HAROLD FURCHTGOTT-ROTH AND MICHAEL POWELL
Approving in part, Dissenting in part
|Re:||The Establishment of Policies and Service Rules for the Mobile Satellite Service in the 2 GHz Band, FCC 00-302, IB Docket No. 99-81, Report and Order (Rel. August 25, 2000).|
We support today's decision to promulgate service rules for Mobile Satellite Service (MSS) in the 2 GHz band. Many of the proposed service providers in this band have been waiting years to get underway. We are pleased that these providers will soon be competing in the marketplace.
We are concerned, however, about the decision to adopt a specific mechanism for determining eligibility for spectrum set-aside for service to rural areas. Conceptually, we are intrigued by the possibility of making additional spectrum available to providers who can demonstrate a meaningful commitment to providing service in underserved areas.(1) However, the United States has never before pursued a satellite licensing approach that rewards a provider with additional spectrum based on a service commitment. In assessing such a new initiative, it seems to us that the Commission has an obligation to weigh carefully the policy implications of any particular approach and to vet fully our proposals with the public. Here, we are concerned that the majority has rushed to judgment in an effort to proclaim that the FCC is "doing something" for underserved areas - in reality that "something" appears to be almost nothing.
This decision to adopt specific qualifying criteria for the set-aside spectrum is based on a virtually non-existent record. The gap in the record is understandable, since the parties were never provided with a clear opportunity to comment on any specific qualifying criteria. Instead, the Notice only sought "guidance" on "any policies or rules we could implement (or forebear from) to encourage 2 GHz MSS service to [unserved, rural, insular, or economically isolated] areas."(2) While the Notice did seek comments relating to providing incentives for service to rural and unserved communities,(3) it did not even address the idea of having a spectrum set-aside, how much the set-aside should be or how providers could qualify for the "extra" spectrum. As a policy matter, we do not believe that such a vague request provided sufficient notice to the parties that such a specific and detailed decision would be forthcoming.(4) The American people would be better served by promulgating a further notice to assess the efficacy of any particular approach. This agency is embarking in a potentially transformative new policy direction - more spectrum in exchange for service commitment quotas to targeted areas. We owe it to all the parties and the public to develop a full record before we proceed.(5)
We are also concerned that the qualifying criteria in the Order will not actually achieve the Commission's stated goals.(6) Under the Order, when a service provider demonstrates to the Commission that it has reserved and contracted to use 10 percent of its U.S. capacity to serve rural and underserved areas, the Commission will notify other service providers that it will begin accepting applications for the set-aside expansion spectrum.(7) Once all the applications are filed, the set-aside spectrum is to be divided evenly among the qualifying licensees. The "demonstration" requires only service contracts. There is no requirement that the system initially provide any service to rural areas. Nor is there any requirement that the qualifying system provide any particular level of service in the future. The only requirement is that 10 percent of the capacity on the system be reserved and contracted for this use. Under this standard, it appears that a ubiquitously available service, such as one that could be received on aircraft, would qualify based on its service to rural areas. In short, it appears that virtually every licensee will qualify for a sliver of the set aside spectrum, without anyone necessarily providing the desired amount of service to rural and underserved areas.
We applaud the Commission's efforts to explore how satellite services can be used to meet the communications demands of underserved and unserved areas. However, in embarking on this mission, we believe we have an obligation to ensure that our press release promises meaningfully correspond to our promulgated policies.
1 See 47 U.S.C. § 151; Order at ¶¶ 31-35.
2 See The Establishment of Policies and Service Rules for the Mobile Satellite Service in the 2 GHz Band, Notice of Proposed Rulemaking, IB Docket No. 99-81, 14 FCC Rcd 4843, ¶ 95 (1999).
3 See id.
4 It is also not completely clear that the Notice was legally sufficient. See Fertilizer Inst. v. EPA, 935 F.2d 1303, 1311 (D.C.Cir.1991) (holding 5 U.S.C. 553(b)(3) to mean that "an agency's notice must provide sufficient detail and rationale for the rule to permit interested parties to comment meaningfully."); Horsehead Resource Development Company, Inc. v. Browner, 16 F.3d 1246, 1268 (D.C. Cir. 1994) (stating that an agency is obligated to "describe the range of alternatives being considered with reasonable specificity. Otherwise, interested parties will not know what to comment on, and notice will not lead to better-informed agency decision-making.") (internal quotation marks and citation omitted).
5 Certainly, we are sensitive to the need of making use of the spectrum as quickly as possible. By addressing the set-aside and eligibility in a further notice, however, even under the majority's approach the Commission could still provide immediate access to almost 90 percent of the spectrum, but could also ensure that the last piece of "expansion" spectrum is distributed fairly without undue regulatory constraints or requirements. Indeed, the majority is not even accepting applications for the expansion spectrum until one year after the first 2 GHz MSS authorization is issued; plenty of time to provide adequate notice. There are also readily available alternatives that would make all of the spectrum available for licensing immediately, while allowing us to consider meaningful incentives for service to rural areas. For example, a further notice could have explored the use of rural service incentives for the redistribution of "abandoned" spectrum. As the Order provides, "there is a probability that additional spectrum will become available as some authorized systems are not able to implement service." Order at ¶ 18. But the item does not establish a policy for the redistribution of abandoned or forfeited spectrum. It seems to push that off to a further proceeding. A further notice would have had at least two additional benefits: (1) it would get the ball rolling on establishing a policy for the redistribution of abandoned spectrum, with the potential of making it available to those truly motivated to serve rural areas; and (2) even if only one applicant dropped out, this process would consider more spectrum (3.88 MHz vs. 3.5 MHz) than the majority's set aside approach. This would also avoid holding hostage the sliver of "expansion" spectrum for a second processing round involving an uncertain and prolonged review of service contracts by the FCC more than a year from now. And, based on the comments about their current business plans, almost all applicants could eventually get the spectrum anyway since they are planning to serve these areas. See id. at ¶ 33.
6 See, e.g., id. at ¶ 32.
7 See id. at ¶¶ 35-38. However, requests for expansion spectrum will not be accepted until one year after the first 2 GHz system is authorized. Id. at ¶ 38.