is used. The power distribution for this signal is very  `nonuniform, varying several orders of magnitude depending upon which part of the channel is examined.  Sl0 For digital signals, power uniformity is essential for producing a 'noiselike' signal which can be evaluated  for interference purposes as if no portion of the signal had any greater (or lesser) interference impact than  pany other portion of the signal. For digital transmitters operating under the rules we are adopting, we will  `continue the policies for uniform power spectral density, including the requirement for continuous energy  S0 dispersal during times of no modulation, as set out in the Digital Declaratory Ruling and 6 MHz will be  used as the reference bandwidth for power limitations. With respect to the spectral mask to be used for  S;0 the time being, we are adopting the mask parameters specified in the NPRM, except that we have amended  @them to take into account the issue raised by General Instrument concerning the first 250 kHz above and  0below the channel edges. We agree that the test data support a slight modification to the suppression  plevels set out in our proposals and we are incorporating that modification into the rules being adopted.  We do not believe that this minor adjustment at the edges of the channels will have any impact on the  S=0 Pinterference environment in the services, inasmuch as the interference tests conducted for the Digital  S 0Declaratory Ruling encompassed this slightly greater spectral occupancy.  S0 ` Pq32.` ` We also agree with General Instrument and others who raised concerns about the proper  interpretation of how outofband suppression levels were to be measured and interpreted. The text of the  S@0 NPRM was not precise concerning where and how the attenuation requirements should be applied to the  `digital emission's spectrum and we believe this should be resolved. As Petitioners noted in their  Comments, there are numerous ways to measure the power spectrum inside and outside the digital  0emission's designated channel, and each of these measurements could result in the calculation of different  suppression levels. In order to avoid this situation, we are incorporating into our rules the two formulas  provided by Petitioners. These formulas take into account all the relevant factors necessary to assure that,  `no matter what exact measurement procedure is used, the results of the tests will be interpreted uniformly  and in accordance with the rules we are adopting. We are not, however, adopting General Instrument's  @suggestion that a maximum suppression limit be placed on digital emitters which would, in effect, remove  the outofband attenuation requirements for power levels below a certain minimum. Although this  approach has been used in some other radio services, such a relaxation of outofband limits, in the context"C#N6P-4)4)dd&"  pof a cellularized CDMA system, could result in an adverse impact on the interference environment. With  respect to CTN's concern about discrete spurious emissions and their potential interference impact, we are  0adopting Petitioners' recommended modification to the spectral mask for response stations which  Sg0 completely eliminates the exception proposed in the NPRM for such emissions. As Petitioners noted, such  pan exception should not now be necessary for the new equipment which will become available for twoway MDS/ITFS systems.  S q` ` 4. Frequency Tolerance and Equipment Certification  S60 ` pq 33.` ` In the NPRM, we sought comment on Petitioners' request that the existing +/ 1 kHz  `frequency tolerance requirement be retained for all  7% B main 7% B  station digital and analog transmitters and for all  digital and analog booster transmitters with an EIRP exceeding 9 dBW, and that for all booster  transmitters with less than 9 dBW EIRP and for all response station transmitters, no frequency tolerance  requirement be imposed. These concepts were generally supported in the Comments and Replies and we  0are adopting them in our rules. The extra interference potential of individual low power boosters and  @response stations which might arise from frequency instability is very limited, and thus imposing a  tolerance requirement on them would result in added equipment cost and complexity with no  0corresponding benefit to the interference environment. This would be especially true for narrowband  response stations which operate on subchannels within, and removed from the edges of, larger channels.  For main station and high power booster transmitters, there is a much more significant potential  interference impact and we believe that requiring the emissions from these stations to be held steady  within their assigned channels is much more important. With respect to certification of devices used in  @these services, we proposed and are adopting rules which would require that all response station  Sm0 transmitters receive certification and we are retaining our rules requiring type certification of ma 7% B in 7% B  and  S:0 0booster transmitters. In addition, we are continuing the interim policy set out in the Digital Declaratory  S0 Ruling allowing the use, without certification, of existing analog equipment for digital emissions so long  S0as the emissions generated by this equipment conform to the appropriate spectral mask specifications.7] {O> #C\  P6Q/P#э Declaratory Ruling and Order, 11 FCC Rcd at 18862  Sp  q` ` 5. Protection from RF Emissions  S=0  S 0 `  q!34.` ` In the NPRM, we sought comment on whether to follow the Petitioners' suggestion and  amend the provisions of Section 1.1307 to provide rules, similar to those adopted for LMDS licensees,  S0 pto govern radio frequency ("RF") emissions for MDS/ITFS return path transmissions.g8Z] {O #C\  P6Q/P#э NPRM at  27.g We noted that all  `FCCregulated transmitters, including the subscriber terminals used in LMDS systems, are required to meet  S?0 @the applicable guidelines regarding RF exposure limits.9\?P] {O!  0#C\  P6Q/P#э Id at 1266970 (citing Guidelines for Evaluating the Environmental Effects of Radiofrequency Radiation, ET  {O]"  @Docket No. 9362, Report and Order, 11 FCC Rcd 15123, 15124, 15152 (1996) (RF Report and Order) and 47  yO'# C.F.R.  1.1307(b)(1)).ġ We recognized that subscriber antennas are very  S 0 0small and can be mounted in a variety of places at subscriber locations.c: ] {O% #C\  P6Q/P#э Id at 12670.c However, we found that the RF  @exposure could be mitigated by the fact that these antennas are ordinarily mounted so that neither  subscriber nor passersby will venture into their transmit beams, because the person will block the signal" :P-4)4)dd "  S0 and interrupt the transmissions between the hub and subscriber transceivers.Z;] {Oh #C\  P6Q/P#э Id.Z Therefore, we decline to  adopt special RF rules for return path transmissions. In addition, we found that exposure could be  `mitigated by the fact that LMDS subscriber equipment probably will be installed by professional  personnel, thereby minimizing the possibility that subscribers or passersby will intercept the transceiver  S40  signal.Z<4Z] {O #C\  P6Q/P#э Id.Z At the same time, we recognize that due to the frequency reusage and greater permissible power  0limits there are differences between these services and LMDS that may warrant greater care in the  `installation and deployment of subscriber units. We, therefore, will require such devices to be installed by the hub station licensee, its employees or its agents.  S50 ` q"35.` ` Further, we stated that it was incumbent upon LMDS licensees to exercise reasonable care  S0 to protect users and the public from exposure from the operation of LMDS transceivers.Z=P] {OV #C\  P6Q/P#э Id.Z We noted that  LMDS licensees are required to provide user and installation information, to label subscriber antennas  properly, and to provide adequate notice regarding the potential safety hazards of LMDS subscriber  Si 0 Ptransceivers.Z>i F] {O #C\  P6Q/P#э Id.Z While we declined to require interlock features, we found that such features could enhance the safety of LMDS subscriber transceivers and we strongly encouraged their use.  S 0 ` q#36.` ` With the exception of the Cellular Phone Taskforce ("CPT"), most parties commenting  pon this issue support our proposals. While not specifically opposing our plan, CPT states that "[B]ecause  pof health concerns familiar to the Commission . . . [CPT] opposes the introduction any more new, or the  S70 expansion of existing digital cellular networks of any type within the United States of America."a?7<] yOw #C\  P6Q/P#э Comments of CPT.a CPT  states that its members "are already suffering profound disability and disease because of such existing  S0 Pservice networks."Z@0 ] {O #C\  P6Q/P#э Id.Z CPT notes that it filed these comments in both this proceeding and ET Docket No.  p9362, the Commission's rulemaking proceeding concerning guidelines for evaluating the effects of RF  Sk0 emissions.ZAk& ] {O #C\  P6Q/P#э Id.Z We agree with the Petitioners that this is not the appropriate venue for considering CPT's  S80 @concerns.yB8] {OX# #C\  P6Q/P#э See Reply Comments of Petitioners.y CPT does not provide any discussion concerning the potential impact of adoption of the  S0 `specific rules proposed in the NPRM. The appropriate proceeding for resolving CPT's concerns is ET"BP-4)4)dd"  S0 @Docket No. 9362, where CPT has been an active participant.oC\] {Oh   #C\  P6Q/P#э See "Appeal" of CPT, ET Docket No. 9362 (filed October 6, 1997); "Petition of CPT for Reconsideration," ET  {O2  Docket No. 9362 (filed November 28, 1997); and "Ex Parte Comments of CPT," ET Docket No. 9362 (filed December 29, 1997).o We find that the public interest will not  0be served by delaying the introduction of twoway service by MDS and ITFS licensees pending further decisions in that proceeding.  S40 ` `q$37.` ` We are generally adopting the proposals contained in the NPRM. We will adopt our  proposal and modify the provisions of Section 1.1307 of our Rules for MDS and ITFS in a manner similar  S0 to the approach we adopted for LMDS.D] {O #C\  P6Q/P#э See Comments of Petitioners and of Wireless One. We will require MDS and ITFS licensees employing twoway  technology to attach labels to every subscriber transceiver in a conspicuous fashion. Such labels should  include reference to the Commission guidelines that apply. In addition, MDS and ITFS licensees  employing twoway technology must include a full explanation of the labels that appear on their  transceivers, as well as reference to the applicable Commission guidelines in the instruction manuals and  @other information accompanying their subscriber transceivers. This information should include advice as  Pto the minimum separation distances required between users and radiating antennas to meet the  0Commission's exposure guidelines. As we declined to do with LMDS, we will not mandate the specific  language that must be used, however, we will require use of the ANSIspecified warning symbol for RF exposure.  S 0 ` q%38.` ` As with LMDS, we encourage MDS and ITFS licensees employing twoway technology  to use safety interlock features on their subscriber units to the extent that such features can be made  available at a reasonable cost. We expect that MDS and ITFS licensees will work with all interested  parties to achieve the protection intended and, in the future, if we find that the requirements and  procedures adopted herein do not provide adequate protection from RF emissions, to subscribers and the general public, we may revisit this issue.  S8 q C .` ` Interference  S0 ` q&39.` ` As discussed in the NPRM, the interference standards in the MDS and ITFS services are  pintended to minimize the occurrence of destructive interference between neighboring systems. We  proposed to carry over the existing 45 dB/0 dB D/U co and adjacent channel protection ratios and the  S:0 ԩ73 dBW/m2 contour protection criterion and apply them to the digital cellularized systems proposed by  the Petition, although with adjustments which account for the particular bandwidths involved in the  S0  calculations.E] yO  #C\  P6Q/P#э For example, the 73 dBW/m2 contour protection limit for a 6 MHz digital channel corresponds to 89.8 dBW/m2  for a 125 kHz digital channel. For digital channels of any width, the required contour protection limit is expressed  yOJ"  by the following formulation: -73 dBW/m2 + 10log(digital channel width in MHz/6). We also proposed, for the sake  {O#  0of uniformity, to conform the 75.6 dBW/m2 contour protection limit of Part 74 (see e.g. former 74.985(c)) to the  yO# 73 dBW/m2 limit of Part 21. Additional adjustments were proposed to account for the fact that multiple cochannel  ptransmitters will be operating simultaneously in some systems and for the fact that the actual locations of  response stations in twoway communications systems will not be used for interference calculations. With  respect to the operation of simultaneous cochannel transmitters, we proposed to calculate the total power  flux density radiated by all such transmitters per channel and use that total flux in calculating conformance  0with the required D/U ratios and contour flux limits at service area boundaries. Because the digital signals" EP-4)4)dd"  to which this process is being applied are 'noiselike' with uniform power spectral density across each  pchannel, subchannel and superchannel, a straightforward process can be applied whereby the power per  channel per station is arithmetically added to the power per channel for all other stations pertinent to the  0interference calculation. If a  7% B main 7% B  station transmitter, one or more booster station transmitters and one  or more response station transmitters in a given system are simultaneously active on channels which fully  or partially overlap, then the calculation of aggregated power would involve all such simultaneously active  S0 stations on all of the overlapping portions of the channels.F] yO6  #C\  P6Q/P#э For example, a given channel or superchannel might be used simultaneously at more than one booster station to  service separate response service areas. The same channel or superchannel might be used in a yet another response  pservice area for response station transmissions. To the extent that such operations involve simultaneously active  transmitters on partially or completely overlapping channels, the power emitted by all such transmitters must be aggregated per channel in order to calculate the total power flux density to be used for interference calculations.  This procedure for interference calculations  @for cellularized systems was proposed because Petitioners expect, and we believe it is reasonable to  assume, that these systems will involve large numbers of transmitters with heavy frequency reuse and  Psimultaneous operation, and that the interference effects of such large numbers of emitters must be taken  into account in a manner drastically different than is now done on a sitespecific basis under our current interference protection rules.  Si 0 ` q'40.` ` With respect to calculating the interference effects of response stations in cellularized  systems, we proposed to implement a process proposed by the Petitioners which utilizes theoretical  0estimations and statistical modeling of response station locations, necessitated by the fact that the locations  of the individual response stations will not be known at the time the interference calculations for the  overall system are made. This situation arises because, in the type of system proposed, the application  for licensing of the system will contain specific site locations for only the transmitters at main and booster  stations. All response station transmitters would be licensed under blanket authorizations which specify  only the locations of the receiving hub stations associated with the response stations. The response  stations themselves would be installed and activated over an indefinite period of time commencing after  the system was licensed. This sequence of system design, development and authorization thus necessitates  a radical departure from the customary process whereby interference calculations are made based on specific information concerning specific stations at specific locations with specific operating parameters.  S0 ` pq(41.` ` The process devised by Petitioners for calculating response station interference, entitled  "Proposed Text of Attachment to Report and Order Setting Forth Method for Predicting Accumulated  Signal Power From a Multiplicity of StatisticallyLocated Transmitters," ("Methodology") was attached  S90 to the NPRM as Appendix D. This Methodology involves essentially two tasks; first, a theoretical model  is constructed for use in estimating the amount of interference likely to be generated by the response  stations operating within a system; and second, this estimate of response station interference is combined  with specific calculated interference levels from  7% B main 7% B  and booster stations and the total is used to  Pdetermine compliance with the Commission's interference standards. A detailed description of the  S;0 proposed Methodology is given in the NPRM, beginning at paragraph 34, and will not be repeated here.  The essential elements of the theoretical model are as follows: A system of intersecting lines in  checkerboard fashion ("the grid") is created within a selected response station service area within the  S0 system. Each grid point (i.e., each point where lines intersect) is considered to be the location of one or  Sq0  more hypothetical response stations with defined parameters for a class of response station, e.g., frequency,"qxFP-4)4)dd`!"  S0 0EIRP and antenna pattern/orientation/polarization/height AGL.G ] yOh  #C\  P6Q/P#э The Methodology implicitly included a worstcase assumption that large numbers of response station transmitters  `for each region and class would be operating simultaneously, and thus each grid point would represent many   simultaneously active emitters. To estimate the geographic dispersion of response stations among grid points,  Petitioners proposed to use U.S. Census population data in such a way as to correlate the location densities of  response stations with population densities within U.S. Postal Service ZIP Code areas. With respect to station  Ptechnical parameters, each hypothetical equivalent station for a regional class was assigned worstcase parameters  {O  visavis all the actual stations it was intended to represent. Thus, a theoretical station would be assumed to have   the highest antenna height, greatest power, widest bandwidth, longest duty cycle, and the highest "combined worstcase" antenna horizontal radiation pattern of all the stations for which it is a proxy. A number of theoretical measurement  points are established at locations surrounding the grid and the theoretical signal strengths of all assumed  response stations at all of the measurement points are calculated and evaluated for sufficient uniformity  Sg0 to test the adequacy of the grid.HZg] {O  0#C\  P6Q/P#э The test for uniformity was described in detail in the NPRM at Appendix D. Once the uniformity test is met, it  @provides a reasonable indication that the density of the grid points is sufficient that no greater number of grid points would significantly improve the accuracy of the interference model. Once the uniformity test is met, all subsequent interference calculations  involving response station transmitters are based on the hypothetical equivalent response stations located at the grid points.  S0 ` q)42.` ` Numerous parties took issue with all or part of the Methodology and some parties  suggested various alternatives to it. Dallas County was critical of the proposed techniques, arguing that  the proposal presents insufficient details for an incumbent to evaluate or validate the conclusions as to no  S0 potential interference from a twoway application.I ] {O& #C\  P6Q/P#э Joint Comments of Dallas County Community College District, et. al.Ě BellSouth supported the use of models to predict  interference, but recommended the establishment of a working group to refine the modeling process as  S 0 actual systems are tested and interference issues are resolved.J ] yO #C\  P6Q/P#э Comments of BellSouth Corporation and BellSouth Wireless Cable, Inc. EDX argued that the approach to  establishing the grid is flawed in several ways, including the omission of terrain considerations in  @performing field strength calculations and the fact that multiple grids, each with different point densities,  0are possible within a given service area and could lead to different interference calculation results that  S 0  would be incompatible.rK ] yO #C\  P6Q/P#э Comments of EDX Engineering, Inc.r EDX suggested that the spacing of grid lines be based on fixed  latitude/longitude increments, rather than mileage as proposed by Petitioners, and that terrain be used as   a determinant of grid point density. EDX also proposed an alternate interference methodology in which  all response station transmitters within a defined area would be represented by "a single hypothetical  aggregate response station located at the RSA hub location, using an omnidirectional antenna, and with  a power level set as a function of the maximum power level and number of response stations associated  S0 @with that RSA hub."[L] {O% #C\  P6Q/P#э Id..[ Spike commented that the EDX methodology, while flawed in Spike's opinion,  Sk0 0might prove useful in areas where terrain shielding is not an important factor.iMk] yOc( #C\  P6Q/P#э Reply Comments of Spike.i Spike argued that"kMP-4)4)dd"  Petitioners' use of census data for estimating the distribution of response stations is flawed, and that  @Petitioners' Methodology does not properly account for Time Division Multiple Access ("TDMA") type  S0 Psystems, where transmitters operate sequentially rather than simultaneously.cN] yO #C\  P6Q/P#э Comments of Spike.c Spike suggested that there  should be more flexibility in the way interference is calculated, with applicants free to choose their own  `particular methodologies as long as they adequately describe their procedures and the assumptions used   to reach their conclusions. With reference to hub stations, Spike proposed that the definition of hubs be  S0 pexpanded to permit transmission as well as reception of signals.[OX] {O* #C\  P6Q/P#э Id..[ CTN, in addition to challenging the use  of census data, argued that the proposal "raises many questions which have not been answered," and that  "there is no procedure for ensuring that the actual installation of response stations corresponds to what the  S50applicant predicted."aP5N] yO #C\  P6Q/P#э Comments of CTN.a  S0 ` `q*43.` ` In response to criticism of their Methodology, Petitioners proposed to make several  modifications to the way the grid system is configured and the theoretical transmitter parameters  Si 0 `established.oQi B] yO #C\  P6Q/P#э Reply Comments of Petitioners.o Petitioners proposed to specify the separation of grid points in terms of latitude and   longitude rather than miles; to revise the grid uniformity test to eliminate the possibility that increasing  the density of points in a grid already meeting the uniformity test could result in the grid failing the test;  @to increase the number of grid points within a sector if the number falls below a predetermined minimum;  `to revise the methods of considering terrain blockage and of the sharing of channels by response stations;  and to use a fewer analytical steps for TDMA systems. In addition, responding to parties who asked for  a more detailed explanation of exactly how the procedures in the Methodology would be applied to the  calculations of response station interference, Petitioners submitted a sample interference study which, they  said, "provides a stepbystep description of how an engineer can employ software products that are readily  S0 Pavailable in the marketplace to perform analyses of the potential for interference from response stations."ZR6] {O #C\  P6Q/P#э Id.Z  In response to Spike and others who challenged Petitioners' use of census data for predicting the  geographical distribution of response station locations, Petitioners agreed that this data reflects residential,  not business, populations, but argued that this "will result in the creation of additional regions within  response service areas in order to meet the uniformity of population test required by the methodology,"  and, thus "the more regions that are created, the more accurate predictions of interference tend to be."  In a subsequent filing, Petitioners proposed further modifications to their Methodology, wherein the actual  terrain elevations at, and around, all grid points are taken into account in the specification of the  S0  theoretical response station parameters used at each grid point for interference calculations.S, ] {O6$ #C\  P6Q/P#э Petitioners' ex parte letter of May 13, 1998. Additionally,  Petitioners proposed to eliminate the use of census data for estimating response station locations in CDMA  S0  systems.ZT" ] {O' #C\  P6Q/P#э Id.Z With reference to CTN's concern that the numbers or types of response stations actually put"TP-4)4)dd"  into operation may differ from what was contained in the system application and interference analysis,  PPetitioners responded that the Commission relies upon licensees to construct their systems in accordance  with the terms of their authorizations which would provide a maximum number of response stations for  each class, and that the Commission has a number of tools, including license revocation, to sanction  S40unlawful operation.oU4] yO #C\  P6Q/P#э Reply Comments of Petitioners.o  S0 ` q+44.` ` With respect to Spike's suggestion that Petitioners' methodology should be more flexible,  and to EDX's proposed alternative to the Methodology, Petitioners argued that neither proposition has  Sh0 merit.ZVhX] {O #C\  P6Q/P#э Id.Z Petitioners stated that the use of a standard methodology "will provide a high degree of certainty  to applicants and licensees and will avoid unnecessary disputes before the Commission regarding the  S0 `efficacy of any particular model."ZWN] {OT #C\  P6Q/P#э Id.Z Petitioners further argued that if a common, Commissionmandated,  methodology is not established, then the licensees of neighboring systems will not only have to verify the  0calculations within an interference analysis submitted to the Commission, but also will have to verify the  assumptions and formulations which went into development of whatever methodology is being used. Such  an approach, Petitioners said, would be antithetical to the goals of applicants and the Commission of  `providing the most expeditious possible processing of applications within the services, in that the number  `and complexity of disputes which might arise with the use of a common methodology will be far less than  would arise if there were multiple unspecified methodologies. With respect to EDX's proposed alternative  methodology, Petitioners argued that it is "fundamentally flawed," in that EDX's use of a single emitter  Pat each hub station location as a proxy for all response stations within the associated response station   service area ("RSA") does not take into account the actual interference effects along the various lineof sight and obstructed paths within the RSA, and thus will inevitably misstate the interference potential of  the response stations in a way that could not be corrected by adjustments to the parameters set for the  Sk0 hypothetical hub station transmitter.[XkD] {O #C\  P6Q/P#э Id. [ Additionally, Petitioners argued that EDX's methodology is "flawed  by its failure to provide any mechanism for modeling the potential for interference from a noncircular  RSA," nor does EDX's methodology "accurately model the potential for interference in those situations  where response station transmitters are located in close proximity to an adjacent market receive site or  PSA boundary." Responding to Spike's request that hub stations be permitted to transmit, as well as   receive, signals, Petitioners argued that such a change would fundamentally alter the type of interference  analysis necessary for hub stations, and that Spike has erroneously assumed that booster stations cannot  S0be colocated with hub stations.ZY:] {OD" #C\  P6Q/P#э Id.Z  S0 ` q,45.` ` In addition to concerns about the response station interference Methodology, CTN  contended that interference could be caused to ITFS receive sites by nearby response stations as a result"m0 YP-4)4)dd"  S0 of brute force overload ("BFO") to broadband downconverters used at these sites.Zx] yOh  #C\  P6Q/P#э BFO interference results from response stations transmitting on channels which are neither cochannel with, nor  directly adjacent to, the channels in use at the ITFS receive site. A broadband downconverter used at an ITFS  receive site is a device connected to the receiving antenna which takes the microwave signals from the antenna and  0converts them to signals of lower frequency. This downconversion is necessary as a preliminary step before the  0signals are demodulated. CTN defined BFO interference to exist if greater than a 1 dB degradation to the carrierto noise ratio of the downconverted NTSC analog ITFS signal is observed due to the operation of one or more response stations using digital modulation.  CTN pointed out that  S0 WCA petitioned the Commission for expedited reconsideration of the Report and Order which established  the Wireless Communications Service ("WCS") in the 2.3 GHz band, where WCA raised concerns about  Sh0 BFO interference and asked for immediate relief to avoid serious and irreparable injury.H[h] {Ot  #C\  P6Q/P#э WCA Petition for Expedited Reconsideration, GN Docket No. 96228, (March 10, 1998); Amendment of the  {O> Commission's Rules to Establish Part 27, the Wireless Communications Service, 12 FCC Rcd 10785 (1997).H CTN cited  WCA's request that WCS stations be limited to 20 watts EIRP, although the WCS is separated from  MDS/ITFS spectrum by 140 MHz, and contrasted it to Petitioners' request that response stations be  permitted an EIRP of 2000 watts, and concluded that "surely response station transmitters operating at  S0 2000 watts with no guardband at all would present a much greater problem to ITFS downconverters."a\ ] yOh #C\  P6Q/P#э Comments of CTN.a   CTN also questioned how response stations can be properly installed so as to minimize BFO interference if customerinstalled equipment is permitted.  S0 ` @q-46.` ` As a solution to the potential problem of interference from response stations, including  pBFO interference, CTN proposed that a spectrum buffer be created which "places a 24 MHz guardband  between downstream ITFS and upstream MDS operation, in which only downstream MDS operations are  S7 0 permitted."]7 ] yO  @#C\  P6Q/P#э Request for Supplemental Comment Period and Extension of Time by Catholic Television Network, November 25, 1997, Appendix at 3. CTN argued that such a guardband would have several benefits, in that it would: (1) moot  the need for calculating response station interference into ITFS receive sites; (2) allow the installation of  pbandpass filtering, when needed, at ITFS receive sites to give broadband downconverters greater immunity  to BFO interference; and (3) confine the risk of BFO interference, as well as conventional cochannel and  padjacent channel interference, solely to the MDS spectrum authorized to MDS licensees and wireless cable  operators, where it could more readily be solved on an intrasystem basis. To implement this plan, CTN  S0 0proposed to "refarm" (i.e., change specific channels used by certain stations, but with no net reduction in  pthe number of channels available to any station) the E, F, G and H Group channels to create a contiguous  band of spectrum for ITFS use at 25002620 MHz and a contiguous band of spectrum for response station  use at 26442690 MHz. As an alternative to their 24 MHz guardband plan, CTN proposed a plan whereby   a 6 MHz guardband between downstream ITFS and upstream MDS operations would be combined with  S0 a notification and testing procedure for all response stations installed in proximity to ITFS receive sites.a^x] yO$ #C\  P6Q/P#э Comments of CTN.a  0Under this procedure, no response station could be installed until a notification was sent to each ITFS  licensee with any receive site within a distance of 1960 feet of the of the location of the proposed response  station. In addition, for proposed response stations located within 300 feet of any ITFS receive site, or   within 300 feet either side of the boresight azimuthal orientation of any ITFS receive site antenna along";l^P-4)4)dd"  pa line extending from the antenna for a distance of 1960 feet, an onair test would be required in order  S0 to establish that, in fact, no interference would result from operation of the response station.[_] {O5 #C\  P6Q/P#э Id. [ CTN stated  @that the notification and testing procedure is necessary in order to compensate for the fact that bandpass  0filters are not usable if the guardband is reduced from 24 to 6 MHz. As a second alternative to the 24  MHz guardband plan, CTN proposed that the Commission designate eight 6 MHz channels, A4, B4, C1,  D1, E4, F4, G1 and H1, for upstream use at response stations. Single channel guardbands, consisting of  pchannels B3, C2, F3 and G2, would be established to separate response station upstream channels from  S0 downstream ITFS channels.g`Z] yO #C\  P6Q/P#э Reply Comments of CTN.g In addition, under this plan, response stations would also be required to  perform the notification/testing procedure set out above for the other 6 MHz guardband proposal. In a  S50 pfiling in response to the Commission's establishment of a comment period on ex parte pleadings, CTN  S0reiterated their requests for a 6 MHz guardband and for notification and testing procedures.paXN] yOU  #C\  P6Q/P#э July 2 Comments of CTN. CTN specified that the 6 MHz guardband would apply geographically within a radius  of 35 miles from each ITFS  7% B main 7% B  transmitter site. Their earlier guardband proposals were geographically indeterminate. p  S 0 ` q.47.` ` A number of parties disputed CTN's allegations that interference would be a serious  pproblem and questioned the need for guardbands. Region IV Educational Service Center ("Region IV")  argued that CTN had created a "theoretical monster," coupled with a "staggeringly complicated and  S 0 restrictive solution which could well result in a still birth of the basic twoway service concept."UbX ] yO  #C\  P6Q/P#э Comments of Region IV, UT Television, George Mason University Instructional Foundation, Inc., Humanities  Instructional TV Educational Center, Inc., the Denver School District, Butler Community College and Minnesota Public Radio.U ITFS  Parties argued that the guardband proposal and refarming of spectrum "creates a host of problems," and  S 0 `that "this cure would be much worse than the purported disease."jc V ] yO #C\  P6Q/P#э Comments of ITFS Parties.j ITFS Parties urged CTN to "focus  @more on simply crafting rules that require proponents of a twoway, cellularized system to resolve  interference problems caused by the system, and to shut down any interfering operations until a resolution  S0 can be achieved." Petitioners argued that the risk of BFO interference is de minimis, saying that "detailed  analyses conducted by Petitioners demonstrate that under any realistic scenario, ITFS receive sites located   in less than 1% of a protected service area would even be at risk, and mitigation techniques generally can  Sm0 eliminate any interference at those few sites."idmJ ] yO! #C\  P6Q/P#э Comments of Petitioners.i Petitioners presented calculations made for four different  S:0 0system architectures (i.e., configurations of response station transmitters and ITFS receive sites) which they  claim demonstrate that, under typical realworld conditions, the amount of vulnerable area within a PSA  S0 is always less than 1% and sometimes as little as 0.003%.Ze>] {O& #C\  P6Q/P#э Id.Z Petitioners also described numerous"4eP-4)4)dd"  0techniques which they claim can be used alone, or in combination, to mitigate the effects of any BFO  S0interference which might occur within the small areas of a PSA which are vulnerable.fZ] {O5   #C\  P6Q/P#э Id. The techniques are cross polarization, antenna offset, improved antenna performance, attenuation, improved  downconverter dynamic range, field tunable notch filter, bandpass filter, reorientation of response station antenna, microwave absorption material and phased antenna arrays.  Sg0 ` q/48.` ` With respect to CTN's guardband proposals, Petitioners argued that restrictions on the  Pchannels available for upstream use would "unnecessarily hamper the commercial viability of twoway  S0 services."og] yO #C\  P6Q/P#э Reply Comments of Petitioners.o Petitioners charged that CTN "has provided the Commission with absolutely no technical  analysis which even purports to show that the operation of response stations within 6 MHz of an ITFS  @channel will invariably lead to interference," and that "CTN would have the Commission sacrifice the   ability of ITFS licensees to deploy their spectrum flexibly merely to avoid the need for the development  S50 pof interference protection rules."[h5] {O #C\  P6Q/P#э Id. [ With respect to the notification and testing procedures advocated by  PCTN, Petitioners said that these measures are "both unnecessary and so onerous that they would threaten  pthe commercial viability of twoway service offerings," and that it is "impossible to establish an inflexible  zone around each ITFS receive site that reflects the area in which a response station installation threatens  Si 0 to result in [BFO interference]."[ii ] {OA #C\  P6Q/P#э Id. [ Petitioners argued that there are many variables, "including orientation  and polarization of the antennas relative to each other, distance between antennas, sidelobe suppression  0of the antennas, [downconverter] dynamic range and response station power" that all determine whether  S 0 interference might occur.[j ] {O #C\  P6Q/P#э Id. [ In response to CTN's arguments concerning WCA's action seeking  reconsideration of the power limits in the WCS, Petitioners argued that the reconsideration applied only  to mobile stations and that the power limit for fixed WCS stations remained at 2000 watts EIRP, identical  @to that proposed for response stations. Petitioners also cited six differences between the interference  protection requirements placed on WCS stations as compared to those proposed for MDS/ITFS response   stations, saying that all six place heavier burdens on, and insure greater protection from, response  S0stations.[k ] {Ob #C\  P6Q/P#э Id. [  S80 ` @q049.` ` In addition to the issues discussed above relating to the response station interference  0Methodology and the creation of guardbands, Petitioners and various other parties raised concerns about,  S0and/or counterproposals for, several other technical issues in the NPRM, specifically:  Sm0  Response Station Power Limit Petitioners requested that the response station power limit be fixed at 33  @dBW, identical to that already permitted for  7% B main 7% B  stations and proposed for highpower booster stations.  S0 `In the NPRM, we proposed to apply an EIRP limit of 18 dBW to response stations, citing concerns about" kP-4)4)dd"  S0 the extremely complex interference environment in which such stations would be functioning.vl] {Oh #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22194v  Petitioners responded that the proposed 18 dBW limit is "far too low to permit wireless cable to be a  S0 commercially viable service."imZ] yO #C\  P6Q/P#э Comments of Petitioners.i Petitioners submitted a technical analysis which contained detailed  Sg0 `calculations which, they argued, supported their proposal for the higher power level.ngN] {O #C\  P6Q/P#э Id., Attachment B, "Power Limitations for Response Station Transmitters: An Analysis" Responding to  Petitioners' argument, CTN did not dispute Petitioners' calculations, but did question the basis for  Petitioners' assumption that response stations would transmit with 33 dBW EIRP into hub stations with  +10 dBi gain receiving antennas, arguing that equal results could be obtained with 23 dBW EIRP and +20  S0 0dBi hub receiving antennas.goD] yO #C\  P6Q/P#э Reply Comments of CTN.g Petitioners disputed CTN's claim that the larger antennas could be used  at hub stations, saying that "it may be physically impossible to mount a sufficient number of antennas with  S50 high horizontal gains at a hub location to provide the necessary omnidirectional coverage."p58] {Oq #C\  P6Q/P#э Petitioners' ex parte letter of March 6, 1998. CTN replied  Pthat they found Petitioners' arguments unpersuasive, and "find Petitioners' claims of tower loading  S0constraints, the lack of tower vertical real estate, and tower sway, to be particularly unpersuasive."|q. ] {O #C\  P6Q/P#э CTN ex parte letter of April 9, 1998.|  Si 0 Protection of Hub Stations In the NPRM, the Commission proposed that the protected signal level at a  hub station receiver would be "the minimum received signal level that the proposed hub can actually  S 0 utilize in the provision of service, specified in dBW/m2/Hz."tr $ ] yO, #C\  P6Q/P#э Proposed Section 21.909(c)(2)(iii).t Commenters were requested to respond  specifically concerning whether "such an important element in the interference analysis [should] be  permitted to be specified by a system operator without some objective basis which could be validated, or  0alternatively, [whether] a suitably representative value [could] be determined for this purpose." CTN  objected to this specification of hub protection, saying that this would mean that an ITFS applicant "would  Phave to show that its proposed modification or newcomer ITFS station would be 45 dB or 0 dB (as  appropriate) below the weakest level signal that the Response Station Hub licensee's receivers could  pconceivably detect," and that requiring such protection for omnidirectional Response Station Hubs "would  Sl0 either result in a de facto freeze to the ITFS service, or would give Response Station Hub licensees such  powerful leverage as a result of the need for "no objection" letters from those licenses that any semblance  S0 of a "level playing field" would be lost."as] yO#$ #C\  P6Q/P#э Comments of CTN.a In response, Petitioners proposed to revise the interference  pprotection for hub stations, eliminating the minimumreceivedsignal criterion and substituting for it a  S0 specification for the maximum permissible degradation of the 'noise floor' of the hub receiver.it ] yO' #C\  P6Q/P#э Comments of Petitioners.i "tP-4)4)dd"  Specifically, Petitioners proposed that a response station hub receiver be deemed protected from  interference when the interfering power flux density generated by a neighboring system (accumulating  the signals of the  7% B main 7% B  station and any booster stations or simultaneously operating response stations)  Sg0 Preceived by the hub antenna is no greater than 190 dBW/m2/Hz if the interfering signal is cochannel, or  S40 151 dBW/m2/Hz if the interfering signal is adjacent channel, with a 20 dB reduction in either case when  the interfering signal is crosspolarized. Petitioners also proposed to amend the protection standard to take  pinto account the actual antennas in use at the hub station, rather than assuming an omnidirectional  S0 antenna.u] {O #C\  P6Q/P#э Petitioners' ex parte letter of May 13, 1998. These modifications, Petitioners argued, should satisfy the Commission's concern "that an  applicant could specify an inappropriate required receive signal level in order to secure undue protection  to the response station hub." Gulf Coast and Spike agreed with Petitioners' proposal to use the noise floor,  while CTN stated that the proposed numbers "appear to be technically valid for uniform density signals,  but not for conventional NTSC analog signals," and that the proposed numbers would penalize NTSC  S 0 @signals because of their nonuniform power spectral distribution.v Z] yO #C\  P6Q/P#э Reply Comments of Gulf Coast MDS Service Company, Spike and CTN. CTN also argued that the proposed  pnumbers posed a 3 dB disadvantage for NTSC signals because they referred to the peak, rather than  average, power of the NTSC signal. Petitioners responded that using peak power for NTSC signals and  S 0 average power for digital signals "continues the practice established in the Digital Declaratory Ruling of  0licensing just one power level for a station and calculating interference the same way for both analog and  S 0 `digital signals."w N] {O #C\  P6Q/P#э Petitioners' ex parte letter of March 6, 1998. In their comments on the Petitioners' ex parte filings, CTN reiterated their contention  that Petitioners' protection criteria for hub stations would have a preclusionary effect on future expansion   or modification of ITFS facilities, and, as a solution, proposed that response station hubs be given secondary status with respect to all ITFS facilities more than 35 miles away.  S0 Terrain Shielding Petitioners questioned the justification in the current interference protection rules for  0providing protection to receive sites from response stations if the signal strength of the response station  0is beneath the noise floor of the victim receiver, noting that "in areas where the desired signal has  0significant excess path loss due to terrain blockage between the receiver and desired transmitter, it can be  S0 impossible to provide the 45 dB protection required."ixD] yO #C\  P6Q/P#э Comments of Petitioners.i Petitioners proposed that, in conducting  interference studies where the desired signal falls below the appropriate noise floor, "no calculations of  compliance with the 45 dB benchmark should be required." Spike and BellSouth both supported this  proposal, although BellSouth added a caveat that the undesired signal should not add more than 1 dB to  S0 the aggregate C/N+I of the desired signal.y8] yOD" #C\  P6Q/P#э Comments of BellSouth Corporation and BellSouth Wireless Cable, Inc. CTN also supported the proposal and would extend it to  apply to situations where the desired signal is above the noise floor but is nevertheless so weak that "there  S0would be no reasonable expectation of useful service at that low level."gz, ] yO% #C\  P6Q/P#э Reply Comments of CTN.g  S<0 pPropagation Formulas/System Data Dallas County raised a concern, also expressed by others, that the  S 0 Methodology developed by Petitioners and proposed in the NPRM is insufficiently detailed to permit"  zP-4)4)dd"  S0 `independent verification of interference analysis results.{] {Oh #C\  P6Q/P#э Joint Comments of Dallas County Community College District, et. al.Ě Dallas County wants Petitioners to "make   available to the Commission for application evaluation purposes a set of stepbystep calculations for all  to follow, including all assumptions and equations, if not the derivative software itself." ITF argued that  the Commission "can assume an important role by making public the databases and engineering software  S40 which it uses to evaluate MDS and ITFS applications."|4Z] yO #C\  P6Q/P#э Reply Comments of Instructional Telecommunications Foundation, Inc. ("Foundation") ITF stated that it will "petition the FCC to  postpone filing windows if the ITFS community cannot gain reasonable access to the essential engineering  tools." The University of Maryland ("Maryland") requested that the software and databases used by the  Commission for conducting interference analyses be made available to the public in order to "alleviate the  Sh0 burden placed on all ITFS operators in evaluating numerous booster and response station proposals."f}hN] yO #C\  P6Q/P#э Comments of Maryland.f  In response to these concerns, Petitioners proposed to amend their Methodology to increase "the level of  specificity in the proposed rules as to the substance and format of information required to be filed with  Pan application for a response station hub license (particularly information regarding the channel plan and  the methodology employed for calculating potential interference), and the possible requirement that filings  be made on computer diskettes in order to provide the Commission and interested parties improved access  S6 0to relevant data."~6 B] {O| #C\  P6Q/P#э Petitioners' ex parte letter of May 13, 1998.  S 0 ` @q150.` ` Our proposals to continue, as well as extend, use of the 45 dB/0 dB D/U interference  S 0 protection ratios and the 73 dBW/m2 contour protection standard were unopposed. Therefore, we are  adopting rules requiring their use in calculating interference from multiple response stations licensed under  blanket authority of hub station licenses, as well as in situations where the signals from  7% B main 7% B , booster  and/or response stations (for both analog and digital systems) must be combined to determine interference  S0 levels.X8] yO   #C\  P6Q/P#э We are also adopting our proposal to replace the 75.6 dBW/m2 contour standard found in Part 74 with the 73  yO  dBW/m2 contour standard of Part 21. We believe it would be impractical, if not impossible, to apply both standards simultaneously when channels from both MDS and ITFS will be combined in cellularized systems. With respect to the Methodology proposed by Petitioners for calculating the interference  potential of response stations, we agree with EDX and others who pointed out that the original formulation  of the proposed grid system ignored terrain data and thus may not be representative of the actual  pinterference potential of the response stations in the grid. Petitioners have, we believe, corrected this  deficiency with their proposal to assign to each grid point the highest elevation AMSL of all the  0geographic area surrounding that grid point, thus making the theoretical stations assigned to each grid  point much more likely to result in more sensitive interference calculations. With respect to the use of  0census data, we agree with Spike and others who argued that this procedure would not produce results that  were necessarily accurate or representative of the actual distribution of response stations. Petitioners have,  Pwe believe, corrected this deficiency with their proposal to drop the use of census data and, instead, to  assume a worstcase distribution of response stations in CDMA systems by assigning all of the  simultaneously active cochannel response stations to the grid points in an RSA which have the greatest  pinterference potential. For TDMA systems, we concur with Petitioners' proposal to also modify their"m P-4)4)dd"  Methodology to conduct interference analyses from the grid points which have the greatest interference  S0potential.8] yO5  #C\  P6Q/P#э For both TDMA and CDMA systems, interference analyses will be conducted by the generation of a matrix of  interference calculations consisting of all potential interfering transmitters and all potential victim sites and   boundaries, and, from this matrix, the worstcase interference levels will be selected in order to determine if the   appropriate protection criteria have been met. Thus, in this procedure, the grid point which causes the highest level  Pof interference at one receive site or boundary may be, and probably will be, different from the grid point which causes the highest level of interference at a different receive site or boundary. 8  Sg0 ` pq251.` ` With the major modifications discussed above, we believe that Petitioners' Methodology  for calculating response station interference is sufficiently comprehensive and conservative that we are  S0 adopting it as a requirement of our rules.vx@] yOE  #C\  P6Q/P#э The text of the Methodology is being incorporated by reference into Rule Parts 21 and 74. As we gain  pexperience with the licensing and operation of twoway systems, we intend to review the Methodology and make  0any appropriate and necessary revisions to it which might enhance spectrum usage and communications capabilities  0without sacrificing necessary interference protection. As now constructed, the Methodology incorporates worstcase  `procedures which, in the light of future realworld experience, may be partially or wholly unnecessary. We invite  `input from licensees and the engineering community in this process. Any amendments to the Methodology will be announced by Public Notice.v We are also adopting other modifications to the Methodology,  including two provisions involving the receiver noise floor. We agree with CTN and others who argued  that Petitioners' original 'minimum receivable signal' hub receiver protection standard would have, in some  instances, overprotected the hub station and thus potentially precluded the construction of other stations.  We believe that Petitioners' amended proposal to protect the hub receiver's noise floor, and to take into  account the actual antenna(s) in use at the hub, is a better way to protect hubs without penalizing other  potential operations and we are therefore adopting it in our rules. We reject CTN's request to protect hub  receivers only to a distance of 35 miles and make them secondary beyond that distance. We understand  CTN's concerns with respect to hub station protection acting as a possible brake on ITFS growth in certain  circumstances. However, we believe that the detailed interference analysis and other safeguards we have adopted in this Order will minimize any such effects to the most reasonably possible extent.  S 0 ` q352.` ` With respect to response station protection of nearby systems, we agree with Petitioners'  proposal to take into account the actual received signal levels of the desired and undesired signals in the  system receiving protection and we are adopting this procedure as an amendment to the Methodology.  We do not believe that EDX's alternative to Petitioners' response station interference Methodology is  usable because, for many twoway system configurations, EDX's interference calculations will inevitably  S0 give erroneous results, a shortcoming conceded by EDX itself. ] {O  #C\  P6Q/P#э In comments in response to Petitioners' ex parte filings, EDX reiterated its arguments that Petitioners'  Methodology for calculating response station interference is unduly and needlessly complex and pressed again for  consideration of EDX's own, simpler, interference calculation methodology. However, EDX provided no new  information about its preferred methodology, or modifications to that methodology, which would reduce the  likelihood that its use could result in significant levels of error when applied to a variety of 2way system configurations.  Nor do we agree that applicants should  be free to choose any methodology they wish for making interference calculations, as this would  drastically slow the evaluation of applications and almost certainly result in many Petitions to Deny, as  licensees and applicants struggled to understand the differing and potentially incompatible assumptions  `and calculations incorporated into the various methodologies. We also decline to adopt Spikes'"P-4)4)dd "  recommendation that hub stations be redefined to include transmitting capability. This is not necessary  `because booster and main stations may be colocated with hub stations to provide transmission capability,  0and permitting hubs to also transmit would simply add redundancy and unnecessary complexity to the  interference protection requirements of the rules. With respect to CTN's concern that the actual numbers  and types of response stations may not conform to those for which application was made and interference  Pcalculated, it should be understood that the assumptions for these items used by an applicant in the  interference analysis become, upon grant of the license, terms of the authorization and, as such, must be  `observed. We do, however, agree with CTN that response stations should not be installed by end users  and we are therefore adopting a requirement that all response stations be installed by the hub station  licensee or its employees or agents. Given the interference environment in which response stations will  `operate, we do not believe it would be prudent to permit them to be installed by nonprofessionals with no knowledge of the protection requirements for nearby ITFS receive sites.  Si 0 ` Pq453.` ` With respect to response station power limits, we have decided to grant Petitioners' request  to permit the use of up to 33 dBW EIRP. Although we continue to be concerned about interference, we  concur with the conclusions of Petitioners' propagation analysis that the proposed 18 dBW power limit  `would adversely impact system range and reliability, thereby increasing the number of stations needed and  increasing system costs. The 33 dBW power limit is predicated on a bandwidth of 6 MHz, and the power  limit for stations using lesser bandwidth must be reduced proportional to that bandwidth. For the 125 kHz  S70 channels, for example, the EIRP limit will be 16 dBW.7] yO  #C\  P6Q/P#э 33 dBW 10 log (6000/125) = 16 dBW; this is equivalent to a 250 milliwatt transmitter utilizing an antenna with 22 dBi gain. As a practical matter, we do not expect that  pall, or even most, response stations will utilize the maximum power permitted. The most efficient  operation of hub station receivers will typically occur when the received signal levels from the multiplicity  Pof associated response stations are roughly equal. We would therefore expect that maximum facilities  would be used only on paths which are relatively long and/or paths with unfavorable intervening terrain.   7% B Main 7% B  station and high power booster stations will be permitted to operate at a maximum EIRP of 33 dBW,  except that, when directional antennas are utilized at either type of station, a maximum EIRP of up to 39  S0dBW will be permitted, depending upon the directivity of the antennas used., ] yO  #C\  P6Q/P#э For  7% B main 7% B  and booster stations with sectorized service areas, a maximum EIRP of 39 dBW would be permitted per sector, based upon the horizontal plane pattern of the sector antennas.,  Sl0 ` 0q554.` ` After carefully considering CTN's concerns about potential interference problems, we have  0decided to deny their request that guardbands be established separating upstream (response station)  transmissions from downstream ITFS transmissions. CTN's first proposal, involving the creation of 24  PMHzwide guardbands, could result in partially or completely eliminating many MHz of potentially useful  @upstream spectrum on the speculative assumption that such action was necessary to protect ITFS receive  Psites from interference. CTN's second and third proposals, involving 6 MHz guardbands, while precluding  less upstream spectrum on the same assumption, would involve establishing notification and testing  S0 procedures for response stations in proximity to ITFS receive sites. ] yO#  #C\  P6Q/P#э The precise amount of spectrum rendered unavailable for upstream transmissions would depend on the specific  pchannels in use in an area and on the geographical distribution of the stations involved. Inasmuch as protected ITFS  pchannels would require guardband spectrum both above and below their edges, protecting a single channel with 6 MHz guardbands could affect 12 MHz of spectrum.  In their fourth guardband proposal,  requiring 6 MHz guardbands within a 35 mile radius of ITFS  7% B main 7% B  transmitters, CTN argued that the  proposed response station interference Methodology is "unduly complex" and will be ineffective in"( P-4)4)dd "  determining interference when the potential victim ITFS receive site is within a hub station's RSA. This  S0 is not the case, however, because the Methodology, as amended in Petitioners' most recent ex parte  psubmission, now calculates interference from both TDMA and CDMA systems based on identification   of worstcase matrix grid points. In this way, calculations to potential victim receive sites inside, as well  `as outside, the RSA can be made. With respect to the complexity of the Methodology, it is, of necessity,  not a simple procedure and CTN offered no alternative methodology to its use, nor any explanation of how  guardbands would eliminate the need for its use for interference calculations beyond whatever geographic  S0 radius was set for the use of guardbands.X] yO  #C\  P6Q/P#э For example, even if guardbands of 6 MHz were required within a 35 mile radius of an ITFS transmitter, the  0techniques set out in the Methodology, or some other similar set of techniques, would still be necessary for interference calculations from response stations more than 35 miles from the ITFS transmitter. In summary, we believe guard bands would deprive parties  the flexibility to design and operate their systems in a manner that best meets their needs, and would  @deprive them of spectrum which, in some, if not most, geographical areas could be partially or wholly utilized for twoway operations without danger of interference to ITFS sites.  S 0 `  q655.` ` With respect to the potential for BFO interference, we agree with CTN that, in certain  0limited circumstances, ITFS receive sites could be adversely affected by downconverter overload and that  some appropriate relief should be available. CTN is correct that the interference from digital response  stations will be 'noise like' and thus will present significantly greater problems than current analog  `emissions in terms of evaluation and location of the responsible transmitters. Additionally, as it is highly  `likely that, in many instances, the interference will be intermittent, as various response stations alternate  Sk0  transmissions with each other and with booster and/or  7% B main 7% B  stations, solving such interference problems  will clearly require a highly coordinated and cooperative effort between system licensees. For these  preasons, we are adopting CTN's request to require a hub station licensee to formally notify an ITFS  plicensee when a response station is to be located in the vicinity of any of the ITFS licensee's receive sites.   Specifically, we are creating a notification zone with a radius of 1960 feet around each ITFS receive site,  and we will require that, at least 20 days prior to the activation of any response station within such a zone,  the hub station licensee notify, by certified mail, the appropriate ITFS licensee. The notification must  0contain the street address and geographic coordinates of the response station, a specification of the station's  PEIRP, antenna pattern, orientation, polarization and height AMSL, channels to be used, as well as the  name and telephone number of a contact person who will be responsible for coordinating the resolution  0of any interference problems. We expect, and will require, that licensees of stations causing interference  fully cooperate with other licensees by promptly and thoroughly responding to any notifications that their  systems are causing interference. In that event, we would expect that the licensee of the offending station  S0 0would immediately commence a cooperative effort with any licensees receiving interference to solve the  `problem as quickly as possible at the expense of the offending licensee. If a licensee fails to promptly  and adequately perform these obligations, the Commission will require appropriate remedial action by that  S<0 licensee. It should be understood clearly that the Commission is prepared to, and will, order the  immediate deactivation of part, or all, of a system if that system is causing interference and the licensee  S0 Phas not cooperated fully and in a timely manner to eliminate the interference. We do not find the  @additional burden of mandatory response station testing is necessary at this time. We believe the best  course of action now would be to permit an adequate and thorough evaluation of the notification procedure prior to any consideration of a testing requirement or other more restrictive actions.  S 0 ` q756.` ` With reference to the technical sufficiency of the formulations, calculations and data  `requirements necessary for utilization of Petitioners' Methodology, we are satisfied that Petitioners' most  recent proposed revisions in this regard are adequate and we are making them part of the Methodology  being adopted. The last section of the Methodology now consists of information and examples relating  to the formatting of data and information to be submitted to the Commission in connection with" $P-4)4)dd'"  @applications for cellularized systems. We will require that, beyond the information contained on FCC  0Forms 304 and 330, additional data be filed in the specified formats and submitted on diskettes  accompanying the application forms. This additional information must be sufficiently complete and  Sg0 accurate for any competent party to verify the validity of the interference analyses. Good engineering  practice must be followed in the performance of these analyses and, in the event that an examination of  the analyses submitted by any applicant demonstrates that due diligence was not given, the Commission  may dismiss the associated applications, or, in the event the applications have been granted, order that the  S0system be deactivated and/or take steps for suspension or revocation of those licenses.  S6 q D.` ` Proposals Specifically Regarding Use of 125 kHz Channels  S0 ` q857.` ` Under current rules, the bulk of the 26862690 MHz band is comprised of 125 kHz  S 0  channels which are utilized at response stations. In the NPRM, we proposed to amend our rules in  Sk 0 `accordance with the most flexible framework requested by Petitioners for use of the 125 kHz channels.uk ] {O #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22199201.u  Pursuant to these proposals, the 125 kHz channels could continue to be used at response stations, but we   also would permit them to be used for pointtomultipoint transmissions, in which case they would be  licensed and afforded interference protection in the same manner as other pointtomultipoint MDS and  ITFS channels. In addition, we proposed to permit the 125 kHz channels to be superchannelized or   subchannelized regardless of whether they are used as response stations or for pointtomultipoint  S90 transmissions. We further proposed to remove the requirements of current Section 74.939(d)j9Z] yO #C\  P6Q/P#э 47 C.F.R.  74.940(d).j that each  125 kHz channel be used solely in conjunction with a specifically associated 6 MHz channel, and noted  the proposal of the Instructional Telecommunications Foundation, Inc. ("Foundation") that we allow ITFS  licensees to swap 125 kHz channels on a routine basis, to create larger bandwidth channels. Moreover,  to avoid confusion, we advanced the suggestion that each of the 125 kHz channels receive an independent   designation, rather than be referenced to the primar 7% B y 7% B  6 MHz channel with which it is associated. Finally,  S0 pwe clarified suggested changes to Section 74.902(d)(1)mN] yOY #C\  P6Q/P#э 47 C.F.R.  74.902(d)(1).m of the Commission's Rules to provide that an  ITFS licensee is limited to the assignment of no more than four 6 MHz and four 125 kHz channels for use in a single area of operation.  S;0 ` q958.` ` Wireless One supports most of the NPRM's proposals for increased flexibility in use of  the 125 kHz channels, though Wireless One does not address specifically the issues of using 125 kHz  `channels other than in conjunction with their associated 6 MHz channels, nor of providing each 125 kHz  S0 channel an independent designation.jB] yO! #C\  P6Q/P#э Comments of Wireless One.j The Bay Area Consortium agrees with the proposed use of the 125  kHz channels for downstream transmissions, "upon proper application to the Commission by the associated  S=0 primary channel licensee," in order to promote efficient use of the spectrum.=6] yOw% #C\  P6Q/P#э Comments of the San Francisco San Jose Educator/Operator Consortium ("Bay Area Consortium"). The Foundation supports  S 0 pthe NPRM's proposals regarding the 125 kHz channels, and adds that the Commission should allow the  0content of those channels to be independent of that transmitted on related 6 MHz channels. The  S0 0Foundation also specifically supports our clarification in the NPRM with respect to Petitioners' suggested" * P-4)4)dd "  S0 changes to Section 74.902(d)(1).] {Oh #C\  P6Q/P#э Comments of the Foundation.; see NPRM, 12 FCC Rcd at 22200 n.51. A few commenters, however, appear to take issue with the concept  of licensees swapping 125 kHz channels. HITN, for instance, requests that all existing and currently  `proposed response stations associated with ITFS licenses continue to be licensed to, controlled by, and  Sg0 exclusively associated with those ITFS licenses pursuant to currently existing rules.gZ] {O  #C\  P6Q/P#э Comments of Hispanic Information and Telecommunications Network ("HITN"); see also Comments of Maryland. While Maryland  supports sub and superchannelization of the 125 kHz channels, as well as their use for upstream or  downstream transmissions, it states that use of 125 kHz channels licensed to ITFS entities "for purposes  S0 other than for ITFS should be secondary to ITFS operations."c] yO #C\  P6Q/P#э Maryland Comments.c And CTN, as part of its "refarming" plan,  S0 advocates that all 125 kHz channels be reallocated to ITFS and used only for response transmissions. ] yO  #C\  P6Q/P#э CTN Comments. In the engineering statement appended to its comments, Maryland goes even further than CTN,  posing that if the Commission were to reallocate the entire 26862690 MHz band to MDS/ITFS response stations,  {O;  that might be sufficient for the twoway services contemplated by the NPRM. Currently, the response channels  @associated with Channels E34, F34 and H13 are also allocated to the Private Operational Fixed PointtoPoint  {O Microwave Service. See 47 C.F.R.  101.147(g).  pPetitioners "vehemently oppose" the suggestion by CTN, and add that CTN has not discussed how the  MDS auction winner, who has the rights to the channels to be reallocated, would be compensated, nor how  S0the reallocated channels would be assigned amongst ITFS licensees.i$ ] yO* #C\  P6Q/P#э Comments of Petitioners.i  S 0 ` q:59. ` ` We believe that this approach will provide licensees with the maximum possible flexibility  will enhance the architecture of twoway systems in the MDS/ITFS bands, we adopt all of the proposed  S6 0  changes in the NPRM with respect to the rules governing the 125 kHz channels. For instance, removing   requirements that each 125 kHz channel be used solely in conjunction with a specifically associated 6  MHz channel offers flexibility to create channels with bandwidths exceeding 125 kHz, and we amend  S 0 Section 74.939(i) of the Commission's Rulesj ] yO #C\  P6Q/P#э 47 C.F.R.  74.939(i).j to eliminate such requirements. For the sake of simplicity  pand consistency with the MDS/ITFS database, we also amend the frequency table in new Section 74.939(i)  S80  to redesignate the 125 kHz channels as the I Channels.X8 ] yOH!  P#C\  P6Q/P#э Redesignating the 125 kHz channels as the I channels, rather than categorizing them as a species of the H  Pchannels, also will prevent any confusion over whether current rules providing for certain H Channel licensee responsibilities likewise apply to 125 kHz channels licensed to an ITFS entity. Furthermore, we amend Section 74.939(i) to   reflect greater flexibility with respect to uses of the I Channels, such as sub and superchannelization,   provision for pointtomultipoint transmissions, and swapping of I channels between licensees. We see   @no reason to disallow swapping of the I Channels where we allow swapping of 6 MHz channels. In   Presponse to concerns expressed by some commenters, we reiterate, as reflected in our amended rules, that   0use of any specific 125 kHz channel is completely at the discretion of the licensee, who remains licensed"9!P-4)4)dd"  S0  Pfor, and whose  7% B main 7% B  station is associated with, that particular channel.X] yOh   #C\  P6Q/P#э Traditional 125 kHz response stations licensed pursuant to new  21.940 and 74.940 must provide interference   pprotection in accordance with  21.902, 21.938 and 74.903 and new  21.909, 21.913(f), 74.939(h) and 74.985(f), of the Commission's Rules, and receive interference protection in accordance with  21.902, 21.938 and 74.903. Moreover, such use may   encompass swapping of I Channels between licensees, and leasing of I Channels to a wireless cable   poperator or another licensee in the market. We also find that the Foundation's suggestion of allowing the   0content of those channels to be independent of that transmitted on related 6 MHz channels is consistent   pwith our flexible approach, and is a corollary to our elimination of the requirement that each 125 kHz channel be used solely in conjunction with its specifically associated 6 MHz channel.  S0 `x;60.` ` Further consistent with our flexible approach, we deny CTN's request to reallocate all of   0the 125 kHz channels to ITFS and to use them solely for response transmissions. As we stated in the  S50  NPRM with respect to a similar proposal similar, we believe that such a reallocation and the ensuing  S0  complications are unduly restrictive and counterproductive.u] {O #C\  P6Q/P#э See NPRM, 12 FCC Rcd at 22200.u Moreover, allowing the I channels to be   pused for pointtomultipoint transmissions promotes greater options for twoway system design and more   efficient use of the spectrum, as described above. Where the I channels are used for pointtomultipoint   `transmissions, they will be afforded interference protection in the same manner as other pointtomultipoint  S7 0  MDS and ITFS facilities including adjustment of the protection ratios for bandwidth.7 ] yO   0#C\  P6Q/P#э Likewise, where I channels are used for response transmissions to hubs under a hub license, the hubs will be afforded interference protection in the same manner as other MDS and ITFS hubs. A licensee who   pwishes to use its associated I channels for downstream transmissions should file with the Commission a   `modification application, using FCC Form 331. In the modification application, the licensee should state   @that it is applying for authority to use the I channels for downstream transmissions, and specify which of  Sk0  `its associated I channels it intends to operate in that manner.xk] yO    p#C\  P6Q/P#э For the sake of maximum flexibility, licensees may elect to use some or all of their associated I channels for   ppointtomultipoint transmissions, and some or all of them for response channels. The same application procedures   that we outline for conversion of I channels to pointtomultipoint transmissions shall be utilized by licensees seeking   to return the status of an I channel back to response channels from pointtomultipoint usage. Likewise, while we   set forth downstream transmissions application procedures by reference to modification applications, the same   procedures shall be utilized by new MDS or ITFS station applicants who seek to use their associated I channels for pointtomultipoint transmissions. Specific instructions for filing the   papplication will be set out in a Public Notice prior to the date such applications are accepted for filing.   PHowever, we note here that these modification applications will be considered minor changes for I   @channels associated with ITFS stations, including ITFS stations licensed to wireless cable entities pursuant  S0  `to Sections 74.99092 of the Commission's Rules,n>] yO" #C\  P6Q/P#э 47 C.F.R.  74.99092.n in order to enhance flexibility by avoiding relegation   `of the filing of such applications to filing windows. While applicants for minor changes to ITFS facilities   @normally are not required to prepare interference showings or serve them on potentially affected parties,   we will require preparation and service of interference analyses by ITFS licensees who seek to use their   associated I channels for downstream transmissions, particularly in light of the potential for having I   Pchannels with upstream and downstream transmissions on adjacent channels within a market or on""2P-4)4)dd@"  S0  cochannels in adjacent markets.X] yOh   #C\  P6Q/P#э MDS and ITFS applicants and licensees applying to use their associated I channels for downstream transmissions   shall comply with the requirements of  21.902 and  21.938 where appropriate, using the appropriately adjusted interference protections values based upon the ratio of the 125 kHz bandwidth to 6 MHz. Finally, for the same reasons that we decline CTN's request to render   low power boosters secondary, we also deny Maryland's request that we mandate that any nonITFS use of I channels licensed to an ITFS entity be secondary to ITFS use.  S4 x E.` ` Application Processing Issues  S0 x<61.` ` In the NPRM, we tentatively rejected the automatic grant proposal made by Petitioners   in which the Commission would grant without review any unopposed twoway license application after   pa 60day comment period. Instead, we proposed to adopt a system under which the staff would review   the filed applications and issue a grant or denial. We were concerned that Petitioners' proposed process   @would not allow a sufficient opportunity for either interested parties or for the Commission to review   applications and, where necessary, to evaluate the potential for interference to existing sites. A number   of commenters, both ITFS and MDS parties, have raised concerns that this approach will unnecessarily   delay the introduction of twoway service and prove so cumbersome that such service may never be  S6 0  `implemented.&6 ] {O"   #C\  P6Q/P# C\  PQ/ э See, e.g., Comments of the Foundation, Region IV, Wireless One and BellSouth. Although some parties did  {O   oppose the concept of an automatic grant, see, e.g., Comments of HITN, the majority of commenters on the subject   supported some type of streamlined process, especially when coupled with a complete guarantee of protection against  {O~ interference, discussed infra. See, Comments of Alliance for Higher Education and the Joint Statement. Upon review of these comments, we have been persuaded that failure to adopt an  S 0  expedited processing system will be seriously detrimental to the provision of twoway service.\ :] {OA    C\  PQ/ э See, e.g., Comments of NIA and MDS Alliance and Reply Comments of Petitioners. Indeed, in their Reply   PComments, Petitioners stated that failure to adopt an expedited processing system will constitute a death knell for  {O the MDS industry. See also, Joint Statement and July 2 Comments of George Mason Instructional Foundation, Inc.   `Therefore, we have revised our proposed application processing system, as discussed below, and will adopt a certification procedure that we believe will dramatically expedite the licensing process.  S70 x=62.` ` The certification procedure we are adopting is a modification of the automatic grant system  S0  that was proposed by the Petitioners, which was discussed in the NPRM and on which we solicited   comments. As such, adoption of it complies with the requirements of the Administrative Procedure Act   ("APA") regarding adequate notice "of either the substance of the proposed rule or a description of the  Sl0  subjects and issues involved."l ] yO2 #C\  P6Q/P##C\  P6Q/P#э 5 U.S.C.  553(b)(3). Courts have held that this notice requirement is satisfied where the final  S90  rule is a "logical outgrowth" of the rulemaking proposal.9 ] {O"  C\  PQ/ э See, e.g., Aeronautical Radio, Inc. v. FCC, 928 F.2d 428, 44546 (D.C. Cir. 1991). Moreover, notice has been held to be   sufficient where the description of the "subjects and issues involved" affords interested parties a reasonable  S0  opportunity to participate in the rulemaking.] {O&   #C\  P6Q/P#э Transpacific Freight Conference of Japan/Korean v. Federal Maritime Commission, 650 F.2d 1235, 1248 (D.C. Cir. 1980). In this instance, we both solicited and received comments   on the Petitioners' automatic grant proposal. A requirement that parties certify that their applications"#jP-4)4)ddP"   comply with the Commission's technical and notice rules, and thereby take full responsibility for the   accuracy and completeness of their applications, is a logical requirement in an environment where the staff  S0  pis not performing an indepth review of the applications.] yO #C\  P6Q/P#э The Commission will rely on an applicant's certification as a material representation. This is especially appropriate where, as here,   @the consequences of an application containing engineering errors include a complete and immediate shut  down of any site that causes interference to existing or previously proposed sites. Therefore, the  S0certification process we adopt here is consistent with the requirements of the APA.9X] {O]   #C\  P6Q/P#э We note that we are also considering a certification procedure In the Matter of 1998 Biennial Review {O' Streamlining of Radio Technical Rules, MM Docket 9893, FCC 98117 (released June 15, 1998).9  S0 x>63.` ` The process we adopt today for twoway applications represents a fundamental shift from   the Commission's traditional review function in MDS/ITFS licensing and from our review function in other   areas of MDS/ITFS licensing, for example in applications for new ITFS stations. It will require increased   diligence by MDS and ITFS licensees in tracking and monitoring the impact of applications by other   parties on their own services. However, we believe this new approach is needed to facilitate twoway   `service to the public and that without it twoway service by MDS operators and/or ITFS licensees may   not become a reality. This approach is consistent with methods we have adopted in other proceedings   where similar certification procedures rely primarily on the certifications of the applicants as the basis for  S 0  0the licensing system.Z ] {O   p#C\  P6Q/P#э See, e.g., 47 C.F.R.  25.132 (Certifications required concerning performance testing of earth station antennae.);   47 C.F.R.  22.603 (Certification required that planned channel usage has been coordinated with existing licensees and previously filed applicants.); 47 C.F.R.  76.1502 (Open video system certification procedure.). However, this approach is not necessarily appropriate for all services. MDS and   ITFS licensees have a long history of mutual cooperation in their operations. The realities of their   operations compel such cooperation. An MDS operator trying to run a system across its BTA must   cooperate with the various ITFS licensees in its BTA. Likewise, many ITFS licensees depend on the   compensation paid by their local MDS operator to make their own systems a reality. Therefore, the   viability of the services depends on the parties working together in good faith, a situation which reinforces   Pthe appropriateness of a certification system in this context. Furthermore, MDS is a subscription service,   only reaching paying subscribers. Unless it can provide reliable and interference free service to those   subscribers the MDS operator will be out of business. We believe the imperative to provide such   @reliability, in the face of a shutdown threat should interference occur, will compel honest and reliable   certifications. Neither the history of cooperation like that between the MDS/ITFS services nor the same   type of business imperatives faced by those services necessarily exist in other services. Therefore, this   licensing model may not be appropriate in other areas despite its suitability here. We also believe that   pour existing sanctions for misrepresentation, including designation for hearing and license revocation, will protect the integrity of the certification process.  S0   x?64.` ` We note here, however, that no changes have been made in this proceeding to Sections   74.901, 74.913, and 74.932 of our Rules which would modify the basic eligibility requirements or   responsibilities of ITFS licensees. Similarly, no changes have been made in this proceeding with respect   to Section 74.990 of our Rules, pertaining to the use of available ITFS frequencies by wireless cable   entities and, therefore, no changes have been proposed to Section 74.990(e), which will govern the   preferences between mutually exclusive ITFS licensees seeking twoway authorization and MDS applicants for vacant ITFS channels. "n$P-4)4)dd!"Ԍ S0 x@65.` ` The procedure we adopt will use the rolling, oneday filing window discussed in the  S0  0NPRM to govern the filing of MDS/ITFS applications for response station hubs or boosters. Each   0applicant will have to provide interference protection to all facilities existing or proposed prior to the filing   of its application, but its application will take precedence over all subsequently filed applications. As   suggested by the Petitioners in their initial request for rulemaking and reiterated in their comments,   0applications filed on the same day will not be treated as mutually exclusive by the Commission and it will   be the responsibility of the parties to resolve any conflicts. Because parties will be unable to offer reliable   service without resolving such conflicts, we believe the incentive to reach a resolution will be so great that Commission involvement will be unnecessary to resolve disputes.  S0 pxA66.` ` The applicant will be required to certify that it has met all requirements regarding   @interference protection to existing and prior proposed facilities. The applicant will also be required to   certify that it has served all potentially affected parties with copies of its application and with its   0engineering materials. The engineering analysis must comply with the methodology set out in Appendix   D. The applicant must also certify that it has obtained any necessary consent letters in lieu of interference   protection. Any application that does not contain the proper certifications will be dismissed with prejudice and will lose its priority over subsequently filed applications.  Sk0 xB67.` ` The Commission will rely on the applicant's certifications in issuing licenses and will not   conduct an independent engineering review of each application filed. The applicant will only be required   to file the application form with the Commission. However, in the interest of making sure that   engineering information is available to all present and future affected parties, applicants will be required   to provide copies of their applications, with all of their engineering materials, in both hard copy and on  Sl0  disk,l] yO   p#C\  P6Q/P#э The document is to be filed in hard copy and on a 3.5" computer diskette in ASCII, and shall contain all necessary engineering showings as set out in Appendices C and D.  to the Commission's contractor for public service records duplication, International Transcription   Services, Inc. ("ITS"), 1231 20th Street, N.W., Washington, DC 20036 and to certify on their application   they have done so. Because the ready availability of complete applications to interested parties is essential   @to the functioning of the application processing system, failure to certify that the application and supporting material have been provided to ITS will result in dismissal.  S:0  `xC68.` ` In order to monitor applicant compliance with our Rules and to protect the integrity of the   `certification process, the staff will conduct random audits, either prior to the expiration of the 60 day   petition to deny period, described below, or after a license has been issued in reliance on a certification.   @In the event that an audit reveals that an applicant improperly certified or that an application is incomplete   or contains a material error, the staff shall dismiss the application or revoke the license. In addition, if   there is evidence that a certification was made in bad faith, we delegate to the Mass Media Bureau the   authority to impose a monetary forfeiture or it may refer the matter to the Commission for designation for hearing.  So0 `xD69.` ` The staff will review applications to make sure all required materials are included,   excluding the interference analysis submitted to ITS. Complete applications filed with the proper  S 0  pcertifications will be placed on public notice without further review. As we stated in the NPRM, we   0believe placing the applications on public notice without prior staff interference analysis will serve to   speed the review process by making the relevant data available to all interested parties as quickly as   @possible. Parties will have 60 days from the date of the public notice to file petitions to deny against the   0application. Due to the complex nature of the engineering matters, we believe a 60 day petition to deny   period is more reasonable than the usual 30 day period. If no petitions to deny are received, the   application shall be granted. However, after a complete and properly certified application is granted, if"$% P-4)4)dd`("   pa new facility operated pursuant to that grant causes unauthorized interference to any protected facility it   must immediately cease operations, regardless of whether any petitions to deny were filed against the   application during the application process. The burden of proving that a twoway facility is not causing   0unauthorized interference lies on the twoway licensee following the filing of a documented complaint of  S40interference by an affected party.4] yO   #C\  P6Q/P#э BellSouth has proposed a mechanism for expedited resolution of interference complaints by the Commission.   @We understand the need to expeditiously resolve interference complaints in order that service to subscribers may   either begin or be reinstated as quickly as possible and we emphasize that we will strive to resolve such disputes as   quickly as possible. However, we find BellSouth's system to be too restrictive and are concerned that it would not allow us to resolve complaints in the most reasonable and beneficial manner possible.  S0 xE70.` ` In the NPRM, we expressed concern that ITFS licensees would not have adequate time   @or resources to evaluate a twoway applicant's proposed service plan. We were concerned that this would  Si0  occur because of the limited technical, legal and financial resources of educational institutions.T@ix] yO   #C\  P6Q/P#э In its comments, the Foundation proposes that twoway digital applications and interference consents be reviewed   Pby an independent counsel who is responsible only to an ITFS licensee and does not represent commercial interests.   Those advisors would certify that grant would not be harmful to future ITFS service. However, we agree with   Pcommenters AshvilleBuncombe Technical Community College, et.al., that such a requirement is unnecessary.   Indeed, in light of the limited number of engineers available who are qualified to evaluate the types of proposals to   be submitted in these proceedings, we believe it might hurt ITFS licensees to require independent engineering counsel   by depriving them of the opportunity to use the engineers they believe are the most qualified. Furthermore, we are very concerned about undertaking to limit a party's ability to secure counsel of its own choosing.T   0However, a number of commenters, including ITFS licensees, stated that the Petitioners' automatic grant  S0  `proposal contained adequate safeguards to protect ITFS licensees. ] {O #C\  P6Q/P#э See, e.g., Comments of Wireless One and Region IV. These commenters believed that the   notice provisions contained in the proposal, coupled with the requirement that a twoway system  S 0  pimmediately cease operation in the event of interference to another party, discussed supra, would protect   the interests of ITFS parties. We believe that the certification process we adopt here, which is very similar  S8 0  0to the automatic grant procedure discussed in the NPRM, provides equal protection. The combination of   service requirements, staff audits and the potential for punitive actions in response to applicant misconduct,   palong with the requirement for automatic shutdown in the case of interference, provides sufficient  S 0protection to the interests of ITFS licensees. ] yO~   0#C\  P6Q/P#э CTN has proposed an alternate application processing system which, although streamlined from our present   system, we believe would create unnecessary delay and uncertainty for twoway applicants. Under this system, an   unopposed application would result in a conditional license following the 60day comment period. This conditional   license would become a final authorization if there have been no complaints of actual interference for 180 days after   the applicant certifies completion of construction or if any such complaints have been resolved to the satisfaction of  {Of"   the Commission and the complainant. Other commenters, e.g., the Petitioners, complain that this will create a level   of uncertainty in the application process that will make it extremely difficult for twoway applicants to obtain   financing. Regardless of the very real possibility that employing CTN's proposal will create an unacceptable level   of uncertainty in the capital market, we believe it is unnecessarily cautious in light of the requirement that twoway   @stations causing interference to existing or previously proposed sites be required to shut down until such interference is resolved.  "m&P-4)4)dd@"Ԍ S0  PxF71.` ` As discussed in the NPRM, it is likely that a large number of applications will be filed   once the new rules become effective and that many of the applications submitted at that time may conflict   with others filed simultaneously. In order to smooth the transition to the rolling oneday filing window   application processing system, we are adopting a special oneweek initial filing window, the opening of   which will be announced by public notice. All applications filed during that week will be deemed filed   pas of the same day. Following the publication of a public notice announcing the tendering for filing of   applications submitted during that window, applicants would have a period of 60 days to amend their   applications to resolve conflicts, provided such amendments do not result in any increase in harmful   @interference to any previously proposed or authorized station (including facilities proposed during the   window), absent consent of the applicant for or licensee of the station that would receive such interference.   During this 60day period, no additional applications could be filed, affording those who filed during the   oneweek window an opportunity to resolve any conflicts without fear that, during the pendency of settlement discussions, third parties will propose facilities that will have to be protected.  S7 0  xG72.` ` At the conclusion of that 60day period, we will release a public notice of the acceptance   0for filing of all applications submitted during the initial window, as amended during the 60day period.   Interested parties will then have 60days from the date of that public notice to file petitions to deny.   0Following the 60day period, all properly certified, unopposed applications shall be granted. On the 61st day after the date of the second public notice, the rolling oneday filing window will be in effect.  S0  xH73.` ` We believe our adoption of the oneweek initial filing window will lessen the burden on   @all affected parties, including the Commission's staff, during the first round of application filing. We also   believe that providing parties with an initial 60day period during which they can resolve any apparent   conflicts and then amend their applications without prejudice will serve to expedite service to the public   by allowing parties to resolve their differences without the need to seek Commission review through the petition to deny process.  S0 xI74.` ` In the NPRM, we solicited comment on whether an applicant who has obtained   authorization for twoway service should be permitted to switch from common carrier to noncommon  S;0  carrier service and back without seeking subsequent authorizations.;] {O #C\  P6Q/P#э For existing requirements for MDS licensees to provide commoncarrier service, see 47 C.F.R.  21.903. In order to be eligible for this type   of flexibility, an applicant would have had to have requested it at the time it filed its application. We also   sought comment on whether operators should be required to give the Commission notice when they are   switching back and forth between common carrier and noncommon carrier service, even if prior approval   is not required. What little comment we received on this subject was supportive of providing the  S<0  requested flexibility.<Z] {O #C\  P6Q/P#э See Comments of Corporation for Public Broadcasting and Gulf Coast MDS. Because we are attempting to provide the maximum possible flexibility to twoway   pservice, we will permit licensees to switch from common carrier to noncommon carrier service and back   pwithout seeking subsequent authorizations. However, in keeping with our oversight functions, we will also require such licensees to provide the Commission with 30days advance notice of such changes.  S= x F.` ` Proposals and Issues Primarily Involving ITFS  S 0  xJ75.` ` Section 74.931 of the Commission's Rules describes the purpose and permissible service  S!0  0of ITFS stations, and also sets forth the minimum ITFS programming requirements for ITFS licensees.q!P] {O' #C\  P6Q/P#э See 47 C.F.R.  74.931.q "!'FP-4)4)dd$"   ITFS stations are operated by educational organizations and are "intended primarily to provide a formal   educational and cultural development in aural and visual form," to students enrolled for credit in accredited  S0  Psecondary schools, colleges and universities.<] yO   0#C\  P6Q/P#э 47 C.F.R.  74.931(a)(1). While ITFS programming generally is transmitted to receive sites at accredited schools,   it still also may qualify to meet programming requirements under certain circumstances when delivered to enrolled  {O   students of accredited schools at businesses, homes, or any other sites. See 47 C.F.R.  74.931(a)(2); Amendment   of Part 74 of the Commission's Rules and Regulations in Regard to the Instructional Television Fixed Service, Second  {O$   Report and Order (Proceeding Terminated), 101 FCC 2d 49, 8081 (1985) ("Second Report and Order in MM Docket  {O   No. 83523"). In addition, recognizing that "ITFS use by health care facilities requires special consideration," the   pCommission has considered as satisfying programming requirements the specialized formal education that hospitals   provide to their staffs as training for state or national licenses, or to students to earn medical and allied health degrees  {OH and certificates. Id. at 8182; Memorandum Opinion and Order, 59 RR 2d 1355, 1378 (1986).< Currently, section 74.931(e)(9) specifies that an ITFS   licensee who leases excess channel capacity to a wireless cable operator must provide a total of at least   20 hours per channel per week of ITFS programming on its authorized channels. ITFS licensees in such   lease arrangements also retain the right to recapture "an average of an additional 20 hours per channel per  S0  week for simultaneous programming on the number of channels for which it is authorized."m] yOr #C\  P6Q/P#э 47 C.F.R.  74.931(e)(9).m In addition,   Section 74.931(e)(9)now allows an ITFS licensee to shift its required educational programming onto fewer   than its authorized number of channels via channel loading or channel mapping. The licensee may further   agree to transmission of recapture time on channels not authorized to it but which are included in the wireless cable system of which it is a part.  S 0 ` qK76.` ` All of the commenting ITFS parties support the concepts and goals underlying the NPRM.  0Nonetheless, even within the ITFS community, the tenor of the call for rule changes differs dramatically  @between some commenters. Generally, these differences are reflected in the tension between allowing  ITFS licensees maximum flexibility in tailoring their relationships with wireless cable operators, and   imposing ITFSprotective lease restrictions designed to safeguard the primary educational purpose of the  S 0 ITFS spectrum.\ ] {O6  #C\  P6Q/P#э Compare, e.g. Comments of Alliance for Higher Education, et al. ("Higher Education Alliance") and Comments  {O  of Region IV ,with CTN November 1997 Ex Parte Presentation, and Comments of Schwartz, Woods and Miller ("SWM"). SWM represents several ITFS entities, listed in an Attachment to its Comments. The commenting parties, including ITFS entities such as CTN and NIA who tend to  0seek a structured and protective approach towards use of the ITFS spectrum, generally are unified,  `however, in acknowledging the symbiotic relationship between wireless cable operators and most ITFS  licensees. CTN recognizes that the Commission's policy on leasing ITFS spectrum to wireless cable  operators is based on the financial benefits that ITFS entities acquire in such arrangements, and states that  S0 the policies permitting these benefits should be preserved.] {O! #C\  P6Q/P#э See Letter from William D. Wallace to Magalie Romn Salas (May 27, 1998). While asserting that ITFS licensees should  not be required to lease excess capacity for commercial use, NIA nevertheless observes that if ITFS  channels are leased for commercial twoway offerings, there could be "substantial new revenues to be"9(P-4)4)dd"  S0 `shared with ITFS."a] yOh #C\  P6Q/P#э Comments of NIA.a Other ITFS parties discuss more specifically the benefits to ITFS licensees from  S0leasing excess capacity to wireless cable operators.X] {O) #C\  P6Q/P#э See, e.g., Bay Area Consortium Comments; Comments of the Corporation for Public Broadcasting.ĺ  Sg0 ` qL77.` ` In the NPRM, the Commission asserted the belief that enhancing the competitive viability  of wireless cable service through maximization of flexibility and service offerings promotes the underlying  S0 educational purpose of ITFS.eN] yOT #C\  P6Q/P#э 12 FCC Rcd at 22202.e Indeed, the growth of wireless cable has led to the continued development  S0 of ITFS by supporting and funding approximately 95 percent of all new ITFS applicants.B] {O #C\  P6Q/P#э Id.; see MDS Auction Order, 10 FCC Rcd at 9594. As the  Commission has stated, "revenues are key to this ITFSMMDS partnership. Leasing channel capacity .  . . generates revenues that may be vital to the continuing operations of authorized ITFS systems, to the  S60 successful deployment in many markets of ITFS service, and to the service's public interest benefits."6 68] {Or  P#C\  P6Q/P#э Amendment of Part 74 of the Commission's Rules Governing Use of the Frequencies in the Instructional  {O<  0Television Fixed Service, Report and Order, 9 FCC Rcd 3360, 3364 (1994) ("ITFS Channel Loading Order"). We  have elaborated previously that wireless cable strengthens ITFS significantly by providing a source of funds to  promote the educational purposes of ITFS, even if educational programming is not transmitted on all ITFS channels.  {O  Id. We also have agreed that the 20 hours per channel per week ITFS programming standard for licensees leasing  Pexcess capacity helps to insure that ITFS licenses are not secured merely to realize financial gain from wireless cable  {O(  operators. Amendment of Parts 21, 43, 74, 78, and 94 of the Commission's Rules Governing Use of the Frequencies  in the 2.1 and 2.5 GHz Bands Affecting: Private OperationalFixed Service, Multipoint Distribution Service,  @Multichannel Multipoint Distribution Service, Instructional Television Fixed Service, & Cable Television Relay  {O  Service, Order on Reconsideration, 6 FCC Rcd 6764, 677374 (1991) ("Wireless Cable Reconsideration Order").  {ML  `See Amendment of Part 74 of the Commission's Rules Governing Use of the Frequencies in the Instructional  {O   Television Fixed Service, Notice of Proposed Rulemaking, 8 FCC Rcd 2828, 2829 (1993) ("ITFS Channel Loading  {O NPRM").  By our actions here, we intend to balance the maximization of flexibility for all MDS and ITFS applicants,  licensees and operators with the need to accommodate ITFS growth where new uses or needs may be  unforeseen now but may arise later, or where the ITFS licensee's relationship with the wireless cable operator ends.  S q ` ` 1. ITFS Programming Requirements  S 0 ` `qM78.` ` In the NPRM, the Commission sought comment on several issues related to the question   of whether to change our ITFS programming requirements in light of the use of digital technology by  S90 ITFS licensees.o9] {O$ #C\  P6Q/P#э See 12 FCC Rcd 2220405.o It asked whether there should be different rules depending on whether the wireless  cable system employs digital or analog transmissions, or some combination of both. It further asked  whether our existing program content requirements should be retained or whether they should be modified.  Specifically, the Commission sought comment on whether data transmission and voice transmission should  count toward the fulfillment of minimum programming requirements, and if they were to count, how they"m)P-4)4)dd"  would be measured. The Commission also welcomed suggestions on whether educationrelated upstream  transmissions should be applied towards satisfaction of minimum ITFS programming requirements, and, if so, how they should be measured for that purpose.  S40 ` qN79.` ` The Joint Statement takes positions on many of the issues relating to ITFS programming  pand content requirements on which we sought comment. While proposing to retain the current minimum   ITFS programming requirements regardless of whether analog or digital transmissions are utilized, the  S0 `Joint Statement provides that each ITFS licensee utilizing digital transmissions, shall, at a minimum, have  Sj0 0the right to use 25% of the capacity of its channels.ej] {O #C\  P6Q/P#э Id. at  1.e Of this 25% of capacity, at least 5% would be  absolutely reserved for immediate ITFS usage and ineligible for leasing, and the licensee also would be  @required to maintain the ability to recapture for the transmission of ITFS programming at least an  S0 additional 20% of the capacity of the channels it leases.kZ] {O/ #C\  P6Q/P#э Id. at  23.k To the extent that the Joint Statement and its  supporters represent an agreement by most of the parties in the wireless cable industry and MDS and ITFS  services, we have accorded it deference in formulating our policies. Nonetheless, while we find some of  S9 0 its approaches sound, as elaborated upon below, we find some of its provisions unworthy of adoption.#9 P] {O  p#C\  P6Q/P#э Indeed, the Joint Statement is not without significant detractors within the industry. For instance, BellSouth "strongly objects" to its recapture provisions. BellSouth Reply Comments.#  S 0 `Thus, notwithstanding the Joint Statement's selfcharacterization of its "series of compromises" as   "inextricably intertwined," as well as its plea that we adopt it "en toto without change," we will adopt some of its resolutions and modify or reject others.  R;0q` `  a. Redefinition of Eligible Content  S0 `  qO80.` ` We received several comments on how to change the educational content requirements  0of Section 74.931, and these comments unanimously supported the proposal that spectrum usage beyond  So0 0video programming should be eligible to satisfy ITFS educational usage requirements.Xo] yO  `#C\  P6Q/P#э In light of the interactive nature of many data and voice applications anticipated for ITFS in a digital  environment, henceforth we will refer to required ITFS transmissions as ITFS "educational usage requirements" in lieu of ITFS "programming requirements," where the transmissions do not solely consist of video programming. For example,  the Bay Area Consortium suggests that transmissions, including Internet and other interactive services,  should qualify as fulfilling educational usage requirements as long as the use is part of an academic  program for students enrolled in an accredited institution, and within the ITFS licensee's reasonable  S0 0judgment is directly related to the education of students.Z ] {O9"  0#C\  P6Q/P#э Bay Area Consortium Comments. See also BellSouth Reply Comments; CTN Comments; Wireless One  Comments (supporting the counting of data and voice transmissions towards minimum educational usage requirements, and implying that upstream and booster station transmissions also should count). HITN proposes that educational usage  requirements should be defined with respect to "any transmissions originated or controlled by the ITFS  S=0 licensee which are used to further the educational objectives of the ITFS licensee."=] yOY' #C\  P6Q/P#э HITN Comment. HITN also stresses that qualifying transmissions would encompass Internet access. In addition, HITN  contends that qualifying educational service should not be limited to that offered by accredited institutions. " * P-4)4)dd"  HITN suggests that limiting eligible educational service providers to accredited institutions deprives  ppopulations of educational techniques such as distance learning, continuing education, ESL instruction,  S0 refresher courses, and "life long learn[ing]."Z] {O #C\  P6Q/P#э Id.Z We disagree with HITN. Accredited institutions can and  do provide such useful educational techniques, and requiring that a qualified licensee be an accredited  institution provides greater certainty of the integrity of the licensee's educational function. The  0accreditation of the appropriate state department of education or national accrediting organization is  puniquely geared towards recognizing the educational institutions fit to meet those needs. Furthermore,  S0 accredited schools have been the intended users of ITFS since the origin of the service.iZ] {O #C\  P6Q/P#э See id. at 85253.i Thus, we will  Sh0keep intact our eligibility requirements of Section 74.932(a).jhP] yO #C\  P6Q/P#э 47 C.F.R.  74.932(a).j  S0 `  qP81.` ` The Commission has long been loath to substitute its judgment for the judgment of  educational authorities concerning what precise ITFS usage is regarded as educational, where such usage  otherwise complies with Commission requirements that it be provided to students enrolled in accredited  Si 0 institutions.EBi D] {O  #C\  P6Q/P#э See, e.g., Second Report and Order in MM Docket No. 83523, 101 FCC 2d at 80 ("putting the responsibility  0for deciding what is educational not on the Commission, but on the accrediting institutions, where it rightly belongs").  While the Bay Area Consortium seeks to codify this approach in the Commission's rules, we decline to establish such  a carte blanche, because there may be instances where the Commission is called upon to adjudicate a challenge to  the bona fides of an ITFS licensee's purported educational usage, or there may be instances where the Commission  chooses to audit such usage. Nevertheless, as a general matter the Commission intends to maintain a deferential  approach to the ITFS licensee's reasonable judgment. We also provide some examples, below, of what will and what will not pass muster, though these examples are by no means exhaustive.E We believe that availability of advanced technologies dictates that it is now time to accord  ITFS licensees increased flexibility in determining which transmissions qualify as satisfying ITFS  educational usage requirements, so long as such transmissions are in furtherance of the educational mission  S 0 Pof an accredited public or private school, college or university, or other eligible institution, ] {O  #C\  P6Q/P#э See 47 C.F.R.  74.932(a). In addition, uses by health care facilities in furtherance of formal staff or medical student training likewise will qualify.  offering  0courses to enrolled students. Such uses may include downstream or upstream video, data and voice  Sj0 transmissions. In addition, while heretofore not qualifying to satisfy educational usage requirements,jp] {O #C\  P6Q/P#э See 47 C.F.R.  74.931(b) and (c) (1997).  Pqualifying uses now may include, but are not limited to, teacher conferencing, remote test administration,  @distribution of reports and assignments, research towards and sharing works of progress in projects for  courses, professional training, continuing education, and other similar uses. Furthermore, in light of the  myriad of possible uses of the spectrum for courses by accredited schools, we no longer need a separate  Sk0 rule pertaining to where transmissions are not to oncampus receive sites.~kf] {O& #C\  P6Q/P#э See 47 C.F.R.  74.931(a)(2) (1997).~ Because we fully expect  several qualifying transmissions to and from homes and other offcampus sites, retention of such a rule"8+\P-4)4)dd"  would be unduly burdensome to ITFS applicants and licensees. We will amend Section 74.931 and other pertinent ITFS rules to reflect all of these changes.  Sg0 ` qQ82.` ` We also will subject ITFS signal booster stations to educational usage requirements, in  @conjunction with those to which main ITFS stations are subject. High power ITFS signal booster stations  originating signals on ITFS channels are hardly distinguishable from main instructional television fixed   stations, and subjecting booster stations to educational usage requirements preserves the primary purpose  of ITFS by ensuring that licensees have no incentive to "crowd out" required educational usage on main  instructional television fixed stations by overlapping transmissions which otherwise would not be subject  Pto such requirements. We note that, like main ITFS stations, educational usage requirements for h  boosters may be shifted off of the channels served by the booster. Furthermore, boosters may satisfy these  requirements through retransmission of signals from the main ITFS station. We will not, however, subject  ITFS response stations or response station hubs to educational usage requirements, because the ITFS  licensee has no control over which upstream transmissions would qualify to satisfy the requirements.  Moreover, the educational usage requirements attached to an ITFS main station and booster station will  S 0 pbe based on the number of channels allocated to the main station, ] yOk  #C\  P6Q/P#э No separate educational usage requirements, however, will attach to the 125 kHz channels assigned to an ITFS licensee. including channels which the licensee  "turns around" for upstream transmissions. Nevertheless, as stated above, qualifying ITFS upstream transmissions may be utilized to fulfill an ITFS licensee's educational usage requirements.  S70 ` qR83.` ` HITN recommends that ITFS licensees be permitted to satisfy educational usage   requirements by providing 20 hours per week of qualifying services "per 6 MHZ block" on their ITFS  S0 0systems._ ] yO #C\  P6Q/P#э HITN Comments._ The Mass Media Bureau found in Comband II,] {O #C\  P6Q/P#э General Electric Co., 61 RR 2d 143, 14647 (Mass Media Bur. 1986). that it was useful where digital compression  technologies are employed to conceptualize a channel as a 6 MHz block, capable of being compressed into  multiple "paths." Henceforth, unless otherwise specified in the Rules, a "channel" shall refer to any of  the 6 MHz frequency blocks assigned pursuant to Sections 21.901(b) and 74.902(a) of the Commission's  S0 Rules,l$ ] yO   #C\  P6Q/P#э 47 C.F.R.  21.901(b) and 74.902(a). This definition will apply to all of the frequency blocks assigned in the   MDS and ITFS bands, except with respect to MDS channel 2A, where the definition of "channel" shall be a 4 MHz  {O  @block. See 47 C.F.R.  21.901(b)(3). In addition, each "channel" in the I Channel Group, located in the 26862690  {On MHz band, shall refer to a 125 kHz block. See new Section 74.939(i) of the Commission's Rules.l and we will add definitions to Sections 21.2 and 74.901 to reflect this clarification.!Z ] Sd!0 ԍ#C\  P6Q/P# Furthermore, we reject the recommendation of the MDS Licensees that we define "channel" to mean "any  substantially distinct packet or stream of content (excluding system administration information) transmitted to an end  user by an MDS or ITFS licensee." Comments of Alliance of MDS Licensees ("MDS Licensees"). As Petitioners  yO#  argue, such a definition could lead to absurd results under certain excess capacity leases. Nevertheless, the  @Commission will not get involved in any disputes between capacity lessors and lessees over their rights pursuant to lease provisions which rely on the use of "channel(s)."! This  `clarification is a necessary frame of reference for the sub and superchannelization scheme that we set  pforth here, and where common parlance may refer, for example, to a video programming path or data",FP-4)4)dd"  stream as a channel. Thus, this clarification should encourage certainty, preventing future confusion over what is a "channel."  Rg0q` `  b. Analog Programming Requirements  S0 ` @qS84.` ` Commenters who addressed analog programming requirements unanimously believe that  the current programming requirements should be retained for ITFS licensees solely engaged in  S0 transmission of downstream analog programming.] S0ԍ#C\  P6Q/P# See, e.g., Comments of Petitioners and CTN Comments and BellSouth Reply Comments. We agree, and we will impose no changes to  Pprogramming requirements where licensees solely utilize analog transmissions. However, for some  S50 commenters there is still discord over what the extent is of the recapture time requirement. In the NPRM,  Pthe Commission rejected Petitioners' proposed changes to Section 74.931(e) that sought to revise the  absolute 20 hours per channel per week recapture time requirement to provide that the ITFS programming  0requirements constitute a total of 40 hours per channel per week, including both actual programming and  Sj 0 recapture time.hj h] yO #C\  P6Q/P#э 12 FCC Rcd at 2220304.h Under the proposed changes, if an ITFS licensee were to actually provide more than  an average of 20 hours per channel per week of ITFS programming, reserved recapture time would only  need to make up the difference to achieve a total of 40 hours per channel per week. The Commission  explained that while the recapture time requirement originally was to bring the total, including actual  S 0 programming, to 40 hours per channel per week, the Commission subsequently, in the Wireless Cable  Sl0 Reconsideration Order, added the absolute 20 hour recapture time language in its revisions to Section  74.931(e)(2). While the Commission acknowledged the great value to wireless cable operators of  pmaximization of spectrum available for leasing, it also emphasized the primary educational purpose of  `ITFS and the importance of maintaining sufficient capacity for programming by ITFS licensees which  S0fulfills that purpose.t\] {O #C\  P6Q/P#э NPRM, 12 FCC Rcd at 2220304.t  S;0 ` qT85.` ` Petitioners argue that in an analog environment, an absolute requirement for 20 hours of  S0 Precapture per channel per week deters investment.R] yO^ #C\  P6Q/P#э Comments of Petitioners, Bay Area Consortium Comments and Wireless One. BellSouth fears that under the Commission's  pinterpretation, recapture could continue until all of the excess capacity initially made available was  S0 recaptured, presumably with no financial or operational detriment.dF] yO #C\  P6Q/P#э BellSouth Comments.d In contrast to these commenters,  Mississippi ETV sees no reason for us to adopt Petitioners' proposed requirement for 40 total hours per  S<0  channel per week for ITFS programming and recapture.j<: ] yOz# #C\  P6Q/P#э Mississippi ETV Comments.j We agree with Mississippi ETV, for the same  S 0 reasons presented in the NPRM.r . ] {O;& #C\  P6Q/P#э See 12 FCC Rcd at 2220304.r However, we clarify that the 20 hours recapture time requirement is  also a maximum over the duration of the lease for systems that continue in an analog environment, unless"-$P-4)4)dd"  the lease allows for more recapture time. The rules do not require that 20 hours always be reserved without accounting for the amount of recapture already exercised.  Rg0q` `  c. Digital Educational Usage Requirements  S0 ` qU86.` ` We received extensive comment on the ability of ITFS licensees currently to meet  Pprogramming requirements, and on whether we should increase educational usage requirements when ITFS  licensees employ digital transmissions. The overwhelming majority of commenters on these issues is in  Pfavor of retaining the current minimum educational usage requirements in a digital environment. One  strain of comment is represented by BellSouth's observation that "there is no direct correlation between  S0 technological advancements and the need for ITFS programming."] yOj #C\  P6Q/P#э Comments of BellSouth, Bay Area Consortium, and Higher Education Alliance. BellSouth relies on Comband II,  where the Mass Media Bureau declined to increase ITFS programming requirements despite the increased  S 0 capacity resulting from use of Comband analog compression technology.a X] yO #C\  P6Q/P#э 61 RR 2d at 147.a BellSouth reports that in some  cases, it has entered into channel lease agreements providing for ITFS airtime usage in excess of the  S7 0 minimum educational usage requirements.87 L] yO  #C\  P6Q/P#э Similarly, the Bay Area Consortium cites the specific example of one of its members successfully negotiating  {OO for additional airtime well beyond that required. See Bay Area Consortium Comments.8 In other cases in BellSouth's experience, the ITFS licensee  negotiated for benefits other than airtime above the minimum required, such as increased compensation,  S 0 pconstruction of additional receive sites, or furnishing of special equipment.n ] {O #C\  P6Q/P#э See BellSouth Comments.n Wireless One observes that  0in many cases under the current rules ITFS licensees are having difficulty fulfilling their programming  obligations, and Wireless One maintains that increasing educational usage obligations would help neither  pITFS licensees nor wireless cable operators, and in fact could discourage ITFS licensees from taking  S0 padvantage of advanced technologies by instituting unrealistic burdens upon them.z ] yO  #C\  P6Q/P#э Wireless One Comments and Reply Comments.z However, in contrast   to most of the commenters on this issue, CTN insists that educational usage requirements must be  modified to reflect increased capacity arising from use of digital technology, and argues that a  proportionate increase in instructional usage is needed to prevent the dilution of the instructional nature  S90of ITFS channels.^9 ] yO1 #C\  P6Q/P#э CTN Comments.^  S0 ` qV87.` ` Several commenters assume the posture reflected in the Joint Statement: that while the  educational usage requirements should not be changed, 25% of an ITFS licensee's capacity should be  Sn0 @immediately available to the ITFS licensee or subject to recapture. While supporting the Joint Statement  S<0 and the overall 25% ITFS capacity reservation, Petitioners nonetheless respond to the arguments justifying  S 0 a 25% reservation as proportional to current requirements for educational usage,  ] yO& #C\  P6Q/P#э Comments of Maryland, Foundation, SWM and Wireless One. by noting that the 25%  reservation is more effective than in an analog environment in light of the efficiencies created through use".P-4)4)dd"  S0 of digital compression techniques.f] yOh #C\  P6Q/P#э Petitioners Comments.f BellSouth, which operates digital video wireless cable systems in  S0 New Orleans and Atlanta, "strongly opposes" the proposed 25% setaside.jX] yO) #C\  P6Q/P#э BellSouth Reply Comments.j It argues that subjecting a  full 25% of a licensee's channel capacity to ITFS immediate use or recapture could have the unintended  effect of encouraging many operators to abandon their digital video plans and focus exclusively on less  capacity intensive uses such as data services, which in turn could undermine the plans of many ITFS  S0 0licensees seeking to provide traditional video services.ZL] {OQ #C\  P6Q/P#э Id.Z Instead, BellSouth is willing to support a  S0reservation of 5% of the capacity of ITFS digital channels.ZB] {O #C\  P6Q/P#э Id.Z  Sh0 ` qW88.` ` BellSouth also "strongly objects" to the Joint Statement's proposal to set aside 20% of  S60 PITFS digital capacity for recapture purposes beyond the 5% minimum retention amount.[68] {Or #C\  P6Q/P#э Id. [ BellSouth explains:  `  An operator that places video programming or other content on capacity that is subject  to recapture does so at the risk that this capacity could be lost down the road, potentially   resulting in an operational and customer relations nightmare that could have serious  financial repercussions. A prudent operator either refrains from making substantial use  of capacity subject to recapture, or factors these risks and uncertainties into such use.  Either way, capacity encumbered by recapture rights is inherently less valuable to the  operator than unencumbered capacity, whether or not the ITFS licensee ever exercises its  recapture rights. As such, ITFS licensees necessarily will receive fewer benefits for  `encumbered capacity. . . . This situation will only be exacerbated if recapture time is  S0substantially increased.[. D {O #C\  P6Q/P#э Id. [  Sl0 @  BellSouth adds that if the Joint Statement's recapture provisions are adopted by the Commission, "the  S:0 pcomplicated terms . . . would reduce the operational flexibility of educators and commercial operators,  pwould redirect limited resources from more productive efforts and, in the end, would preclude parties from  S0 `agreeing to terms that maximize desired benefits of ITFS and MDS partners."$ ] {O" #C\  P6Q/P#э Letter from Karen Possner to Magalie Romn Salas (April 22, 1998), Ex Parte Presentation. The Bay Area  pConsortium observes further that few ITFS licensees have completely developed their systems to fully  utilize the recapture time presently required under the Commission's rules, and argues that an increase in  S;0 recapture time requirements also would conflict with the Comband II precedent.n;] yOY' #C\  P6Q/P#э Bay Area Consortium Comments.n Region IV supports";/P-4)4)dd@"  `additional digital recapture rights to allow for a total of four program tracks per four channel ITFS group,  S0but states that requiring more would undermine the incentive for wireless cable operators to digitize.d] yO5 #C\  P6Q/P#э Region IV Comments.d  Sg0 ` PqX89.` ` In light of the varied market strategies that different wireless cable operators will  implement in a digital environment, and likewise in light of the broad range of educational uses to which  different ITFS licensees will seek to devote their channels, it is not a simple matter to arrive at a "one size  0fits all" approach towards minimum ITFS educational usage requirements and reservation of spectrum  S0 solely for instructional purposes, whether immediate or future.HX] yO   #C\  P6Q/P#э For instance, while many of the wireless cable operators commenting in this proceeding have declared a  substantial interest in rapid deployment of twoway services, BellSouth's comments evidence at least a nearterm  intent to focus on digital video wireless cable services. Similarly, while some commenting ITFS licensees appear  0to indicate a current interest in utilizing twoway transmissions in their educational offerings, others seem intent for  {O  now on maintaining downstream video instructional service. Compare Reply Comments of AshvilleBuncombe  {O  Technical Community College, et al. ("North Carolina ITFS") ("Reply Commenters believe the flexibility to utilize  their frequencies for twoway transmissions will enhance their offerings to their students and those at their receive  {Os  `sites"); with SWM Comments (commenters are "vitally concerned" that rules governing twoway transmissions  @"protect the interests of ITFS licensees providing traditional ITFS service through proven and relatively inexpensive analog transmission technology").H Therefore, because we seek to maximize  @the flexibility of educators and wireless cable operators to design systems which best meet their varied  @needs, we will adopt ITFS excess capacity leasing rules which best promote this flexibility while at the  Psame time safeguarding the primary educational purpose of the ITFS spectrum allocation. After a careful  review of the comments in this proceeding, we decide that these goals are best harmonized where digital  S 0 transmissions are utilized Z ] {O  p#C\  P6Q/P#э In the NRPM, the Commission sought comment on how to resolve the scenarios where licensees employ digital  @operations on one or more, but not necessarily all, of their authorized channels, and where licensees switch from  analog to digital and digital to analog modulation among channels and on the same channel. The Commission noted  {OT  that in the Digital Declaratory Ruling, we allowed licensees to play out these scenarios. NPRM, 12 FCC Rcd at  {O  22204 n.61; see Digital Declaratory Ruling, 11 FCC Rcd at 18865. In comments related to these issues, Petitioners  {O  @contend that the proposed rules embodied by the Joint Statement should govern ITFS licensees that lease excess  `capacity "in whole or in part for digital" uses. Petitioners Comments. We agree that the rules that we set forth here  pertaining to excess capacity leases where digital transmissions are used shall apply also when such transmissions are used in part, as in the scenarios described above. by retaining the current 20 hours per channel per week educational usage  Si 0  requirements,i ] yO  #C\  P6Q/P#э However, in light of our broadening in this proceeding of eligible educational usage, which especially will benefit  licensees which employ digital transmissions, we will not allow new licensees utilizing digital technology to avail  themselves of the "phasein" reduced educational usage requirements of Section 74.931(e)(3). We already had  eliminated the availability of that reduced requirement to any licensee taking advantage of channel loading  {O##  techniques. See ITFS Channel Loading Order, 9 FCC Rcd at 3365. We will modify Section 74.931 to reflect both of these principles. adopting the Joint Statement's proposed absolute reservation of a minimum of 5% of an  ITFS station's capacity for instructional purposes only, and eliminating requirements setting aside capacity  for ready recapture by ITFS licensees. This 5% reservation shall apply spectrally over the ITFS licensee's  whole protected service area. Therefore, a minimum of 5% of an ITFS licensee's capacity is guaranteed" 0tP-4)4)dd"  S0 0to be available to the licensee immediately at all times.] yOh  #C\  P6Q/P#э Regarding this minimum 5% ITFS capacity reservation, Petitioners request that there be no restriction on the  ITFS licensee's ability to permit the wireless cable operator access to unused portions, so long as such access can  be terminated immediately upon notice from the ITFS licensee. Given that we have eliminated recapture  prequirements where digital transmissions are utilized, allowing wireless cable operators unfettered access to up to  95% of an ITFS licensee's channel capacity should the licensee choose to lease that much, we do not believe it necessary nor prudent to heed Petitioners' request, and we reject it. Eliminating recapture requirements eliminates  the potential for uncertainty about which BellSouth is concerned. We emphasize that the 20 hours per  channel per week minimum educational usage requirement is independent from, but concurrent with, the  minimum 5% capacity reservation; further, the reserved capacity can be devoted to satisfying minimum  educational usage requirements. We will add provisions to Section 74.931 of the Commission's Rules to reflect these new standards.  S0 ` qY90.` ` We believe that taken together, these complementary standards are in the public interest.  In retaining the 20 hours per channel per week requirement, we insure the immediate devotion of ITFS  Pspectrum to formal educational usage, and the provision by ITFS licensees of at least as much educational   usage as they provide under the current rules. In addition, the Commission long has been concerned with  S0 providing for expansion of ITFS service offerings.@] {O  #C\  P6Q/P#э See, e.g., Second Report and Order in MM Docket No. 83523, 101 FCC 2d at 90 n.46 ("an ITFS licensee cannot surrender all future rights to adjust to changing needs"). While henceforth where digital transmissions are  0employed we no longer will require reservation of recapture time, which heretofore has been the primary  pmechanism for providing capacity to meet expanding needs, this minimum 5% absolute reservation of  ITFS capacity should embody the same balance which is the basis for recapture provisions; namely,  Pmaximizing the spectrum available for leasing to wireless cable operators, while maintaining sufficient  S 0 @capacity for expanded educational usage by ITFS licensees.x ] {O #C\  P6Q/P#э See NPRM, 12 FCC Rcd at 2220304.x To what extent the minimum 5% reserved  `capacity actually is utilized by the licensee, and whether such utilization is sufficient to meet the 20 hours  Pper channel per week minimum usage requirements, let alone provide for future expansion of service, will   depend both on the digital compression ratio employed by the licensee, and on the particular form of  S0 @transmissions utilized by the licensee to meet its usage requirements. For instance, at a low (e.g., 2:1)  compression ratio where the licensee is transmitting video to satisfy its usage requirements, the licensee  0would need to reserve at least 6% of its capacity just to satisfy its educational usage requirements, and  Pthis would not allow for any future expansion of service. This demonstrates that where a licensee utilizes  `a low digital compression ratio, it may need to reserve more than 5% of its capacity in order to fulfill the  p20 hours per channel per week bedrock educational usage requirement. However, at a 5:1 ratio and  @reserving just 5% of its capacity, the licensee would both be able to fulfill its 20 hours per channel per  pweek usage requirements, and provide for more room to expand than is provided for by our current  Sm0recapture rules.m ] yOe# #C\  P6Q/P#э Technology already exists to employ 6:1 compression ratios.  S0 ` @qZ91.` ` Thus, depending on the form of the transmissions and the compression ratio employed,  a 5% spectrum reservation may lead to some spectrum, beyond that necessary to meet educational usage  requirements, being used for other purposes by the ITFS licensee or lying in wait for immediate usage  upon future need by the ITFS licensee. Or, a licensee may need to reserve more than 5% of its capacity  in order to satisfy minimum educational usage requirements or to provide room for future expansion of";1 P-4)4)dd@"  Pservices by the licensee. However, we believe that the combination of increasingly efficient compression  techniques, coupled with our adoption here of a broad definition of what content satisfies ITFS educational  0usage requirements, will result in future growth of ITFS educational usage. We also emphasize that an  ITFS licensee may reserve for itself in excess capacity lease negotiations more than the minimum required  S40 preservation of capacity,oZ4] yO  #C\  P6Q/P#э As depicted in several of the comments, the ability of ITFS licensees to retain more than the minimum required  {Od  `educational capacity in their leases with wireless cable operators is not illusory. See, e.g., Bay Area Consortium Comments.o and is free not to lease its excess capacity at all if it does not wish to do so.  We urge ITFS licensees to exercise cautious judgment in lease negotiations pertaining to the amount of spectrum to be made available for future educational needs.  Rh0q` `  d. Measurement of Educational Usage  S0 ` @q[92.` ` We did not receive extensive comment on this issue, and the comments that we did receive  0did not provide much by way of specificity. Mississippi ETV suggests measuring data transmission on  "an hourbyhour basis," and educationrelated upstream transmissions through "traditional logging," but  Si 0  provides no further insights into these proposals.ji ] yOW #C\  P6Q/P#э Mississippi ETV Comments.j Higher Education Alliance urges the Commission to  find that educational usage requirements are satisfied where Internet access is available "at ITFS receive  sites during the entire school day at a data transmission rate satisfactory to an ITFS licensee, together with  a reasonable expectation on the part of such ITFS receive sites that Internet access use will collectively  S 0 Pamount to at least 20 hours per channel per week."t ] yO #C\  P6Q/P#э Higher Education Alliance Comments.t Petitioners express preference for measuring non video educational usage with respect to an amount equivalent to the current 20 hours per channel per week  prequirement; and with respect to a requirement which instead would utilize a percentage of capacity gauge.  pHowever, Petitioners concede that both proposed requirements are difficult to measure, and conclude that  at least for now, the Commission should defer to good faith efforts by the ITFS licensee to comply with the requirements.  S80 ` q\93.` ` In addition, Petitioners "strongly oppose" timeofday requirements. They argue that when  `the Commission repealed its former such requirements, the record at that time established that there were  a variety of legitimate uses of ITFS outside the mandated hours. Petitioners further assert that college and  university students have been known to study at unusual hours. Or, in order to conserve bandwidths,  Pschools may utilize their ITFS capacity at offpeak hours to download, using the Internet, educational  material from a central location to multiple schools, where such material will be stored on a local file  S0 server and accessed by students the next day via an intranet within each school.K] yO!  0#C\  P6Q/P#э Petitioners' Comments. Petitioners urge that for this reason, the Commission should, in conjunction with this  proceeding, grant pending petitions for reconsideration of a 1994 decision that only programming transmitted for  Preal time viewing by students counts towards minimum educational usage requirements. Petitioners contend that  @whatever merit that decision may have had before, it is becoming obsolete with the introduction of advanced digital  {O$  services. Id. at 140 n.225. See Petition of Wireless Cable Ass'n Int'l for Reconsideration and Clarification, MM  {O%  Docket No. 93106, at 611 (filed August 12, 1994); Petition of Alliance for Higher Education, et al., MM Docket  {O&  0No. 93106 (filed August 5, 1994). We agree with Petitioners. In the ITFS Channel Loading Order, the Commission  declared that the "videotaping of ITFS programming which is transmitted in the early hours of the day for later replay  @during the school day appears . . . unredeemably wasteful of the spectrum and libraries for such taped presentation""(P-4)4)'"  can be readily assembled without the use of ITFS facilities." 9 FCC Rcd at 3367 (citation omitted). However, in  light of the fundamental changes in service available for deployment by ITFS licensees as a result of this proceeding,  yO   as reflected in our changed content requirements, we agree that the Commission's previously enunciated stance is  0today unduly restrictive and obsolete, and we will grant those portions of the cited pending petitions for  Preconsideration addressing that decision. However, to any extent that these petitions are inconsistent with our ruling in this proceeding, they are denied.K The Foundation"2@P-4)4)dd"   challenges Petitioners' grounds for opposing timeofday requirements for ITFS educational usage, out of  concern that unscrupulous licensees would seek to satisfy all educational usage requirements between the  @hours of midnight and 6 A.M. Rather, the Foundation envisions that educational usage should be on a  Sg0 steady, 24 hour basis, and not relegated to obscure times of day.kg@] yO #C\  P6Q/P#э Foundation Reply Comments.k Consistent with the revised ITFS  content requirements that we adopt in this proceeding, which seek to fulfill our goal of according ITFS  licensees maximum flexibility in determining which uses of their spectrum enhance their formal educational mission, we decline to adopt timeofday requirements for measuring educational usage.  Sh0 ` q]94.` ` In the foregoing, we have retained two different but complementary requirements of ITFS  `spectral usage: a minimum of 20 hours per channel per week for educational usage, and a minimum  reservation of 5% of a licensee's capacity that it may not lease. As reflected in the comments of  0Petitioners and others, both are difficult to measure in light of the varied forms that such usage can take.  We agree with those parties commenting on this issue that at least for now, the best course is to rely on  the good faith efforts of ITFS licensees to meet the requirements set forth here. We are not instituting  any new, formal, proof of compliance reporting submissions in this area. However, under certain  circumstances, ITFS licensees may bear the burden of proving compliance with these requirements, such  pas a Commission audit. In responding to audits, licensees must be ready and able to describe and  document how they complied with these requirements. We find that this approach to enforcing the  minimum amounts of educational usage and absolute capacity reservation required of ITFS licensees  utilizing digital transmissions will preserve the formal educational goals which underlie ITFS. Moreover,  S0 as suggested by Petitioners,p4] {O< #C\  P6Q/P#э See Petitioners Comments.p if we find that experience dictates the necessity for a more structured  mechanism for measuring compliance, for instance in order to curb abuses and/or to promote certainty, we can revisit this issue in a future rulemaking proceeding.  S8 q ` ` 2. Channel Loading, Shifting and Swapping (#  S0 ` q^95.` ` In the NPRM, the Commission advanced Petitioners' proposal to amend Section   74.931(e)(9) to allow ITFS licensees, at their sole discretion, to satisfy their educational usage  requirements on other channels within the wireless cable system ("channel loading"), and not mandate that  S:0 licensees meet these requirements using at least one of their own channels ("channel shifting.).h:* ] yOh# #C\  P6Q/P#э 12 FCC Rcd at 2220508.h  Petitioners promoted this proposal as being of utmost importance to construction of twoway systems.  PPetitioners also propose that ITFS licensees be allowed to trade some or all of their licensed spectrum for  spectrum licensed to MDS operators ("channel swapping."). Petitioners anticipate that system developers   will attempt to utilize contiguous 6 MHz channels for twoway services in order to minimize the amount  of spectrum that would be lost to the proposed spectral mask whenever a return path is adjacent to a  0downlink channel. Furthermore, depending on the demand for twoway services, entire ITFS channel"3 P-4)4)dd"  S0 groups may need to be devoted for return paths.] {Oh #C\  P6Q/P#э Petitioners reiterate these supporting arguments in their comments on the NPRM. See Petitioners Comments. The Commission described how this channel "shifting"  0proposal would be the next step in a progression of rule changes that have afforded ITFS licensees  S0  increased flexibility in the implementation of their minimum educational usage requirements.\Z] {O  #C\  P6Q/P#э 12 FCC Rcd 2220506. See Wireless Cable Reconsideration Order, 6 FCC Rcd at 6774 (allowing the use of  {O  `channel mapping technology); ITFS Channel Loading Order, 9 FCC Rcd 3360 (allowing the use of channel "loading," which is the functional equivalent of channel mapping but more cost efficient). The  Commission found this progression consistent with the view that "it is most practicable to view a licensee's  S40group of four ITFS channels as an integral constituent of a marketwide set of channels."4] {O #C\  P6Q/P#э 12 FCC Rcd 22206; see ITFS Channel Loading Order, 9 FCC Rcd at 3365.  S0 ` 0q_96.` ` The Commission inquired regarding what restrictions on channel shifting, if any, should  S0 Pbe adopted.e] yOw #C\  P6Q/P#э 12 FCC Rcd at 22208.e Responding to comments received leading up to the NPRM, ] {Ok #C\  P6Q/P#э These comments are summarized in the NPRM at 12 FCC Rcd 22206, 22207. the Commission further  proposed to allow the trading of channels between licensees, channel "swapping." The Commission also  solicited comment on the effects of allowing complete flexibility in the number of channels "turned  Paround" for return paths, and on whether we should require ITFS licensees to retain one or more channels  for downstream transmissions and the ramifications of such a requirement. Finally, the Commission  welcomed further proposals for providing flexibility in usage of ITFS channels while ensuring that ITFS  Sj 0licensees are not deprived of capacity for downstream programming.dj ] {O0 #C\  P6Q/P#э Id. at 22208.d  S 0 ` pq`97.` ` The Joint Statement addresses all of these issues. It supports channel shifting, so long as  S 0 the educational usage is on another ITFS channel within the same wireless cable system. ] {O   #C\  P6Q/P#э Id. at  IV. The Joint Statement broadly characterizes the channel shifting concept as "channel loading." While  {OX  0this characterization exceeds the channel loading which the Commission first authorized in 1994, see ITFS Channel  {O"  Loading Order, 9 FCC Rcd 3360, the Joint Statement's characterization likewise encompasses approval of the  `previously authorized channel loading concept. We refer to channel loading as the transmission by an ITFS licensee of all of its required educational usage on its own channels, but using fewer than its authorized number of channels. It would  0permit any ITFS licensee to swap channels with any other ITFS or MDS licensee in the 2.5 GHz band  operating in the same geographic area, and calls for expedited consideration by the Commission of channel  S90 0swap applications.q9] {O$ #C\  P6Q/P#э Joint Statement at  V.q Furthermore, it provides that each ITFS licensee leasing channels to be used for  return paths shall be required to maintain at least 25% of its licensed channels to be used for downstream  S0 transmissions both during the term of the lease and following termination of its leasing arrangement.f] {O' #C\  P6Q/P#э Id. at  VI.f "4P-4)4)dd@"  @The general concepts of channel loading, shifting, and swapping similarly are supported by several  S0 commenting parties who do not expressly endorse the Joint Statement;4] {O5  #C\  P6Q/P#э See, e.g., BellSouth Comments (supports "so long as they are voluntary"); Bay Area Consortium Comments (supports so long as "both ITFS and MDS licensees have full access," and likewise stresses voluntariness).4 in fact, very few commenters  S0 express any opposition to these general concepts.x"] yO  #C\  P6Q/P#э However, one of the few commenters who does express some opposition is Mississippi ETV, which is concerned  that channel shifting and channel swapping may confuse viewers who have become accustomed to finding specific  instructional programs on specific channels. Therefore, Mississippi ETV urges that if these concepts are approved  `by the Commission, and channel shifting or swapping is necessary to accommodate a twoway system, the wireless  cable operator should be required to commit the necessary financial resources to properly inform all ITFS viewers  0of channel changes. Mississippi ETV Comments. We decline to implement any such requirement, and find that such matters are properly addressed between the affected licensee and its system operator. With the exception of our channel loading rules and  intraITFS channel swaps between licensees utilizing analog transmissions only, the concepts which we  `permanently adopt in this section apply only to licensees utilizing digital transmissions, leasing excess  capacity to an operator which utilizes digital transmissions, or swapping channels with a licensee which  S0utilizes digital transmissions.@ ] yO  `#C\  P6Q/P#э In this regard, Region IV pushes for the permissibility of channel loading, shifting and swapping in both the  `analog and digital modes. Region IV Comments. However, we decline to authorize channel shifting and cross service swapping in a purely analog system other than by waiver, because the efficiencies of digital use or general  need for contiguous blocks are not present. Furthermore, to the extent that channel shifting involves some ceding  of control by the licensee whose educational usage is shifted, there are insufficient benefits to outweigh such a risk  `in a purely analog system. Similarly, any benefits of crossservice channel swaps between MDS and ITFS licensees  solely utilizing analog transmissions would be outweighed by the muddling of the regulatory picture which would ensue from such swaps.  Ri0q` `  a. Channel Loading  S0 ` qa98.` ` In the NPRM, the Commission revisited its channel loading rules because, in the ITFS  S0 0Channel Loading Order, we provided that the channel loading rules adopted there would remain in effect  0until the Commission assessed the impact of digital compression on MDS and ITFS in a future notice and  Sl 0 `comment rulemaking proceeding.l 2] {O #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22206; see ITFS Channel Loading Order, 9 FCC Rcd at 3368. The Commission recognized in the NPRM that the continued  `allowance of channel loading is "an almost necessary component" of the scheme to devote significant  S 0 blocks of the MDS and ITFS spectrum to return paths.e (] yO3! #C\  P6Q/P#э 12 FCC Rcd at 22206.e While expressing the belief that our channel  loading rules have provided additional muchneeded flexibility to ITFS licensees and wireless cable  operators, and proposing to retain the rules, the Commission requested that interested parties comment on  0whether the rules have been beneficial to ITFS licensees and wireless cable operators, or whether they have been detrimental. "5P-4)4)dd "Ԍ S0 ` qb99.` ` Those parties commenting on our channel loading rules unanimously support their  S0 retention, and we shall do so as modified below.\] yO5  @#C\  P6Q/P#э Because we are permanently incorporating our channel loading and mapping rules, we eliminate the requirement  {O  specified in the ITFS Channel Loading Order that lease agreements permitting channel loading and mapping  {O acknowledge that those practices are subject to any future Commission rule changes. See 9 FCC Rcd at 3368. Petitioners believe that, consistent with promoting   ITFS licensee flexibility, the Commission should eliminate the portion of Section 74.931(e)(9) that requires  each ITFS licensee engaged in channel mapping or channel loading to preserve the ability to transmit all  pof its ready recapture time simultaneously on the number of channels for which it is licensed. "Simply  put, the Commission should defer to the local educator to determine the best method for scheduling the  S0 `capacity available for recapture."f] yO #C\  P6Q/P#э Petitioners Comments.f BellSouth echoes Petitioners' request, and adds that the simultaneous   recapture provision "unnecessarily requires educators to set aside limited resources for unlikely  Sh0 contingencies," resulting in devaluation of the spectrum and a lost opportunity cost to the ITFS licensee.jh] yOL #C\  P6Q/P#э BellSouth Reply Comments.j  We agree with Petitioners and BellSouth for the reasons advocated by them, and we note that with our  abolition in this proceeding of recapture requirements where the ITFS licensee employs digital technology,  there would be much less occasion for invoking the simultaneous recapture rule anyway. We will amend  S 0 Section 74.931(e)(9) to reflect its elimination.| ] yOt  #C\  P6Q/P#э We acknowledge that the simultaneous recapture right was deemed to be "essential" to educators agreeing to the  {O<  industrywide compromise which served as the foundation for the ITFS Channel Loading Order, and that we  previously concluded it to be a restriction on the use of channel loading necessary to maintain the primary purpose  `of ITFS. 9 FCC Rcd at 3368. However, with the advent of digital technologies, including twoway transmissions,  {O  in the wireless cable industry, much has changed in the four years since the ITFS Channel Loading Order was  adopted, and we no longer deem this restriction necessary. Nevertheless, those educators who continue to consider the right essential may insist upon it in their lease negotiations with wireless cable operators. Furthermore, in light of our broadening in this  `proceeding of eligible educational usage for all licensees, regardless of what technology they utilize, we  S6 0 clarify that to the extent the ITFS Channel Loading Order is concerned with the time of day of loaded  S 0  usage, these concerns no longer apply. In accord with the ITFS Channel Loading Order, however,r |] {O #C\  P6Q/P#э See id., 9 FCC Rcd at 3367.r we  Preiterate that channel loading remains permissive only, and not mandatory, for all licensees, regardless of whether they utilize analog or digital transmissions.  R90q` `  b. Channel Shifting  S0 ` Pqc100.` ` The overwhelming majority of commenters on this proposal wholeheartedly support it.  BellSouth states that channel shifting offers considerable benefits to licensees and operators even when  downstreamonly digital services are offered, and is particularly critical to maximizing spectrum  efficiencies. For example, BellSouth describes how channel shifting will allow ITFS usage to be grouped  @with all other local content in each market, permitting use of remote encoding, compression, encryption  and multiplexing systems in each market. These systems, in turn, reduce costs and network complexity,"6rP-4)4)dd`"  S0 0and improve reliability and efficiency of spectrum use. ] {Oh  #C\  P6Q/P#э See BellSouth Comments and Reply Comments. To the extent that these benefits result from deployment of  @digital "super" headends that can serve multiple markets or an entire region, BellSouth maintains that the entire area  {O  0served by the "super" headend should be considered an integrated "system" for purposes of channel shifting. Id.  We disagree, because where the "super" headend serves multiple markets, conceivably a market could be deprived  of its ITFS educational content where such content is wholly shifted to channels in a different market served by the "super" headend.  BellSouth also, like several other commenters,  S0 emphasizes that channel shifting must be voluntary.dD] yO #C\  P6Q/P#э BellSouth Comments.d Higher Education Alliance supports channel   shifting so long as the licensee's "legitimate expectation of renewal" is not adversely affected by the fact  Sg0  that none of its required educational usage was transmitted on its own licensed channels.tg8] yO #C\  P6Q/P#э Higher Education Alliance Comments.t As  S40 Psummarized above, the Joint Statement is supportive of channel shifting so long as the usage is shifted onto channels licensed to other ITFS entities.  S0 ` qd101.` ` We are amending Section 74.931(e)(9) to permit maximum flexibility in channel shifting  for an ITFS licensee which itself utilizes, or leases excess capacity to a wireless cable operator which  utilizes, digital transmissions. Such flexibility encompasses the right of an eligible ITFS licensee to shift  its required educational usage onto any other channel(s) within the same wireless cable system, regardless  S0 of whether licensed to an MDS or ITFS entity. As the Commission expressed in the NPRM, channel  0shifting greatly assists in assembling the contiguous frequency blocks which are essential to a twoway  architecture. We further hope that the flexibility we accord to ITFS licensees to lease their channel  capacity, along with the maintenance of minimum ITFS educational usage requirements, also encourages  S 0 peducators to apply for new ITFS stations and leads to more educational usage.w , ] {O5 #C\  P6Q/P#э See Notice, 12 FCC Rcd at 22207.w We believe that such  pbenefits of allowing eligible licensees maximum flexibility outweigh any issues relating to licensee control,  and we emphasize that an ITFS licensee's decision to enter into a channel shifting arrangement is  completely voluntary. In the event that an ITFS licensee is dissatisfied with the transmission of its  educational usage over others' channels, we expect the wireless cable operator to work with the licensee  `in good faith to resolve the conflict. Given that some or all of the ITFS licensee's channels may have   been turned around for upstream transmissions, for example, returning those channels to downstream  transmissions may be extremely disruptive to the twoway system. However, we will entertain complaints  where the downstream channels devoted to ITFS educational usage are subject to harmful interference such  that the ITFS licensee cannot meet its service obligations. In fact, the pursuit of complaints under such  S0circumstances is consistent with the ITFS licensee's responsibilities.bZ" ] {O-"  #C\  P6Q/P#э See ITFS Channel Loading Order, 9 FCC Rcd at 3366: "ITFS licensees must undertake the obligation of insuring  that their . . . programming, if it is to be transmitted over channels other than their own, actually reaches their students."b  R0q` `  c. Downstream Channel Reservation  S;0 ` 0qe102.` ` In the NPRM, the Commission solicited comment on proposals that each ITFS licensee  be required to preserve at least one downstream channel, and that each ITFS licensee devote at least half" 7P-4)4)dd"  S0 of its capacity for downstream use.e] yOh #C\  P6Q/P#э 12 FCC Rcd at 22207.e Of the few comments that we received on this issue, the majority  `favors a mandatory preservation of one downstream channel. Wireless One, for instance, believes that it  should alleviate concerns over how ITFS entities will be able to continue operations after terminating their  Sg0 relationship with a wireless cable operator.mgX] yO #C\  P6Q/P#э Wireless One Reply Comments.m Higher Education Alliance likewise supports the required  S40 preservation of one downstream channel per each ITFS licensee, though it diverts from the Joint  S0 Statement's similar position by allowing that the channel need not necessarily be from amongst the  S0  licensee's own channel group.tL] yO #C\  P6Q/P#э Higher Education Alliance Comments.t The Foundation, which was the original proponent of the halfcapacity  S0 downstream preservation, reiterates that position.e@] yO #C\  P6Q/P#э Foundation Comments.e The Bay Area Consortium, on the other hand,  Sj0 generally "opposes the proposals discussed in the [NPRM] which would dedicate specific channels to  S80upstream or downstream use."n84] yOp #C\  P6Q/P#э Bay Area Consortium Comments.n  S0 ` pqf103.` ` We are adopting the Joint Statement's proposal, as modified by the Higher Education  @Alliance comments, and we are adding appropriate provisions to Section 74.931. Specifically, each ITFS  licensee leasing channels to be used for return paths shall be required to maintain at least 25% of its  capacity to be used for downstream transmissions both during the term of the lease and following  Ptermination of its leasing arrangement. This 25% of capacity downstream preservation need not be over  @the licensee's own licensed channels. We believe that this solution provides maximum flexibility in usage  of the channels within a wireless cable system, while at the same time safeguarding the continued  reservation of spectrum for downstream transmission of ITFS educational programming so that the licensee   can continue to deliver such programming if its relationship with the wireless cable operator ends. In  `order to provide additional safeguards of the ITFS spectrum allocation, we stipulate further that in the  event this relationship ends, the wireless cable operator must return to the ITFS licensee unfettered use  `of as many 6 MHz channels as are authorized to the licensee; only 25% of these channels, however, must  0be devoted to downstream transmissions. Finally, when none of these returned channels are from the  0licensee's originally licensed channel group, the Commission will expeditiously grant channel swap  applications reflecting the channel return, shortly after mutual submission of such applications by all relevant licensees.  Rp0q` `  d. Channel Swapping  S 0 ` qg104.` ` In the NPRM, the Commission solicited comment on whether ITFS channel swaps should  only be just between ITFS channels, or whether ITFS licensees should be able to swap their spectrum for  channels in the MDS band. The Commission also sought input on related proposals, including a  requirement that wherever an exchange of ITFS channels is permitted, reimbursement of all costs of  channel changes should occur; and a reallocation counterproposal that the Commission institute a five to  0ten year plan to convert MDS channels 1, 2, and 2A from their current pointtomultipoint use to upstream  multipointtopoint transmissions, leaving the rest of the ITFS and MDS spectrum for pointtomultipoint use."8( P-4)4)dd!"Ԍ S0 ` Pԙqh105.` ` All of the comments that we received on channel swapping issues are in favor of the  S0 `concept. Aside from its initial "refarming" plan,p] {O5 #C\  P6Q/P#э See  46, supra.p CTN merely comments in favor of channel swaps  S0 among ITFS licensees.hZ] {O #C\  P6Q/P#э See CTN Comments.h However, most of those commenting on these issues indicate full support for  Sg0 swaps both between ITFS channels, as well as between ITFS and MDS channels. The Joint Statement  seeks to limit swaps to those channels in the 2.5 GHz band, but most of the comments do not contain this  stipulation. SWM supports channel swaps so long as they are voluntary, and views them as a method to  decrease the interference risks attendant to twoway transmissions. SWM also reiterates its cost  S0 reimbursement proposal on which the NPRM sought comment.^ P] yO #C\  P6Q/P#э SWM Comments.^ Wireless One, one of a couple of  commenters expressing support for SWM's cost reimbursement proposal, adds that channel swapping, like  0channel shifting, will help to allow the wireless cable operator and the ITFS licensee to group channel  S0usage to their best advantage.q D] {OL #C\  P6Q/P#э See Wireless One Comments.q  S 0 ` qi106.` ` In light of the overwhelming support for channel swapping and its obvious benefits   particularly where twoway transmissions are envisioned, the question here is not whether to allow it;  rather, the focus must be on the nature and breadth of the rules governing it. We note that Part 21 of our  S 0 Rules already allows withinservice MDS channel swaps.m  :] yOC #C\  P6Q/P#э 47 C.F.R.  21.901(d)(6).m We emphasize that channel swapping is  completely voluntary, and we also will allow nearly maximum flexibility in the types of swaps that may  take place: First, parties may swap any ITFS channels and parties may swap almost any ITFS and MDS  Sl0 @channels in the same market or geographic area. l. ] yO  #C\  P6Q/P#э The only exception to this flexibility is where it is a swap between MDS and ITFS channels, and both stations  yOf are utilizing analog transmissions only.  Second, we do not limit swaps to channels within the  S90 P2.5 GHz band; rather, ITFS channels also may be swapped with MDS channels 1 & 2. 9 ] yO' #C\  P6Q/P#э However, ITFS channels may not be swapped with MDS channel 2A, because it is only a 4 MHz channel. Third, a licensee  may swap as many or as few of its channels as it chooses. Furthermore, we specify that channel swaps  Prepresent a change in the licensee of the swapped channels, and are not tied to the duration of any excess  0capacity lease or other agreement. This will provide certainty both to wireless cable operators, that their  psystems will not be disrupted, and to ITFS licensees, who can plan postrelationship issues accordingly,  and with certainty that others' swaps also are permanent. In this regard, we agree with the Foundation's  suggestion that "[i]f an ITFS channel is swapped for a channel which is normally assigned to"9 P-4)4)dd"  S0 pMDS/MMDS, the former MDS/MMDS channel should be regulated as an ITFS channel, and vice  S0versa."1] {O6  #C\  P6Q/P#э Foundation Comments. See also Petitioners Comments. We also agree with Petitioners' additional specification  Pthat an ITFS licensee who swaps to the E or F Group channels should not be subject to the restrictions on ITFS  {O  `licensees who were authorized to operate on the E and F Group channels prior to May 26, 1983. See Amendment  pof Parts 2, 21, 74, and 94 of the Commission's Rules and Regulations in Regard to Frequency Allocation to the  Instructional Television Fixed Service, the Multipoint Distribution Service, and the Private Operational Fixed  {O" Microwave Service, 98 FCC 2d 129, 13234 (1984).1  Si0 ` qj107.` ` Because channel swapping is voluntary and its terms negotiable, contrary to SWM's  proposal we see no need to require that the wireless cable operator cover all of the costs of it. However,   we anticipate that as the system coordinator, the wireless cable operator usually will be the proponent of   the channel swap, and an ITFS licensee requested to swap its channels is free to seek payment in its lease  S0 negotiations or otherwise.XF] yO  #C\  P6Q/P#э In order to maximize flexibility in compensation that ITFS licensees may seek from wireless cable operators, we  @will impose no limits at this juncture on the amount or types of compensation that ITFS licensees may demand in exchange for agreeing to swap their channels, other than to specify that such demands must be in good faith.  In addition, CTN has suggested that when accommodating channel  relocations, exchanges, or sharedtime agreements, Section 74.902(d)(1) of the Commission's Rules should  S70 Pnot apply.!7 ] {O  #C\  P6Q/P#э See Request of Catholic Television Network for Supplemental Comment Period and Extension of Time, MM Docket No. 97217, at 6 (filed November 25, 1997) ("CTN NPRM Comment Extension Request").! While it is not clear to which exact element of that rule CTN is referring,X7 ] yO  #C\  P6Q/P#э Section 74.902(d)(1) is a lengthy set of rules, which, in its current form, begins: "A licensee is limited to the  0assignment of no more than four channels for use in a single area of operation, all of which should be selected from the same Group listed in paragraph (a) of this section." rather than carve  out broad exceptions to the application of the rule, we believe that the scenarios contemplated by CTN  `will be facilitated by amending the rule to stipulate that a licensee initially must select its maximum of  Pfour channels from amongst the same channel group, but that subsequently it may be licensed to channels within different channel groups through Commission authorized channel swaps.  S 0 ` 0qk108.` ` While the Commission sought comment in the NPRM on the proposal to convert MDS  @channels 1, 2, and 2A from their current pointtomultipoint use to upstream multipointtopoint  transmissions, leaving the rest of the ITFS and MDS spectrum for pointtomultipoint use, the Commission   tentatively rejected the proposal, because it would artificially limit the amount of spectrum that could be  used for upstream transmissions and unnecessarily prevent ITFS licensees from using their own channels  S0 for upstream transmissions.q ] {O" #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22180.q For the same reasons cited by the Commission, the parties commenting on  this proposal unanimously support the Commission's rejection of it. Some commenters also argue that the  S0  proposal would harm existing licensees relying on downstream use of channels 1, 2, and 2A.] {O% #C\  P6Q/P#э See Bay Area Consortium Comments; MDS Licensees Comments. Based  on the comments and on our own further consideration, we see no reason to limit response channels to"n:P-4)4)dd"  MDS channels 1, 2, and 2A. We also decline to adopt other proposals limiting the location of response  S0channels.] {O5  #C\  P6Q/P#э See  46, supra, addressing CTN's "refarming" plan; and  57, supra, addressing reallocation proposals for the 125 kHz channels.  Sg0 ` ql109.` ` Regarding channel swap application and processing procedures, the few comments that   we received suggest that channel swaps be governed by current rules and procedures for formal license  S0 assignments.u"] {O' #C\  P6Q/P#э See, e.g., BellSouth Comments.u Commenters also urge that we adopt specific expedited procedures for processing  S0 assignment applications filed pursuant to channel swap agreements.x] {O #C\  P6Q/P#э See Bay Area Consortium Comments.x We will implement simple  S0 procedures for channel swap applications: Each licensee seeking to swap channels shall file a pro forma  0assignment application with the Commission, attaching an exhibit which clearly specifies that the  S60 0application is filed pursuant to a channel swap agreement.6] SH0ԍ #C\  P6Q/P#See new  21.901(d) and 74.902(f). Because pro forma assignment applications  typically are processed rapidly, however, we do not believe that special expedited processing procedures are necessary at this juncture.  Rk 0q` `  e. Effects on ITFS License Renewal  S 0 ` Pqm110.` ` Several commenters seek to impress upon us that it is important that we clarify that  `channel shifting, in particular, will not constitute a basis for, or be a factor in, a license renewal  S 0 proceeding.  ] {O #C\  P6Q/P#э See, e.g., BellSouth Reply Comments; Higher Education Alliance Comments. The Joint Statement also contains a provision to this effect.  ] {O  #C\  P6Q/P#э Id. at  IV (channel shifting "shall not be considered negatively at the time the ITFS licensee seeks renewal of its authorization"). This concern arises over  possible effects of an ITFS licensee not providing any educational usage over its own licensed channels,  0even if it satisfies its educational usage requirements on other channels in the same wireless cable system.   BellSouth relies on notions of fairness, arguing that "ITFS licensees should not be jeopardized because  S0 shifting has occurred in order to use the technology more efficiently."j ] yO #C\  P6Q/P#э BellSouth Reply Comments.j The Foundation presents a more  `dire observation, suggesting that ITFS licensees will be unlikely to allow use of their channels for twoway  Sn0operation "unless renewal expectancy is assured."en] yO,$ #C\  P6Q/P#э Foundation Comments.e  S0 ` qn111.` ` In the NPRM, the Commission stated its belief that consideration of renewal expectancy  `is beyond the scope of this proceeding. While we do believe that the issue of renewal expectancy in ITFS  is best to be considered fully in another proceeding, we also recognize that twoway system design may  `be based largely on the implementation of channel shifting, and that wireless cable operators and their"p;P-4)4)dd`"  PITFS lessors may be deterred from utilizing these efficiencies without assurances that doing so will not  have an adverse effect at the time the ITFS licensee seeks renewal. In other contexts, we have assured  @ITFS licensees that so long as they meet their overall educational usage requirements, they will not be  penalized for not providing educational usage on each of their authorized channels, where their scheme  0for meeting their requirements will promote the wireless cable system in their market and prevent  S0 "balkanization of the ITFS spectrum."Z] {Oi  `#C\  P6Q/P#э See ITFS Channel Loading Order, 9 FCC Rcd at 3364. There, the Commission amended Section 74.902(d) of  its rules to allow new ITFS applicants to satisfy presumptively, when proposing employment of channel loading techniques, their obligation to demonstrate need for all four channels in the sought channel group. We find it wise to provide similar assurances to ITFS licensees  `which employ channel shifting, which we have described above as the next step in an increasingly flexible  `progression of rule changes concerning fulfillment of minimum educational usage requirements.  Accordingly, we amend Section 74.93 to reflect that the fact that an ITFS licensee utilizes channel shifting  S50  will not itself be considered adversely to the licensee in seeking a license renewal.J 5] yO#  @#C\  P6Q/P#э While only ITFS licensees utilizing digital transmissions, or leasing excess capacity to a wireless cable operator  utilizing digital transmissions, are eligible under our revised rules to avail themselves of channel shifting techniques,  the assurances that we add to Section 74.931 encompass the concepts of channel loading and channel mapping, techniques which may be utilized by any ITFS licensee, regardless of what form of transmissions it utilizes.J However, we  steadfastly maintain that any other consideration of renewal expectancy is beyond the scope of this  proceeding. Furthermore, we note that we have struck the words "or otherwise" from the language that   we add to Section 74.931, because we also do not believe it appropriate in this proceeding to evaluate  pwhat treatment channel shifting techniques should be accorded, for example, in initial licensing of new ITFS stations.  S  q` ` 3. Autonomy of ITFS Licensees and Agency Role  Sj0 ` @qo112.` ` When the Commission solicited comments in preparation for the NPRM, several of the  ITFS parties who commented at that time expressed concern that the proposed twoway scheme would  threaten the independence of ITFS licensees and their future ability to use spectrum capacity for  instructional purposes. Some of those concerned commenters focused on the effect that the proposed rules  0could have on the engineering autonomy of ITFS licensees. Concerned commenters also identified issues  relating to possible encroachment upon the financial autonomy of ITFS licensees by implementation of  @the proposed twoway framework. Recognizing the symbiosis between the MDS and ITFS worlds, and  the increasing entanglement that they believed will result from wireless cable twoway operations, these  @commenters sought precautions to ensure that no ITFS licensee would be forced to engage in twoway   operations, and that those ITFS licensees that do cellularize can continue to provide educational services  should their relationship with their wireless cable lessee end or should their wireless cable lessee become  S:0 insolvent. While the Commission, in the NPRM, sought comment on the effects that cellularization would  @have on the engineering and financial autonomy of ITFS licensees, we also acknowledged that any  proposed solutions inherently would implicate the fundamental question of what degree of oversight the  Commission should maintain in regulating the wireless cable industry and ITFS. The Commission  solicited views on this fundamental question, and on one of its principal offshoots, the question of what  impact the proposed twoway rules should have on the Commission's requirements regarding excess  S 0capacity lease agreements.} 6] {OC& #C\  P6Q/P#э See generally, 12 FCC Rcd at 2220813.} "<, P-4)4)dd"Ԍ S0 `  qp113.` ` The comments that we received in response to the NPRM evince many of the same  concerns expressed by some of the ITFS commenting parties in earlier rounds of comment, and likewise  are met with opposing comments conveying responses comparable to those previously conveyed. For  example, the Foundation argues that the need for safeguards over posttermination aspects of leases  increases in a twoway environment "which makes licensees depend more than ever on the facilities of  S0 third parties."k] yOj #C\  P6Q/P#э Foundation Reply Comments.k Wireless One counters that threats to ITFS autonomy in a twoway system are minimal,  because "[i]n reality, there will be no greater dependence than exists currently, and that which exists  S0 @currently was based on a multitude of individual decisions made by ITFS licensees."g X] yO #C\  P6Q/P#э Wireless One Comments.g Similarly, while  Petitioners reiterate that postrelationship arrangements should be addressed by contract, not by regulation,  in part because there is no "one size fits all" approach and educators' needs will vary, the Foundation  S0 "could not disagree more."f!L] yOS #C\  P6Q/P#э Petitioners Comments.f CTN charges that "there can be no dispute that it is the Commission's  responsibility, rather than the responsibility of individual ITFS licensees or wireless cable operators, to   preserve the essential educational character of ITFS and to promote its use consistent with the public  Sj 0 interest."d"j @] yO #C\  P6Q/P#э CTN Reply Comments.d Some of our decisions here, such as requiring ITFS licensees to retain 25% of their capacity  for downstream transmissions, and generally prohibiting involuntary modifications to ITFS stations in a  twoway environment, should help address some of the concerns of ITFS licensees regarding their  autonomy and ability to continue providing service should they no longer be in a relationship with a  wireless cable operator. However, as our decisions below will show, while we will continue to require  certain provisions in excess capacity leases between ITFS licensees and wireless cable operators, and  likewise will continue to prohibit certain provisions, we believe generally that ITFS licensees can and  @should in their negotiations with wireless cable operators arrange for lease terms that best protect their own individual interests and needs.  Sl0 ` qq114.` ` As a starting point, we reiterate the ultimate safeguard of the autonomy of ITFS licensees  and their ability to maintain the provision of educational services. The Commission declared in the  S0NPRM:     Those ITFS licensees desiring to abstain from cellularization are free to deny efforts by  wireless cable lessees to modify leases for cellularization, and ITFS licensees also may  decline altogether to lease their excess airtime. We emphasize that cellularization would  @be permissive only. We will not authorize a twoway framework which involves the  S0mandatory participation of any ITFS licensee.e#4D yO # #C\  P6Q/P#э 12 FCC Rcd at 22210.e "=( #P-4)4)dd"Ԍ S0   The significant number of commenters addressing this directive unanimously support it.$Z] {Oh  p#C\  P6Q/P#э See, e.g., Petitioners Comments (stating the "fundamental precept" that no ITFS or MDS licensee should be  forced to cellularize); Wireless One Comments (suggesting that the "fact" that cellularization is not mandatory should be included in the Commission's rules). Some  commenters ask that we endorse the closely related concept, as stated by the MDS Licensees, that "lessees  S0 may not compel licensees without their consent to file for any of the new facilities made possible by the  Sh0  twoway proposal."%h] {OV  0#C\  P6Q/P#э Comments of Alliance of MDS Licensees ("MDS Licensees") (emphasis in original). See also, e.g., SWM Comments. We reiterate that only the licensee may file an application for a twoway facility  or application to modify a facility on the licensee's authorized channels, so it is impossible for any two S0 way facility license to be obtained without that licensee's consent.&] yO  #C\  P6Q/P#э The Commission, however, will not get involved in resolving any disputes over whether a lease contemplated twoway operations. The Foundation seeks redress of a  S0 more subtle form of coercion of ITFS licensees, specifically, that under the rules proposed in the NPRM,  an ITFS licensee that offered highspeed Internet service pursuant to a lease with a wireless cable operator  pwould enjoy protected service area (PSA) protection, but an ITFS licensee that provided exactly the same  @service on its own would not. The Foundation argues that the effect of this "anomaly" is to mandate the  `leasing of excess channel capacity if an ITFS entity is to be able to operate with any assurance that it will  S0 @remain free of interference.e'd ] yO9 #C\  P6Q/P#э Foundation Comments.e In recognition of concerns such as those expressed by the Foundation, we  S 0have decided to grant all ITFS licensees psa protection.((@ X ] yO  p#C\  P6Q/P#э 47 C.F.R. 74.903(d) of the new rules. This psa protection, which shall comprise an area within a 35 miles   radius of the licensee's registered receive sites, shall be in addition to the registered received site protection currently enjoyed by ITFS licensees.  An ITFS entity which did not receive psa protection prior to September 17, 1998 shall be accorded such protection  by a cochannel or adjacent channel applicant for a new station or station modification, including a booster station,  presponse station or response station hub, where the applicant is required to prepare an analysis of the potential for harmful interference.(  S8 0 ` qr115.` ` Other commenters in addition to the Foundation seek to protect the rights of ITFS  licensees which do not lease excess capacity. For instance, Higher Education Alliance states that the  S 0 Commission's rules must permit, and observes that the rules proposed in the NPRM appear to permit, ITFS  `licensees to implement twoway services on their own. It goes on to say that ITFS licensees will provide  @such services to enhance distance learning interactivity, provide students with high speed Internet access,  S:0 or fill in downstream coverage gaps.#):] yO$  p#C\  P6Q/P#э Higher Education Alliance Comments. Higher Education Alliance notes that the Commission's previous Public  Notice allowing downstreamonly data services, including Internet access, over ITFS channels limited the privilege  {O%  @to ITFS licensees who lease excess capacity. See "The Mass Media Bureau Implements Policy for Provision of  {O\&   Internet Service on MDS and Leased ITFS Frequencies," Public NPRM, DA 961720 (rel. Oct. 17, 1996). But see,  {O&'  `e.g., proposed Section 74.931(a)(1), which provides for use of ITFS channels for response channels employed in  connection with formal educational courses, without distinguishing between stations that lease excess capacity and"'(P-4)4)'"  {O stations that do not. 12 FCC Rcd at 2224849. See also MDS Licensees Comments.# HITN argues that the Commission recognize that many stand":>Z)P-4)4)dd@"ԫ alone ITFS providers offer a number of telecommunications services which are not educational services,  S0 `and that more ITFS providers will desire to provide such services.-*Z] yO+   #C\  P6Q/P#э HITN provides as an example the case of George Mason University, which currently provides a commercial wireless cable service over ITFS frequencies that, among other things, broadcasts Commission proceedings.- We reaffirm the ability of stand alone ITFS licensees to provide communications services that are not specifically educational over their frequencies, so long as they meet the educational usage requirements set forth in our Rules.  R0q` `  a. Engineering Autonomy  S0 ` qs116.` ` Petitioners concede that it is "inevitable" that MDS licensees and ITFS licensees in a  market all will lose some degree of autonomy when they choose in their own discretion to have their  pchannels combined into a twoway system, and they may find it impossible to return to their prelease  S0 configuration upon termination of their lease.+] {O  #C\  P6Q/P#э Petitioners Comments. See Foundation Comments (describing specific scenarios where a licensees may be unable to return to its prelease configuration). Higher Education Alliance echoes Petitioners'  observations, and adds that if the prospect of twoway ITFS use is sufficiently attractive to an ITFS  licensee, however, "the risk of not being able to return to the status quo ante may simply be a price that  Si 0 @is worth paying."t,i ] yOA #C\  P6Q/P#э Higher Education Alliance Comments.t Nonetheless, we received suggestions on how an ITFS licensee may be able to  @continue providing educational services should its relationship with the wireless cable operator terminate.  POne commenter proposes that we require site leases to provide that the ITFS licensee can continue to  S 0 Poperate its facilities from such locations upon reasonable terms.- ] yO  #C\  P6Q/P#э Foundation Comments. Similarly, MDS Licensees argue that given the siting problems faced by many licensees  pin different services, the Commission should require that MDS and ITFS licensees use their best efforts to make   space available at their sites, whether by requiring that space be leased at reasonable terms on licenseeowned towers  Por by requiring nonexclusive and nonpreclusive arrangements with the tower lessors. MDS Licensees' Comments.  While we encourage cooperation between parties on siting issues, we believe such issues to be beyond the scope of this proceeding. Another commenter concludes that if  0the excess capacity lease terminates, the ITFS licensee should recover "full unencumbered usage of its  Sj0 poriginally licensed spectrum."_.j] yO #C\  P6Q/P#э HITN Comments._ While we acknowledge that our solution requires substantial foresight  `on the part of the ITFS licensee, we believe that these postrelationship configuration issues should be  arranged by the ITFS licensee in the course of negotiating the terms of its excess capacity lease with the  wireless cable operator. We also agree with the commenters who recognize that our requirement that each  ITFS licensee retain 25% of its capacity for downstream transmissions will present significant assistance  Sk0to ITFS licensees in continuing to provide downstream educational services./k] {O& #C\  P6Q/P#э See Higher Education Alliance Comments; Wireless One Reply Comments. "8?/P-4)4)dd"Ԍ S0 ` pqt117.` ` Another issue related to engineering autonomy is the issue of licensee control. Some   commenters specify that ITFS licensees must maintain independent control of all of their ITFS facilities  S0 pand licenses, whether or not they participate in the cellularized system.0] {O #C\  P6Q/P#э See Maryland Comments; HITN Comments; SWM Comments. It is axiomatic, as these  commenters suggest, that an ITFS licensee have ultimate control over its facilities and license. While two way services will increase the entanglement of the wireless cable system operating environment,  particularly when techniques such as channel shifting are employed, nevertheless we anticipate that, given  the systemwide coordination necessary to successfully design and operate a twoway system, as well as  the fact that the ITFS licensee must initially consent to take part in cellularization, conflicts over control  `and use of ITFS facilities will be minimal. In addition, as the Commission has observed previously,  "[o]peration of facilities by lessees is not necessarily inconsistent with the performance of an ITFS  licensee's responsibilities, and no . . . loss of control need occur when an ITFS physical plant is leased  from an MDS operator. . . . [L]icensees will continue to be held ultimately responsible for full compliance  S 0 pwith . . . Commission rules."1 Z] {O #C\  P6Q/P#э Second Report and Order in MM Docket No. 83523, 101 FCC 2d at 90. We also will continue to review excess capacity leases to ensure that they  contain no provisions abdicating ultimate licensee control. Therefore, we are not concerned that an ITFS  licensee's ultimate control over its facilities and licenses will be jeopardized significantly by twoway operations.  S 0 ` qu118.` ` SWM additionally asserts that the ITFS licensee must at all times preserve "ultimate legal  Sj0 control over broadcast and content of the specified bandwidth."^2jP] yO #C\  P6Q/P#э SWM Comments.^ While we note that in the past, the  S70 Commission has placed primary emphasis on a licensee's programming control,37D] {O #C\  P6Q/P#э See Second Report and Order in MM Docket No. 83523, 101 FCC 2d at 90. we believe that  attempting to measure a licensee's control over the content transmitted over its licensed bandwidth is an  unduly difficult standard to meet in an environment where, for instance, an ITFS licensee may shift all   of its required educational usage off of its own licensed channels, leaving control over the content  Ptransmitted over those channels to the wireless cable operator. Furthermore, with the provisions that we  padopt for flexible alteration between common carrier and noncommon carrier service offerings, the issue  Pof a licensee's control over content on its authorized bandwidth may be rendered irrelevant, where the  operator is providing service on a common carrier basis. We conclude that, particularly in light of the  Pprimary educational function of ITFS licensees, where an ITFS licensee is not the source of transmissions  over its licensed bandwidth, we will not regard the ITFS licensee as having legal control over the content  `of such transmissions. We believe that the originating source of such transmissions should be regarded  S0 as having legal control over their content.4X:] yOD"  #C\  P6Q/P#э Thus, for example, while a wireless cable operator transmitting obscene language or other matter over frequencies  leased from an ITFS licensee could be prosecuted for such transmissions pursuant to 18 U.S.C.  1464 and/or 1468, we believe that the ITFS licensee in such a case should not be subject to prosecution. At most, an ITFS licensee's legal control over content  transmitted over its authorized bandwidth is a contractual matter between the leasing parties. Nevertheless,  we strongly encourage ITFS licensees to incorporate into their excess capacity leases provisions specifying  that responsibility over the content transmitted by a lessee over bandwidth licensed to an ITFS entity is  borne by the lessee. We do emphasize, however, that control over and responsibility for the content and":@ 4P-4)4)dd`"  amount of an ITFS licensee's educational usage is solely vested in the ITFS licensee, no matter whose channels it uses to transmit the educational usage.  Rg0q` `  b. Involuntary Modifications  S0 ` qv119.` ` In the NPRM, the Commission solicited comment on whether it should prohibit the filing  of involuntary modification applications. The Commission asked commenters to recount the extent to  which they are currently employed, and to anticipate to what degree they likely would be utilized in a two  way digital environment, and whether such utilization would constitute abuse of the mechanism. The  S60 Commission further asked whether it should restrict the scope of Section 74.986g56] yO #C\  P6Q/P#э 47 C.F.R.  74.986.g of the Commission's  S0Rules to involuntary modifications that are consistent with downstream transmissions only.j6X] yO_ #C\  P6Q/P#э 12 FCC Rcd at 22210 n.70.j  S 0 `  qw120.` ` In their comments, Petitioners argue that the Commission "must take care to avoid  empowering any one licensee in a market with the ability to unreasonably frustrate the introduction of new  S7 0 technologies by its neighbors," as, Petitioners believe, too often occurs under the current rules.f77 L] yO #C\  P6Q/P#э Petitioners Comments.f  Petitioners assert that given the ease of retuning ITFS and MDS transmitters to other frequencies in the  02.5 GHz band, the Commission should coordinate the retuning of transmitters to other frequencies in the  band at the expense of the proponent of such retuning, when doing so promotes the introduction of  advanced technologies in a spectrally efficient manner and where "comparable facilities" in the 2.5 GHz  S80 band are available.?88@] {O|   #C\  P6Q/P#э Id. at 10708, 111. Petitioners also suggest that involuntary retuning may be justified in order to eliminate  {OF harmful interference caused to an incumbent station by a newcomer.  Id. at 24 n.40.? Petitioners note that the Commission already requires ITFS licensees to make certain  involuntary modifications "in order to promote the most efficient use of the spectrum under certain  `circumstances," and likewise has required licensees in other services to do so in a similar or more intrusive  S0 pmanner than retuning to other frequencies within the same band.n9 ] {O #C\  P6Q/P#э Id. at 24 n.40, 10811.n Acknowledging that voluntary  agreements certainly are to be promoted, Petitioners outline a threestep process for handling retuning  S90 @proposals.:^9 ] {O3   #C\  P6Q/P#э Id. at 11112. Petitioners' proposed involuntary retuning process received some support in the comments, both  {O  pin the initial round, and in the round of comments established to address the numerous ex parte submissions in this  {O! proceeding. See, e.g., Wireless One Reply Comments; NIA Ex Parte Comments. Finally, Petitioners comment that it "is specious" to suggest that the involuntary modification  0mechanism either has been abused, or will be abused upon implementation of twoway digital services,  `because only a handful of such applications pursuant to Section 74.986 have been filed, and the  S0Commission apparently never has denied such an application.;] {O$& #C\  P6Q/P#э Petitioners Comments. See also Bay Area Consortium Comment. "mAv;P-4)4)dd`"Ԍ S0 ` qx121.` ` While not opposing the concept of involuntary retuning, the Foundation nonetheless points  to several flaws in Petitioners' proposal. Some of these flaws include the lack of provisions for the  S0 Paffected ITFS licensee to oppose retuning applications;u<] {O #C\  P6Q/P#э See Foundation Reply Comments.u the inefficiency of maintaining multiple  Sg0 0mechanisms for involuntary modifications;u=gZ] {O #C\  P6Q/P#э See Foundation Reply Comments.u and the lack of provision for involuntary retuning of MDS  S40 pchannels.e>4P] yO #C\  P6Q/P#э Foundation Comments.e We note that Petitioners' involuntary retuning proposal is at odds with their initial emphasis  S0 that no ITFS licensee would be required even to shift educational usage off of its own channels,u?D] {OI #C\  P6Q/P#э See NPRM, 12 FCC Rcd at 22205.u let  alone be forced to trade its licensed frequencies, safeguards which received support from some  S0  commenters.t@:] {O #C\  P6Q/P#э See, e.g., Maryland Comments.t CTN opposes involuntary retuning of ITFS stations on ITFS autonomy grounds,A0 ] {O  #C\  P6Q/P#э See CTN Reply Comments. ("Wireless cable operators are invitees within the ITFS spectrum, and they should not be allowed to dictate the nature of ITFS facilities.") and,  although our existing rules permit some involuntary retuning, we agree with CTN that disallowing  involuntary retuning modifications is another measure that will protect the autonomy of ITFS licensees  S0 Pin a twoway environment.B ] yO  #C\  P6Q/P#э We will, however, retain the very narrow provisions of 47 C.F.R.  74.902(h)(j), which allow for mandatory retuning of pointtopoint ITFS stations. In addition, because of the complex interference environment inherent where  there are twoway operations, we also will not grant involuntary modifications under Section 74.986 in  any market where response station hubs have been proposed or are operating. Such involuntary  @modifications may render it more difficult for a licensee to later modify its station voluntarily than it  would be had the involuntary modification never occurred. Finally, rejecting the proposal for involuntary  0retuning and discouraging many other involuntary modifications will keep us from getting more involved  in relationships between participants in the industry, at a time when we are taking measures to become less involved in such relationships and attempting to let the market dictate outcomes where possible.  R70q` `  c. Financial Autonomy  S0 ` @qy122.` ` In the NPRM, the Commission recounted the concerns of several commenters at that stage  of the proceeding that ITFS licensees will be unable to sever their relationship with the wireless cable  operator and acquire the equipment to either continue cellular operations or return to nontwoway  transmissions. The Commission sought comment on that matter and on what type of equipment MDS  lessees of ITFS channels should be required to make available to the ITFS licensees upon termination of  S0 0a lease.eC] yO& #C\  P6Q/P#э 12 FCC Rcd at 22212.e The Commission also solicited comment on what solutions, if any, it should implement to"BCP-4)4)dd"  combat potential encroachment upon the general financial autonomy of ITFS licensees resulting from a  S0twoway framework.gD] {O5 #C\  P6Q/P#э Id. at 2221011.g  Sg0 ` qz123.` ` CTN reiterates its concern that dependence of ITFS licensees on wireless cable operators  will be fostered in a twoway environment, because the cost of installation and maintenance of twoway  S0 systems is likely to be far beyond the means of ITFS licensees.^EZ] yO_ #C\  P6Q/P#э CTN Comments.^ Such dependence also leads some  commenters to express concern regarding an ITFS licensee's welfare and continuation of operations should  S0 Pthe wireless cable operator become insolvent.uFN] {O #C\  P6Q/P#э See, e.g., CTN Reply Comments.u Some commenters propose as a solution the required   establishment by twoway wireless cable operators of a performance bond or escrow account, with  S50 `sufficient funds to ensure the uninterrupted operation of participating ITFS stations for a given period.G5D] {O} #C\  P6Q/P#э See, e.g., CTN Comments. SWM Comments; Foundation Comments.  Opposed commenters argue that any ITFS licensee is free to negotiate for a performance bond when it  enters into the lease, but that it should not be required and ITFS licensees should retain the flexibility to  S 0  negotiate whatever consideration under the excess capacity lease best suits their needs.H :] {O #C\  P6Q/P#э See, e.g., Petitioners Reply Comments; Region IV Reply Comments. We agree with  the opposed commenters' stance on this issue, and believe that the same approach and rationale applies  towards other proposals that would have transmission systems transfer automatically to the ownership and  S 0control of the ITFS licensee upon termination of the lease,hI 0 ] {O7 #C\  P6Q/P#э See SWM Comments.h or upon commencement of a lease term.oJ & ] {O- #C\  P6Q/P#э See Foundation Comments.o  S 0 ` q{124.` ` Citing our Turner precedent,K ] {O #C\  P6Q/P#э See Turner Independent School District, 8 FCC Rcd 3153, 3155 (1993). the NPRM asserted that the Commission consistently has  maintained that an ITFS licensee should be permitted to purchase the ITFS equipment necessary to  S80 Pmaintain its operation in the event the excess capacity lease is terminated.eL8] yON! #C\  P6Q/P#э 12 FCC Rcd at 22212.e However, in a twoway  penvironment where several licensees may be using common equipment, or where ITFS licensees may shift  S0 their required educational usage off of their own channels, the application of the Turner principle is not  as clearly defined as it was at the time it was enunciated. CTN argues that upon termination of a lease,  an ITFS licensee should have access to all equipment necessary for continued distribution of its signal  consistent with that during the lease term. CTN further maintains that the Commission's policy should":CLP-4)4)dd"  0include reference to dedicated (individual station) and common (shared by stations) equipment, or the  S0equivalent thereof, and the parties can negotiate more specific terms.^M] yO5 #C\  P6Q/P#э CTN Comments.^  Sg0 ` q|125.` ` We believe that the Turner principle is still good policy, in order to assure as seamless  a transition as possible for the ITFS licensee to continue providing educational services following  S0 termination of the lease.uNX] {O^ #C\  P6Q/P#э See Turner, 8 FCC Rcd at 3155.u Furthermore, we agree with CTN's approach, and will require that each excess  capacity lease contain a provision assuring the ITFS licensee's right to purchase the actual equipment, or  equipment comparable to that, used by the ITFS licensee during the lease for educational purposes. This  means, for example, that if the ITFS licensee was providing educational services during the lease period  putilizing digital transmissions, the wireless cable operator is not obligated to retain analog transmission  `equipment for ITFS licensees seeking to return to traditional downstream analog transmissions. In  addition, as requested by CTN, this required lease provision applies to dedicated or common equipment  pused for educational purposes. By specifying that this obligation can be fulfilled by providing the right  0to purchase comparable equipment, we hope to ensure that service over the system is not disrupted when  the wireless cable operator's relationship with one licensee transmitting over shared equipment terminates,  S 0 pbut the relationships with the other licensees sharing the equipment do not.gOZ N] yOV  #C\  P6Q/P#э We also believe that this comparable equipment allowance should allay the concerns of commenters who argue  {O  Pthat providing access to purchase shared equipment is unworkable. See BellSouth Reply Comments and Petitioners Comments.g Nonetheless, as further  indicated by CTN, negotiations between the parties to the lease still will be required to spell out the  S 0 appropriate specific equipment that must be made available . Because provision for ITFS licensee access  0to purchase equipment upon termination of an excess capacity lease is a longstanding requirement, we do  not believe that our adaptation of the requirement here should conflict with our decision to grandfather  S0certain excess capacity leases.qP] {O #C\  P6Q/P#э See  130, infra.q  R0q` `  d. Commission Role  S90 ` q}126.` ` In the NPRM, the Commission invited comment on the degree of oversight that it should  maintain in regulating the wireless cable industry and ITFS. The Commission described how in the past,  it has adopted rules and procedures to accommodate and protect what has been viewed as the special needs  of educational institutions and organizations, out of a belief that these entities should be treated differently  in many situations due to limited financial and staff resources, governmental constraints, and similar  factors. One of these protections has been required review by the staff of ITFS excess capacity lease   agreements, for overly restrictive provisions affecting the licensee's rights and obligations and for  S0 compliance with the Commission's leasing policies.sQ ] {O$ #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22211. s The Commission requested comment on whether  Pparties should continue to be required to file written agreements governing the ITFS licensee's lease of  So0 pexcess capacity on its channels.gRo ] {O3( #C\  P6Q/P#э Id. at 2221213.g Petitioners "strenuously take issue" with the belief that ITFS licensees"oD RP-4)4)dd"  `are incapable of protecting their own interests without Commission micromanagement. They assert that  many ITFS licensees are major universities, statewide organizations, noncommercial broadcast licensees,  or other organizations with resources that dwarf those of their wireless cable lessees. Petitioners believe   that the Commission's wellmeaning efforts to protect ITFS licensees too often have had the unintended  consequence of denying ITFS licensees flexibility to craft contractual arrangements that best serve local  educational needs, and that, as a matter of principle, the Commission thus should refrain from dictating  S0 the provisions of ITFS excess capacity leases to the greatest extent possible.pS] {O6 #C\  P6Q/P#э See Petitioners Comments.p Some commenters,  however, such as the Public Broadcasting Commenters, ask that the Commission remain cognizant that  ITFS licensees frequently find themselves in precarious financial positions due to their being nonprofit  S50entities.T5Z] {O #C\  P6Q/P#э See Public Broadcasting Commenters Comments.  S0 ` q~127.` ` We have considered carefully the opposing viewpoints that have been presented to us: on   the one hand, that many ITFS licensees are wellfunded and have "come of age"; on the other hand, that  Pmany still have very limited resources, and often those that they have to devote to ITFS are obtained  `completely through their excess capacity leases with wireless cable operators. Because we believe that  many examples supporting both viewpoints exist, we find it still appropriate for us to maintain some  degree of oversight regarding the relations between the wireless cable industry and ITFS, albeit a limited  role which allows for maximum possible flexibility of the parties in establishing excess capacity lease  `provisions, while at the same time ensuring educational use of ITFS and a licensee's ability to continue  `uninterrupted in that use should its relationship with the wireless cable operator terminate. In this regard,  we will heed the prescriptions of the numerous commenters who request that we continue to review excess  pcapacity leases for provisions overly restrictive of ITFS licensees and in order to police established  S0  safeguards, and require amendment of noncompliant leases.UP] {O #C\  P6Q/P#э See, e.g., Bay Area Consortium Comments; Mississippi ETV Comments, and Maryland Comments. However, consistent with many of our  0decisions here regarding the substance of such leases, we intend this review to be on a lesser scale than  previously, and to be more deferential to the burdens and benefits which constitute the agreement between the parties to the leases, and to allowing of flexibility in implementation of twoway services.  S0 ` Pq128.` ` In the NPRM, the Commission also sought comment on a proposal, advanced by the  Foundation, that the Commission require that twoway digital applications and interference consents be  reviewed by legal and engineering counsel that do not represent commercial interests, and that these  @independent advisors certify that in their professional opinion the submission will not harm future  instructional service. The Commission noted that past attempts to require all leasing parties to hire  @separate counsel have been declined by the Commission, having found it an unnecessary safeguard and  Sn0 relying instead on the staff's review and monitoring of leases.VnF] {O" #C\  P6Q/P#э See Second Report and Order in MM Docket No. 83523, 101 FCC 2d at 91. Seeing no reason to change position on  S;0 this issue, the Commission tentatively rejected the Foundation's proposal in the NPRM.eW;<] yO{% #C\  P6Q/P#э 12 FCC Rcd at 22212.e The Foundation  continues to advocate this proposal in its comments. The Foundation argues that with the advent of two @way services, interference studies will grow far more complex, and the motives for operators to "gull"  ITFS licensees will expand even further than today, when operators act on such impulses with some"E0 WP-4)4)dd!"  degree of frequency. The Foundation further asserts that the matter of interference consents is  distinguishable from that of leases, because in contrast with leases, the Commission has no formal  mechanism for evaluating interference consents, and there are no rules governing what interference can  be accepted by licensees and what cannot. The Foundation concludes that adoption of its proposal is  S40necessary "if the Commission's goal of protecting ITFS service is to be achieved."xX4] yO #C\  P6Q/P#э Foundation Comments and Reply Comments.x  S0 ` q129.` ` Petitioners reiterate their arguments in opposition that were recounted in the NPRM:  namely, that the proposal is inappropriate, and unworkable in that no one can predict the impact of an  application or consent on "future instructional service"; and that it is the licensee educators, not lawyers  or consulting engineers, who are in the best position to determine the educational needs of their  S0 community.YX] {O_ #C\  P6Q/P#э Petitioners Comments; see NPRM, 12 FCC Rcd at 22212. Region IV contributes that "if the Commission were to begin dictating to ITFS entities   which lawyers and engineers they must use, the boundary of legitimate FCC oversight and supervision  S 0 would have been obliterated."Z N] {O   #C\  P6Q/P#э Region IV Reply Comments. See also Spike Reply Comments at 1011 (discussing a wireless cable operator's incentive to monitor interference to ITFS lessors). While we believe it wise for ITFS licensees to seek impartial review of  Papplications and consents where resources allow for such review, we agree with Petitioners and Region   IV that ITFS licensees are best suited to decide how to allocate their resources in this regard. In addition,  as stated above, we will continue to review excess capacity leases with an eye towards provisions which  are overly restrictive of the role of the ITFS licensee. Therefore, we continue to find the Foundation's proposal unnecessary, and we will not adopt it.  R80q` `  e. Grandfathering of Excess Capacity Lease Provisions q  S0 ` q130.` ` The Joint Statement recommends that excess capacity lease agreements that provide for  S0 digital usage and were entered into prior to release of this Order be "grandfathered for their duration."t[ ] {O #C\  P6Q/P#э Joint Statement at  VIII.t  Sm0 Although some commenters consider this proviso "critical,"\m ] {Os #C\  P6Q/P#э See Petitioners Comments; Higher Education Alliance Comments. others, such as CTN, maintain that because  many ITFS excess capacity leases were negotiated before the parties understood the nature of digital  Pservice or had considered the availability of twoway services, the Commission should adopt a policy that  `requires such agreements "to be consistent with current rules rather than the rules in effect when the lease  S0 Ptook effect."h] ] {O" #C\  P6Q/P#э See CTN Comments.h We will adopt a slightly modified version of the approach recommended by the Joint  So0 Statement, in recognition of the fact, as described by Petitioners, that since no ITFS facility can be  modified without the licensee executing an application form, "every ITFS licensee will have an opportunity  Pto consider its contractual rights and obligations before technical changes are implemented, and can insist  S0  upon an amendment if necessary."f^ ] yO' #C\  P6Q/P#э Petitioners Comments.f In addition, because we are not changing our minimum educational"F^P-4)4)dd"  `usage requirements, grandfathering lease agreements does not present a lost opportunity cost with respect to an immediate increase in educational usage by ITFS licensees.  Sg0 ` q131.` ` We seek to ensure a transition as smooth as possible to twoway operations, and we   believe that effectively requiring amendment of numerous existing leases could prove unduly burdensome  to ITFS licensees and wireless cable operators who did not anticipate such changes. In this regard, we  0are persuaded by commenters who describe how having to go back and renegotiate excess capacity  agreements will require ITFS licensees to make other concessions that may seriously undermine their  Sh0 expectations and damage their ability to provide educational services._h] {O #C\  P6Q/P#э See, e.g., Higher Education Alliance Comments; Region IV Comments. However, since the March 31,  1997 release of our Public Notice announcing the filing of the petition for rulemaking which initiated this  S0 proceeding,`"Z] yO`  #C\  P6Q/P#э "Pleading Cycle Established for Comments on Petition for Rulemaking to Amend Parts 21 and 74 of the  Commission's Rules to Enhance the Ability of Multipoint Distribution Service and Instructional Television Fixed  {O  Service Licensees to Engage in Fixed TwoWay Transmissions," Public Notice RM9060, DA 97637 (rel. March 31, 1997.) no party can be heard to argue that it did not have notice that ITFS/MDS twoway  S0 operations were anticipated in the nottoodistant future.a] yO{  #C\  P6Q/P#э Similarly, the Foundation contends that grandfathering privileges only should extend to excess capacity leases  pentered into prior to January 8, 1998, the date that initial comments were due in this proceeding and one day  {O   following the ratification of the Joint Statement by its signatories. The Foundation further believes that leases should  comply with current Commission standards upon their renewal, or as of their original expiration date if their terms are extended. Foundation Reply Comments. Thus, any excess capacity lease entered into,  renewed, or extended after March 31, 1997 is expected to be brought into compliance immediately with  Si 0 pall of the rule changes and policies that are adopted here,Qbi ] yO+  `#C\  P6Q/P#э Any lease falling into this category and needing to be brought into immediate compliance with the rules and  {O policies adopted here must be done so within 75 days of the publication of this order in the Federal Register.Q as is each new such lease, renewal, or term  extension from here onward. Finally, we emphasize that we will not adjudicate whether the provisions  Pof any specific lease contemplated digital operations as a general matter. In the absence of resolution  `between the parties to the lease, we believe this issue to be a matter of contract law properly heard before a state tribunal.  S70 ` pq132.` ` In framing our policies towards grandfathering of certain excess capacity leases, we have  @considered, and rejected, SWM's proposal that in order to protect the rights of incumbent ITFS licensees,  the Commission require that leases approved or submitted under the previous rules "be amended to make  @clear that the wireless cable lessee and the ITFS licensee have together considered the rule changes  adopted and made any appropriate changes to lease terms, prior to the commencement of commercial  S80 operations on the frequencies using cellularization, sectorization or differing channelization plans."c8|] {O#  #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22212. SWM reiterated this proposal in its comments on the NPRM; see SWM Comments. We  also decline to adopt any rules in response to HITN's comment that unless "expressly provided for" in the  `lease agreement, wireless cable operators should be required to renegotiate agreements with ITFS licensees  in order to obtain additional capacity in a digital environment or to provide services other than"G:cP-4)4)dd@"  S0 @downstream wireless cable video._d] yOh #C\  P6Q/P#э HITN Comments._ As HITN itself states, and we reiterate, the "construction of existing  S0agreements is a matter of contract law."eeX] yO) #C\  P6Q/P#э HITN Reply Comments.e  Rg0q` `  f. Length of Leases  S0 ` q133.` ` In the NPRM, the Commission solicited comment on whether to retain several present  S0 requirements for excess capacity leases, including, inter alia, those dealing with length of lease.hfL] yO #C\  P6Q/P#э 12 FCC Rcd at 2221213.h The  S0 `Joint Statement urges that the Commission allow excess capacity leases of up to 15 years duration,   provided that any lease extending beyond the term of a licensee's authorization provides for termination  S80 Pof the lease in the event the Commission denies the subject station's application for renewal.sg8@] {O| #C\  P6Q/P#э Joint Statement at  VII.s Virtually  all of the commenters who address this proposal support it, and we are adopting it, permitting such lease   terms subject to negotiation by the parties. In extending permissible excess capacity lease term limits to  010 years a few years ago, the Commission recognized that "the wireless cable industry requires substantial   equity investment in order to become a viable competitor. . . . We also realize that a potential financier   is likely to exercise caution . . . where there is uncertain longterm availability of the ITFS channels that  S 0 `provide the basic capacity for that system."=h 6] {O@  `#C\  P6Q/P#э Amendment of Part 74 of the Commission's Rules With Regard to the Instructional Television Fixed Service,  {O  Report and Order, 10 FCC Rcd 2907, 2914 (1995) (hereinafter ITFS Window Filing Order).= As several commenters have persuaded us, the conversion  to digital operations, whether twoway or merely downstream, will entail a substantial increase in  @operational and infrastructure costs, and the investment community will require even far greater comfort  Sm0 regarding the longterm availability of excess capacity on ITFS channels.<im ] {Og  #C\  P6Q/P#э See, e.g., Petitioners Comments; NIA Comments; Bay Area Consortium Comments; BellSouth Comments. While BellSouth prefers that we abolish lease term limits altogether,r we do not believe that proposal to be justified.< In addition, we agree with  pthe commenters who have suggested that a 15 year lease term limit will help to place wireless cable on  a more equal footing with its competitors. Higher Education Alliance, for instance, argues that 15 years  is the customary period for traditional cable franchises, so that extending the term limits here hopefully  S0 would enable wireless cable operators to access capital markets that traditionally support wired cable. j ] {OY!  #C\  P6Q/P#э Higher Education Alliance Comments. See also Petitioners Comments (explaining how a 15 year term limit will help wireless cable compete against other wireless services).   Furthermore, as other commenters have described, a 15 year lease term limit also will help provide greater  Pcertainty to ITFS licensees, which, for instance, may appreciate the assurance of longterm, stable  S0maintenance and operational support offered by a longer lease term.kr] {O~& #C\  P6Q/P#э Bay Area Consortium Comments. See also Petitioners Comments. "HhkP-4)4)dd"Ԍ S0 ` Pq134.` ` Because we find that these policies apply equally regardless of service offering, we reject  `the Foundation's suggestion of maintaining the 10 year lease limit for downstreamonly digital and analog  S0 systems, while allowing a 15 year limit for twoway systems.kl] yO #C\  P6Q/P#э Foundation Reply Comments.k ITFS licensees concerned by lease limits  @longer than 10 years are free to negotiate for lease limits of 10 years or less. Finally, as the Commission  S40 stated in the ITFS Window Filing Order, the existence of a lease "in no way affects the duration of that  S0 license or the licensee's use of the frequency, but it nevertheless allows the benefits discussed above."dmX] yO^ #C\  P6Q/P#э 10 FCC Rcd at 2914.d  S0 Thus, we emphasize, as reflected in the Joint Statement's proviso on this issue, that any lease extending  beyond the term of a licensee's authorization must specify that such an extension is subject to the renewal  Sj0of the ITFS license.njL] {O #C\  P6Q/P#э See ITFS Window Filing Order, 10 FCC Rcd at 2914.  R0q` `  g. Other Lease Requirements  S 0 ` `q135.` ` Petitioners urgeo B] yO #C\  P6Q/P#э Petitioners Comments and BellSouth Reply Comments. that the Commission reverse two policies which, Petitioners assert, were   not formed in rulemaking proceedings: 1) Barring lease provisions that require an ITFS licensee to assign  S8 0 `its remaining obligations under an excess capacity lease if it chooses to assign its underlying license;p8 6] {Or #C\  P6Q/P#э See, e.g., Central Cass Public School District, 10 FCC Rcd 3167, 3168 (1995).  and 2) Rejecting lease provisions which require that an ITFS licensee, seeking to cease operating its  facility during the excess capacity lease term, provide the wireless cable operator a reasonable opportunity  S 0 to secure an eligible ITFS assignee before the license is returned to the Commission for cancellation."q , ] {O  #C\  P6Q/P#э See, e.g., Harlem Consolidated School District #122, 9 FCC Rcd 7927, 7928 (1994); Walker County Board of  {O Education, 12 FCC Rcd 13837, 1383940 (Mass Med. Bur. 1997)."  PPetitioners contend that these policies have played a role in deterring investment in wireless cable, by  S90 diluting investor confidence in the duration of availability of leased channels.r9 ] {O) #C\  P6Q/P#э Petitioners Comments; see Wireless One Reply Comments. HITN's opposition to such  S0 provisions, on the basis of undermining the autonomy of ITFS licensees,es] yO #C\  P6Q/P#э HITN Reply Comments.e is consistent with the  justification that traditionally has been provided for banning the second aforementioned set of provisions;  S0namely, that allowing them "intrudes in an area that has been the sole province of the licensee."t] {Oz$  #C\  P6Q/P#э Harlem Consolidated School District #122, 9 FCC Rcd at 7928; see Second Report and Order in MM Docket  {OD% No. 83523, 101 FCC 2d at 90.  S:0 ` q136.` ` We believe that it is appropriate to continue our ban of provisions that would require an  pITFS licensee to assign its remaining obligations under an excess capacity lease, while henceforth allowing"ItP-4)4)dd"   provisions that would permit a wireless cable operator to find a qualified ITFS assignee to assume the  license prior to its cancellation. The first policy has previously been justified out of the belief that such  S0 provisions place an unreasonable impediment on the assignment or transfer of the ITFS facility.u] {O #C\  P6Q/P#э See Central Cass Public School District, 10 FCC Rcd at 3168. We  still believe that this rationale applies, because banning such provisions enhances the ITFS licensee's  S40 flexibility in finding a buyer should it decide to seek a buyer. Thus, we will continue to bar lease  0provisions that require an ITFS licensee to assign its remaining obligations under an excess capacity lease  if it chooses to assign its underlying license. However, with respect to the second policy, allowing such  S0 provisions should keep the ITFS channels, which have been designated by the licensee for cancellation,  pfrom lying fallow, because the wireless cable operator will have incentive to find a buyer quickly. This  results in a winwin situation, because the wireless cable operator may maintain commercial use of some  of the channels; educational service is available again in a much quicker manner than if the Commission  were to make the station available to competing applicants as a new station; and the educational institution  pthat merely was going to turn in its license instead also may receive some remuneration for its license, without expending many, if any, efforts towards its sale.  S 0 ` q137.` ` Thus, henceforth we will allow, but not require, provisions which require that an ITFS  0licensee, seeking to cease operating its facility during the excess capacity lease term, provide the wireless   cable operator a reasonable opportunity to secure an eligible ITFS assignee before the license is cancelled  Sl0 by the Commission. Under such provisions, the ITFS licensee would give the cable operator six months  notice that it intends to relinquish its license. The wireless cable operator will then have a period of six  @months both to continue utilizing the same amount of spectrum permitted under the lease, and to find an  passignee for the station. If an assignee was found within the appropriate time period, the incumbent ITFS  licensee would make its best efforts to cooperate with the transfer of the license to the new licensee. If  no assignee was found within the appropriate time, the cancellation of the license would become final, the  wireless cable operator would be forced to cease transmissions over the spectrum at issue, and the station  then would be eligible for licensing by the Commission according to then current procedures for  pdisposition of new stations. During the period that the wireless cable operator is attempting to find a new  Plicensee for the ITFS station, the ITFS licensee is obligated to continue meeting its educational  0programming requirements. This requirement serves the public interest by maintaining the availability of  the educational programming until a new licensee can assume the duties of providing such programming.  S0  Of course, we will prohibit lease provisions which require a licensee to refrain from submitting its license from cancellation should it desire to do so.  Sp0 ` q138.` ` The Joint Statement contains provisions which call for all excess capacity leases to state  Pthat the ITFS licensee "shall have the right to use any Internet services offered over the system at no  greater than the lowest prevailing commercial rate and shall have reasonable access, at rates to be   negotiated between the parties, to other services offered over the system (such as addressability and two S0 way capability)."svZ] {O" #C\  P6Q/P#э Joint Statement at  XII.s We decline to implement these provisions of the Joint Statement. We do not wish  `to get involved in arbitrating rate complaints in MDS/ITFS, and we believe that these are best private  contractual matters between the parties. While we will not mandate either of these proposals, we particularly expect that reasonable access will be a vital component to any healthy twoway system.  S! q ` ` 4. ITFS Call Sign Transmission "t"JPvP-4)4)dd%"Ԍ S0 ` q139.` ` In the NPRM, the Commission presented Petitioners' arguments that continued enforcement  S0  of the ITFS call sign transmission requirementw] yO6  #C\  P6Q/P#э 47 C.F.R.  74.982. Under our existing rules, ITFS stations generally are required to transmit their call signs when beginning and ending operation and, during operation, on the hour. in a twoway environment will impose substantial costs  on ITFS licensees. Petitioners concluded that because it is proposed that the Commission's records will  reflect who is transmitting on what channels at all times, the burdens of the call sign transmission  S50 requirement far outweigh the benefits.x5 ] {OY #C\  P6Q/P#э Petitioners reiterate these arguments in their comments on the NPRM. See Petitioners Comments. Nevertheless, the Commission recognized the complexity of the  interference environment that would result from implementation of the twoway scheme, and the difficulty  `that it may pose in determining sources of harmful interference. Thus, the Commission sought comment  `on the proposed elimination of Section 74.982, and solicited alternative solutions for maintaining the  Si0accountability of ITFS licensees.qyi] {O #C\  P6Q/P#э NPRM, 12 FCC Rcd at 22213.q  S0 ` q140.` ` The few commenters which addressed this proposal unanimously favored eliminating the   call sign transmission requirement where digital transmissions are utilized. The Foundation, for instance,  argues that the twoway use of ITFS spectrum renders station identification requirements inapplicable, and  that the "superannuation of the current rules" is reinforced by complexities related to subchannelization  S7 0  and superchannelization.ez7 ] yOG #C\  P6Q/P#э Foundation Comments.e We believe that the complexity of the engineering environment that will ensue  `as a result of adoption and implementation of the rules in this proceeding presents arguments both for  retaining and eliminating call sign transmission requirements. On the one hand, the greater interference  `risk of twoway operations justifies retention of the rules to help identify interferers. On the other hand,  0redefining the requirement becomes a daunting and perhaps fruitless task where subchannelization and  superchannelization are involved in a system, and the costs of enabling each upstream transmitter to transmit a call sign, and perhaps even assigning each a separate call sign, could be staggering.  S0 ` q141.` ` As the Commission stated in the Digital Declaratory Ruling and replicated in the NPRM,  `"the burdens of requiring ITFS licensees to transmit call signs may outweigh the benefits, especially where  0the channels are leased to a wireless cable operator, whose identity is readily discernible and whose  S0 licensing status is readily ascertainable."{ ] {O  #C\  P6Q/P#э Digital Declaratory Ruling, 11 FCC Rcd at 18868; see Notice, 12 FCC Rcd at 22213. In a twoway environment, alleviation of interference problems  primarily will be left to the wireless cable operator, because of all the coordination it must do to make a  twoway system function properly. In recognition of this and the greater efficiency of digital  Ptransmissions, we believe that the burdens embedded in Section 74.982, such as costs, outweigh the  benefits of applying the rule to any ITFS station utilizing any digital transmissions. Thus, any ITFS  `station utilizing digital modulation, whether or not in a lease agreement with a wireless cable operator and  @whether or not in a twoway system, will be exempt from the requirements of Section 74.982. However,  because these costs would not be prohibitive to ITFS stations utilizing only analog transmissions, and  because the benefits of interference identification can still be realized economically where transmissions are in analog, we will retain Section 74.982 and apply it to ITFS stations which transmit only in analog. " K {P-4)4)dd@"Ԍ S  IV. PROCEDURAL MATTERS Đ?Kq  S0 ` `q142.` ` Accordingly, IT IS ORDERED that, pursuant to the authority contained in Sections 4(i)  and (j), 301, 303(f), 303(g), 303(h), 303(j), 303(r), and 308(b) of the Communications Act of 1934, as  S40 amended, 47 U.S.C.  154(i), 154(j), 301, 303(f), 303(g), 303(h), 303(j), 303(r), and 308(b), this Report  S0  and Order IS ADOPTED, and Parts 1, 21, and 74 of the Commission's Rules, 47 C.F.R.  1, 21, and 74, ARE AMENDED as set forth in the attached Appendix C.  Sj0 ` q143.` ` IT IS FURTHER ORDERED that the rule amendments set forth in Appendix C WILL BECOME EFFECTIVE 60 days after their publication in the Federal Register.  S0 ` q144.` ` IT IS FURTHER ORDERED that the Petition of Wireless Cable Ass'n Int'l for  Reconsideration and Clarification, MM Docket No. 93106 (filed August 12, 1994), and Petition of  Sk 0 Alliance for Higher Education, et al., MM Docket No. 93106 (filed August 5, 1994), are granted to the extent described above in note 230.  S 0 ` q145.` ` The action contained herein has been analyzed with respect to the Paperwork Reduction  Act of 1995 and found to impose new or modified reporting and recordkeeping requirements or burdens  on the public. Implementation of these new or modified reporting and recordkeeping requirements will  Pbe subject to approval by the Office of Management and Budget as prescribed by the Act. The new or  modified paperwork requirements contained in this Report and Order (which are subject to approval by the Office of Management and Budget) will go into effect upon OMB approval.  Sn0 ` `q146.` ` As required by the Regulatory Flexibility Act, see 5 U.S.C. Section 604, the Commission  has prepared a Regulatory Flexibility Analysis of the possible impact on small entities of the rules adopted  S 0 Pin this document. See Appendix B. IT IS FURTHER ORDERED that the Office of Public Affairs  S0 Reference Operations Division SHALL SEND a copy of this Report and Order, including the Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration. q` `  hh,FEDERAL COMMUNICATIONS COMMISSION q` `  hh,Magalie Romn Salas q` `  hh,Secretary