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X40  0!5.44In 1981 19 YEARS , we allocated twenty 25kilohertz channel pairs in the 928929 MHz and 952 %@953 MHz bands for exclusive, private use by Power Radio Service eligibles for energy  X0 % distribution automation."~> yO5   pԍ Amendment of the Commission's Rules To Reallocate Forty Eight 25 kHz Channels in a Certain MHz Range   for Multiple Address Radio Systems; and To Establish a New Standard for Frequency Tolerance on Specific MHz  {O   pMultiple Address Channels, SS Docket No. 7918, Report and Order, 47 Fed. Reg. 6869 (January 30, 1981); see 47  yO   PC.F.R.  90.63. Energy distribution automation systems are a type of MAS operation that use remote radio   `transceivers located at customers' premises to enable utilities to control energy peak usage through load management techniques. These systems are used to promote fuel savings and efficiency." We later allocated fourteen 25kilohertz channel pairs in the same bands  %and eight 25kilohertz unpaired channels in the 956 MHz band for private MAS operations by  %all entities eligible under former Part 94 of our Rules, the Private OperationalFixed Microwave  X0 %("POFM") Service. > yOj#   ԍ Amendment of the Commission's Rules To Reallocate Forty Eight 25 kHz Channels in a Certain MHz Range   for Multiple Address Radio Systems; and To Establish a New Standard for Frequency Tolerance on Specific MHz  {O$   PMultiple Address Channels, SS Docket No. 7918, Second Report and Order, 47 Fed. Reg. 6,869 (February 17,   1982). Previously, Part94 contained rules for the Private Operational Fixed Microwave ("POFM") Service. Part   `94 eligibles were persons (individuals, partnerships, associations, joint stock companies, trusts, or corporations),   governmental entities, or agencies eligible to provide POFS under Parts 80, 87, or 90, or entities proposing to provide"T',-(-(*'"   such service to such POFM eligibles. POFM services include any use of microwave frequencies other than for  {OX   common carrier purposes. See former 47 C.F.R.  94.5. We note that, effective August 1, 1996, we consolidated  {O"   `the service rules for fixed microwave operations, formerly in Parts 21 and 94, into Part 101.  See Reorganization   and revision of parts 1, 2, 21, and 94 of the rules to establish a new part 101 governing terrestrial microwave fixed   pradio services, WT Docket No. 94148, Amendment of Part 21 of the Commission's Rules for the Domestic Public  {O| Fixed Radio Services, CC Docket No. 932, Report and Order, 11 FCC Rcd 13449 (1996).  The Commission also allocated six 25kilohertz paired channels in the 928"F,-(-(ZZ"  X0 %and 959 MHz bandsF> yO   ԍ Although these channels are listed as paired, unpaired operation is permitted and, in fact, is the dominate mode of operation on the channels. for common carrier Domestic Public Land Mobile ("DPLM") use under Part  X0 %@22 of our Rules for control of wide-area paging networks.J > {O8 ԍ  See 47 C.F.R.  22.623.J In an effort to facilitate the efficient  %0use of this "pool" approach, we adopted sharing criteria. Specifically, under our current rules,  %`if the MAS channels available under the POFM pool have been licensed in a given geographic  X0 %area, Part 101 eligibles may apply for MAS channels allocated for DPLM operations, and vice  X0 %versa.N 0 > {Op ԍ See 47 C.F.R.  101.147(b).N Later, at the request of the MAS community, the Commission further modified the rules  % and policies governing MAS operations, including establishing a standard mileage separation and  %reducing the channel spacing from 25 kilohertz to 12.5 kilohertz, in order to increase spectrum  XL0efficiency and reduce regulatory burdens. zL > yO   ԍ Amendment of  22.501(g)(2) and 94.65(a)(1) of the Rules and Regulations to Re-Channel the RM-5206   900 MHz Multiple Address Frequencies Amendment of  94.65(a)(1) of the Rules of Revise Footnote 3 in the   Frequency Table to Make the RM-5362 Frequencies Available for use by any Part 94 Eligible Amendment of Part   P2 and  94.63(d)(5) and 94.65(a)(1) Footnote 3 of the Rules to Permit Operation of Mobile RM-5178 Remote   Meter Reading Systems on a Primary Basis on the Exclusive Power Radio Service Frequencies in the   952.3625-952.8375 MHz Band Amendment of Part 94 of the Rules to Permit Intrasystem Communications Among  {Oo Multiple Address System RM-5383 Master Stations, PR Docket No. 875, Report and Order,3 FCC Rcd 1564 (1988).  X 0  0!6.44In 1989, the Commission allocated, for both Federal Governmental and non %Governmental pointtomultipoint use, an additional forty 12.5kilohertz channel pairs in the 932 X 0 %932.5 MHz and 941941.5 MHz bands. Z > yO   ԍ Amendment of Parts 1, 21, 22, 74, and 94 of the Commission's Rules to Establish Service and Technical   Rules for Government and non-Government Fixed Service Usage of the Frequency Bands 932-935 MHz and 941-944  {O5 MHz,GEN Docket No. 82243, Second Report and Order, 4 FCC Rcd 2012 (1989). Governmental and nonGovernmental use was to be  %pcoordinated by the Interdepartment Radio Advisory Committee ("IRAC") of the National  X 0 %Telecommunications and Information Administration ("NTIA"). By Public Notice, the  %Commission stated that it would open five twoday filing windows during January and February  X0 %1992, and thereafter license applicants on a firstcome, firstserved basis.y &> {Om% ԍ Public Notice, DA 911422, 6 FCC Rcd 7242 (released Nov. 27, 1991). y In the event that we  %`received mutually exclusive applications, we indicated that lotteries would be used to select" ,-(-(ZZ"  X0 %0among applicants.3> {Oy ԍ  Id.3 In response to the series of filing windows, over 50,000 applications were  %filed for the available forty 12.5kilohertz channel pairs in the 932932.5 MHz and 941941.5 MHz bands.  X0  0!7.44On August 10, 1993, the Omnibus Budget Reconciliation Act of 1993 ("Budget Act")JZ> {O  %ԍ Pub. L. No. 10366, Title VI,  6002(a), 107 Stat. 312, 387 (1993) (Budget Act); see H.R. Conf. Rep.  {Oy No.213, 103d Cong., 1st Sess. 48089 (1993), reprinted in 1993 U.S. Code Cong. & Admin. News 116978. J  X0 % added Section 309(j) to the Communications Act of 1934, as amended ("Communications Act").J> {O ԍ See 47 U.S.C.  309(j).J  %PSection 309(j) permits the Commission, for certain classes of radio licenses, to employ  %0competitive bidding procedures to choose among mutually exclusive applications for initial  %Plicenses. As a result, in the Competitive Bidding docket we examined various radio services to  % determine whether they should be subject to competitive bidding. In this connection, as described  X 0 % more fully infra, we determined at that time that POFM MAS did not qualify as subscriberbased  X 0 %and therefore should not be subject to competitive bidding.& H> yO  %ԍ Implementation of Section 309(j) of the Communications Act Competitive Bidding, PP Docket No. 93253,  {O  %Notice of Proposed Rule Making, 8 FCC Rcd 7635, 765960 (1993); Implementation of Section 309(j) of the  {O  %Communications Act Competitive Bidding, PP Docket No. 93253, Second Report and Order, 9 FCC Rcd 2348,  {OZ 2354 (1994) (Competitive Bidding Second Report and Order). Therefore, we noted that it would  % not be appropriate to use competitive bidding to award those POFM MAS licenses for which the  X 0 %50,000plus applications were pending, even in the event of mutual exclusivity. 6 > {O  %Pԍ Notice of Proposed Rule Making, 8 FCC Rcd at 7660 n.156; Competitive Bidding Second Report and Order,  yO 9 FCC Rcd at 2354 n.25. Subsequently,  %we did a preliminary examination of the pending applications and found that the vast majority  %`(over 95 percent) were filed by applicants seemingly proposing to use their licenses principally to provide subscriberbased service.  Xd0O IV. DISCUSSION ă  X60 "8. In light of the substantial number of MAS applications filed in response to the 1992  %filing windows and the type of proposed operations indicated, we are concerned that our initial  %assessment in the Competitive Bidding docket regarding the principal use of POFM MAS  %P spectrum may not accurately reflect existing and future operations. We are aware that it has been  X0 %` eight years since our last comprehensive examination of MAS.Z > {O$ ԍ See supra para. 19 YEARS5.Z Given that the wireless industry,  %including MAS, has changed dramatically since the 1980's, we believe we must reexamine the  %current and future uses of and demand for MAS spectrum to determine the appropriate method  %by which to award the licenses associated with the numerous pending applications. As part of"",-(-(ZZ"  % this reexamination, we seek to establish a streamlined regulatory framework which will provide  % licensees sufficient flexibility to meet the public's current and future MAS needs. We begin with  X0 %a review of our MAS service rules to determine whether they should be modified e.g., whether  %P we should retain a sitespecific licensing approach or transition to geographic area licensing. We  % then address the mechanism by which we might select among mutually exclusive applications for initial licenses.  Xa0 A. Spectrum Allocation 1. Treatment of the 932/941 and 928/959 MHz bands  X 0 " 9. A total of 3.2 megahertz (MHz) of radio spectrum is currently allocated for MAS, and  %0 this can be divided into three general categories. The first category, consisting of one megahertz  %@of paired spectrum in the 932932.5 MHz and 941941.5 MHz bands (932/941 MHz bands), is  X 0 %0available for both Federal Governmental and nonGovernmental use.S > {O9 ԍ See 47 C.F.R. 101.147 (b), Table 7.S These 12.5 kilohertz  X 0 %`channels are used by common carrier and private radio licensees on a coprimary basis. Z> {O ԍ Second Report and Order, GEN Docket No. 82243, 4 FCC Rcd at 2014; 47 C.F. R.  101.147(b)(4).  % According to the Commission's licensing database, to date, these bands support only two Federal  %Governmental licensees, one in Alaska and one in Florida, and no nonFederal Governmental  %users. The second category, consisting of 300 kilohertz of paired spectrum in the 928.85929  %MHz and 959.85960 MHz bands (928/959 MHz bands), is allocated for, and used primarily by,  %0common carrier licensees under Part 22 of our Rules, and may also be used for private radio  X0licensees pursuant to certain sharing criteria.d> {O ԍ  See 47 C.F.R.  22.621 and  101.147, Table 5.d  X0 " 10. Given the significant number of applications filed for the 932/941 MHz bands, we  %seek comment on whether we should modify the spectrum allocation for MAS based on current  X0 %licensee operations and the applicants' proposed uses. As noted supra, of the over 50,000  %applications filed for the 932/941 MHz bands, over 95 percent were filed by entities seemingly proposing to use their licenses principally to provide subscriberbased service.  Xi0 "  11. Rather than evaluating the particular use made of these two discrete MAS spectrum  %` groups and then designating them for common carrier or private use, we tentatively conclude that  %P the groups are substitutable and consequently we will consider them as a whole in evaluating the  %Pdemand for future use of MAS spectrum. As discussed above the majority use of the 928/959  %MHz bands is subscriberbased. Similarly, there are over 50,000 applications pending for the  %p932/941 MHz bands, the overwhelming majority of which were filed by applicants seemingly  % proposing to use their licenses principally to provide subscriberbased service. One could argue  % that the substantial number of applications coupled with the subscriberbased use of the 928/959  % MHz bands indicates that MAS is evolving into a service where licensees primarily seek to"!~,-(-(ZZ#"  %provide subscriberbased services. Thus, we tentatively conclude that the 928/959 MHz bands  %and the 932/941 MHz bands should be designated for subscriberbased services. We seek  %comment on this alternative. We encourage commenters to address the feasibility of the above  %alternative, as well as other possible allocations. If suggesting other spectrum allocations, commenters should include the rationale underlying their proposal.  Xv0 2. Treatment of the 928/952/956 MHz bands  XH0 " 12. The third category, consisting of 1.7 megahertz of paired spectrum in the 928928.85  %`and 952952.85 MHz bands and 200 kilohertz of unpaired spectrum in the 956.25956.45 MHz  %bands (928/952/956 MHz bands), is allocated for, and used primarily by, private radio licensees,  X 0 %0and may be used by common carriers pursuant to certain sharing criteria.R > {O| ԍ  See id.  101.147 (b), Table 2.R The Commission's  %licensing database BAND USE  reveals, however, that the third category of MAS spectrum the 928/952/956  %PMHz bands appears currently to be used overwhelmingly for private service. While some of  %these licensees share some or all of their capacity on a forprofit, thirdparty, private carrier  X 0 %basis, Z> {O  %ԍ See generally National Ass'n of Regulatory Utility Comm'ners v. FCC, 525 F.2d 630 (D.C. Cir. 1976),  {O| cert.denied, 425 U.S. 992 (1976) (private carrier concept). we estimate from our records that the majority of channels in this group are used by  X0 %private systems to satisfy internal communication needs.> yO  %ԍ In determining whether the General Category channels are principally used for subscriberbased services, we  {O  %0looked at the majority use of the band.  See Amendment of Part 90 of the Commission's Rules to Facilitate Future  {O  %Development of SMR Systems in the 800 MHz Frequency Band, First Report and Order, Eighth Report and Order,  {OS  %and Second Further Notice of Proposed Rule Making, PR Docket No.93144, GN Docket No.93-252, PP Docket  {O No. 93253, 11 FCC Rcd 1463, 1535 (800 MHz First Report and Order). Specifically, we estimate that, of the  %p approximately 7,700 licenses granted for use in this spectrum, about 70 percent have been granted to public safety, business, or industrial entities to satisfy internal communications needs.  X40 " 13. Because currently the principal use of the band does not appear to involve subscriber %based services, we tentatively conclude that the 928/952/956 MHz bands should be designated  %0exclusively for private, internal use. Under this approach, we would prohibit any further  %subscriberbased use of these channels by future licensees, whether on a private carrier basis or  %through sharing with common carrier licensees. We nonetheless would grandfather existing  %psubscriberbased services currently being provided on these MAS frequencies. We ask for  %comment on whether existing or projected internal communications requirements of private  %service users justify creation of such a purely private allocation, including empirical analysis of projected private MAS spectrum needs.  Xe0  XN0B. MAS Licensing Approach  X 0 1. Geographic Area Licensing " n ,-(-(ZZ`"Ԍ X0 "ԙ 14. As discussed above, MAS spectrum is located in various 900 MHz bands. In  % addition, the use of the service varies somewhat among the bands. Examples of differences in  %0use include whether the channels are used for private or for common carriage, maximum power  %`limitations, mileage separation requirements for cochannel users, and frequency separation  %prequirements for master and remote station transmit channels. Similarities in use include use of  %`the same type of equipment and mode of operation (pointtomultipoint). Under our current  %Prules, MAS licensees file an application to license each transmitter site in the area they wish to  % serve. The particular mileage separation between cochannel assignments depends upon the type  XH0 % of operation.H> {O ԍ There are different separation requirements for fixed and mobile operations.  See 47 C.F.R.  22.625 and  101.105(c)(3). We have concluded in other services that licensing based on predefined service  %`areas geographic area licensing poses significant advantages over sitebased licensing for  % entities providing subscriberbased services because of the greater operational flexibility it gives  X 0 %plicensees and the greater ease of administration for the Commission. "> {O  %Pԍ  See, e.g., Third Report and Order, PR Docket Nos. 89553, 93144, GN Docket No. 93252, 9 FCC Rcd  {O 7988, 8044 (CMRS Third Report and Order). We believe adopting  % geographic area licensing for any MAS bands for which the principal use will involve, or is  %reasonably likely to involve, subscriberbased services, would offer the same potential benefits.  % Therefore, we propose to use geographic area licensing in these bands. Licensing such systems  % by geographic area would simplify system expansion and reduce administrative burdens on both  X0 %licensees and the Commission. We also propose herein, see infra paragraph SET ASIDE66, to set aside five  X{0 %0channel pairs in the 932/941 MHz bands for Federal Governmental/Public Safety use. Because  %pthe principal use of these five channel pairs would therefore not involve the receipt of  %0compensation for providing subscriberbased services, we would exclude them from our geographic licensing proposal.  X0 "15. We invite comment on our proposal to employ geographic area licensing in the MAS  %`bands, particularly in the 928/959 MHz bands, where a number of systems are already licensed.  %PWe also request comment on whether, in the event that we find that the principal use of the  %928/952/956 MHz bands involves, or is reasonably likely to involve, subscriberbased service,  %`geographic area licensing should be employed. Alternatively, if we conclude that the principal  % use of the 928/952/956 MHz bands is likely to remain private, should the we continue to award  %p MAS licenses in these bands on a sitebysite basis or use a geographic licensing approach? We  %also seek comment on which rules in this context should be modified even if we retain site %0specific licensing on a firstcome, firstserved basis. Finally, we seek comment on whether the Part 22 rules concerning pointtomultipoint operations should be placed within Part 101.  X 0X4` hp x (#%'0*,.8135@8: u {O ԍ See 47 C.F.R.  101.63.J In order to be considered in  X 0 %@ operation, an MAS station must be serving at least four separate active remote stations.N? Zu {O ԍ  See 47 C.F.R.  101.147(b).N These  % requirements are intended to provide some assurance that spectrum is used effectively and service  %` is implemented promptly. We tentatively conclude that these requirements should be retained for  %` incumbent licensees. Such incumbents operate within existing nongeographic service areas, and  X 0we have proposed in this Notice to grandfather these licensees and their operations.  X{0 "$37. We believe, however, that different treatment is appropriate for new licensees that  %will be operating as proposed here under a geographic area license with flexible service rules.  XM0 %When designing competitive bidding systems, Section 309(j)(3) of the Acti@Mu xP0#c PE37P#э 47 U.S.C.  309(j)(3).i states, in part, that  %` "the Commission shall include safeguards to protect the public interest in the use of the spectrum  X0. . . ." In addition, Section 309(j)(4)(B) states that the Commission shall:lA|u xPL0#c PE37P#э 47 U.S.C.  309(j)(4)(B).l   P0X,44,` ` include performance requirements, such as appropriate deadlines and penalties  Pfor performance failures, to ensure prompt delivery of service to rural areas,  Pto prevent stockpiling or warehousing of spectrum by licensees or permittees,  Pand to promote investment in and rapid deployment of new technologies and services.!`  Xg0 "p%38. We have previously found that these provisions could be satisfied through  XP0 %construction requirements.BP u {O $  %ԍ See, e.g., Implementation of Section 309(j) of the Communications Act Competitive Bidding, PP Docket  {O$  %@No. 93253, Fifth Report and Order, 9 FCC Rcd 5532, 5570 (1994); Amendment of Parts 21 and 74 of the  %Commission's Rules With Regard to Filing Procedures in the Multipoint Distribution Service and in the Instructional  {Oi&  %Television Fixed Service and Implementation of Section 309(j) of the Communications Act Competitive Bidding,  {O1'  %`PP Docket No. 93253 and MM Docket No. 94131, Report and Order, 10 FCC Rcd 9589, 965960 (1995);"1'A,-(-( '"  {O  %Allocation of Spectrum Below 5 GHz Transferred from Federal Government Use, ET Docket No. 9432, Second  {OZ Report and Order, 11 FCC Rcd 624, 669670 (1995). In the MAS context, we believe that some coverage requirements"P$B,-(-(ZZ"  %@ may be needed as performance requirements to deter speculation while promoting prompt service  %to the public. An additional public interest benefit of imposing coverage requirements on  %geographic MAS licenses is that they would hinder warehousing, promote rapid deployment of  % new technologies and services and promote service to rural areas. We nonetheless are concerned  %that strict construction requirements may not be the most suitable and effective means of  %addressing the statute's concerns given that MAS spectrum may be used to offer a variety of  %services, including pointtopoint, pointtomultipoint, multipointtopoint, and mobile. As a  %result, we note that strict construction requirements might result in uneconomic construction:  %Pconstruction in geographic areas different than those that would be served in a competitive  %Penvironment; deployment at a different rate than would occur in a competitive environment; or  %Pdeployment of technology and equipment differing from that which competition would dictate.  % Further, strict construction requirements might have the unintended consequence of causing firms  %to build first in urban areas where the mandatory benchmarks could be met most cheaply, and thus slow the development of service to rural areas.  X 0 "0&39. Balancing all of the above factors, we tentatively conclude that geographic MAS  %Plicensees should be subject to liberal construction requirements. We seek comment on this  %tentative conclusion. Specifically, we propose that geographic MAS licensees must provide  % coverage to at least onefifth of the population in their service areas or substantial service within  %five years of the license grant. In addition, geographic MAS licensees must make a showing of  % substantial service within ten years of being licensed. We further propose that failure to meet  %these coverage requirements will result in automatic termination of the geographic MAS license.  X0 %We note that this approach is consistent with our rules for other services.CH$u {O  %ԍ See, e.g., Amendment of the Commission's Rules to Establish New Personal Communications Service, GEN  {O  %Docket No. 90314, Second Report and Order, 8 FCC Rcd 7700, 7754,  134 (1993); Amendment of Parts 2 and  %90 of the Commission's Rules to Provide for the Use of 200 Channels Outside the Designated Filing Areas in the  %896901 MHz and the 935940 MHz Bands Allotted to the specialized Mobile Radio Pool, PR Docket No. 89553,  {O  %0Second Report and Order and Second Further Notice of Proposed Rulemaking, 10 FCC Rcd 6884, 6899,  43;  %PAmendment of Parts 21 and 74 of the Commission's Rules with Regard to Filing Procedures in the Multipoint  {O  %Distribution Service and in the Instructional Television Fixed Service, MM Docket No. 94131, Report and Order, 10 FCC Rcd 9589, 9613,  43. We seek comment on these proposals and any alternatives thereto.  X0 9. Technical Flexibility  X|0 " '40. The basic channelization in the MAS bands is 12.5 kHz. However, entities currently  Xe0 %may be licensed for 25 kHz and 50 kHz operations upon a showing of need.[De4 u {OJ& ԍ See 47 C.F.R.  101.109, 101.147(b).[ We propose to  % allow geographic area licensees to combine contiguous channels resulting in bandwidths up to 50"N D,-(-(ZZ`"  %kHz without a showing of need. Permitting licensees to combine channels without a showing of  %need will enable them to employ the widest variety of technologies to best meet the  X0 %communications requirements of consumers and reduce regulatory burdens.E\u {OK  %Pԍ  See 220 Third Notice, 11 FCC Rcd at t  81. See also Amendment of Parts 2, 15, and 90 of the  %Commission's Rules and Regulations to Allocate Frequencies in the 900 MHz Reserve Band for Private Land Mobile  {O Use, Report and Order, GEN Docket No. 841233, 2 FCC Rcd at 1825,  74. Geographic area  X0 %@ licensees would also be able to subdivide their 12.5 kHz channels.NFu {OX ԍ  See 47 C.F.R.  101.147(b).N Further, we propose the out %0ofband emission rules apply only to the extent necessary to protect operations outside of the  X0 %licensee's EA and to spectrum inside if used by incumbents.G~u {O ԍ  See CMRS Third Report and Order at  161.  See also 900 MHz Second Report and Order at  61 EA licensees, however, would be  %free to negotiate with adjacent EA licensees concerning interference rights. We also tentatively  %@conclude that it is appropriate to extend the same technical flexibility adopted for EA licensees  %to incumbent licensees. We seek comment on these proposals. We also seek comment on  % whether it would be in the public interest to increase the maximum authorized bandwidth beyond  X 0 %`the current maximums of 12.5 kilohertz, 25kilohertz, and 50 kilohertz.YH u {O ԍ  See 47 C.F.R.  101.109, 101.147. Y For instance, under a  %geographic area licensing approach, should MAS channel pairs be combined to assign larger  X 0 % frequency blocks? Of the thirtyfive channel pairs available in the 932/941 MHz band,I u yO?  %ԍ There are forty 12.5 kilohertz channels pairs in the 932/941 MHz band. We are, however, proposing to set  {O aside five channel pairs for public safety and Federal Government use. See supra paragraphs 6364. we  %could, for instance, combine channels to make one tenchannel block, two sixchannel blocks,  %four fourchannel blocks, four twochannel blocks, and five onechannel blocks. We seek comment on these approaches.  Xy0 10. Operational Flexibility  XK0 "(41. The current rules governing MAS allow licensees to use certain MAS channels for  % other types of operations besides pointtomultipoint transmissions. The rules, for instance, allow  X0 %mobile operations on certain paired channels on a secondary basis.HJ u yO ԍ 47 C.F.R.  101.105 (c)(3).H Certain pointtopoint  X0 %operations also are permitted on a secondary basis.EK u yOC" ԍ 47 C.F.R.  101.147 (b).E Likewise, MAS licensees may transmit  X0 %ancillary oneway communications on certain paired channels on a casebycase basis.3Lu {O$ ԍ  Id.3 Our  %original purpose in adopting limitations on these uses was to ensure that the spectrum would be used primarily to satisfy bona fide pointtomultipoint requirements."L,-(-(ZZp"Ԍ X0 "ԙ)42. We are proposing herein to employ a new geographic area licensing approach for the  %932/941 MHz and 928/959 MHz bands. We also ask for comments on extending geographic area  %licensing to the 928/952/956 MHz bands. We believe that affording MAS licensees additional  %operational flexibility would offer a number of benefits. For example, lifting the operational  %restrictions on forprofit third party providers serves to broaden the array of services offered by  %pthese licensees and thus benefits the public through increased competition. To compete  %peffectively in today's changing communications marketplace, we believe licensees should have  %0the ability to provide consumers a wide array of services and to have the ability to respond  % quickly to changing consumer demands. For these reasons, we propose to allow MAS geographic  X10 %area licensees to utilize both pointtopoint and pointtomultipoint operations and to provide  X 0 %fixedoM u yO ԍ Fixed service includes both pointtopoint and oneway transmissions.o and mobile service on a co-primary basis. This approach would continue, however, to  %prohibit MAS licensees from providing broadcast services. We recognize that permitting point %` topoint operations would be a departure from our previous decisions, where we stated that MAS  X 0 %spectrum should be reserved for pointtomultipoint operations.N Xu {O  %0ԍ See Report and Order, WT Docket No. 94148 and CC Docket No. 932, at  47; Report and Order, 3FCCRcd at 1568 & nn.3, 54. We tentatively conclude,  %however, that permitting this additional flexibility, along with the flexibility afforded by the  %P option to provide mobile service, is in the public interest, and we seek comment on this approach.  X0 %POur proposed approach is consistent with current proposalsnOu {O  %ԍ See e.g., In the Matter of Amendment of Part 90 of the Commission's Rules to Provide for the Use of the  {O  % 220222 MHz Band by the Private Land Mobile Radio Services, PR Docket No. 89552, Second Memorandum  {O  %Opinion and Order and Third Notice of Proposed Rule Making, [cite] (proposal to allow fixed operations on a  %primary basis with land mobile operations in band). In the Matter of Amendment of the Commission's Rules to  {O  %Permit Flexible Service Offerings in the Commercial Mobile Radio Services, WT Docket No. 966, Notice of  {O  %Proposed Rule Making, [cite] (proposal to allow broadband CMRS licensees to provide fixed services with mobile operations in band).n and the policies set forth in the  Xy0 %`Communications Act.Py u {O& ԍ See 47 U.S.C.  157; see also S. Conf. Rep. No. 104230, 104th Cong., 2d Sess. 1 (1996). Also, we tentatively conclude that it is appropriate to extend the same  %poperational flexibility proposed for EA licensees to incumbent licensees. We seek comment on this tentative conclusion. We seek comment on the following issues as well:  X0 P(a)44,` ` Should the Commission allow the operation of the market to determine the most efficient use of MAS as we have proposed?(#`  X0(b) ` ` How will expanding licensee flexibility affect further development of MAS?(#` " P,-(-(ZZ"Ԍ X0 (c)44,` ` For mobile operations, should we consider restricting interconnection with the  X0public switched network (PSN)?fQu yOb  %ԍ Interconnection with the PSN, coupled with allowing mobile offerings, might change the regulatory status  {O*  %Pof MAS, requiring an application of different and more restrictive regulation from that currently applied. See Public  {O  %Notice, Information for Part 90 Licensees Subject to Reclassification as Commercial Mobile Radio Service Providers  %on August 10, 1996 Wireless Bureau Answers Frequently Asked Questions Regarding CMRS Status, DA 961245, 11 FCC Rcd 9267 (1996).f(#`  X0 (d) ` ` Given the different operating characteristics of fixed and mobile, should the  ptechnical rules be revised to avoid the potential for harmful cochannel interference, and if so, how? (#`  X_0 11. Regulatory Status  X10 "*43. We propose to allow MAS geographic area licensees to provide both fixed and  %` mobile service. Under this approach, geographic area licensees could provide a variety of mobile,  %fixed, pointtopoint and pointtomultipoint services. While our proposal increases operational  %flexibility, thereby allowing EA licensees to better respond to market demand, it also makes it  %difficult to determine the regulatory status of each licensee. This process could be further complicated if we adopt rules allowing interconnection with the PSN.  X0 "0+44. For the purposes of this Notice, we propose an approach for determining regulatory  X{0 %status similar to that adopted for the General Wireless Communications Service (GWCS).TR{|u {O ԍ GWCS Second Report and Order at 126.T We  %propose to rely on applicants to specifically identify the type of service or services they intend  %to provide and that they include sufficient detail to enable the Commission to determine whether  X60 %pthe service will be offered as a commercial mobile radio service,MS6u {O ԍ See 47 U.S.C.  332(d)(1).M a private land mobile radio  %service, a common carrier fixed service, or a private fixed service. To simplify the process, we  %propose to establish a presumption that MAS geographic area licensees be telecommunications  % carriers regulated as common carrier. Depending upon our final decision in regard to the 928/952  %MHz and 956 MHz bands, we may also establish a presumption that those specific bands are  %private. Any interested party would be able to challenge the regulatory status granted an MAS  %geographic area licensee. This approach should allow us to carry out our regulatory  %responsibilities without imposing a hardship upon licensees. We note that the type of radio service provided will depend on our conclusions after reviewing the record in this proceeding.  XP0 ",45. We seek comment on the most efficient manner in which to administer the  %requirements of the Communications Act and our rules and, at the same time, grant licensees as"9S,-(-(ZZp"  X0 %much operational flexibility as possible.T$u yOy  %ԍ We note here that we are addressing similar concerns in regard regulatory status and increasing flexibility in  {OA  %the CMRS.  See Amendment of the Commission's Rules to Permit Flexible Service Offerings in the Commercial  {O   %Mobile Radio Services, First Report and Order and Further Notice of Proposed Rule Making, WT Docket No. 966, FCC 96283, adopted June 27, 1996. We also request that commenters address whether it  % is necessary for the Commission to require licensees to notify the Commission if they change the  %type of service offered using some or all of their licensed spectrum even though the new use  %would be permissible under our rules. If so, what requirements should be met in effecting  %notification? We also request comment on whether we should develop a standard longform  % license application for MAS on which the applicant would specify its intended regulatory status,  Xv0 %@an approach we used for the GWCS._Uvu {O ԍ GWCS Second Report and Order, 11 FCC Rcd at 672._ Finally, we seek comment on the implications to this  %analysis of Section 10 of the Communications Act of 1934, as amended, and the extent, if any,  XH0to which Section 10 forbearance should apply.GVHFu {O? ԍ See 47 U.S.C.  160.G  X 0 C. Competitive Bidding Issues  X 0 1. Authority to Conduct Auctions  X 0 "-46. As discussed supra, the Commission is authorized by Section 309(j) of the  %0Communications Act to employ auctions to choose among mutually exclusive applications for  %Pinitial licenses. Under Section 309(j), in order to employ auctions for a particular service, the  %Commission must determine that "the principal use of [the] spectrum will involve, or is reasonably likely to involve, the licensee receiving compensation from subscribers."   X60 ".47. Specifically, the statute permits auctions where: (1) mutually exclusive applications  %for initial licenses are accepted for filing by the Commission; (2) the principal use of the  %0spectrum will involve, or is reasonably likely to involve, the receipt by the licensee of  %compensation from subscribers in return for enabling those subscribers to receive or transmit  X0 %0 communications signals utilizing the licensed frequencies;WZu yOc  %@ԍ We determine principal use by comparing the amount of nonsubscription use made by the licensees in a  %service as a class with the amount of subscriberbased use on the basis of information throughput, time, or spectrum.  {O Competitive Bidding Second Report and Order, 9 FCC Rcd at 2354. and (3) the public interest objectives  %`of Section 309(j) would be served by subjecting mutuallyexclusive applications to competitive bidding. These objectives are:  X~0   (A)` ` the development and rapid deployment of new technologies, products, and  services for the benefit of the public, including those residing in rural areas, without administrative or judicial delays; "9 W,-(-(ZZ"Ԍ X0  0(B)` ` promoting economic opportunity and competition and ensuring that new  and innovative technologies are readily accessible to the American people by  avoiding excessive concentration of licenses and by disseminating licenses among  a wide variety of applicants, including small businesses, rural telephone companies, and businesses owned by members of minority groups and women;  Xv0 `(C)` ` recovery for the public of a portion of the value of the public spectrum  presource made available for commercial use and avoidance of unjust enrichment through the methods employed to award uses of that resource; and  X 0(D)` ` efficient and intensive use of the electromagnetic spectrum.  X 0 "`  /48. The Commission requested comment on whether MAS licenses should be subject to  X 0 %competitive bidding in a 1993 Notice of Proposed Rule Making in the competitive bidding  X 0 %pdocket.X u {O9 ԍ Notice of Proposed Rule Making, PP Docket No. 93253, 8 FCC Rcd 7635, 765960 (1993). At that time, the Commission stated that "we [could not] be certain that the principal  %0use of [the] frequencies [was] reasonably likely to involve the provision of service to  %subscribers," and tentatively concluded that licenses to provide POFM MAS should not be  X{0 %awarded through competitive bidding.BY{Zu {O ԍ Id. at 7660 n.156.B The Commission received three comments arguing that  %0 POFM MAS is principally used for private service. Based on this input, the Commission decided  XM0 %@ to exempt the MAS service (as regulated under the then Part 94) from competitive bidding.oZMu {O ԍ  Competitive Bidding Second Report and Order, 9 FCC Rcd at 2354.o The  %Commission also decided to award licenses for the pending preJuly 26, 1993, mutually exclusive  X0 %MAS applications for the 932/941 MHz bands by lottery.E[~u {ON ԍ Id. at 2354 and n.25.E In the same proceeding, the  %Commission concluded that mutually exclusive applications in the Part 22 DPLM service would  X0 % be subject to competitive bidding.<\u {O ԍ Id. at 2359.< Consequently, mutually exclusive applications in the 928/959  X0MHz and 932/941 MHz bands, if filed under Part 22, are subject to competitive bidding.J]u {O- ԍ See 47 C.F.R.  22.131.J  X0 " 049. Based on our review of the over 50,000 applications filed for MAS licenses in the  X0 %932/941 MHz bands,I^4 u {Oz$ ԍ See para. 5, supra.I it now appears that the proposed use of some of the MAS spectrum has  X~0 %changed since we made our initial determination in the Competitive Bidding Second Report and  Xi0 %`Order. Of those applications filed for channels in the 932/941 MHz bands, the vast majority  %(over 95 percent) were filed by entities planning to provide a subscriberbased service. Given"T ^,-(-(ZZ"  %this data, we believe it is reasonable to conclude that the principal use of this spectrum would  %0 involve, or is reasonably likely to involve, subscriberbased service. Accordingly, we tentatively  %@conclude that the principal use of spectrum in the 932/941 MHz bands is, or will likely be used, to provide subscriberbased services. We request comment on this tentative conclusion.  X0 "150. Moreover, we note that Part 22 use of the 928/959MHz bands is already subject to  %competitive bidding in the event of mutually exclusive applications. Although some entities  %p licensed in the 928/959 MHz bands use the spectrum to satisfy private or internal communications  %needs, the principal use of these bands clearly involves the provision of subscriberbased  X10 %p services._1u {O  %ԍ Mutually exclusive applications filed under Part 22 are subject to competitive bidding.  See Competitive  {Ot Bidding Second Report and Order, 9 FCC Rcd at 2359. As discussed supra at paragraph BAND USE12, we also seek comment on how frequencies in the 928/952/956 MHz bands presently are being used.  X 0 "251. We also now address whether the remaining statutory criteria under Section 309(j)  %0 can be met. We observe that the majority of applications presently on file are mutually exclusive.  % In addition, given the substantial level of interest in providing MAS service (as demonstrated by  %@the more than 50,000 applications that have been filed to date), we anticipate that mutual  %exclusivity likely would exist if additional applications were accepted for filing. We believe that  %using competitive bidding as a means of awarding MAS licenses for the 932/941 MHz and  %928/959 MHz bands will promote the objectives of Section 309(j)(3). More than any other  %method of awarding licenses, auctions are likely to foster the rapid deployment of new  %technologies and products by placing spectrum in the hands of those who value it most highly.  %pIt is also our view that, by fostering the rapid deployment of MAS services, auctions will serve  %` Congress' goal of bringing new services as expeditiously as possible to the public, including rural  %areas. With more than 50,000 pending applications, subjecting these to a lottery process would  %be timeconsuming and complex. Several months would be spent simply establishing chains of  %mutual exclusivity among the applicants. During a comparable period of time, an auction for the  %same frequencies could be completed. In this respect, we observe that processing of more than  %50,000 220222 MHz applications using the lottery procedure took more than two years to  %complete. In addition, unlike lotteries or comparative hearings, auctions will result in recovering  %for the public a portion of the value of the spectrum. Finally, we believe that the rapid award  %P of licenses through the auction process will promote efficient use of the MAS spectrum. We seek  %comment on these proposals, as well as on the overall proposal to use competitive bidding to award those licenses for 12.5 kilohertz channel pairs supporting subscriberbased services.  X0  2. Disposition of Previously Filed Applications  X 0 "352. As noted, we currently have over 50,000 applications for licenses in the  %P932/941MHz bands, filed pursuant to filing windows of JanuaryFebruary 1992. Given the fact  % that these applications were filed before July 26, 1993, we have the discretion to choose to award""$_,-(-(ZZ#"  X0 %p these licenses by random selection procedures.`Zu yOy  %ԍ Because the applications were filed prior to July 26, 1993, they fall under the "Special Rule" of Section  {OA  %P6002(e) of the Omnibus Budget Reconciliation Act of 1993. See 47 U.S.C.  309(i) and (j); Budget Act, Pub. L. No. 10366,  6002(e) (Special Rule), 107 Stat. 312, 397 (1993).  On the facts before us, we tentatively conclude  %that the public interest would best be served by using competitive bidding to award the  % applications for licenses in the 932/941 MHz bands, and we seek comment on this tentative  X0 %conclusion. We also propose to dismiss without prejudice the pending license applications for the 932/941MHz bands.  Xv0 "453. In granting the Commission authority to award licenses by auction, Congress  %specified in Section 309(j), as quoted above, a series of strong public policy reasons supporting  % the use of auctions. Further, we have designed our auction methodologies to award the licenses  %rapidly, facilitate the efficient aggregation of licenses, avoid excessive implementation costs and  X 0 %complexity, and award licenses to the parties that value them most highly.a u {O ԍ Competitive Bidding Second Report and Order, 9 FCC Rcd at 236061; see also supra para. 44. Based on our  %experience, competitive bidding is an extremely efficient method of assuring, with a minimum  %0 of regulatory burden, that radio licenses are assigned to those applicants with the greatest desire  %@ for the spectrum. The use of lotteries, on the other hand, does not further the public policy goals  % described above, and in fact has been found to create its own set of problems, such as speculative conduct and a resultant delay in service to the public.  Xy0 "0554. Twice in the past, in the context of other services, we have addressed this issue and  Xb0 %@ found that the public interest would best be served by the use of lotteries.bb|u yO  %ԍ In the case of one additional service, the Interactive Video and Data Service (IVDS), Congress explicitly  % singled out the service and its pending applications as an instance in which the Commission could choose to award  {O  %licenses by lottery. See H.R. Rep. No. 213, 103d Cong., 1st Sess. 498 (1993). In light of this, we subsequently held  {O  %a lottery for the pending IVDS applications, but did not in that context address the present issue at length. See  {O  % Notice of Proposed Rule Making, 8 FCC Rcd at 7659; Competitive Bidding Second Report and Order, 9 FCC Rcd at 2357. In the first instance,  %papproximately 10,900 applications for Cellular Radio Service unserved areas were filed for an  X40 % available 146 licenses.{c4 u {O ԍ Memorandum Opinion and Order, PP Docket No. 93253, 9 FCC Rcd 7387 (1994). { In the second instance, approximately 100 Multiple Distribution Service  X0 %(MDS) applications were filed for five available licenses.d u {OZ! ԍ Report and Order, MM Docket No. 94131, PP Docket No. 93253, 10 FCC Rcd 9589, 963034 (1995). Our decisions reflected  %Congressional recognition that equitable considerations and administrative costs may, in some  % instances, justify the use of lotteries despite the public benefits now recognized to be associated  %with the use of competitive bidding. Upon balancing the factors on both sides of the issue, we found that the public interest was, in those instances, best served by the use of lotteries. "d,-(-(ZZ"Ԍ X0 "p655. On balance, we tentatively conclude that the factors before us favor resolving the  %` pending mutually exclusive MAS applications through competitive bidding. First, given the large  % number of pending applications and potential markets, the use of a lottery would result in greater  %0 processing costs and a delay in service, when compared to use of an auction. By contrast, in the  X0 %MDS context, there were relatively few applications and licenses at issue,`eu {O ԍ Report and Order, 10 FCC Rcd at 9630 n.56, 9631.` and a fifth of the  %0number pending in the cellular unserved context. Thus, in the context of MAS, we believe the  %use of auctions would considerably reduce administrative costs, further efficient licensing, and expedite service the public.  X10 "0756. Second, based on the fact that we are proposing significant changes to the MAS  %service rules, we believe that processing the previously filed applications would be inconsistent  %with our proposed licensing approach for MAS. As noted, for instance, we are proposing to  %change from a sitebysite licensing approach to a geographic area licensing plan, facilitating  %`widearea operation and permitting a wider array of services to be provided by MAS licensees.  X 0 % We are also proposing to allow geographic area licensees to provide mobile and fixed operations  %on a coprimary basis with pointtomultipoint operations. Thus, it appears that the pending  %applicants would in any case need to substantially rethink their initial plans. This is in contrast  %to the cellular unserved and MDS services, where we made no changes to the types of services  %that could be offered by licensees or any other significant changes to the service rules between the time that the applications were filed and the lotteries were held.  X0 "857. We concede that the 50,000 applications have, much like cellular unserved, been on  %file for several years. Significantly, however, these applicants had ample opportunity to carry  %pout their business plans with little additional expenditure by applying for other MAS channels.  %0In this respect, we note that throughout the period the 50,000 MAS applications have been  %pending, spectrum was available that is substitutable in every respect. In contrast, the pending  %Pcellular unserved and MDS applicants had no alternative spectrum for pursuing their business  %plans. The public interest is, we tentatively conclude, best served by applying the new rules to both previous and new applicants.  XN0 "958. We recognize that the tentative decision to use competitive bidding for these licenses  %P will be contrary to the expectations of those applicants who, in good faith, expected to participate  %in a lottery and, if successful, provide MAS service. We nonetheless tentatively conclude that  %0 this factor, while significant, does not offset the strong public interest factors favoring the use of auctions. We seek comment on our proposal and tentative conclusions.  X 0 3. Competitive Bidding Provisions  X"0 ":59. We anticipate conducting the auction for MAS frequencies in conformity with the  %@general competitive bidding rules in Part 1, Subpart Q of the Commission's Rules, and"#Ze,-(-(ZZ$"  X0 % substantially consistent with the auctions that have been employed in other wireless services.fu yOy  %ԍ The Commission makes no representations or warranties about the use of this spectrum for particular services.  %Applicants should be aware that an FCC auction represents an opportunity to become an FCC licensee in this service,  %subject to certain conditions and regulations. An FCC auction does not constitute an endorsement by the FCC of  %Pany particular services, technologies or products, nor does an FCC license constitute a guarantee of business success.  %pApplicants should perform their individual due diligence before proceeding as they would with any new business venture.  % We propose to adopt the simultaneous multiple round competitive bidding design used in the PCS  %0auctions for the MAS auction. Multiple round bidding should provide more information to  %bidders than single round bidding during the auction about the values of the licenses. We seek  %0comment on this proposal. We also tentatively conclude that the MAS auction will follow the  % general competitive bidding procedures of Part 1, Subpart Q. We seek comment on this tentative conclusion.  XH0 "@;60. Small Business. In the Second Memorandum Opinion and Order in the competitive  % bidding docket, we indicated that we would establish definitions for "small business" on a service X 0 %byservice basis.g @u {O  ԍ Second Memorandum Opinion and Order, PP Docket No. 93253, 9 FCC 7245, 726869 (1994). Commenters should discuss the level of capital commitment that is likely to  % be required to purchase an MAS license at auction and create a viable business. Our goal, should  %we adopt a definition and associated special provision(s) for small businesses, will be to ensure  % the participation of small businesses in the auction and in the provision of service. Thus, we seek comment regarding the establishment of a "small business" definition for MAS.  X0 "0<61. We note that small business provisions offered in other services include installment  %P payment plans and bidding credits. We seek comment on what small business provisions should  % be offered to MAS small business licensees and what terms should be offered. In other services  %p we also adopted different attribution rules for purposes of determining small business status. We  % tentatively conclude that for MAS we will attribute the gross revenues of all controlling principals  %in the small business applicant as well as its affiliates. We seek comment on this tentative  X0conclusion.` `  X0 "=62. We also seek comment on whether small business provisions are sufficient to promote  %participation by businesses owned by minorities, women, or rural telephone companies. To the  % extent that commenters propose additional provisions to ensure participation by minorityowned  %or womenowned businesses, we also invite them to address how such provisions should be  X~0crafted to meet the relevant standards of judicial review.h~u {O#  %`ԍ See Adarand Constructors v. Pena, 115 S.Ct. 2097 (1995) and United States v. Virginia, 166 S.Ct. 2264 (1996).  XP0 "`>63. Partitioning and Disaggregation. We also seek comment on the type of unjust  %enrichment requirements that should be placed as a condition for approval of an application for";, h,-(-(ZZp"  X0 %a partial transfer (either by partitioning or disaggregation) of a license owned by, e.g., a qualified  %`small business to a nonsmall business. We tentatively conclude that these unjust enrichment  %provisions would include accelerated payment of any bidding credit that we may adopt for small  % businesses, unpaid principal, and accrued unpaid interest, and would be applied on a proportional  %basis. We seek comment on this tentative conclusion. We also seek comment on how such  %unjust enrichment amounts should be calculated, especially in light of the difficulty of devising  % a methodology or formula that will differentiate the relative value of the partitioned areas and the  %amount of spectrum disaggregated. We propose to use population as the objective measure to  %calculate the relative value of the partitioned area and the amount of spectrum disaggregated as  %the objective measure for disaggregation, and we seek comment on this proposal. Finally, in the  %event that restrictions are placed on the assignment or transfer of "complete" MAS licenses  %`awarded pursuant to special provisions, should we similarly restrict the partitioning of such  %licenses when the partitionee is not within the definition of an entity eligible for such special  X 0 %provisions? At some point (e.g., a term of years), should such restriction be removed and the unjust enrichment provisions apply on a proportional basis?  X 0   X0 "@?64. In the event that we determine that special provisions for small businesses are  %Pappropriate for MAS auctions, we tentatively conclude that if we permit a qualified small  %business licensee to partition or disaggregate to a nonsmall business entity, the partitioning or  %disaggregating licensee should be required to repay any benefits it received from the small  %business special provisions on a proportional basis. This would include accelerated payment of  %p bidding credits, unpaid principal, and accrued unpaid interest. We seek comment on this tentative  %conclusion. To the extent that we adopt installment payment financing for MAS, we seek  %comment on how to adjust installment payments owed by partitioning and disaggregating  %@licensees. For example, should a small business licensee that partitions or disaggregates to  %` another small business be required to repay, on an accelerated basis, a portion of the outstanding  %0principal balance owed under an installment payment plan? We seek comment on how this  %pshould be calculated. If we do not require payment of any amount of the outstanding principal  %balance for a license obtained by a small business as a condition for approval of the partitioning  %or disaggregation application, what other alternative conditions could we impose to ensure that  %the partitioning licensee continues to meet its financial obligation to the United States  % Government? We seek comment on whether the partitionee or disaggregatee should be required  %to guarantee payment of a portion of the obligation incurred by the partitioner or disaggregator  X 0 % (the original licensee). Similarly, in the event that we adopt bidding credits for MAS auctions,  %Pwe tentatively conclude that if a small business licensee partitions or disaggregates to another  %`qualified small business that would not qualify for the same level of bidding credit as the  % disaggregating licensee, the disaggregating licensee should be required to repay a portion of the benefit it received. We seek comment on how that amount should be calculated.  Xl$0 D. Frequency SetAside for Governmental and Public Safety Entities  X>&0 "@65. As noted above, we are proposing to use competitive bidding to award licenses in the  %932/941MHz bands. These bands, however, are currently available for both Federal"''h,-(-(ZZP("  %governmental and nongovernmental, including public safety, use. Federal governmental and  X0 %public safety services are exempt from competitive bidding procedures.iZu {Ob  % ԍ See, e.g., Competitive Bidding Second Report and Order, 9 FCC Rcd at 2352 (Public Safety Services).  %PHowever, when spectrum is subject to competitive bidding procedures, Federal Governmental and Public Safety entities that are otherwise qualified under the rules may participate in the auction and purchase licenses.  Furthermore,  %concerning public safety use, we have long recognized that this community of users has certain  X0 %unique characteristics that distinguish it from other users of the electromagnetic spectrum.Fj&u {OV  %ԍ  See, e.g., Report and Plan for Meeting State and Local Government Public Safety Agency Needs Through  {O  %the Year 2010, Report and Plan, FCC 9555, adopted Feb 9, 1995, released Feb 9, 1995.  See also The Development  %of Operational, Technical, and Spectrum Requirements for Meeting Federal, State and Local Public Safety Agency  {O Communication Requirements Through the Year 2010, Notice of Proposed Rule Making, WT Docket No. 9686, cite.F  %@Along these lines, in the Final Report of the Public Safety Wireless Advisory Committee  %0(PSWAC), it was stated that "wireless communications systems are critical to Public Safety  Xv0 %agencies' ability to protect lives and property and the welfare of Public Safety officials."Pk\vu yO  %ԍ Final Report of the Public Safety Wireless Advisory Committee to the Federal Communications Commission  {O  %0and The National Telecommunications and Information Administration (Sept. 11, 1996), Volume 1, at 1 (PSWAC  {O Final Report).P The  X_0 % PSWAC Final Report further states that currently allocated public safety spectrum is inadequate  XJ0 % to meet the public safety community's current voice and data needs.:lJ u {O ԍ Id. at 19.: As part of its  % recommendations and observations concerning how the public safety community's immediate and future needs can be met, PSWAC's Steering Committee stated that:   0!X,44More flexible licensing policies are desirable. The current approach, focused primarily   0!Pon continuous narrow banding, does not provide the Public Safety community the   0!@flexibility of selecting or obtaining the most efficient technology to meet userdefined   0!@needs. Policies should encourage the use of the most spectrally efficient approaches while remaining technology neutral.(#4   0!44More sharing and joint use should be encouraged. Some states and regions are   0!experiencing considerable success in pooling spectral and other resources. In many   0!instances, perceived losses in terms of independence of operation are more than offset   0!@by improvements in function and efficiency. Policies designed to streamline  X0cooperative use of federal and nonfederal spectrum should be adopted.9m u {OG" ԍ Id. at 3.9(#4  X0 "`A66. Therefore, we propose to set asideSET ASIDE five (5) of the forty (40) channel pairs in the  X0 %932/941MHz band exclusively for Federal governmental and public safety operations.n u yO&  %ԍ Public Safety would be defined as any person or governmental entity eligible for licensing under 47 C.F.R. Part 90, Subpart B. While"xn,-(-(ZZ"  X0 %the PSWAC Final Report did not specify MAS spectrum for a potential new public safety  %allocation, we believe that this spectrum is feasible for accommodating some of the public safety  X0 % community's growing demand for narrowband data and paging applications.Tou {OM ԍ See PSWAC Final Report at 4243, 56.T We also consider  % this Federal governmental and public safety channel set aside proposal to be a first step towards  %p establishing a policy streamlining cooperative use of Federal and nonFederal spectrum. We seek comment on this proposal.  Xa0 "pB67. With respect to our licensing approach for these five channel pairs, we take note  %of PSWAC's request for more flexible licensing policies in the public safety context. As a result,  %we propose that these channels be available on a first come, first served basis, with licensees  % having the technical flexibility to offer a variety of services, including pointtopoint, pointto %multipoint, fixed, and mobile. We further propose that coordination of operations on these  %0frequencies be accomplished through IRAC using the mileage separation criteria in Part 101 of  %Pour rules. In the event of mutually exclusive applications, we propose to use random selection  %pprocedures to assign the channels. We seek comment on these proposals. In addition, we ask  % for comments of whether we should (1) make some of the 5 channel pairs available primarily to  %either public safety or the Federal government rather than coprimary as proposed, and (2)  X{0 %establish a cutoff date for terminating this setaside (e.g., make some or all of the 5 channel pairs  %generally available if they are not used by public safety/Federal government after five years).  %`We also ask commenters on this issue to support their positions, where possible, with data  %0demonstrating the current and projected needs for Federal governmental and public safety  %` licensees. If the above level of proposed spectrum set aside is inadequate or too large, what level would be adequate?  X0 E. Suspension of Acceptance and Processing of Applications  X0 "C68. In light of our actions described above, and effective as of the date of the adoption  X0 %of this Notice, we will temporarily suspend acceptance of MAS applications for new licenses,  %amendments, or modifications for the 932/941 MHz bands, the 928/959 MHz bands, and  %applications to provide subscriberbased service in the 928/952/956 MHz bands, except as  %pprovided below. The suspension is effective until further notice and applies to applications  X=0 %0 received on or after the date of the adoption of this Notice. Any such applications received after  % that deadline will be returned as unacceptable for filing. We take this action to permit the orderly  %` and effective resolution of the issues in this proceeding. Absent this action, applications for new  %licenses, amendments, and modifications might limit the effectiveness of the decisions made and  %`the standards developed in this proceeding. We note that this action is consistent with the  %approach we have taken in all other existing services where we have proposed to adopt  X!0 %geographic area licensing and auction rules.op!Zu {O% ԍ See, e.g., Paging Notice at  139 & n.270.o We therefore find that this temporary measure is  %in the public interest. This suspension, however, does not affect applications for MAS licenses""p,-(-(ZZ#"  %0for private, internal communications (Part 101), in the 928/952/956 MHz bands based on our tentative conclusion to designate these bands exclusively for private use.  X0 "`D69. Notwithstanding this temporary suspension, we will continue to process all MAS  X0 %@applications for minor modifications\qu {O ԍ See 47 C.F.R.  101.59, 101.61.\ or for license assignment or transfer of control. This  %exception will also apply to amendments to applications for minor modifications. This exception  %should permit modifications that can improve the efficiency of incumbent MAS operations  X_0 % without affecting the effective and orderly resolution of the issues in this proceeding. Again, we  %pwill continue to accept applications for minor modifications, license assignments, and transfers of control under existing procedures.  X 0 "E70. With respect to MAS applications for new licenses, amendments, or nonminor  X 0 %modifications which were filed prior to the deadline stated above and remain pending, we will  % process such applications provided that (1) they are not mutually exclusive with other applications  %as of the deadline stated above, and (2) the relevant period for filing competing applications has  %expired as of the deadline stated above. We believe that this approach gives the appropriate  % consideration to those applicants who filed applications prior to our proposed changes and whose  % applications are not subject to competing applications. Previously filed applications not meeting  %the above criteria will be held in abeyance until the conclusion of this proceeding. We will  %determine later, in accordance with such new rules as are adopted, whether to process or return any such pending applications.  X0 "0F71. These decisions are procedural in nature and therefore not subject to the notice and  X0 % comment and effective date requirements of the Administrative Procedure Act.rZu {O ԍ See 5 U.S.C.  553(b)(A), (d); Kessler v. FCC, 326 F.2d 673 (D.C. Cir. 1963). Moreover, there  % is good cause for proceeding in this manner: to do otherwise would be impractical, unnecessary,  %and contrary to the public interest because compliance would undercut the purposes of these  X0interim measures.Xsu {OG ԍ See 5 U.S.C.  553(b)(B), (d)(3).X   X|0 NV. CONCLUSION ă  XN0 "G72. In this Notice we propose, inter alia, to (1) convert licensing of MAS spectrum for  %which the principal use will involve, or is reasonably likely to involve, "subscriberbased"  %services, from sitebysite licensing to geographic area licensing, (2) simplify and streamline the  %PMAS licensing procedures and rules, (3) increase licensee flexibility to provide communication  %services that are responsive to dynamic market demands, and (4) employ competitive bidding  %procedures to resolve mutually exclusive applications for MAS spectrum for which the principal  %use will involve, or is reasonably likely to involve, "subscriberbased" services. In addition, we  %temporarily suspend the acceptance and processing of MAS applications, except as provided"! ~s,-(-(ZZ#"  X0 % herein. This suspension is effective as of the date of the adoption of this Notice. These actions  %are intended to establish a flexible regulatory framework for MAS that will, among other things,  % provide opportunities for continued development of competitive new service offerings by allowing  % flexible use of the spectrum, expedite market entry through streamlined licensing procedures, and promote technological innovation by eliminating unnecessary regulatory burdens.  Xx0'T VI. PROCEDURAL MATTERS Đ\  XJ@ A. Ex Parte Rules NonRestricted Proceeding  X 0 "PH73. This is a nonrestricted notice and comment rule making proceeding. Ex Parte  %presentations are permitted, except during the Sunshine Agenda period, provided they are  X 0 %disclosed as provided in Commission rules. See generally 47 C.F.R.  1.1202, 1.1203, and 1.1206(a).  X 0 B. Initial Regulatory Flexibility Analysis  X0 "pI74. With respect to this present Notice, an Initial Regulatory Flexibility Analysis (IRFA),  Xk0 %see generally 5U.S.C.603, is contained in Appendix A. The IRFA addresses the expected  %impact on small entities of the proposals made in this document, and requests written comments  %on these proposals. To fulfill the mandate of the Contract with America Advancement Act of  %1996 (Pub. L. No. 104121, 110 Stat. 847 (1996)) regarding the subsequent Final Regulatory  %Flexibility Analysis in this proceeding, we ask a number of questions in the IRFA regarding the  %prevalence of small businesses in the Multiple Address Systems industry. Comments on the  %`IRFA must be filed in accordance with the same filing deadlines as comments regarding this  X0 % Notice, and must have a separate and distinct heading designating them as responses to the IRFA.  X0 %pThe Secretary shall send a copy of this Notice, including the IRFA, to the Chief Counsel for  %pAdvocacy of the Small Business Administration in accordance with Section 603(a) of the  X0Regulatory Flexibility Act, Pub. L. No. 96354, 94 Stat. 1164, 5 U.S.C.  601 et seq. (1981).  X_0 C. Initial Paperwork Reduction Act of 1995 Analysis   X10 "J75. This Notice contains a proposed information collection. As part of the Commission's  %continuing effort to reduce paperwork burdens, we invite the general public, the Office of  % Management and Budget (OMB), and other agencies to take this opportunity to comment on the  X0 %information collections contained in this Notice, as required by the Paperwork Reduction Act of  %1995, Pub L. No. 10413. Public and agency comments are due at the same time as other  X!0 % comments on this Notice; OMB comments are due 60 days after the publication of this Notice  %in the Federal Register. Comments should address: (a) whether the proposed collection of  %@information is necessary for the proper performance of the functions of the Commission,  %including whether the information shall have practical utility; (b) the accuracy of the  %Commission's burden estimates; (c) ways to enhance the quality, utility, and clarity of the  %information collected; and (d) ways to minimize the burden of the collection of information on  %0the respondents, including the use of automated collection techniques or other forms of":'!s,-(-(ZZ`("  %pinformation technology. In addition to filing comments with the Secretary, a copy of any  X0 %comments on the information collections contained herein should be submitted to both of the  %following: Dorothy Conway, Federal Communications Commission, Room 234, 1919 M Street,  %N.W., Washington, D.C. 20554, or via the Internet to dconway@fcc.gov, and Timothy Fain,  %OMB Desk Officer, 10236 NEOB, 725 17th Street, N.W., Washington, D.C. 20503, or via the  X0 %@Internet to fain t@al.eop.gov. For additional information regarding the information collections contained herein, contact Dorothy Conway, above.   XJ0 D. Comment Dates  X 0 "K76. Pursuant to applicable procedures set forth in Sections 1.415 and 1.419 of the  %Commission's Rules, 47. C.F.R.  1.415 and 1.419, interested parties may file comments on or  % before April 21, 1997, and reply comments on or before May 6, 1997. To file formally in this  % proceeding, you must file an original and four copies of all comments, reply comments, and  %supporting comments. If you want each Commissioner to receive a personal copy of your  %comments, you must file an original plus nine copies. You must send comments and reply  %comments to Office of the Secretary, Federal Communications Commission, Washington, DC  %20554. You may also file informal comments by electronic mail. You should address informal  %p comments to bjames@fcc.gov. You must put the docket number of the proceeding on the subject  %line ("WT Docket No. 9781"). You must also include your full name and Postal Service mailing  % address in the text of the message. Formal and informal comments and reply comments will be  %0available for public inspection during regular business hours in the F.C.C. Reference Center of  %`the Federal Communications Commission, Room 239, 1919 M Street, N.W., Washington, DC 20554.  X0 "L77. For further information, contact Bob James, Private Wireless Division, Wireless Telecommunications Bureau, at (202) 4180680.  X0  X~0/VII. ORDERING CLAUSES ă  XP0 "M78. Authority for issuance of this Notice of Proposed Rule Making is contained in  %Sections 4(i), 303(r), and 309(j) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 303(r), and 309(j).  X0 "PN79. Accordingly, IT IS ORDERED that, effective as of the date of the adoption of this  X0 %Notice of Proposed Rule Making, NO NEW APPLICATIONS WILL BE ACCEPTED FOR  %FILING in the 932932.5/941941.5 MHz bands and the 928.85929/959.85960 MHz bands, and  %PNO NEW APPLICATIONS WILL BE ACCEPTED FOR FILING for subscriberbased service  %in the 928928.85/952952.85 MHz bands and the 956.25956.45MHz band, except applications for minor modifications or for license assignment or transfer of control.  XW%0 "O80. IT IS FURTHER ORDERED that pending applications for licenses in the 928.85 %929/959.85960 MHz bands, 928928.85/952952.85 MHz bands, and the 956.25956.45MHz  X)'0 %@band WILL BE PROCESSED provided that (1) they are not mutually exclusive with other")'"s,-(-(ZZP("  X0 %P applications as of the date and time of the adoption of this Notice of Proposed Rule Making, and  %0 (2)the relevant period for filing competing applications has expired as of the date of the adoption  X0 % of this Notice of Proposed Rule Making. Pending applications not meeting these criteria, except  %applications for private, internal communications in the 928928.85/952952.85 MHz bands and  %pthe 956.25956.45MHz band, WILL BE HELD IN ABEYANCE until the conclusion of this  %proceeding. We will determine later, in accordance with such new rules as are adopted, whether to process or return any such pending applications.  XL0 "P81. The interim measures described will continue until the Commission announces that  %` the acceptance of the subject applications and the processing of applications held in abeyance (if  %such is determined) will resume. This action is authorized under Sections 4(i), 4(j), and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C.  154(i), 154(j), 303(r). 44` `  hhCFEDERAL COMMUNICATIONS COMMISSION 44` `  hhCWilliam F. Caton 44` `  hhCActing Secretary"O#s,-(-(ZZ"  X0#o\  PC+XP# ]APPENDIX A  X0  X0 INITIAL REGULATORY FLEXIBILITY ANALYSIS  X0 4Regulatory Flexibility Act ă  X_0  0!1.44Pursuant to the Regulatory Flexibility Act (RFA), see 5U.S.C.603, the Commission  %Phas prepared this Initial Regulatory Flexibility Analysis (IRFA) of the expected impact on small  X30 %entities of the policies and rules proposed in this Notice of Proposed Rule Making (Notice).  %Written public comments are requested on the IRFA. Comments must be identified as responses  X 0 %to the IRFA and must be filed by the deadlines for comments on the Notice, as described supraĄ  X 0 %in section VI. The Secretary shall cause a copy of this Notice to be sent to the Chief counsel for Advocacy of the Small Business Administration, in accordance with 5 U.S.C.  603(a).  X 0 A.Reason for Action:  X0  0!2.44This Notice requests public comment on our proposals to maximize the use of  %spectrum allocated to Multiple Address Systems in the Microwave Service. These proposals  %include: (1) converting licensing of MAS spectrum for which the principal use will involve, or  %is reasonably likely to involve, "subscriberbased" services, from sitebysite licensing to  % geographic area licensing, (2) simplifying and streamlining the MAS licensing procedures and  %rules, (3) increasing licensee flexibility to provide communication services that are responsive to  % dynamic market demands, and (4) employing competitive bidding procedures (auctions) to resolve  %mutually exclusive applications for MAS spectrum for which the principal use will involve, or  X0 %0is reasonably likely to involve, "subscriberbased" services. In addition, by this Notice we  %temporarily suspend the acceptance and processing of MAS applications, with the exception of applications in a few noted categories.  X0  Xq0 B.Objectives:  XC0  0! 3.44In attempting to maximize the use of MAS spectrum, we continue our efforts to  %`establish a flexible regulatory framework for spectrum allocations that will, among other things,  % provide opportunities for continued development of competitive new service offerings by allowing  %flexible use of spectrum, expedite market entry through modified licensing procedures, and promote technological innovation by eliminating unnecessary regulatory burdens.  X!0  X#0C.Legal Basis:  X]%0  0!4.44The authority for this action is contained in Sections 4(i), 303(r), and 309(j) of the  XF&0 %Communications Act of 1934, as amended, 47 U.S.C.  154(i), 303(r), and 309(j). See also Administrative Procedure Act, 5 U.S.C.  553."1'$s,-(-(ZZP("Ԍ X0ԙ D.Description and Estimate of Small Entities Affected:  X0  0!5.44Pursuant to the Contract with America Advancement Act of 1996, Pub. L. No.  X0 %104-121, 110 Stat. 847 (1996),tu X40 %ԍ#o\  PC+XP# Title II of the CWAAA is the "Small Business Regulatory Enforcement Fairness Act of 1996" (SBREFA), codified at 5 U.S.C.  601 et seq. the Commission is required to estimate in its Final Regulatory  %Flexibility Analysis the number of small entities to which a rule will apply, provide a description  %of such entities, and assess the impact of the rule on such entities. The Regulatory Flexibility  %Act defines a "small business" to be the same as a "small business concern" under the Small  % Business Act unless the Commission has developed one or more definitions that are appropriate  XH0 %to its activities.uHbu {O[ #C\  P6QIP#Ѝ See 5 U.S.C.  601(3) (incorporating by reference the definition of "small business concern" in 15 U.S.C.  632). Under the Small Business Act, a "small business concern" is one that: (1)  %is independently owned and operated; (2) is not dominant in its field of operation; and (3) meets  X 0 %any additional criteria established by the Small Business Administration (SBA).v u {O #C\  P6QIP#Ѝ 15 U.S.C.  632.  See, e.g., Brown Transport Truckload, Inc. v. Southern Wipers, Inc., 176 B.R. 82, 89 (N.D. Ga. 1994). To assist the  %Commission in this analysis, commenters are requested to provide information regarding how  %many MAS entities, total, would be affected by the various proposals on which the Commission  X 0 %seeks comment in this Notice. In particular, we seek estimates of how many affected entities will  %be considered "small businesses." In this regard, we ask commenters to note that we have  X 0 %prequested comment, supra, regarding the establishment of a small business definition for MAS for the purpose of competitive bidding.  Xf0  0! 6.44The proposals in the Notice would effect MAS licensees and applicants for licenses.  %Such entities fall into two categories: (1) those using MAS spectrum for which the principal use  %involves, will involve, or is reasonably likely to involve, "subscriberbased" (commercial)  %p services, and (2) those using, or intending to use, MAS spectrum to provide for their own internal  %communications needs. Theoretically, it is also possible that an entity could fall into both categories. The spectrum uses in the two categories differ markedly.  X0  0!7.44With respect to the first category, neither the Commission nor the Small Business  %Administration (SBA) has developed a specific definition of small entities applicable to MAS  %0 licensees that provide commercial subscription services. The applicable definition of small entity  %in this instance appears to be the definition under the SBA rules applicable to establishments  %Pengaged in radiotelephone communications. This definition provides that a small entity is any  XT0 %entity employing fewer than 1,500 persons. See 13 C.F.R.  121.201, Standard Industrial  %Classification (SIC) Code 4812. The 1992 Census of Transportation, Communications and  %Utilities, conducted by the Bureau of the Census, which is the most recent information available,  %Pshows that only 12 radiotelephone firms out of a total of 1,178 such firms operated during 1992  %had 1,000 or more employees. Therefore, whether or not any or all of these 12 firms are MAS"%v,-(-(ZZ@ "  %commercial service providers, nearly all MAS commercial service providers are small businesses  %`by the Small Business Administration's definition. The Commission's licensing database  %indicates that, as of November 8, 1996, there were a total of 8,171 MAS station authorizations. Of these, 1087 authorizations were for common carrier service.  X0  0!8.44Alternatively, under the SBA rules, the applicable definition of small entity for MAS  %@ licensees that provide commercial subscription services may also be applicable to establishments  %0primarily engaged in furnishing telegraph and other message communications. This definition  XH0 %0provides that a small entity is an entity with annual receipts of $5 million or less. See 13 C.F.R.  %121.201, Standard Industrial Classification (SIC) Code 4822. 1992 Census data, which is the  %most recent information available, indicates that, of the 286 firms under this category, 247 had  X 0 %annual receipts of $ 4.999 million or less.dw u X~ 0 %ԍ#o\  PC+XP# 1992 Economic Census Industry and Enterprise Receipts Size Report, U.S. Bureau of the  %pCensus, U.S. Department of Commerce, Table 2D, SIC Code 4822 (industry data prepared by the Census Bureau under contract to the U.S. SBA Office of Advocacy).d We seek comment on whether the appropriate definition for such MAS licensees is SIC Code 4812, SIC Code 4822, or both.  X 0  0!9.44The Commission seeks comment on the number of small entities that currently provide  %commercial MAS subscription service, and the number of small entities that would anticipate  X0 %filing applications to provide such service under the various proposals described in the Notice.  %PWe seek comment on whether we should conclude, for purposes of the Final Regulatory  %Flexibility Analysis in this matter, that all MAS commercial communications service providers are small entities.  X!0  `10.` ` With respect to the second category, which consists of entities that use or seek to  %use MAS spectrum to provide for their own internal communications needs, we note that MAS  %serves an essential role in a range of industrial, business, land transportation, and public safety  % activities. These radios are used by companies of all sizes operating in virtually all U.S. business  %0categories. Because of the array of users, the Commission has not developed (nor would it be  % possible to develop) a definition of small entities specifically applicable to such MAS users. Nor  %pis there a precise SBA definition. In this context we again seek comment on the whether the  %appropriate definition of small entity under the SBA rules is that applicable to radiotelephone  Xi0 %companies: any entity employing fewer than 1,500 persons. See 13 C.F.R.121.201, Standard  %Industrial Classification (SIC) Code 4812. Again, alternatively, we seek comment on the  % appropriateness of defining such MAS licensees under SIC Code 4822, concerning establishments  %@primarily engaged in furnishing telegraph or other message communications, or perhaps under  %both Codes 4812 and 4822. For the purpose of determining whether a licensee is a small  %business as defined by the Small Business Administration, each licensee would need to be  %evaluated within its own business area. The Commission's licensing database indicates that, as  %of November 8, 1996, of the 8,171 total MAS station authorizations, 7,084 authorizations were for private radio service, and of these, 426 were for private mobile service. ""&Kw,-(-(ZZ#"Ԍ X0  `11.` ` We seek comment on the number of small entities that use MAS spectrum for their  %`internal communications needs. Further, we seek comment on the number of small entities that  X0 %are likely to apply for licenses, under the various proposals described in the Notice, to obtain  % spectrum for their own internal communications needs. Because any entity engaged in a business  X0 % or commercial activity is eligible to hold an MAS license, the proposals in the Notice could  % prospectively affect any small business in the United States interested in using MAS for its own  %pcommunications needs. In other words, the universe of prospective or possible MAS users includes all U.S. small businesses.  X50 12.` ` The RFA also includes small governmental entities as a part of the regulatory  X 0 %flexibility analysis.fx u X 0#o\  PC+XP#э 5 U.S.C.  601(5).f The definition of a small governmental entity is one with populations of  X 0 %fewer than 50,000.Yy yu X10#o\  PC+XP#э Id.Y There are 85,006 governmental entities in the nation.z ,u X0#o\  PC+XP#э 1992 Census of Governments, U.S. Bureau of the Census, U.S. Department of Commerce. This number  %p includes such entities as states, counties, cities, utility districts and school districts. There are no  % figures available on what portion of this number has populations of fewer than 50,000. However,  %this number includes 38,978 counties, cities and towns, and of those, 37,566, or 96 percent, have  X 0 %@ populations of fewer than 50,000._{ u X90#o\  PC+XP#э Id._ The Census Bureau estimates that this ratio is approximately  %accurate for all governmental entities. Thus, of the 85,006 governmental entities, we estimate that 96 percent, or 81,600, are small entities that may be affected by our rules.  XO0 13.` ` Again, we have requested comment, supra, regarding the establishment of a refined  X:0 % small business definition for MAS for the purpose of competitive bidding. This Notice does not propose any specify definition, but merely seeks comment on this issue.  X0 E.Reporting, Recordkeeping, and Other Compliance Requirements:  X0 P14.` ` If we use competitive bidding to award certain MAS licenses, as proposed, and  %@also establish a small business definition for the purpose of competitive bidding, then all small  %businesses that choose to participate in these services will be required to demonstrate that they  X0 %meet the criteria set forth to qualify as small businesses. See generally 47 C.F.R. Part 1,  % SubpartQ (competitive bidding proceedings). Any small business applicant wishing to avail itself  %of small business provisions will need to make the general financial disclosures necessary to establish that the small business is in fact small.  X0 15.` ` If this occurs, prior to auction each small business applicant will be required to  %submit an FCC Form 175, OMB Clearance Number 30600600. The estimated time for filling"'{,-(-(ZZ@ "  %0out an FCC Form 175 is 45 minutes. In addition to filing an FCC Form 175, each applicant must  %submit information regarding the ownership of the applicant, any joint venture arrangements or  %@bidding consortia that the applicant has entered into, and financial information which  % demonstrates that a small business wishing to qualify for installment payments and bidding credits  %is a small business. Applicants that do not have audited financial statements available will be  %P permitted to certify to the validity of their financial showings. While many small businesses have  %0 chosen to employ attorneys prior to filing an application to participate in an auction, the rules are  %proposed so that a small business working with the information in a bidder information package  %can file an application on its own. When an applicant wins a license, it will be required to  X10 %submit an FCC Form 494 (common carrier) or FCC Form 402 (private radio), which will require  %technical information regarding the applicant's proposals for providing service. This application  %will require information provided by an engineer who will have knowledge of the system's  %0design. (Also, the Commission is currently developing a single, consolidated MAS form, FCC Form 415, which will eventually supersede both Form 494 and Form 402.)  X 0 F.Federal Rules That May Duplicate, Overlap, or Conflict With the Proposals:  Xy016.` ` None.  XK0 ""  G.Significant Alternatives Minimizing the Impact on Small Entities Consistent with the  X40Stated Objectives:  X0 `17.` ` The Notice solicits comment on a variety of proposals, some of which are  % described below. Any significant alternatives presented in the comments will be considered. As  X0 %0noted, we have requested comment, supra, regarding the establishment of a small business  %definition for MAS. We also seek comment generally on the existence of small entities in MAS  %Pand how many total entities, existing and potential, would be affected by the proposed rules in  X0 %the Notice.  Finally, we request that each commenter identify whether it is a "small business"  X0 %punder either of the two SBA definitions described supra  either employing fewer than 1500  %0employees (for radiotelephone communications companies) or having annual receipts of $5 million or less (for telegraph or other message communications companies).   X(0  18. ` ` The Commission expects that licensing subscriberbased MAS bands by geographic  X0 %area, as proposed, will assist small businesses. As described supra, such licensing makes  %expansion of operations easier, and this flexibility assists all licensees, including small business  % licensees. We also believe that the proposed EA geographic area service area is large enough to  %@support the services contemplated while being small enough to be attractive to small business  X!0 %entities. The Notice also proposes a purely private allocation for licenses using MAS solely for  %internal uses. In addition, the proposed flexible approach to the buildout of MAS systems will  % assist licensees, including small business licensees, in designing and implementing their particular  %business plans, while the partitioning and disaggregation proposals will assist those small  %businesses that might otherwise be unable to acquire a "full" license as currently configured.  %0 Finally, we believe that the proposed spectrum auction will assist small entities desiring to obtain  %MAS licenses. This approach gets licenses to those most likely to use them most effectively. "/'({,-(-(ZZP("  %By contrast, when awarding licenses by lotteries it is only coincidental when the license is  %0awarded to the entity best suited to using the license. Using lotteries, therefore, creates  %` uncertainty for all wouldbe licensees, including those that are small business. We seek comment  X0 %@ on all proposals and alternatives described in the Notice, and the impact that such proposals and alternatives might have on small entities.