[Senate Hearing 106-1120]
[From the U.S. Government Printing Office]



                                                       S. Hrg. 106-1120

      S. 2454, WIRELESS HIGH SPEED INTERNET ACCESS FOR RURAL AREAS

=======================================================================

                                HEARING

                               before the

                     SUBCOMMITTEE ON COMMUNICATIONS

                                 OF THE

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 14, 2000

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation

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                            WASHINGTON : 2003
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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                     JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
SLADE GORTON, Washington             JOHN D. ROCKEFELLER IV, West 
TRENT LOTT, Mississippi                  Virginia
KAY BAILEY HUTCHISON, Texas          JOHN F. KERRY, Massachusetts
OLYMPIA J. SNOWE, Maine              JOHN B. BREAUX, Louisiana
JOHN ASHCROFT, Missouri              RICHARD H. BRYAN, Nevada
BILL FRIST, Tennessee                BYRON L. DORGAN, North Dakota
SPENCER ABRAHAM, Michigan            RON WYDEN, Oregon
SAM BROWNBACK, Kansas                MAX CLELAND, Georgia
                  Mark Buse, Republican Staff Director
            Martha P. Allbright, Republican General Counsel
               Kevin D. Kayes, Democratic Staff Director
                  Moses Boyd, Democratic Chief Counsel
                                 ------                                

                     SUBCOMMITTEE ON COMMUNICATIONS

                    CONRAD BURNS, Montana, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
SLADE GORTON, Washington             DANIEL K. INOUYE, Hawaii
TRENT LOTT, Mississippi              JOHN F. KERRY, Massachusetts
JOHN ASHCROFT, Missouri              JOHN B. BREAUX, Louisiana
KAY BAILEY HUTCHISON, Texas          JOHN D. ROCKEFELLER IV, West 
SPENCER ABRAHAM, Michigan                Virginia
BILL FRIST, Tennessee                BYRON L. DORGAN, North Dakota
SAM BROWNBACK, Kansas                RON WYDEN, Oregon
                                     MAX CLELAND, Georgia


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on June 14, 2000....................................     1
Statement of Senator Breaux......................................    17
Statement of Senator Burns.......................................     1
Statement of Senator Stevens.....................................     2
Statement of Senator Wyden.......................................     3

                               Witnesses

Mosely, Dean M., President and CEO, AccelerNet...................    20
    Prepared statement with attachments..........................    22
Morton, Larry, Director, Community Broadcasters Association......    33
    Prepared statement...........................................    35
Popham, James J., Vice President/General Counsel, Association of 
  Local Television Stations, Inc. (ALTV).........................    38
    Prepared statement...........................................    40
Stewart, Roy, Chief, Mass Media Bureau, Federal Communications 
  Commission, accompanied by Dale N. Hatfield, Chief, Office of 
  Engineering and Technology, Federal Communications Commission..     4
    Prepared statement...........................................     6

                                Appendix

O'Connell, Maureen, Fox Broadcasting Company, letter with 
  attachments dated June 28, 2000, to Hon. Conrad Burns..........    49

 
      S. 2454, WIRELESS HIGH SPEED INTERNET ACCESS FOR RURAL AREAS

                              ----------                              


                        WEDNESDAY, JUNE 14, 2000

                                       U.S. Senate,
                            Subcommittee on Communications,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 9:30 a.m. in 
room SR-253, Russell Senate Office Building, Hon. Conrad Burns, 
Chairman of the Subcommittee, presiding.
    Staff members assigned to this hearing: Lauren Belvin, 
Republican Senior Counsel; Maureen McLaughlin, Republican 
Counsel; Paula Ford, Democratic Senior Counsel; and Alfred 
Mottur, Democratic Counsel.

            OPENING STATEMENT OF HON. CONRAD BURNS, 
                   U.S. SENATOR FROM MONTANA

    Senator Burns. Good morning. The Subcommittee on 
Communications of the Committee on Commerce, Science, and 
Transportation will come to order.
    The topic today is wireless high speed Internet access for 
rural America. Today's hearing will focus specifically on S. 
2454, the Low Power Television Internet Act, which I introduced 
with Senator Breaux. The Burns-Breaux bill would allow lower 
power television stations the flexibility to use their spectrum 
for wireless two-way high speed Internet service.
    The pace of broadband deployment in rural America must be 
accelerated for the electronic commerce to meet its full 
potential. I am aware of the recent discussion regarding the 
digital divide, and I am very concerned that the pace of 
broadband deployment is greater in urban areas than in rural 
areas. The Internet has transformed the way we live, we work, 
we conduct our commerce and educate our children. It is without 
a doubt the engine that is driving the new economy. It has been 
the single greatest contributor to the extension of this 
economic cycle that we have ever known.
    One look at the stock market clearly indicates that the new 
economy is fueling much of the current economic expansion, even 
though we have been through rough times here of late. I firmly 
believe the historic Telecommunications Act of 1996 also has 
helped foster that kind of growth and innovation that we are 
witnessing in the communications industry today.
    It was once said that every child in America would have to 
learn how to read, write, and do 'rithmetic to stand a chance 
to succeed. Now we have to add surf the net to that list. 
Unfortunately, millions of Americans, many in my home State of 
Montana, are being left behind because they live too far from 
the urban centers to get wired. As I have often said, there is 
a lot of dirt between light bulbs in my State of Montana. 
Wiring these folks is an expensive proposition whether it is 
DSL technology or cable modem access to the Internet. This 
leaves large areas in my State of Montana left behind.
    This legislation will bridge that digital divide by 
utilizing the spectrum of low power television stations to 
provide two-way wireless Internet service. We can bring low 
cost high speed Internet access to many rural areas, who are 
anxiously awaiting high speed service for their homes and, of 
course, their businesses.
    The recent history of telecommunications aptly illustrates 
that demand and usefulness of wireless access. Wireless 
telecommunication has been an enormous benefit to the American 
economy. Wireless Internet access will be even more beneficial 
as the useful components of two wired services. The use of low-
powered television station spectrum to provide low cost high 
speed Internet access will facilitate the best use of their 
facilities, provide a market acceptance to the stations' need. 
The FCC is required to ensure that this service will not in any 
way interfere with other users of the spectrum.
    The legislation will allow these stations to provide two-
way wireless digital service to areas that may not otherwise be 
served. It will provide another option to rural schools, 
libraries, and hospitals trying to provide the best service for 
their rural constituents.
    The technology is here today to bring Americans fully into 
the digital era. I look forward, working with my colleagues, to 
move this bill out of committee and into final passage, and I 
have always said from the word go that I never thought years 
ago that there would be competition for rural telephones, the 
cooperatives and the independents, the small independents, but 
now I have changed my tune on that. I think wireless is going 
to be a competitor of those companies in rural areas, and I 
would also suggest that the only way that we can speed access 
to high speed Internet is wireless in rural areas, that they 
never will be wired really for the next generation.
    So with that, I have my good friend here from Alaska who 
represents a frontier State, not just rural. Senator Stevens.

                STATEMENT OF HON. TED STEVENS, 
                    U.S. SENATOR FROM ALASKA

    Senator Stevens. Thank you, Mr. Chairman. I was pleased to 
meet Mr. Mosely with you when we were in Montana recently and, 
as you say, this system might work in Alaska.
    I am concerned about the statements I have heard from the 
National Association of Broadcasters and the public television 
stations that they fear that this extension of rights to the 
low power television stations could interfere with their 
existing service or when they make the modifications that are 
required to go into the new mode of service.
    I do hope that we can work that out and make certain that 
we work it out in this legislation and not leave it to 
interpretation of the FCC or the courts as we move forward. But 
I am pleased to be with you and to tell you that I do think 
that this service could improve the lives of many people in 
very remote parts of our State. The distances in Alaska that 
people here do not even comprehend, could be addressed by this 
technology and so I look forward to working with you on the 
bill.
    Senator Burns. Thank you, Senator, and the concerns you 
raise are also concerns of our own, and that is the reason we 
have two of the probably most capable people that have devoted 
their lives to the Federal Communications Commission and 
probably are more knowledgeable on this than anybody else here 
today to speak with us.
    Senator Wyden.

                 STATEMENT OF HON. RON WYDEN, 
                    U.S. SENATOR FROM OREGON

    Senator Wyden. Thank you, Mr. Chairman. I want to commend 
you, Mr. Chairman, because once again you are initiating an 
extremely important effort. In this case, you are opening the 
door to what looks to be a very promising new technology, 
access to high speed data services, particularly Internet 
access is, of course, extraordinarily important in today's 
information economy.
    Both you, Mr. Chairman, and Senator Stevens have noted not 
just today but on many other occasions that rural communities 
are frequently left stranded on the wrong side of the digital 
divide. It is very important that we look at every possibility 
for delivering high speed data services to rural communities at 
affordable prices.
    At the same time, I think we do need to examine the issue 
of broadcast spectrum. Because it is limited we need to examine 
carefully the potential effects on this bill on the other 
services that use the spectrum, and so I look forward to 
examining the impact this bill would have on providers or 
consumers of free over-the-air broadcast services, including 
broadcasters who provide local programming or bring television 
signals to rural areas that otherwise may get no reception.
    So this is an important hearing and, as always, an issue 
like this involves potential benefits and trade-offs, and so 
often we have been able to come up with solutions with respect 
to these issues that are bipartisan and balance the competing 
interests and work for our communities. I look forward to 
working with you, Mr. Chairman and, of course, Chairman Stevens 
on this issue that is so important to rural areas.
    Senator Burns. Thank you very much, Senator Wyden. We have 
with us this morning Mr. Roy Stewart, who is the bureau chief 
of the Mass Media Bureau at the Federal Communications 
Commission, and we look forward to hearing your testimony this 
morning, Mr. Stewart. We know that some areas have to be 
massaged and language has to be massaged in this thing and we 
are certainly looking forward to your views on that. Thank you 
for coming down this morning.

  STATEMENT OF ROY STEWART, CHIEF, MASS MEDIA BUREAU, FEDERAL 
  COMMUNICATIONS COMMISSION, ACCOMPANIED BY DALE N. HATFIELD, 
     CHIEF, OFFICE OF ENGINEERING AND TECHNOLOGY, FEDERAL 
                   COMMUNICATIONS COMMISSION

    Mr. Stewart. Thank you, Mr. Chairman. I would like to 
summarize my testimony and then place the joint statement of 
Mr. Hatfield and myself in the record.
    I am Roy Stewart, Chief of the Mass Media Bureau at the 
Federal Communications Commission. Accompanying me today is 
Dale Hatfield, Chief of the FCC's Office of Engineering 
Technology. I welcome this opportunity to discuss low power 
television and legislation S. 2454, intended to authorize low 
power television stations to provide digital data services.
    S. 2454 presents both intriguing possibilities and some 
significant concerns. It would authorize low power television 
stations to provide an unlimited subscription-based data 
service on their broadcast television channel without regard to 
the broadcast nature of their authorization.
    It would also preclude the commission from authorizing any 
new service, television broadcast station, or modification of 
any existing authority that would result in the displacement of 
or predicted interference with a low power television station 
providing such services. This innovative approach would permit 
low power television stations to provide broadband services, 
including one-way and two-way high speed Internet access that 
could be of particular value where such access is otherwise 
unavailable or severely limited in such very rural areas.
    As a general matter, of course, providing broadband access 
to as many people as possible on reasonable terms is a goal the 
commission has made one of its higher priorities. Indeed, the 
commission has numerous initiatives underway intended to 
address this issue. Dale Hatfield is directly involved in many 
of these efforts and can address any questions you may have in 
this area. The use of LPTV stations as a means of achieving 
this objective, however, at least as it is now described in S. 
2454, does raise issues that require careful consideration.
    Let me just briefly describe the low power television 
service, and then turn to the specific concerns that we have 
identified in the proposed legislation.
    As Chief of the Mass Media Bureau, and in my former 
position as Chief of the Video Services Division, I have been 
involved with low power television since its inception. It has 
always offered great possibilities for additional service to 
the public, and has often provided innovative highly local 
programming not easily provided by full service broadcasters. 
It has also been a service that was subject to displacement by 
others because of its secondary status.
    There are currently 2,100 licensed low power TV stations. 
These operate in 1,000 communities of all sizes, and in all 50 
States. They are operated by such diverse entities as schools, 
churches, community groups, and a variety of small businesses. 
Many low power television stations serve as a community's only 
local TV station and provide coverage of local news, weather, 
community affairs, and local elections. The low power 
television service also includes more than 4,500 television 
translator stations, the majority of which operate in the 
western mountainous States.
    Many rural communities in these areas depend upon 
translators as the only means of obtaining free television 
programming. Both the commission and the Congress have 
recognized that there is insufficient spectrum to guarantee the 
operation of all low power TV and translator stations during 
the transition to the new digital television service, which 
involves the temporary awarding of a second TV channel to more 
than 1,600 broadcast stations.
    The FCC has changed its rules where it can to reduce the 
impact of the digital transition on the low power TV service, 
including permitting stations displaced by interference 
conflicts to seek replacement channels on a noncompetitive 
basis.
    In the Community Broadcast Protection Act of 1999, the 
Congress also acted to preserve the services of low power TV 
stations that have provided locally produced programming in 
their communities. This statute provided for the creation of a 
Class A low power TV service affording qualifying low power TV 
stations with a measure of primary status, that is, some of the 
protections afforded full service stations.
    The bureau has recently released a public notice granting 
to some 900 low power TV licensees eligibility to file Class A 
licenses, and we are now receiving those applications.
    Against this backdrop, let me now turn to a brief 
description of some of the significant concerns that I believe 
are raised by S. 2454 as introduced. First, the bill would 
apparently permit a low power TV station to totally eliminate 
its broadcast service and convert to an all-data format. In 
some cases this could result in the withdrawal of broadcast 
service in areas with access to very few such services.
    It could also have a serious impact on the availability of 
channels for translator-based broadcast services because 
existing translators would convert to nonbroadcast data mode, 
and applications for new translators would lose in any 
licensing contest with datacasting low power stations because 
the translators would be viewed as secondary facilities. 
Translators will continue to be needed to bring digital 
television to rural areas during the DTV transition.
    Affording low power TV stations primary status based on a 
conversion to data delivery also seems at odds with the 
determination made by Congress in the Community Broadcast 
Protection Act that the uniquely valuable broadcast service of 
low power TV stations was a fundamental reason for providing 
these stations with Class A protection status.
    Finally, this approach seems hard to reconcile with the 
provisions of section 336 of the Communications Act. That 
section provides in part that full service broadcast stations 
must limit their ancillary services, such as datacasting, so as 
to avoid derogation of their broadcast signal. The Commission 
has implemented this section by requiring full service 
broadcast television stations to provide at least one full 
channel of broadcast service before they can offer ancillary 
services such as datacasting on their digital stations.
    Second, the bill as drafted has serious implications for 
and may undermine the transition to digital television service. 
For example, it does not specifically provide protection to the 
table of allotments of full service DTV stations which was 
adopted by the commission to permit existing analog stations to 
operate digitally while continuing to broadcast on their analog 
channel.
    Nor would the bill permit necessary adjustments by the 
commission to that table, as the transition to digital service 
proceeds. Thus, a datacasting LPTV station could preclude a 
change in the digital channel assignment of an analog 
broadcaster that might be necessary to permit the analog 
station to provide digital service.
    Some of these issues we have raised may be addressed but 
not fully resolved by an approach that was taken in the 
Community Broadcasters Protection Act. That statute provided 
for protection of the digital television table of allotments 
which allowed the commission to continue the reclamation of 
spectrum for new broadband services. That approach expressly 
afforded the commission the flexibility necessary to adjust the 
table as needed during the digital transition.
    Third, because S. 2454 would afford datacasting LPTV 
stations with primary spectrum rights, these stations would 
have a significant preclusive effect on future full service 
digital television stations. A similar preclusive effect was 
permitted under the Class A legislation, but in that case, 
unlike here, the LPTV station being protected was providing 
broadcast service.
    There are various additional issues that the bill presents 
as well. For example, there is no commission application and 
approval process, and no mechanism for objecting parties, 
including individuals and local communities, to raise concerns. 
Moreover, the enumeration of the interference rights and 
obligations of datacasting LPTV stations is incomplete. It is 
not clear, for instance, whether a datacasting LPTV station is 
required to protect future Class A low power TV stations or 
existing non-Class A low power TV stations, translators, and 
mobile radio stations operating on television channels 14 to 
20.
    Finally, as introduced, S. 2454 does not limit datacast 
operations to the core television channels of 2 to 51.
    In conclusion, we agree with the objective to facilitate 
broadband deployment in rural America. However, the approach 
taken in S. 2454 as introduced could undermine the digital 
transition, eliminate spectrum for new broadband services, and 
potentially decrease the availability of free over-the-air 
television in rural America.
    We look forward to working with you, Mr. Chairman, to 
address the critical issues of broadband deployment in rural 
America.
    Thank you, Mr. Chairman, for the opportunity to appear here 
today. This concludes my testimony, and Mr. Hatfield and I 
would be pleased to answer any questions you may have.
    [The prepared statement of Mr. Stewart and Mr. Hatfield 
follows:]

 Prepared Statement of Roy Stewart, Chief, Mass Media Bureau, Federal 
   Communications Commission and Dale N. Hatfield, Chief, Office of 
     Engineering and Technology, Federal Communications Commission

Introduction
    Good morning, Mr. Chairman, and Members of the Subcommittee. My 
name is Roy Stewart, Chief, Mass Media Bureau, Federal Communications 
Commission (FCC). I am accompanied by Dale Hatfield, Chief of the FCC's 
Office of Engineering and Technology. We welcome this opportunity to 
discuss the importance of broadband deployment in rural areas. There is 
no question that this in an important issue that needs to be addressed. 
At the Commission, we have made it a top priority.
    The Internet and the capability to transmit large quantities of 
data at very high speeds are transforming the telecommunications 
industry, and providing tremendous benefits to citizens around the 
world. We must make sure that the benefits of the communications 
revolution are experienced by all Americans. Those communities without 
access to broadband will be placed at enormous risk in the next 
century.
    Directly or indirectly, through our information and 
telecommunications sectors, the Internet is linked to one-third of our 
country's real economic growth. But for the Internet economy to develop 
to its full potential in our country, there must be an available, 
affordable broadband telecommunications infrastructure throughout the 
country. To bring everyone into the Information Age, we must make sure 
that rural America reaps the benefits of broadband. As Chairman Burns 
knows from his participation in our rural field hearings, the 
Commission has been actively working with consumers, industry, the 
states and other parts of the federal government to ensure and 
facilitate broadband deployment to every community. We have embarked 
upon a series of outreach hearings so that consumers and small 
businesses can tell us in their own words about the broadband 
challenge. The Commission adopted an order that is already providing us 
firm data on the status of infrastructure deployment, so we do not have 
to rely on anecdotal or incomplete information when examining the 
issue. The Commission has asked a Federal-State Joint Board to review 
services supported by universal service, and to help the FCC keep up 
with the changes in telecommunications. The FCC and state regulators 
are also creating a national database to store, monitor, and 
disseminate information on broadband deployment. This database will be 
available on the Internet and is intended to be a clearinghouse for 
local communities to share information about their broadband deployment 
projects. An interactive survey will allow local governments, private 
industry and schools to provide broadband information. The survey will 
be accessible at www.nrri.ohio-state.edu/broadbandsurvey.php. The 
database will be available at www.nrri.ohio-state.edu/
broadbandquery.php. Finally, the Commission is making spectrum 
available for wireless broadband and carving out a deregulatory zone 
for companies that want to deploy broadband in under-served markets.
    While we commend Chairman Burns for attempting to address the issue 
of broadband deployment in rural America, we have serious concerns 
about the provisions in S. 2454 which would require the FCC to protect 
from interference low-power television broadcasting stations providing 
digital data services. Specifically, we are concerned that, as 
introduced, the bill does not adequately protect the rollout of digital 
television service (DTV). In addition, the legislation as introduced 
would permit primary low-power television services to operate on 
spectrum that has been reclaimed and reallocated for new services, 
including public safety and commercial wireless broadband. This could 
adversely impact the ability of the Commission to auction this spectrum 
as mandated by the Congress and thus have an equally adverse budgetary 
impact. The legislation could also hinder the expansion of DTV services 
provided by TV translators to rural areas, particularly in the western 
mountainous states.

Spectrum Management
    Spectrum is a valuable and finite public resource that must be 
allocated and assigned in a manner that will provide the greatest 
possible benefit to the American public. The FCC's Office of 
Engineering and Technology is responsible for advising the Commission 
in carrying out its responsibilities for allocating the spectrum in the 
public interest. In order to do this, we must help to define policies 
that maximize the efficient use of the spectrum and promote the 
introduction of new services and technologies.
    Over time, technological advances, growth in user demand, and the 
finite nature of spectrum have made our spectrum management 
responsibilities increasingly complex. To address the continuing growth 
of demand for radio services, we have focused our approach to spectrum 
management on allowing spectrum markets to make more efficient use of 
frequency bands through new technologies and on increasing the amount 
of spectrum available for use. In addition, we have sought to encourage 
the development and deployment of new, more spectrum-efficient 
technologies that will increase the amount of information that can be 
transmitted in a given amount of bandwidth and allow greater use of the 
spectrum occupied by existing services wherever possible.

Digital Television Transition
    The efficiency of the digital television transmission standard has 
made it possible to reduce the amount of spectrum for television 
broadcasting while at the same time improving the quality of the 
service. The Commission provided a second channel for each existing 
full-service station to use for DTV service in making the transition 
from the existing analog, National Television System Committee (NTSC) 
TV technology to the new DTV technology. These second channels were 
provided to broadcasters on a temporary basis until the end of the DTV 
transition, which is currently scheduled for December 31, 2006. In 
developing the DTV channels, the Commission maintained the secondary 
status of TV translators and LPTV stations. The Commission also 
provided for recovery of a portion of the existing TV spectrum so that 
it can be reallocated to new uses. Specifically, the Commission 
provided for immediate recovery of channels 60-69 stations and for 
recovery of channels 52-59 at the end of the DTV transition.

The Low-Power Television Service
    Low-power television (LPTV) stations are broadcast stations that 
operate on the standard VHF and UHF television channels, but at much 
lower power levels than conventional TV stations. LPTV stations may 
retransmit programming received from other sources or originate their 
own television programming. LPTV stations may also transmit 
subscription television broadcast programs intended to be received by 
the public for a fee. LPTV stations are secondary to full-power TV 
stations, which means that they may not interfere with, and must accept 
interference from, conventional ``primary'' TV stations.
    The FCC created the LPTV Service in 1982 as a secondary service. 
The FCC believed that LPTV stations could increase television 
programming diversity in both urban and rural areas and that these 
stations would be particularly well suited to provide local 
programming.
    The LPTV Service also includes television translator stations. 
There are more than 4,500 licensed television translator stations, the 
majority of which operate in the western mountainous states. Many rural 
communities in these areas depend on translators as the only means of 
obtaining free television programming.
    Television translators rebroadcast the programs of full-service TV 
stations to geographic areas where full-service stations cannot be 
directly received. A translator generally receives the signal of a 
television station on one channel, amplifies it, and retransmits the 
signal on another channel. Translator stations may be converted to LPTV 
status at any time upon notification to the Commission.

The LPTV Service Today
    There are currently more than 2,100 licensed LPTV stations. These 
stations operate in more than 1,000 communities of all sizes and in all 
50 states. Station operators include such diverse entities as schools, 
colleges, churches, local governments, community groups and radio and 
TV broadcasters. The service has also provided first-time ownership 
opportunities to minority groups, women and a variety of small 
businesses. LPTV stations can be operated in a wide variety of ways. 
FCC rules do not require minimum hours of station operation or minimum 
amounts of locally produced programming. Some stations primarily 
retransmit programming imported from full-service television stations, 
satellites or other sources. Many others transmit locally oriented 
programming, including ``niche'' programming tailored to audiences with 
specific interests, as well as local news, weather, community affairs, 
local elections and events such as high school football games.

Digital Television Impact on LPTV
    Despite their secondary status, until the arrival of the digital 
television era, primary television stations had displaced few stations 
in the LPTV service. Where interference from LPTV to full power 
stations occurred, the LPTV affected stations were usually able to find 
a suitable replacement channel on which to operate using an FCC 
``displacement relief'' provision. That provision permits stations with 
an interference conflict to seek replacement channels at any time on a 
noncompetitive, ``first-come'' basis.
    The prospects for LPTV service disruption are increased by the 
emergence of DTV service. The FCC concluded in its DTV proceeding that 
there was insufficient spectrum to protect the existing services of 
secondary LPTV and translator stations and to provide a second channel 
for DTV service to more than 1,600 full-service stations during the 
transition to DTV. It also concluded that LPTV and translator stations 
would remain secondary, and therefore, must not interfere with DTV 
service. The Commission, however, provided several measures designed to 
mitigate the impact of the DTV transition on the LPTV service. The 
channel displacement relief provisions were extended to stations 
potentially affected by DTV and operating on channels 52-69. 
Applications for replacement channels were accorded the highest 
priority among applications in the LPTV service.
    In addition, several of the interference protection provisions have 
been eliminated or relaxed. LPTV and translator stations were afforded 
additional operating flexibility and permitted to negotiate 
interference agreements with other stations in the LPTV service and the 
Commission also expanded its policy of granting waivers of the 
interference rules based on consideration of terrain shielding. 
Further, the Commission has increased LPTV maximum power limits 
primarily to enable LPTV and translator stations to operate on channels 
adjacent to those of full power stations operating at the same 
location. Finally, the Commission modified more than 60 DTV allotments 
to eliminate conflicts with one or more LPTV stations.

S. 2454
    S. 2454, as introduced, seeks to create opportunities for LPTV 
stations to provide a variety of digital data services to subscribers, 
including one-way and two-way high speed Internet access, as well as to 
change the secondary status of those stations. As noted in our 
introduction, facilitating access to broadband technology is an 
important goal of Chairman Kennard and his fellow Commissioners, and 
the Commission has made substantial efforts in this regard. For 
instance, the Mass Media Bureau recently completed a comprehensive 
proceeding to enable two-way cellularized video and data communications 
in the Multipoint Distribution and Instructional Fixed Television 
Services. Our DTV rules also provide for the provision of data services 
on a supplementary or ancillary basis. Full-service television stations 
must provide a free video broadcast service of comparable quality to 
today's analog television, but may use their excess channel capacity 
for a variety of data services. The Commission has also created the 
Local Multipoint Distribution Service as another means of gaining 
access to broadband technology and has auctioned spectrum for such uses 
in the 24 GHz and 39 GHz frequency bands. Perhaps of greatest 
significance, the Congressional provisions for the reallocation and 
auction of approximately 20 percent of the television broadcast 
spectrum should create very substantial opportunities for new broadband 
services throughout the country.
    We are greatly concerned about the implications of S. 2454, as 
introduced, particularly its potential to hinder or even cripple the 
roll out of DTV service, eliminate spectrum for new broadband services, 
and potentially decrease the availability of free, over-the-air 
television in rural America.
    As introduced, S. 2454 provides that all LPTV stations may use 
their authorized broadcast channels to deliver data services to the 
public. The bill does not specify the amount of such service, nor does 
it appear to require LPTV stations to provide any free broadcast 
service. Presumably, all LPTV stations could provide Internet access 
either on a full-time basis, or to a very minimal extent. The 
Commission could not authorize new or modified broadcast facilities 
predicted to interfere with such LPTV stations. More than 2,100 LPTV 
stations are licensed to operate throughout the United States. 
Additionally, there are more than 4,500 licensed television translator 
stations that may convert their stations to LPTV status by a simple 
notification to the Commission. Thus, it is possible that thousands of 
stations could seek to qualify under the interference protections 
afforded by S. 2454. Significantly, the bill does not limit such 
protection to existing LPTV stations. The Mass Media Bureau recently 
announced an LPTV application filing window that will open later this 
summer. The window will geographically restrict where new LPTV and TV 
translator stations can be located. Its primary intent is to provide 
opportunities for translators to deliver additional TV programming 
services to rural communities, such as the new broadcast networks and 
the Fox network in some communities. This window could significantly 
increase the number of LPTV and potential LPTV stations in rural areas 
that could qualify for full interference protection under the LPTV 
datacasting provisions of S. 2454.
    The FCC concluded in its DTV proceeding that there was insufficient 
spectrum to protect the existing services of all secondary LPTV and 
translator stations and to provide a second channel for DTV service to 
more than 1,600 full-service stations. It also concluded that LPTV and 
translator stations must not interfere with DTV service and must accept 
interference from existing and future DTV stations. We believe it is 
well established that there is insufficient broadcast spectrum to 
accommodate thousands of LPTV stations with full interference 
protection without substantially impacting the transition to digital 
television, particularly in the rural areas. This is evidenced by the 
more than 1,800 channel displacement applications we have received from 
LPTV and translator licensees who believe they cannot continue to 
operate on their authorized channels, mainly due to conflicts with DTV 
service or channel allotments.

The Community Broadcasters Protection Act of 1999
    Congress recognized the spectrum impact and the paramount 
importance of protecting the digital transition when it enacted 
legislation to create the Class A LPTV service. On November 29, 1999, 
the President signed into law the ``Community Broadcasters Protection 
Act of 1999'' (CBPA). This new law created a Class A TV service which 
provides certain interference protections, but not full protection, for 
those LPTV stations that qualify by airing locally-produced programming 
in their communities and that will operate in the manner of full-
service television stations. Noting that not all LPTV stations could be 
guaranteed a certain future, the CBPA limited eligibility for Class A 
status to a very specific group of LPTV stations: those that were 
broadcasting television programming produced in their communities. The 
Mass Media Bureau recently issued a public notice granting Class A 
eligibility to more than 900 LPTV stations that certified compliance 
with the qualification thresholds of the CBPA. The Mass Media Bureau is 
also now accepting applications for these new Class A LPTV licenses. It 
is yet unclear, however, how many of these stations can meet the 
interference protection requirements of the CBPA to obtain Class A 
licenses. Further, the proposed legislation could permit stations that 
received their Class A status because of their commitment to local 
television programming to abandon that programming.
    In view of the complexities of the DTV rollout, Congress also found 
it necessary to limit the interference protections afforded to Class A 
stations by DTV stations. For instance, Congress stipulated a higher 
priority for certain application proposals to maximize (or enlarge) the 
service areas of DTV stations and provided DTV broadcasters the 
flexibility to make necessary adjustments to their facilities, 
including channel changes, without regard to protection of Class A LPTV 
stations. The Commission Report and Order implementing the CBPA further 
provided that Class A stations must protect and would not be protected 
from DTV operations on a broadcaster's assigned, in-core channel at the 
end of the transition period.
    S. 2454, as introduced, provides none of these necessary 
safeguards, nor is it even clear that the Commission could authorize a 
station on a broadcaster's allotted DTV channel under this bill if the 
proposed facilities would be predicted to interfere with a protected 
LPTV station. Nor does the bill clearly define the requirements of LPTV 
stations to protect full-service television stations and station 
proposals, for example, DTV allotments, authorized service, and pending 
requests for DTV channel changes.
    Even with the inclusion of the safeguards that were included in the 
Class A legislation, we believe that because of the much larger number 
of LPTV stations that would be protected, the current bill could affect 
the provision of television service, both analog and digital, in rural 
areas. If broadcasters convert their translators to LPTV service and 
then opt for protection under this legislation, many rural communities 
will lose free, over-the-air television services. Likewise, it is 
expected that DTV service will be delivered to many communities by 
television translator stations. Translator licensees will need 
additional channels for this purpose. We are concerned that entities 
seeking to provide LPTV data service will file applications in the 
forthcoming filing window and operate new LPTV stations that could 
preclude translator operators from obtaining channels for the 
rebroadcast of DTV stations.
    The Commission is committed to ensuring that spectrum use is 
flexible and put to the maximum possible use. Accordingly, when the 
public interest demonstrates that testing new technology and sharing 
arrangements are warranted, the Commission will seek to accommodate 
such situations. We have granted experimental licenses to stations 
interested in providing data services on a secondary basis. For 
example, in Houston, Texas, the Commission authorized as an experiment 
the testing of a digitally based interactive broadcast service using 
low-power television. Following a year and one-half period during which 
no interference to other broadcast services was encountered, we 
authorized the station to provide a one-way Internet service to limited 
subscribers on a secondary basis. In Alaska, we similarly authorized on 
a secondary basis the provision of Internet service to secondary 
schools. These types of requests must be reviewed on a case-by-case 
basis.
    Having to provide primary, interference-protected status to 
thousands of existing and potential LPTV stations would not be possible 
under the current proposed spectrum allocation for digital television. 
There simply is not enough room. The Commission would be forced to 
reduce the amount of spectrum being reclaimed for new services. This 
spectrum, the first segment of which is scheduled for auction in 
September of this year, has been allocated for advanced wireless 
services. FCC Chairman Kennard has repeatedly noted that this spectrum 
offers the potential for the third residential, two-way broadband pipe, 
a wireless pipe that will enable affordable broadband access, including 
to rural areas.

Conclusion
    In conclusion, we agree with the Committee's objective to 
facilitate broadband deployment in rural America. However, the approach 
taken in S. 2454, as introduced, could undermine the digital 
transition, eliminate spectrum for new broadband services, and 
potentially decrease the availability of free, over-the-air television 
in rural America. Nonetheless, we look forward to working with Chairman 
Burns, his staff and the Congress to address the critical issue of 
broadband deployment in rural areas. This concludes our testimony and 
we would be pleased now to answer your questions.

    Senator Burns. Thank you, Mr. Stewart. I appreciate your 
statement today, and I want to start off in the area which you 
have great concerns, and we do, too, to be right honest with 
you--is the technology there for separation, and then what we 
can get done.
    Your rules give broad authority to DTV stations to provide 
data services. In fact, your rules authorize DTV, digital 
television stations to provide any services other than video 
services. Your rules do not specify how the DTV stations may 
provide such services. You make no distinction between one-way 
wireless and two-way wireless. Is it true under this rule DTV 
stations can do exactly what LPTV stations can do under S. 2454 
as long as the DTV stations maintain its video service?
    Mr. Stewart. I would think that is a concern that we have, 
and it would appear to be so. Dale, do you agree?
    Mr. Hatfield. I want to make sure that I understand your 
question. What we are saying is that full power station would 
broadcast an NTSC-quality service and then could use the 
balance of the capacity for the data services. It was not clear 
in the bill whether the station, the low power station, that 
datacasting would have to also maintain the broadcast signal at 
the same time.
    Mr. Stewart. That is the difference we saw between the two, 
that it looks like the low power TV datacasting station could 
just do that, primarily, or all the time, whereas we have said 
that the digital TV station must maintain that one channel of 
free over-the-air broadcast service and use the extra spectrum 
that is available for ancillary and supplementing purposes, so 
there is that difference, Mr. Chairman.
    Senator Burns. OK, and I think we can work that out. Also, 
tell me, Mr. Hatfield, in the separation of the using of 
spectrum interference is still a concern of mine and also of 
yours. Could you just give me your idea on the problems we face 
there technologically?
    Mr. Hatfield. There is a couple, and for example, the 
traditional broadcast service is a one-way service, so as soon 
as you say, we are going to introduce the possibility of two-
way, where consumers would actually be then transmitting back 
to the broadcast station, if you will, that is, as we say, a 
different architecture. In that case we would have to develop 
rules to make sure that, in transmitting back to the broadcast 
station, the viewer does not cause interference to other 
services, or to other people nearby trying to watch the 
station.
    There are various ways--I mean, I do not want to 
overemphasize this, but there are various ways of accomplishing 
that, and we would need to think about rules that would 
implement the law. That is the primary thing.
    There is also, for example, the experimental licensee that 
has been using a different type of modulation than people are 
contemplating in terms of full digital television. There are 
some issues that us engineers have to worry about because of 
those differences, and so we would need to take them into 
account in the interference analysis.
    Senator Burns. But your main concern is in the area of the 
return signal?
    Mr. Hatfield. I do not want to overemphasize that, because 
some architectures would use spectrum in other bands for that 
return channel, and of course there the interference might be 
less, or conceivably could be more, but you would have to look 
at the architecture, how people intend to do it.
    Senator Burns. In terms of the digital television roll-out 
the Community Broadcasters Protection Act provided the FCC 
authority to displace a Class A LPTV station if necessary to 
implement digital television service. If we gave you a similar 
provision with respect to LPTV stations providing data 
services, would that not give you sufficient authority to 
ensure that DTV roll-out is not frustrated?
    Mr. Stewart. I think it is hard to make up all the 
possibilities that may arise, but I remember when I testified 
in the House about the establishment of a Class A service I 
suggested that we have some kind of safety net that the 
commission have to be able to adjust problems that arise, so I 
think that would be helpful.
    But I think one of the things, Mr. Chairman, that concerns 
me, there are 4,500 translators in the country. There is 
nothing to stop them tomorrow, if this statute gets adopted, to 
switch to low power television. They can just tell us they are 
now a low power television station. Rather than rebroadcasting 
the signal of a full service station, I elect to operate as a 
low power TV station, which then makes me qualified for the 
datacasting.
    The effect may be draconian in that those translators 
basically provide off-air broadcast services to the more remote 
areas of our country, and if they switched to datacasting--now, 
one could argue, let the public make that determination as to 
whether they want datacasting access or want the full over-the-
air broadcast services that each of the channels can give them 
on a translator.
    But one of the concerns that I have is that that may take 
place, and unless we put something in there, it is not just 
rural areas, but it is in any part of the country, where there 
are 4,500 translators.
    Or for that matter the low power stations that we have now, 
they could switch also, and instead of getting only local 
community broadcast service, or localism, or the status that we 
gave them--when I say we, the Congress and the commission--and 
created this Class A service because of the unique local 
programming that we did not want to see get knocked off the 
air, they could turn around and start datacasting, and we lose 
the benefits of the Class A status, and I do not know how you 
stop that.
    A safety net might help some aspects of the interference to 
the transition to digital television, but there is that 
fundamental concern that exists about losing the translators, 
the only way, unless you are going to have satellite delivered 
in some areas, to provide programming right now to a great 
number of the rural areas in our country, and I am sure you are 
aware of that.
    Senator Burns. Well, we are aware of it, and just like I 
say, we want to work with you in providing that language, and 
technically if we can do it, that is the next thing, without 
interfering.
    Senator Stevens.
    Senator Stevens. I regret that I have to leave very soon 
because of a markup in another committee, but the conflict on 
this bill is going to be more acute in my State than any place 
else. You said there were 2,100 of these low power stations 
now, right?
    Mr. Stewart. Yes.
    Senator Stevens. What is the cost to startup one of those? 
Do you have any idea?
    Mr. Stewart. I do not know. Keith, do you know what the 
cost is? Keith Larson is the senior engineer in the bureau. He 
is the Associate Bureau Chief for Engineering, and he says, 
what, about $100,000?
    Mr. Larson. $50,000 to $100,000.
    Senator Stevens. And there are churches and nonprofit 
groups, and then there are some that are local for-profit 
groups, but they are very local, right?
    Mr. Stewart. Yes.
    Senator Stevens. And this new concept now, this new DTV, if 
they apply to these low powered stations, would permit them to 
do both digital and their local broadcast service at the same 
time?
    Mr. Stewart. Well, not as we think is proposed in the bill 
right now. It is not clear that they still have to maintain 
some aspect of broadcast service.
    Senator Stevens. I am not asking whether they have to do 
it. I am asking could they do it.
    Mr. Stewart. I would expect so.
    Senator Stevens. What kind of investment does that take?
    Mr. Hatfield. I think it would be still roughly the same 
order of magnitude here, because the television signal then 
would just occupy part of this digital bit stream. If you think 
of the transmitter as a big pipeline with lots of bits, what it 
would mean was, some of those bits would be allocated to 
maintain a television-like service, or television service, and 
the balance of those bits then could be feeding to a personal 
computer, for example.
    Senator Stevens. And the service area would be roughly the 
same?
    Mr. Hatfield. Yes.
    Senator Stevens. As I understand what you said, Mr. 
Stewart, they could avoid interference with their own operation 
by just putting in a second band and taking the return signal 
into a different system.
    Mr. Hatfield. I am in a little bit of a quandary here. It 
is not clear to me exactly how different people might architect 
it, but one of the ways is just to use your telephone line for 
return, and then the outbound for the broadband services. 
Another is to use a different band like IVDS, which is another 
band we have set aside for the signal that goes up from the 
subscriber. Trying to actually accommodate two-way services 
within the broadcast band itself is probably the most difficult 
to configure, and that is what we would need to consider in our 
rules.
    Senator Stevens. Is there a theoretical yardstick for the 
area currently served by low power stations? How far out do 
they go from their station?
    Mr. Stewart. Well, I think it depends on the terrain. It 
could be 5, 10, 15 miles.
    Mr. Larson. 12 to 15 miles.
    Senator Stevens. So if I am in Fairbanks and I have an 
over-the-air station, a television station, public or private, 
and someone is out at the North Pole, roughly 12 miles away, 
they put up a low power station, there is a potential for 
interference, right?
    Mr. Stewart. Assuming--well, I think we would not authorize 
it if we knew there was going to be any interference.
    Senator Stevens. But you have already authorized a low 
power station out there. Now, if they convert, is there a 
different kind of interference?
    Mr. Stewart. The interference would not be to that full 
service station, I do not think, but the question would be, 
what would be the preclusionary effect on any digital channel 
we may have set aside for that full service station in terms of 
that channel?
    You see, what we do now, Senator, as you know, is low power 
TV stations and translator stations under the commission's 
rules are secondary services. If they cause any interference 
they have to either find a new channel, or they go off the air. 
It may be that that low power station, since it is operating 
now, is not causing any interference to the full service 
station, but it may be that there is a channel in the digital 
table that that television station is going to match up to for 
the transition, and there may be some interference problems 
with that channel. It is not on the air yet.
    Senator Stevens. But do we need some demonstration areas to 
determine that? I think low power stations fill a void, and it 
appears to me that they were started for a particular purpose, 
and now this would give them a chance to go into an entirely 
different course of business. I do not know, have we had any 
demonstrations of these yet?
    Mr. Hatfield. There is two issues there. I do not think 
that--I think we understand the basic propagation mechanisms 
and so forth. I do not think we need tests.
    Senator Stevens. I mean in the conversion area. Have you 
had any low power stations operating in an area where the 
existing over-the-air station is converting as they are 
authorized to do at this time?
    Mr. Stewart. And which resulted in interference? I am not 
aware of any. Those are in the major markets, the top 30 
markets.
    Senator Stevens. By definition, Mr. Stewart, Alaska is not 
in the top 30 markets. We are about 450, I think.
    Mr. Stewart. But our experience has only been in the top 30 
markets with generally operating DTV stations. I am sorry, the 
top 30, outside the top 30 stations have more time to get on 
the air, so our experience has not been in the areas you are 
talking about.
    Senator Stevens. Well, I do not have much time, but I am 
worried about an outfit that gets together $100,000 that is 
going to provide low power service, television service in an 
area that needs it for local information, local control, and 
suddenly it gets the right to convert and become a digital 
server for the Internet. What kind of capability do they need 
for that that they would not need to run that low power TV 
station?
    Mr. Hatfield. Basically the tower and the RF equipment. It 
does not care whether that digital bit stream is a television 
digital stream or data. Parts of it would, if it is analog 
today, have to be changed to handle the digital bit stream. 
Thus while there are some changes, the nice thing about the 
digital world is, bits are bits.
    Senator Stevens. Well, Mr. Chairman, I am very interested 
in this, because you know, those areas served by low power 
stations are the ones that are totally left out of the digital 
world right now, but I am not sure this is the means to make 
the conversion. I really wonder about putting that service in 
the hands of people who entered this whole enterprise to 
provide fairly routine and I think low level expertise required 
to handle low powered television station as compared to that 
that is going to be required to be a server for the Internet.
    Maybe I am not seeing something here, but I do think we 
need a lot more information before we get involved in this. I 
am with you, but I do not want to give up what I have got in 
order to hope that the reflection of the bone in the water is 
bigger than the one I have got, and that is the way I look at 
this right now.
    Thank you very much.
    Senator Burns. Do you want to restate? That is easy for you 
to say.
    Senator Stevens. Maybe I need to get you the book on fables 
so you'll remember the dog walked over the bridge with a bone 
in his mouth, looked down into the reflection and saw a bigger 
bone, let go of the little one, and he lost them both, right?
    Senator Burns. Well, we have got to visit with that dog.
    Senator you raise the same concerns we have raised in this 
legislation. The only thing we had to do, we had to fashion 
something. Now we get to move it along, and the dialog and the 
language will probably find the answer both in the technical 
world and in this, but I also want to recognize Senator Wyden. 
I am going to have to give some more thought to this next 
question. Senator Wyden.
    Senator Wyden. Thank you, Mr. Chairman.
    Gentlemen, is the spectrum congestion problem less in rural 
areas than in urban areas?
    Mr. Stewart. I am not an engineer. Let me give you my 
sense, and then I will defer to Mr. Hatfield, who is the senior 
engineer in the agency, that there is certainly more spectrum 
available in the rural areas. There may be as much or more 
demand, though, because they do not have the full service 
broadcast stations that can provide service to a wider area. 
When you get into the more remote areas you need translators 
and secondary type services, and those take up channel 
capacity.
    Dale.
    Mr. Hatfield. I agree.
    Senator Wyden. I think one of the issues that we are 
undoubtedly going to examine is whether this bill ought to be 
limited to rural areas. There is not a rural service 
requirement. Obviously, you could hear from the questions asked 
by Chairman Burns and by Chairman Stevens that there are 
questions with respect to squeezing out broadcast services, and 
there is going to be a question about whether there is 
sufficient spectrum to satisfy all desired uses.
    I mean, supposing there were to be a procedural change 
requiring that licensees apply to the FCC and make the required 
showing that there is spectrum rather than just notification. 
Is that another step toward balancing the competing interest in 
your mind?
    Mr. Stewart. As I understand, what you are saying, Senator, 
is that instead of my telling the commission I want to convert 
my low power to a data delivery service, make me be required to 
show you that there is in addition X number of channels 
available to backfill what I am moving away from, particularly 
if you do not require me to have some minimum amount of 
broadcast service.
    Senator Wyden. Moving beyond the notice requirement, what 
do you think of that?
    Mr. Stewart. It is an interesting idea. I do not know what 
the impact would be in terms of the real world as to how much 
spectrum might be available.
    Senator Wyden. In the real world, somebody has got to have 
a showing. You have got to come in with a showing that you are 
not producing interference.
    Mr. Stewart. Part of the problem I think, and I would defer 
to Dale, is that we are going to have more digital TV stations 
hopefully in the rural areas, and they might want translators 
to bring their signals into those areas, and I do not know how 
many they are going to need in order to be able to make certain 
that digital television service gets into those rural areas, 
and so you may say to me today there is enough channels, and I 
may say to you, yeah, but 2 years from now, or when those 
stations go on the air, will there be enough channels if we let 
you use them now for data.
    Mr. Hatfield. You picked up there, at the end, the point 
that I was going to make. And that is it is sometimes hard to 
foresee at the time the applicant is coming in what the other 
translator stations in the market will need in terms of digital 
facilities to enable them to make the transition. We also may 
need to make adjustments to fit in people later on. Here again, 
it would tie our hands if there are too many of these stations 
that are already locked in with what amounts to primary status.
    Senator Wyden. If this bill was not enacted, would there be 
any way for AccelerNet to get channels in the broadcast 
spectrum? Are there any existing policies, for example, that 
are going to make broadcast channels available to high speed 
data providers?
    Mr. Hatfield. I think I understand your question, but we 
have underway today a clearing of the spectrum 60 to 69 to 
allow that spectrum to be used for data services. In fact, we 
have already scheduled auctions for that to occur, and then 
later on there is additional spectrum, the channel 52 to 59 
spectrum, which will eventually be made available for those 
types of data services as well.
    Senator Wyden. The answer to my question is yes.
    Mr. Hatfield. That is already underway. The question is, 
though, is whether doing some of these things might preclude us 
from doing that clearing. In other words, we have to clear that 
spectrum to enable the new services, the new data services. The 
question is, would the stations, if they go in would they make 
it more difficult for us to do that clearing?
    Mr. Stewart. If they had a primary status, could we remove 
them from that spectrum?
    Senator Wyden. I think you are making an argument, though, 
that this bill may make work that is ongoing at the commission 
more difficult. At least, that is the argument you just gave 
me. I asked specifically, are there existing policies that you 
could use to move forward now if this bill was not enacted? The 
answer was yes, and it seems to me you are saying that perhaps 
this bill as currently written would make that work more 
difficult. Is that right?
    Mr. Stewart. I think that is fair. Obviously, you could 
have a place where you are going to allow these low-powered 
stations to convert, and maybe you will not let them convert if 
they are on the 60 to 69 channels, or the 52 to 59 channels, so 
that the auctions can take place and they can go to the highest 
valued use, and that we do not have to protect these kinds of 
services, so there are some adjustments, Senator, that could be 
made.
    Senator Wyden. The point we are touching on here is 
absolutely key. I think there has been some confusion about 
whether or not these changes that would accommodate AccelerNet 
and others could be made without the Burns/Breaux bill, and a 
lot of us were under the impression that AccelerNet and others 
could not go forward without this legislation.
    Now I think you are saying that not only can a lot of this 
work get done, but that this bill might cause additional 
problems.
    Mr. Hatfield. Let me make it clear, of course, in the 
cleared spectrum they would have to then go to auction to be 
able to get access to the spectrum to be able to do that. As 
Roy said in his testimony and his conclusion, the bill as 
introduced could undermine the digital transition and eliminate 
spectrum for new broadband services. What we were just saying 
reflects the concern that he stated in his oral statement.
    Senator Wyden. Mr. Chairman, my time is up. I think what 
you and Senator Breaux want to do is definitely important. We 
have just got to get through the nuts and bolts to figure out 
how to do it, and there are a variety of issues that need to be 
examined. I look forward to working with you.
    Senator Burns. Senator Breaux.

               STATEMENT OF HON. JOHN B. BREAUX, 
                  U.S. SENATOR FROM LOUISIANA

    Senator Breaux. Thank you, Mr. Chairman, and I thank the 
members. I apologize for being late. We had the Senate Finance 
Committee marking up a bill at the same time, and it is 
difficult to be in two places at once. Thank you very much.
    Obviously, as an author of the bill, I am a supporter of 
the legislation, but it is very important to have the FCC's 
views and recommendations. I was particularly interested in the 
line of questions from Senator Wyden with regard to whether the 
bill is necessary or not, and I guess the answer that you have 
said is that you grant low power stations authority to provide 
broadband Internet services, without this legislation. Is that 
correct?
    Mr. Stewart. We have done it on an experimental basis, as I 
think you are aware, Senator, in Houston, Texas.
    Senator Breaux. With AccelerNet, did you not?
    Mr. Stewart. Yes, but I am not sure that there was not some 
indication in that application when it was submitted that there 
would be some over-the-air broadcasts continued, but we have 
had some experiments to find out whether there was interference 
problems.
    Senator Breaux. Would you look at the application 
differently if it is one that would retain some free over-the-
air services along with broadband services, as opposed to an 
applicant that would have just broadband Internet services on 
their low power station?
    Mr. Stewart. I have to give you my personal view, and I am 
not here really representing the commission, and there has been 
no commission action in this area. My feeling is it would make 
it more acceptable, if this is broadcast spectrum, if, in fact, 
there was a continued broadcast service. If you were sitting in 
the community and that was the only local TV station, or low 
power television station, or if it was a translator bringing 
in, you know, Monday Night Football, or call it what you would 
want, and you suddenly did not get it, you might want to trade 
the data, but your next-door neighbor might not want to trade 
that for data.
    So it seems to me without trying to piece together a piece 
of legislation right now, because I am not sure I have the 
ability to do that on behalf of the commission right now, but 
it seems to me that it would be more tenable to require that 
there continue to be some aspect of broadcast service provided 
by that facility, whether it is a translator that is converted 
to low power, or a low power station itself.
    Senator Breaux. But full power broadcasters can provide 
this data service on an ancillary basis. What do they have to 
do when they decide to use their full power station to provide 
the broadband services?
    Mr. Stewart. Well, I am not sure there is anybody that is 
really doing it yet. We went through a proceeding because 
Congress had required us to assess a fee for the use of that 
excess digital capability, and I am not sure that anybody is 
actually doing it now, but they would just broadcast, whatever 
the mechanism is, and Dale could probably speak to that, as 
long as they maintain the one channel, Senator, of over-the-air 
broadcast service in a digital mode.
    Senator Breaux. You said Congress required a fee.
    Mr. Stewart. Yes.
    Senator Breaux. Does that requirement of Congress not apply 
to low power stations if they decide to convert to a broadband 
Internet provider?
    Mr. Stewart. I do not know. That is a good question. That 
is the next hearing, Senator.
    [Laughter.]
    Mr. Stewart. The Congress did not even tell us what the 
amount was. We did a proceeding and determined that 5 percent, 
I think, of the gross revenues was the appropriate amount for 
full service television licensees, commercial television 
licensees.
    Mr. Hatfield. If I could just add one thing, there are a 
number of broadcasters who have digital stations, DTV stations 
on the air now that are also sending data along with the 
digital television broadcast itself. For example, the company 
called I-Blast, that is currently doing that.
    Senator Breaux. Do they pay a fee for the right to do that 
or not?
    Mr. Stewart. I would assume they would have to on a yearly 
basis give us information as to what the gross revenue was. I 
do not think we have made an exception based on that. I have 
not seen any report come in annually. The first one that came 
in I do not think had anybody on it.
    Senator Breaux. You do not know whether they are required 
to pay a fee?
    Mr. Stewart. I would assume if they are operating a 
television station and they are using the excess capacity for 
ancillary and supplementary services, I know of no exemptions 
that we have given to that 5-percent fee for commercial 
television licensees, so I would assume at the end I think 
there is a period, maybe September or October of every year, 
where there is a form that they have to report to us 
information about that.
    Senator Breaux. A final point, if I may, Mr. Chairman. You 
point out in your testimony the bill does not add or really 
protect the roll-out of the digital television services, DTV. 
Can the legislation be modified to ensure that interference 
problems are corrected in some form or fashion? How would we 
modify the legislation if we wanted to protect the roll-out of 
digital television from full power stations?
    Mr. Stewart. Well, I think again it is hard to put all the 
kinds of examples that may arise, but we could use, perhaps, as 
a backdrop the Community Broadcaster Act, where we created 
these Class A low power television stations and put in language 
to protect the digital roll-out in terms of future digital 
television stations and present digital television stations, 
and that would be a place where we could start.
    And I think that is what we are going to focus on if we 
look at that, but obviously I do not have to tell you, Senator, 
that digital transition is something we promised the American 
public. We gave them a second channel, and we have to be 
careful we do not do anything to disrupt that.
    I think the Community Broadcasters Act, we put in, or 
Congress put in a safety net provision that said the commission 
has the authority, irrespective of Class A status, to do what 
is necessary to protect that digital roll-out as it affected a 
particular station.
    Senator Breaux. Thank you, Mr. Chairman.
    Senator Burns. Well, let us take that one step further, 
Senator Breaux, and Mr. Stewart. 2454 provides that the FCC 
shall prevent interference from LPTV stations providing data 
services. That is not adequate.
    Mr. Stewart. Is that to the full service broadcast 
stations? Is that to other low power TV stations? Is that to 
the Class A stations? It is the specificity I think I was 
concerned about, Senator. That is a phrase. What comes under 
that phrase?
    Senator Burns. Well, that is right. I take from this, and 
your testimony, and the answers to the questions this morning, 
that we are going to have to spend some more time on 
definitions and be more specific in our areas, and I have no 
problem with that.
    We can get that dialog going and take care of that, because 
I do not think it is the wish of the low power people--they do 
not want to interfere with anybody else, either, and basically 
we are just fulfilling the FCC is fulfilling their primary 
responsibility, and that is to make sure that everybody stays 
in their lane that uses the spectrum and the airwaves, so I 
think we can massage that language, and we will work with you 
and want to work with you very closely before we ever clear 
this thing out of committee.
    I would like to see it move, and I also see, now, your full 
power stations, they are going to offer datacasting?
    Mr. Stewart. Yes.
    Senator Burns. And we do not want to interfere with what 
they want to do, either, but we would sure like to see robust 
competition out there in this area as far as the customers are 
concerned.
    Mr. Stewart. I think, Mr. Chairman, we have to make certain 
we do not deprive citizens who now get over-the-air broadcast 
service via translators or local LPTV stations of their only 
broadcast service, and how we shape what the future is in this 
area.
    Senator Burns. I am very supportive also of my public radio 
station out there, and public radio in our State. We also have 
a problem with low power FM that we have to work out, and we 
will get that done, too.
    That is all the questions I have for this panel. We thank 
you for coming down this morning, and look forward to working 
with you as this legislation moves along. Thank you very much.
    Mr. Stewart. Thank you, Mr. Chairman.
    Senator Burns. We have now a panel, Larry Morton, director, 
Community Broadcasters Association from Little Rock, Arkansas, 
Mr. James Popham, vice president/general counsel, Association 
of Local Television Stations, Inc., here in town, and Dean 
Mosely, who is president and CEO of AccelerNet, from Houston, 
Texas.
    We welcome these gentlemen this morning and look forward to 
their testimony, and Mr. Mosely, we will start with you once 
you get settled in.

   STATEMENT OF DEAN M. MOSELY, PRESIDENT AND CEO, ACCELERNET

    Mr. Mosely. Good morning, Mr. Chairman and Senator Breaux. 
Mr. Chairman, my name is Dean M. Mosely. I am president and CEO 
of U.S. Interactor, which is doing business as AccelerNet. I 
thank the Committee for the opportunity to testify in support 
of Senate bill 2454. Senate bill 2454 will facilitate the 
deployment of high speed, cost-effective Internet access 
throughout the United States, including rural America.
    S. 2454 will further the congressional commitment embodied 
in section 706 of the Telecommunications Act of 1996 to 
encourage deployment of advanced telecommunications capability 
to all Americans so that rural Americans can receive the same 
quality services as are available in urban areas and at a fair 
price, and Mr. Chairman, S. 2454 will do so without the need 
for any Federal subsidies.
    In short, S. 2454 is a technological no-subsidy, free 
market solution to the digital divide. AccelerNet is a licensee 
of LPTV Station KHLM-LP, Channel 43, in Houston, Texas. 
AccelerNet is in the business of providing high speed Internet 
access. We do so from our Houston LPTV station in a one-way 
mode, using a wire line uplink pursuant to FCC digital 
authority. We offer downlink or downstream wireless burst 
speeds in excess of 4 megabits per second.
    In part as a result of the cost savings our service offers 
over wired Internet service, Internet service provider access 
rates for T-1 speeds have come down appreciably in Houston, 
Texas. Exciting new technology is available to overcome the 
inherent limitations of our wireless one-way service. Two-way 
wireless service using timed division duplexing, also known as 
TDD, over a single 6 megahertz channel will enable the use of a 
richer content available on the Internet today, including 
streaming media and interactive services such as 
videoconferencing, telemedicine, and distance learning.
    It will also enable portable access to the Internet. 
Today's business customer cannot be tied down to a wire for 
Internet service any more than he or she can be tied down to a 
wire for telephone service. As we speak, the majority of our 
country does not even have wire line access to high speed 
Internet service. For this majority of Americans in at least 
the near or medium-term future, wireless may offer their only 
access to the communications capability the rest of us take for 
granted.
    The LPTV service was created to make use of television 
broadcast spectrum otherwise unusable, or full service 
television, due to the separation distances required between 
full service television stations. S. 2454 would allow this 
prime spectrum to be put to use to conquer the digital divide 
among Internet users in the United States.
    Imagine what we could do if we could provide T-1 speed 
Internet service to every classroom in Montana or South 
Carolina without having to perform disruptive construction to 
run one wire through ceilings and walls. Imagine the ability to 
bring telemedicine to every Native American reservation.
    Imagine the ability to make available to an isolated 
village in Alaska a complete K through 12 curriculum, with 
lectures, exercises, study guides, and tests prepared by the 
very best educators in America.
    Wireless Internet can do this cost-effectively. Wireless 
Internet can do this with technology that exists today. 
Wireless Internet can do this using LPTV stations.
    Section 336 of the Communications Act of 1934 as amended, 
and FCC Rule section 73.624(c) implementing that provision, 
granted full service television stations broad authority to 
provide digital data services. DTV stations are permitted under 
this rule to offer, quote, services of any nature, close quote, 
including data and interactive transmissions on a supplementary 
or ancillary basis.
    The rule sets forth no limitation in the nature of one-way 
or two-way service, nor does it set forth how such service may 
be provided. That is left to the DTV stations, subject to not 
derogating DTV service. S. 2454 would allow similar flexibility 
for LPTV stations.
    This Committee should be concerned to ensure that over-the-
air television reception will not be subject to interference as 
a result of S. 2454. As the chairman said, everybody needs to 
stay in their own lane.
    As drafted, S. 2454 provides the FCC full authority to 
protect television reception. In Houston, we have never had a 
complaint of interference from our one-way high speed Internet 
access service ever. Moreover, I have appended to my testimony 
the analysis of Dr. Daniel L. Sharre, chief technical officer 
of Adaptive Broadband, which demonstrates that interference to 
television reception will not occur.
    To attract capital to roll-out service across the Nation, 
we and other providers who may decide to provide a similar 
service need to be assured that we will not arbitrarily be 
displaced from our spectrum. We have attracted the interest of 
rural telephone companies, electric cooperative associations, 
and other organizations, who see the service we intend to offer 
as a means of providing rural America with the high speed 
Internet access which it is currently denied.
    Absent a clear congressional policy declaration in favor of 
rapid deployment of innovative high speed wireless services, 
low power television licensees face years of regulatory 
uncertainty and delay in making these services available to 
average Americans.
    The adoption of S. 2454 will allow AccelerNet and other 
service providers to bridge the digital divide in rural America 
and in other areas currently lacking high speed Internet 
access. I urge you to support passage of this legislation.
    Thank you.
    [The prepared statement of Mr. Mosely follows:]

  Prepared Statement of Dean M. Mosely, President and CEO, AccelerNet
    Mr. Chairman, my name is Dean M. Mosely. I am President and CEO of 
U.S. Interactive, L.L.C. d/b/a AccelerNet. I thank the Committee for 
the opportunity to testify in support of S. 2454.
    AccelerNet is the licensee of LPTV station KHLM-LP (Channel 43) in 
Houston, Texas. AccelerNet is in the business of providing high-speed 
Internet access. We do so from our Houston LPTV station in a one-way 
mode, using a wireline uplink pursuant to FCC digital authority. We 
offer downlink or downstream wireless burst speeds in excess of 4 mbps. 
In part as a result of the cost savings our service offers over wired 
Internet service, Internet service provider access rates for T-1 speeds 
have come down substantially in Houston, Texas.
    There are inherent limitations, however, with our wireless one-way 
service. The principal limitation is that our service is asymmetrical 
in speed, with tremendous wireless downstream speed but relatively slow 
wired upstream speed. Our customers have told us repeatedly that they 
need higher upstream access speeds which a two-way wireless service 
would facilitate, and countless potential customers have told our sales 
staff that they would subscribe to our service as soon as AccelerNet 
offered two-way wireless service.
    Two-way wireless service will enable the use of the richer content 
available on the Internet today, including streaming media and 
interactive services such as video conferencing, telemedicine, and 
distance learning. It will also enable portable access to the Internet, 
a service that our customers are demanding. Today's business customer 
cannot be tied down to a wire for Internet service any more than he or 
she can be tied down to a wire for telephone service. Whether it is the 
real estate agent who needs to check the latest listings for her 
clients who desire to see just one more prospective home, the architect 
who wishes to check a design during a lull in his vacation, or the 
Senator needing to check his email while back home to give a speech, 
more and more of us would not think of traveling without our laptops.
    Moreover, as Mr. Morton will explain in his testimony, as we speak, 
the majority of our country does not even have wireline access to high 
speed Internet service. For this majority of Americans in at least the 
near or medium term future, wireless may offer their only access to the 
communications capability the rest of us take for granted.
    The LPTV service was created to make use of television broadcast 
spectrum otherwise unusable for full service television due to the 
separation distances required between full service television stations. 
S. 2454 would allow this prime spectrum to be put to use to conquer 
this digital divide among Internet users in the U.S. Imagine what we 
could do if we could provide T-1 speed Internet service to every 
classroom in Montana or South Carolina without having to perform 
disruptive construction to run one wire through ceilings and walls. 
Imagine the ability to bring telemedicine to every native American 
reservation. Imagine the ability to make available to an isolated 
village in Alaska a complete K-12 curriculum, with lectures, exercises, 
study guides and tests prepared by the very best educators in America. 
Wireless Internet can do this cost effectively. Wireless Internet can 
do this with technology that exists today. Wireless Internet can do 
this using LPTV stations.
    The technology necessary to bring high-speed wireless Internet 
service to the public exists today and is in use in the United States, 
in Japan and in Europe. It can operate over a single television channel 
without causing interference to television reception. It is called Time 
Division Duplexing (``TDD''). TDD allows both the uplink and downlink 
of a wireless signal to be transmitted over the same spectrum without 
interfering with itself. TDD can achieve spectral efficiencies of 
between four to 20 times that achieved with more traditional FDD 
(frequency division duplexing), which requires separate transmit and 
receive frequencies. TDD systems have been developed and deployed by 
TRW and Adaptive Broadband, formerly California Microwave. Several 
other companies are in various stages of development of TDD systems.
    I have appended to my testimony a statement prepared by Mr. Alfred 
Boschulte, former President of NYNEX Mobile Communications, explaining 
in more detail, the capabilities of TDD technology. In addition, I have 
appended the cover story from the April 2000 edition of RF Design, by 
Dr. Adel Ghanem, which discusses the difficulties of providing fixed 
wireless services using microwave frequencies and which delineates the 
numerous advantages of transmission in the lower frequency bands, 
including eliminating in most instances the requisite of a 
professionally installed subscriber terminal. What Dr. Ghanem is 
describing is what we at AccelerNet have been advocating for some time: 
a ``plug and play'' high speed, cost effective wireless Internet 
delivery system. Upon passage of S. 2454, this system can be 
implemented in the very near future.
    Section 336 of the Communications Act of 1934, as amended, and FCC 
Rule Section 73.624(c), implementing that provision, granted full 
service television stations broad authority to provide digital data 
services. DTV stations are permitted under this rule to offer 
``services of any nature,'' including data and interactive 
transmissions, on a supplementary or ancillary basis. The rule sets 
forth no limitation in the nature of one-way or two-way service, nor 
does it set forth how such service may be provided. That is left to the 
DTV station, subject to not derogating DTV service. S. 2454 would allow 
similar flexibility to LPTV stations.
    The Committee should be concerned to ensure that over the air 
television reception will not be subject to interference as a result of 
S. 2454. As drafted, S. 2454 provides the FCC full authority to protect 
television reception. We have never had a complaint of interference 
from our one-way high speed Internet access service in Houston. 
Moreover, I have appended to my testimony the analysis of Dr. Daniel L. 
Sharre, Chief Technical Officer of Adaptive Broadband, which 
demonstrates that interference to television reception will not occur.
    AccelerNet currently holds or has the right to acquire LPTV 
stations in various cities in the states of Arkansas, Arizona, Florida, 
Idaho, Montana, New York, Tennessee, Texas and Hawaii. We are currently 
in negotiations to acquire stations in Kansas, Virginia, Michigan and 
elsewhere throughout the U.S. Ultimately, it is our goal to be a part 
of providing every community in the nation with high-speed wireless 
Internet access. To attract sufficient capital to roll out service 
across the nation, we and other providers who may decide to provide a 
similar service need to be assured that we will not arbitrarily be 
displaced from our spectrum. We have attracted the interest of rural 
telephone companies, electric co-operative associations and other 
organizations who see the service we intend to offer as a means of 
providing rural America with the high-speed Internet access which it is 
currently denied.
    The adoption of S. 2454 will allow AccelerNet and other service 
providers to bridge the digital divide in rural America and in other 
areas currently lacking high-speed Internet access. I urge you to 
support passage of this legislation.
                                                       Attachment 1

                                             DETECON, Inc.,
                                         Reston, VA, June 12, 2000.

Hon. Conrad Burns,
Washington, DC.

Dear Senator Burns,

    I am the President of DETECON Incorporated, part of the DETECON 
Worldwide Telecommunications Consulting Organization. We specialize in 
Telecommunications Engineering, Technical Consultation and Management 
Services and are members of International Worldwide Standards 
Organizations, and have been particularly engaged in the United States 
in current and future generations wireless communications. AccelerNet, 
Inc. is one of our clients and we have been working with the AccelerNet 
team in developing the UHF low power television broadcast spectrum 
opportunity for 2 way high speed internet communications. I want to 
offer our insight as to the appropriateness of utilizing this spectrum 
and the assurance that can be given as to inference concerns and the 
feasibility of this approach.
    Wireless Data is expected to undergo an explosive growth over the 
next several years and Internet access is an integral part of that 
market. data needs of the emerging The people of the United States use 
the Internet. Consumers and businesses use this important vehicle to 
communicate with families, friends and colleagues; to perform research 
and to purchase and sell goods. They are able to send and receive short 
messages and transmit large data files. However, there is a growing 
need for the ability to effectively transmit and receive larger files 
incorporating video and graphic applications. As a result, there is an 
ever-growing demand for high-speed access to meet the emerging data 
needs in the United States. One readily adaptable and cost effective 
alternative to the traditional landline network is to provide high-
speed Internet access and services via wireless technology. As the 
industry struggles with an ever-expanding search for better use of the 
radio spectrum, providing high-speed Internet access from the UHF 
spectrum is a reasonable avenue to pursue.
    Television channels in the Ultra-High Frequency (UHF) range are of 
interest to private industry because many are either available or are 
becoming available in major metropolitan markets across the USA. There 
is a great demand for spectrum in the United States as private industry 
attempts to meet the consumer demand for wireless services offering 
newer and better features. An UHF TV channel offers a desirable amount 
of spectrum in a frequency range that exhibits desirable propagation 
characteristics, in comparison to frequencies which other technologies 
are forced to amount of spectrum in a frequency range that exhibits 
desirable propagation characteristics, in comparison to frequencies 
which other technologies are forced to operate at. The UHF TV channels 
not already in use for NTSC (analog) UHF TV stations or for ATSC 
(digital) UHF DTV stations are currently under evaluation by a number 
of private companies for uses other than those originally intended; 
that is, for services other than television transmission.
    AccelerNet would like to purchase UHF television channels, as 
allotted by the FCC,\1\ for the purpose of delivering two-way high-
speed Internet services. AccelerNet wishes to use one 6 MHz UHF TV 
channel in a given market to compete with the incumbents already 
offering these services, e.g. the local telephone company, independent 
Internet Service Providers (ISPs), Local Multipoint Distribution 
Service (LMDS), etc. AccelerNet would like to be able to offer their 
customers these fixed two-way high-speed data services in a totally 
wireless manner in the near future while assuring the FCC that no 
interference will be caused by the utilization of these UHF TV 
frequencies to existing or future UHF TV channels, e.g. existing 
National Television System Committee (NTSC) UHF TV channels, existing 
Advanced Television Systems Committee (ATSC) UHF DTV channels, and 
planned ATSC UHF HDTV channels.
---------------------------------------------------------------------------
    \1\ http://www.fcc.gov.
---------------------------------------------------------------------------
    The operating frequency range of this equipment will be, using one 
6 MHz UHF TV channel, from 470 MHz to 698 MHz (channels 14-51), as 
specified for the geographical area for which it is allocated 
(typically a metropolitan area). AccelerNet will utilize existing 
technology in order to provide their service. There is a precedent for 
using the types of modulation and data transmittal that AccelerNet is 
currently evaluating for offering their service; LMDS, Multichannel 
Multipoint Distribution Service (MMDS), and Personal Communication 
Services (PCS) systems utilize the modulation and transmittal types 
that AccelerNet is considering. However, the frequencies that LMDS, 
MMDS, and PCS operate at have different propagation characteristics 
from those in the UHF range. LMDS operates in several bands in the 28-
31 GHz range, the A band with 1.15 GHz of spectrum and the B band with 
150 MHz of spectrum, this is a great deal of spectrum when compared to 
the 6 MHz of one UHF TV channel. However, the frequency range in which 
LMDS operates is strictly Line-Of-Sight (LOS), as everything in the 
environment severely attenuates the signal including inclement weather; 
these disadvantages severely limit the range of LMDS to a maximum of 15 
km., although operational use can typically be around 2-8 km. MMDS 
operates in the 2.1-2.7 GHz range, utilizing multiple 6 MHz channels. 
PCS operates in the 1.9 GHz range, operating in several bands utilizing 
blocks of spectrum of either 10 MHz or 30 MHz. Both MMDS and PCS suffer 
from similar limitations due to their operating frequencies, they are 
essentially LOS but offer much greater ranges than LMDS. A UHF TV 
channel, while limited in the amount of spectrum, 6 MHz, has very 
desirable propagation characteristics, much greater than those of LMDS, 
MMDS, or PCS, and so, a fewer number of antenna sites is required to 
cover a given geographical area than with the other technologies.
    The methods of modulation and data transmittal in LMDS, MMDS, PCS, 
and other wireless methods are: Frequency Division Duplexing (FDD), 
Time Division Duplexing (TDD), Code Division Multiple Access (CDMA), 
Quadrature Amplitude Modulation (QAM), and Phase Shift Keying (PSK). 
FDD is a less spectrally efficient method than TDD but is ideal for 
voice traffic when available bandwidth is not a concern. TDD is very 
good at utilizing existing spectrum in an efficient manner and is very 
well suited for Internet-type data traffic. CDMA is spectrally 
efficient, and well suited to either voice or data traffic, CDMA also 
utilizes its own methods of modulating data. TDD and FDD must utilize 
modulation methods such as QAM and PSK to transmit data; there are 
different types of QAM and PSK that they can utilize, for data 16-QAM, 
64-QAM, an even 256-QAM have been utilized, as well as 8-PSK, the 
modulation method chosen depends on the available spectrum and the 
desired speed of the connection. These are accepted and proven methods 
of communicating both voice and data and have been utilized 
commercially at different frequencies and bandwidth allocations than 
the one for which AccelerNet plans to operate. In particular, systems 
utilizing TDD and CDMA are currently in use within spectrum-limited 
situations, where adjacent channel interference is a major concern (as 
it is with UHF TV), and these methods have performed very well in 
reducing interference and allowing the spectrum to be fully utilized. 
DETECON, Inc. feels strongly that some or all of these technologies can 
be adapted for the use of AccelerNet on a 6 MHz UHF TV channel. In 
particular, AccelerNet plans to utilize TDD for service introduction. 
In DETECON's opinion there is no impeding technological issue to 
applying currently used modulation approaches to the two-way high speed 
Internet application in a 6 MHz UHF low power television spectrum.
    We would like to assure the FCC that no undue interference to any 
other radio-frequency (RF) services will be caused by the utilization 
of an UHF TV channel for the service that AccelerNet proposes. We 
propose to adhere to the specifications proposed by the ATSC,\2\ the 
organization that formalized the HDTV standard for the United States of 
America. ATSC document A/64, Transmission Measurement and Compliance 
for Digital Television, Section 4.1.1,\3\ specifies the guidelines 
which must be met in order to avoid interference with existing NTSC TV 
channels, AccelerNet will comply with these guidelines in order to 
avoid Interfering with other carriers utilizing TV channels and other 
radio frequencies.
---------------------------------------------------------------------------
    \2\ http://www.alsc.org.
    \3\ http://www.alsc.org/standards/A64/.
---------------------------------------------------------------------------
    In conclusion, in DETECON'S opinion, we feel very strongly that 
AccelerNet can take commercial advantage of an UHF TV channel and 
effectively compete with other technologies to offer two-way high-speed 
data services in a given market.

DETECON, Inc. also believes that AccelerNet can comply with any and all 
guidelines with regards to interference and spurious emissions so that 
the proposed modulation techniques AccelerNet uses will not interfere 
with operators in other parts of the radio spectrum.
        Sincerely,

                                       Alfred F. Boschulte,
                                                   President & CEO.

                                                       Attachment 2
           Fixed wireless communications for the mass market
                         RF design, April 2000
                         By Adel Ghanem, Ph.D.
With an open market for many communications services, the current 
challenge is to offer a cost-effective package of services to both 
consumers and small businesses.

    Fixed wireless could provide the best opportunity for a competitive 
alternative to wireline communications services but so far has had a 
minimal impact. The obvious competitive ``no-brainer'' has become an 
implementation and success story ``no-gainer.''
    A closer look at the reasons why suggests the opportunity has not 
passed us by. We've merely been focusing attentions on selling 
solutions destined for mediocre success--and/or failure--from the 
start.
    It's time to take advantage of the lessons learned from past 
successes and failures. By concentrating efforts on sound RF 
principles, innovative technology, efficient design and pro-competitive 
public policy and regulations, we can provide fixed wireless solutions 
that offer an economic and competitive alternative to everything the 
wireline public network has to offer--voice, data, even video

What's needed
    First and foremost, a competitive fixed wireless offering needs to 
be focused on the mass market as opposed to the current focus on the 
high-end, large business users. A solution that isn't designed with the 
residential and small office home office (SOHO) market in mind at the 
outset is less likely to be an economic alternative in hindsight.
    There is no lack of telecommunications alternatives for high-end 
business customers. And as these solutions--wireline and wireless--
become more and more competitive, they could become economic options 
for medium-size businesses. But they will likely never become an 
economic alternative for the residential and SOHO markets. From the 
capacity, functionality, and ease of installation points of view, they 
weren't designed with those customers in mind--a major distinction.
    The economics of the mass market are all about cost and price. This 
isn't a new or major revelation. Cellular and personal communications 
system (PCS) carriers have proven that we sell a lot more wireless 
service with free or $49 phones than with $249 or $1,499 phones.
    But it's a well known fact that cellular networks and service 
weren't, initially, designed for the mass market. Actually, cellular 
was once viewed as having very limited market potential. It is a good 
example of a technology application which found/developed a sizeable 
market and continues to reinvent itself to become more acceptable and 
affordable to a wider audience.
    Fixed wireless solutions, designed for the mass market, need 
special attention paid to technologies and specifications that allow 
cost effective networks to be built. PCS carriers helped drive efforts 
to incorporate cost-saving technologies into their networks because 
without a lower operating cost--and corresponding lower overall service 
costs--there was little hope of attracting customers away from 
cellular.
    Fixed wireless networks present similar challenges and bigger 
opportunities. By definition, fixed wireless requires the installation 
of a ``fixed'' subscriber terminal--a costly consideration if installed 
by a qualified technician. But if the subscriber terminal could be 
self-installed, the service economics would change considerably.
    Subscriber-installed terminals could have the same impact on fixed 
wireless as they had on the direct broadcast satellite (DBS) market, 
where a similar problem existed. Initially, special technicians were 
required for all satellite installations, which delayed the overall 
service penetration. The solution to this dilemma was a self-
installation kit and a bit of innovative technology.
    Today, the self-directing installation kit guides the subscriber 
through the process. A signal at the set-top receiver tells them when 
the satellite dish is positioned properly for the strongest signal 
strength. By removing a major implementation cost and hurdle, the 
service is applicable and appealing to a wider audience, while 
improving the overall economics of the business plan
    All of the above-described factors play a role today in fixed 
wireless implementations. And they further suggest what else needs to 
change. Meeting these conditions for economic, competitive, self-
installed fixed wireless equipment and services suggests efforts should 
be concentrated on finding solutions that operate in lower, rather than 
higher, frequency bands--counter to all existing efforts to date.
    Wireless systems operating in lower frequency bands reduce the 
point-to-point or line-of-sight requirements, making self-installation 
possible and eliminating a major cost and implementation hurdle. And 
that factor alone will have a major impact on the economics of fixed 
wireless infrastructure and implementations.
    Furthermore, the availability of spectrum in the lower or sub-2.5 
GHz frequency bands suggests other RF technologies, such as time-
division duplexing (TDD), must be considered for fixed wireless 
applications. Lower frequencies allow for a less complex RF solution 
and TDD implementations worldwide have proven efficient, cost-effective 
and viable for mass-market applications.
    Fixed wireless systems based on TDD technology and operating in 
sub-2.5 GHz offer the best opportunity for a cost-effective, 
competitive alternative to wireline telecommunications services. And 
competitive service providers--wireless or wireline--should concentrate 
efforts on seeing these solutions are given a fair opportunity to be 
brought to market.

The search for higher ground: an historical perspective
    Prior to the Telecommunications Act of 1996 there wasn't much 
emphasis on mass-market competitive local exchange services. And given 
the state-of-the-art in wireless technology, lower frequencies weren't 
a fixed wireless service option. It is difficult to say--from a 
chicken-and-egg perspective--which came first or mattered most, but 
both prevented serious consideration and development of cost-effective 
fixed wireless solutions.
    The lack of competitive incentive prior to 1996 is perhaps easiest 
to explain. Although fixed wireless offers no-brainer status as a 
competitive local exchange alternative, there wasn't a carrier group 
particularly interested in pursuing the residential opportunity--
wireless or wireline.
    From 1992 on, most of the wireless attention was centered on PCS 
spectrum auctions and bringing competitive alternatives to the 
``cellular'' duopoly. Mobility was key in every wireless business plan 
and although fixed wireless was not prohibited in any way, it did not 
reflect the interests of auction participants or the best perceived 
market opportunity for the available spectrum.
    Likewise, in the same time frame on the wireline side, competitive 
local exchange carriers (CLECs) were still known as competitive access 
providers (CAPs). All their efforts were concentrated on constructing 
fiber optic rings and providing lower cost and reliable wireline 
telecommunications service alternatives for lucrative business 
customers. Residential and SOHO subscribers were not on the radar 
screen.
    Cable TV companies expressed interest and ``dabbled'' in 
telecommunications trials but the complexities of providing high-
reliability telephone services ran counter to their existing 
operations. So despite their interest in expanding the service 
offerings to their residential customer base, their existing cable 
plant prevented execution of the strategy.
    With the only available lower frequency spectrum being ``reserved'' 
for mobility applications and a general lack of interest in competitive 
residential local exchange services, fixed wireless applications 
garnered very little service interest.
    The impact of available wireless technologies factored into the 
fixed wireless development equation as well. At the time, most wireless 
equipment manufacturers developed solutions based on state-of-the-art 
frequency division duplexing (FDD) access schemes to support the needed 
high-speed mobility.
    In contrast to TDD, FDD divides its transmission into transmit 
(upband) and receive (downband) frequencies separated by a guard band 
of a specific size. The use of FDD for wireless applications was widely 
accepted and in many respects the defacto standard. In fact, the PCS 
spectrum allocations were established with FDD duplexing in mind.
    The selection of FDD by equipment manufacturers for mobility 
applications led to the same choice for fixed wireless. Despite the 
lack of interest within the U.S., fixed wireless became a preferred 
solution for basic telecommunications in many competitive offerings 
worldwide, especially in underdeveloped regions. To compete for these 
worldwide contracts, vendors needed to include fixed wireless systems 
in their product line. For obvious reasons of convenience and economies 
of scale, equipment manufacturers developed fixed wireless solutions, 
from their stable of available mobility solutions, that were already 
based on FDD technology.
    In turn, the use of FDD in product offerings pushed fixed wireless 
applications into higher and higher frequency bands where paired-bands 
can still be allocated. The lack of large blocks of spectrum--required 
for FDD--in the U.S. and most of the world prevented consideration of 
lower frequency applications.
    This fluke of logic, convenience and/or progression of events, is 
why fixed wireless solutions have encountered only mediocre success 
from the start. Fixed wireless developed into a higher frequency 
wireless mobility ``adaptation'' instead of a lower frequency 
``designed for the masses'' efficient, economic alternative to 
wireline's hold on residential access.

Low frequency advantages
    It's not that it isn't possible to construct an efficient, cost-
effective fixed wireless system at higher frequencies. But given the 
alternative of lower versus higher frequency solutions who wouldn't 
choose sub-2.5 GHz?
    Wireless technology gets better and more stable every day but some 
basic facts and laws of physics will never change. A rainstorm still 
wipes out wireless transmission at 24 GHz and even a simple rainy day 
can block signals at 3 GHz.
    Even foliage and building obstructions have a greater impact at 
higher frequencies. For example, a 3.6 GHz fixed wireless installation 
in Poland worked perfectly following its fall installation but ground 
to a halt in spring. The strange phenomenon design engineers failed to 
account for was the annual reappearance of tree leaves.
    At lower frequencies, Mother Nature would not have had an impact. 
And while design options include raising antennas to ``see'' over the 
trees, trees will continue to grow and the problem will likely reoccur.
    Urban fixed wireless deployments can be even more disconcerting. 
Building heights and other obstructions force the use of sophisticated 
modeling tools and experienced technicians for mapping and installation 
on a sight-by-sight basis. Certainly not an economic, low-cost 
alternative.
    In-building penetration could also benefit from lower frequency 
transmission and impact fixed wireless applications. Who hasn't noticed 
the difference between in-building penetration of cellular and PCS 
frequencies in the U.S.? Because of its sub 1.0 GHz frequency, cellular 
exhibits greater in-building penetration when compared to PCS at 1.9 
GHz. Even in the middle of a building you will likely receive a 
cellular call, whereas PCS transmission in the lobby of many high-rise 
buildings gets dicey. Now consider the implications of these same 
frequencies on fixed wireless where you don't have the option of 
``walking'' the antenna for better reception.
    In fact, all wireless applications at high frequencies require 
line-of-sight transmission for optimal performance. This restriction 
alone can kill the economics of an urban or even suburban fixed 
wireless application.
    In contrast, lower frequencies don't require line-of-sight, nor is 
it necessary to pinpoint antennas with laser-beam precision. Signals 
are more tolerant and can bend around and penetrate a wider range of 
structures. And imagine the impact on a fixed wireless business case if 
the subscriber terminal could be self-installed or placed within the 
home or business.
    The business case drives all wireless ventures and the ``numbers'' 
have to work. Low frequency fixed wireless has a business case 
advantage in the overall cost of system equipment. For the same output 
power, the cell size is larger at lower frequencies, requiring fewer 
base stations and reducing infrastructure costs.
    For example, a fixed wireless application in a sub-2.5 GHz 
frequency provides a cell size range of 15-25 km. With that coverage, 
many urban and suburban applications could be handled with a single 
cell and base station.
    In contrast, at higher frequencies the laws of physics shrink the 
cell radius and coverage for the same system output power. It forces 
operating in a micro rather than macro cellular environment with 
corresponding effects on design, equipment costs and ease of 
installation. Not to mention that high-frequency transceivers are just 
more complex and require greater attention to detail.
    In totality, the combination of all these factors suggest lower 
frequencies are the economic choice for fixed wireless applications if 
providers are serious about providing a ``competitive'' alternative to 
wireline.

Enter TDD
    Yet, that assertion contains a Catch-22 of sorts. With the last 
sub-2.5 GHz spectrum going to PCS mobility applications there hasn't 
been sufficient lower frequency spectrum available.
    Taken at face value, the assertion is true. There isn't sufficient 
lower frequency spectrum to accommodate fixed wireless or even other 
mobility applications--if FDD is the duplexing assumption.
    That frequency quandary forced manufacturers, carriers, governments 
and regulators worldwide to search, select and set-aside spectrum 
blocks at higher frequencies for fixed wireless applications. But the 
logic behind the search for a frequency ``home'' that meets the needs 
and requirements of a particular wireless ``technology'' is 
counterintuitive. FDD isn't required or necessary for many fixed 
wireless applications.
    Selecting wireless technologies and frequencies that maximize the 
economics and business case of a mass-market application should have 
been the thrust. And under those assumptions, time division duplexing 
in sub-2.5 GHz frequency bands is the logical choice.
    For starters, TDD spectrum could be squeezed into any available 
contiguous spectrum. Because the transmission is time-slot, rather than 
frequency-based, it requires a single contiguous chunk of spectrum for 
transmitting and receiving. Its ``Ping-Pong'' transmission approach is 
very effective for fixed applications and slow-speed mobility.
    TDD transceivers are also significantly less complex and more cost 
effective than FDD transceivers on both the subscriber and base station 
side. For the base station, TDD eliminates the need for expensive 
duplexers. With subscriber equipment, the transceiver is much simpler 
and more cost effective to implement.
    One reason is TDD's channel reciprocity. Because it uses the same 
channel for transmitting and receiving, channel characteristics seen at 
the base station could be considered as identical to those of the 
subscriber unit. This channel reciprocity simplifies the TDD equipment 
design considerably.
    There have been past concerns about TDD and its susceptibility to 
echo and difficulty with synchronization. But the industry and 
technology has evolved to ensure these concerns are no longer valid. 
Proper system design and technology innovations have significantly 
reduced the potential of echo in even the longest TDD links. Further, 
with global positioning satellite (GPS) technology, all cells can be 
synchronized to the same clock, guaranteeing the synchronization 
between the transmit and receive time slots in all adjacent cells, 
thereby eliminating possible inter-cell interference.
    The only remaining concern surrounding TDD technology is that it 
hasn't received sufficient market attention as a competitive fixed 
wireless alternative. It's not that there aren't successful TDD 
implementations worldwide. In fact, TDD success stories include 
wireless PBX technologies (like personal handiphone systems (PHS) in 
Japan, digital European cordless telephone (DECT) in Europe) and a 
number of fixed wireless advanced code-division multiple access (ACDMA) 
implementations around the world. By design, PHS and DECT take a micro-
cellular approach while ACDMA offers the wide-area and high capacity 
coverage of a macro-cellular design.
    The encouraging fact is that TDD can offer an efficient, cost-
effective infrastructure alternative for competitive fixed wireless 
applications targeted at a mass market--if lower frequencies can be 
made available.

What needs to happen
    The challenge of finding lower-frequency available spectrum isn't 
as large an ``if'' as it might first appear. But there are a number of 
factors needing sufficient attention to bring lower frequency fixed 
wireless TDD applications to market.
    First and foremost we need to generate more serious attention to 
providing a competitive alternative to incumbent local exchange carrier 
(ILEC) telecommunications services. And that attention should be 
concentrated on encouraging fixed wireless applications.
    Regional bell operating companies (RBOCs) are slowly being allowed 
into the long distance market because local exchange competition 
``exists.'' But that competition is hardly ubiquitous and there are 
really no serious alternatives available for the mass-market 
residential customer aside from using the RBOCs own outside plant 
facilities.
    AT&T has switched local exchange access strategies a number of 
times from the wireless ``Project Angel'' to a $100 billion gamble on 
cable TV infrastructure. Apparently it is ``serious'' about local 
exchange alternatives, but hasn't yet hit on a killer, cost-effective 
strategy (perhaps we should take another look at recently announced 
fixed wireless products using newly developed CDMA/TDD technologies).
    Making lower frequency fixed wireless TDD applications a 
possibility requires cooperation from the FCC and other regulatory 
bodies to ensure rules and regulations support rather than hinder the 
opportunity for a mass-market success story. That could include 
removing requirements that suggest, dictate or favor specific 
technologies, such as FDD. Taking a bold step and encouraging or 
specifying the use of TDD for specific spectrum allocations is another 
option.
    Existing unintentional restrictions include mobile antenna output 
power requirements. Because mobile applications use omnidirectional 
antennas, output power is restricted to reduce radiation patterns and 
possible interference among the mobile units. But the same requirements 
aren't necessary for fixed wireless applications.
    With fixed wireless using directional antennas, transmit power can 
remain high without creating the same interference problems. The 
results are increased link budgets, resulting in wider and better 
coverage for the same or reduced cost--a plus for cost-effective, mass-
market implementations.
    Eliminating the restriction could open up D, E and F allocations in 
the PCS bands for fixed wireless consideration. Many of these PCS 
auction winners have yet to deploy because the spectrum allocations are 
limited in size to support high capacity mobile networks. Rather than 
sit on valuable spectrum or introduce yet another risky mobile 
application, perhaps TDD-based fixed wireless deserves a second look.
    Additional lower frequency spectrum is now available with more to 
come in the future. Examples include the upcoming 700 MHz auction of 
vacated television channel frequencies and spectrum in the 400 MHz 
range now used by analog services being phased out.
    Recent moves by the FCC regarding the 700 MHz frequencies suggest 
more of an FDD slant. But while it is possible to construct a paired 
band out of the available 30 MHz to allow for FDD applications, using 
the band for TDD implementations eliminates the need for significant 
guard bands and hence increases the available spectrum for wireless 
communications services.
    Lastly, a concerted effort by equipment manufacturers to explore 
and expand TDD options is warranted. Carriers have been ``pushed'' into 
higher frequency applications because FDD solutions are what wireless 
equipment manufacturers have had to offer.
The future
    Wireless equipment vendors need to focus energies on turning out 
TDD applications that ensure the competitive success of a mass-market 
fixed wireless alternative to wireline. That translates to modular 
equipment configurations that offer a ``pay as you grow'' philosophy 
for prospective carriers without the deep pockets of an AT&T or MCI 
WorldComm.
    Carriers can not depend on a ``build it and they will come'' 
wireless equipment mentality. As sure a bet as alternative residential 
and SOHO local exchange service may appear--considering the unmet 
demand for inexpensive, high-bandwidth Internet connections--carriers 
still need scalable solutions, providing cost-effective implementations 
and realistic returns for 100 or 100,000 subscribers.
    These equipment, regulatory and competitive environment goals are 
attainable and the alternative of TDD-based fixed wireless access 
solutions is realistic. But the cycle of technology dictating wireless 
solutions needs to end.
    Communications services for the mass-market require solutions 
designed to incorporate every frequency, wireless technology and 
implementation advantage possible. Lower frequency TDD fixed wireless 
applications are the real competitive opportunity. Adapting what's 
convenient and available should not be an option.

                                                       Attachment 3

                            Adaptive Broadband Corporation,
                                      Sunnyvale, CA, June 12, 2000.
Hon. Conrad Burns,
Washington, DC.
                                             Re: AccelerNet
Dear Senator Burns:

    I have been asked to explain why the two-way wireless Internet 
access service using low-power television stations proposed by U.S. 
Interactive, LLC d/b/a AccelerNet is not a risk for causing 
interference to other television licenses in the UHF band. This letter 
will address that subject, as well as present to you information 
demonstrating that the technology we would supply AccelerNet is proven 
and workable.
    By way of background, I am Executive Vice President and Chief 
Technical Officer of Adaptive Broadband Corporation, and have served as 
such since September of 1997. I hold a Ph.D. in physics from the 
University of California, Berkeley, an MBA from Santa Clara University, 
and a BA from the California Institute of Technology. Prior to 
September 1997, I was Vice President and Chief Technical Officer of 
ComStream Inc. Prior to that position, I held various executive and 
management positions at Ilex Systems; Loral Western Development Labs, 
and Space Applications Corporation. In 1985 I founded Theta Corporation 
and served as its President and Chief Executive Officer. From 1977 to 
1982 I was an assistant professor of high energy particle physics at 
Stanford University.
    Adaptive Broadband is a pioneer in the wireless broadband access 
market. Founded in 1968, as California Microwave, we are a leading 
supplier of terrestrial wireless systems that support ultra high-speed 
Internet access. In 1998, we acquired Adaptive Broadband Limited of 
Cambridge, U.K. The new AB-Access system developed from that 
acquisition offers a solution that provides wireless broadband access 
delivering up to 25 Mbps to each user based upon demand, which is 400 
times faster than conventional modem networks. This product is made 
possible by a patent-pending packet algorithm that adjusts efficiently 
to the ebb and flow of asymmetric Internet data traffic and supports 
the widest range of available spectrum.
    AccelerNet's plan for delivering two-way wireless high-speed 
Internet access using low-power television stations is an innovative 
and very workable concept that we are very excited to assist. The 
likelihood that operation wou1d cause interference to existing 
television or other users of the UHF band is extremely remote for a 
number of reasons.
    As I understand the plan, AccelerNet would utilize existing low 
power television stations and certain newly licensed additional 
stations as base stations only where they fit under the FCC's current 
rules. Thus, these base stations would comply with current FCC 
interference protection requirements with respect to full power, other 
low power television stations, and any other authorized users in the 
UHF band. Thus, there is no question of interference from the base 
station transmissions themselves. Hence, the only real question is one 
of whether the subscriber units, consisting of wireless modems which 
would talk back to the low-power stations with specific requests for 
Internet data, could cause interference. This is also not a meaningful 
possibility.
    Interference might only occur in the circumstance where a 
television receiver is: (1) near the edge of the service contour of a 
broadcast station operating adjacent to the system's transmitting 
channel, and (2) in proximity to an operating subscriber unit. This in 
itself, is highly improbable. Moreover, several circumstances combine 
to render interference even in this scenario, extremely remote:
    First, AccelerNet has indicated that the subscriber units will 
operate with low power, in the neighborhood of one watt or less. This 
plainly limits the potential for interference from these units.
    Second, system design will provide that the subscriber unit will 
operate with the minimum power necessary to carry on communication, 
similar to how the cellular and PCS services operate. Thus, actual 
operating power of subscriber units will almost always be well below 
the peak power of the unit.
    Third, if I understand the AccelerNet service model, the wireless 
access is such that more than 99 percent of transmission time for the 
system will be in the downlink mode from the base station to the 
thousands of subscriber units located in the system's service area. The 
individual subscriber unit's operating time (uplink mode) will be 
greatly limited, consisting of sporadic transmissions of a length of a 
few microseconds each, which will be insufficient to have any 
substantial affect upon even extremely proximate television reception.
    Fourth, prevention of interference in this case is primarily a 
function of the emission mask applicable to signal transmissions, The 
emission mask which will be employed for the subscriber units for 
AccelerNet will result in lower absolute power emission levels than 
that specified for full service DIV operation by the FCC in FCC Rule 
Section 73.622(h). This is a stringent emission limitation. The tighter 
the emission limitation, the less likely the potential of interference 
to adjacent channel television reception.
    Fifth, in the extremely unlikely situation where an interference 
problem actually occurs, it would be handled as it currently is 
handled--for example, when high power television stations interfere 
with TV reception in the areas immediately around their transmitters--
with the installation of an inexpensive filter.
    In light of the circumstances set forth above, I am confident that 
AccelerNet's operation will not result in interference to other 
authorized licensees in the UHF band. In this connection, one 
additional observation is appropriate. The FCC has authorized in its 
rules full power digital television stations (DTV) to provide digital 
data services, including Internet access, on an ancillary or 
supplementary basis. FCC Rule Section 73.624(c) states that

        provided that DTV stations comply with paragraph (b) of this 
        section [which is not relevant to this discussion], DTV 
        broadcast stations are permitted to offer services of any 
        nature, consistent with the public interest convenience, and 
        necessity, on an ancillary or supplementary basis. The kinds of 
        services that may be provided include, but are not limited to, 
        computer software distribution, data transmissions, teletext, 
        interactive materials, aural messages, paging services, audio 
        signals, subscription video, and any other services that do not 
        derogate DTV broadcast stations' obligations under paragraph 
        (b) of this section. Such services may be provided on a 
        broadcast, point-to-point or point-to-multipoint basis, 
        provided, however, that any video broadcast signal provided at 
        no direct charge to viewers shall not be considered ancillary 
        or supplementary.

The FCC's rules thus appear to give broad authority to DTV stations to 
offer data services of their choice, and leave technical design for 
these digital data services to their discretion, subject to compliance 
with the emission mask set by the DTV rules in order to prevent 
interference, in line with the approach required of full power DTV 
stations, AccelerNet would comply with the DTV emission mask and take 
such other action as necessary to ensure it will not cause 
interference. Moreover, the FCC will have full authority to require 
remediation in the unlikely event interference may occur, just as with 
full service DTV operation.
    You have also raised a question concerning whether the service 
AccelerNet will provide will actually work.
    I can assure you that the TDD technology Adaptive Broadband would 
provide AccelerNet will work. Adaptive Broadband is currently producing 
TDD equipment operating in the 2.5 to 2.686 GHz MMDS band, and in the 
5.25 to 5.825 GHz U-NII (unlicensed) band. This equipment provides a 
two-way wireless Internet I access service very similar to what 
AccelerNet would be implementing. Modifying this equipment for UHF 
operation will be straightforward. It will essentially require 
rechanneling the radio to the UHF band and fashioning an integral 
antenna for the subscriber unit. Those are relatively simple 
engineering tasks.
    In fact, Adaptive Broadband will have TDD product available for use 
by high bidders in the FCC's upcoming 700 MHz band auction, should such 
licensees desire to provide digital data services and should these 
licenses contract with Adaptive Broadband for development and 
manufacture of such product. There are no material differences in radio 
system design and implementation in that 700 MHz band, compared with 
operation in the lower portions of the UHF band used by low-power TV 
stations. Thus, there is no question but that this technology will work 
on low-power TV spectrum.
    Specifically, the TDD technology AccelerNet would employ from 
Adaptive Broadband is particularly suited to Internet access 
applications compared to conventional wireless technology. Current 
wireless technology, such as that used by cellular, PCS and other 
systems such as Nextel's employs Frequency Division Duplexing (FDD). 
FDD systems require separate dedicated transmit and receive spectrum. 
They are thus comparably inefficient because at least one-half of the 
spectrum must be silent while the other half of the spectrum is used 
for transmission. With Internet access, and other digital data 
services, the inefficiency of FDD technology is even more pronounced. 
This is because--unlike voice--data transmissions are highly 
asynchronous. Thus, although a 58 Kbps plain old telephone (POTS) line 
can, in many instances, adequately handle the uplink for Internet 
access, today's marketplace frequently requires the downlink side to 
provide data rates of more than 1 Mbps. Hence, an FDD system becomes 
even more inefficient when employed for delivery of data.
    TDD systems solve this problem of spectral inefficiency by 
employing the same spectrum to transmit both the downlink and uplink 
segments of a two-way transmission. With TDD, no aspect of bandwidth is 
committed, allowing dynamic allocation of spectral resources to serve 
users with data to transmit and dynamically altering direction 
according to traffic load. This greatly increases the efficiency of 
spectrum use, with spectrum use dynamically altering from upstream to 
downstream in less than a millisecond, as compared to traditional FDD 
systems, which allocate fixed partitions of spectrum to upstream and 
downstream traffic thereby resulting in unused spectrum. TDD, 
therefore, results in an improvement in efficiency by a factor of two 
to eight times. It is, therefore, estimated that just one site of a TDD 
system can adequately serve some 12,000 users. By contrast, cellular 
systems have a much smaller capacity per cell. TDD systems are thus 
more cost effective than FDD systems for data transmission, to the 
benefit of both the service provider and the consuming public.
    Moreover, UHF offers certain advantages compared to MMDS and U-NII 
bands in terms of propagation and building penetration. Thus, it is 
expected that subscriber units will be able to operate effectively 
without the need for outdoor antennas. Currently MIMDS and U-NII 
subscriber equipment generally require outdoor antennas. UHF operation 
thus has considerable benefit to the public in terms of increased 
utility and reliability compared to existing applications.
    We are aware that other TDD equipment suppliers, such as TRW and 
Arraycomm, Inc. have publicly announced plans to offer UHF equipment 
for TDD operation. Thus, this is not an issue where there should be any 
substantial question in the industry but that the technology works.
    Copies of materials you may find of interest relating to the points 
covered in this letter are enclosed for your information.
    I would be pleased to discuss this matter directly with you at your 
convenience.
        Very truly yours,
                                         Daniel L. Scharre,
                                          Executive Vice President.

    Senator Burns. Thank you.
    Mr. Morton, director of Community Broadcasters Association.

  STATEMENT OF LARRY MORTON, DIRECTOR, COMMUNITY BROADCASTERS 
                          ASSOCIATION

    Mr. Morton. Mr. Chairman, thank you.
    My name is Larry Morton. I am a member of the board of 
directors of the Community Broadcasters Association, and 
president of Equity Broadcasting Corporation. I appreciate the 
opportunity the Committee has given me today to come here and 
testify in support of passage of S. 2454. The CBA is the 
principal trade association of low power television 
broadcasters.
    We supported and appreciated the efforts of the Members of 
Congress who enacted the Community Broadcasters Protection Act 
into law last year. As a result of that act, community 
broadcasters with a record of substantial public service now 
have been given some measure of certainty that the investment 
they make to provide service to their local communities will 
not be subject to loss at the whim of the FCC.
    Previously, the FCC could, or had the ability to authorize 
Class A legislation. Frankly, I believe it is questionable this 
would have happened today had it not been for the legislative 
action the Congress did to support this. We really thank you 
for your consideration and support in this effort.
    S. 2454 would expand the class of LPTV stations entitled to 
protection to include those LPTV stations which provide the 
public digital data services, including wireless Internet. The 
CBA enthusiastically supports this legislation. However, we do 
believe there are two issues that need to be clarified.
    The first of these issues is to create a public service 
guideline for future Class A stations to avoid owners leaving 
the broadcast spectrum solely for digital transmission as a 
safe harbor to protect their license, and second to limit the 
initial transition to digital data services to existing 
licensees and permittees to avoid mass speculation in the 
pending filing window.
    These issues are discussed in detail in my written 
testimony.
    Now, briefly, I would like to put on my other hat as the 
president of Equity Broadcasting Corporation. Equity 
Broadcasting Corporation owns and operates two full power 
television stations, has two more under construction, and has 
an additional full power station under contract.
    In addition to that, we have an interest in more than 20 
full power television station construction permits and 
applications. We also own and operate 12 radio stations, and 
have 35 low power television stations.
    To some degree I have a foot in each one of these arenas, 
and so I think I am in a unique situation to look at this 
objectively. From this position, I firmly believe that low 
power television is a very unique situation, and is very vital 
to our country. Low power television is probably the most 
effective use of the broadcast spectrum there is.
    Something I often do in talking about this, I use an 
analogy, and I am sorry Senator Stevens is not here for this. 
He has better ones than I do. But it is like a bucketful of 
rocks. That bucket seems to be full. It weighs a lot. But if 
you look at it, you see all these gaps in between where the 
rocks fit together, and if you want to pour some sand in there, 
you can actually probably put another half a bucket of sand in 
between those gaps.
    And that is what low power television has done and 
community broadcasters have done. They have taken the gaps that 
were initially in the spectrum, gaps that other people 
overlooked and thought to be not worth much, or even worthless, 
and brought vital services to the community. The usage of this 
spectrum for wireless digital data services is another way to 
maximize this usage for the good of the public.
    Obviously, the importance of Internet access is obvious to 
even the most casual observer. In its short existence, the 
Internet has grown to become an important medium for the 
conduct of commerce, the education of our children, and the 
maintenance of the informed and enlightened electorate 
necessary for our free society.
    As Alan Greenspan pointed out this week, the Internet is 
one of the engines which is driving the United States economy 
to record levels of productivity and employment. Recent 
estimates are that e-commerce will total some $300 billion by 
2002. Enactment of 2454 will help facilitate full public access 
to the Internet, which in turn will promote the continued 
expansion of our economy.
    As Congress, the administration, and the FCC have all 
recognized, not every American enjoys the benefits of the 
Internet, especially high speed Internet service. As Chairman 
Kennard said last week in a speech in Atlanta, the Internet can 
either be the great equalizer, or just another missed 
opportunity. Access. Access makes the difference. Access to 
high speed Internet services is severely restricted in this 
Nation. Indeed, it has been suggested that we confront a 
digital divide.
    In its recent report on advanced telecommunications in 
rural America, NTIA found that rural areas are currently 
lagging far behind urban areas in access to high speed 
Internet. The economics of wireless operation in rural areas 
are much more favorable than wired operations.
    There is obviously a major problem in achieving the 
potential for wireless high speed Internet access which this 
Committee may help resolve by favorable action on S. 2454. That 
problem is the lack of sufficient and adequate spectrum.
    Currently, spectrum available for two-way wireless high 
speed data services is restricted to LMDS, MMDS, and unlicensed 
PCS spectrum. Other wireless spectrum suffers from technical or 
practical problems, including the high demand for mobile voice 
service and narrow band configuration. The currently available 
bands, however, are in the microwave area of the 
electromagnetic spectrum.
    Microwave spectrum is particularly unsuited for this type 
of service. It suffers signal degradation from rain. It is 
impeded by trees and foliage, and it cannot easily penetrate 
building structures. LPTV stations operating in the UHF band, 
however, can deliver high speed wireless Internet access to 
homes, offices, and classrooms without facing these problems, 
and in most cases without the need for exterior antenna.
    The need to provide high speed DSL quality Internet 
services to areas not currently served at a cost-effective 
price is a key public interest concern. As the FCC has 
repeatedly recognized, as Chairman Kennard said, our challenge 
is not just to build the Internet that goes faster, but that 
goes farther, that reaches all Americans.
    We need to make sure that the opportunities that the 
Internet and communications technologies provided are available 
to all Americans. This high priority initiative is fully 
consistent with Congress' direction to the FCC in the 
Telecommunications Act of 1996 to promote the goal of 
widespread deployment of advanced services. This proposed 
legislation is directly responsive to this goal, and will 
facilitate its achievement.
    As I previously stated, Community Broadcasters' board of 
directors has unanimously supported this legislation, and as 
president of Equity Broadcasting Company, a company that has a 
uniquely unbiased view of this industry, we all support the 
legislation, the passage of this legislation and hope you will 
expedite its process.
    Thank you.
    [The prepared statement of Mr. Morton follows:]

             Prepared Statement of Larry Morton, Director, 
                   Community Broadcasters Association

    Mr. Chairman, my name is Larry Morton. I am a member of the board 
of directors of the Community Broadcasters Association (``CBA'') and 
President of Equity Broadcasting Corporation. I appreciate the 
opportunity the Committee has given me today to come here and support 
the passage of S. 2454.
    The CBA is the principal trade association of Low Power Television 
broadcasters. We supported and we appreciated the efforts of members of 
Congress who enacted the Community Broadcasters Protection Act into law 
last year. As a result of that Act, LPTV broadcasters with a record of 
substantial public service now have been given some measure of 
certainty that the investments they make to provide service to their 
local communities will not be subject to loss at the whim of the FCC. 
We thank you for that consideration.
    S. 2454 would expand the class of LPTV stations entitled to Class A 
protection to include those LPTV stations which provide the public 
digital data services, including wireless Internet access. The CBA 
enthusiastically supports this legislation; however we believe there 
are two issues that need to be clarified.
    First, on May 1, 2000, the Commission announced an auction filing 
window for new LPTV and translator station applications. The filing 
period is July 30-August 4 of this year. Although this filing 
opportunity was intended principally to allow for new applications in 
rural areas that have limited television service, this legislation 
could change the dynamics of this filing period. The result could be 
the filing of speculative applications which would ultimately compete 
and conflict with those who are trying to provide a few more basic 
channels of broadcast television in highly rural areas.
    There is a solution to this problem. CBA proposes a modification to 
Sec. (h)(1) of this legislation to limit eligibility under this Act to 
existing licensees and holders of construction permits. We suggest a 
cutoff date of June 30, 2000. This would effectively eliminate 
speculators from the upcoming filing window.
    Secondly, CBA is also concerned that this legislation could provide 
incentives to non-Class A LPTV broadcast stations to become data 
service providers because this legislation would provide them the only 
pathway to protect their license. That clearly isn't the purpose of 
this legislation and CBA wants to be certain that this is not an 
unintended result.
    Mr. Chairman, in S. 1547, the Community Broadcasters Protection Act 
of 1999 which you authored last year and which became law on November 
29, 1999, you provided LPTV licensees two opportunities to qualify for 
a permanent, Class A license. First, a station was eligible if for 90 
days before enactment it was on the air 18 hours per day and averaged 
no fewer than 3-hours of locally originated programming on a weekly 
basis. Second, a station could become eligible if the Commission 
determined it was in the public interest.
    I believe you understood and we shared that view, that the 
Commission would develop, through its regulatory process, a public 
interest test so that stations that did not initially qualify, would 
have a future opportunity to file a petition with the Commission and 
become a Class A station.
    In its March 28, 2000, Class A Report and Order, the Commission 
determined mistakenly that the purpose of the legislation was to 
provide a single window of opportunity to existing LPTV stations. On 
that basis the Commission decided not to grant additional Class A 
licenses beyond those who qualified during the 90 days prior to 
enactment of the CBPA.
    CBA believes that decision was wrong. With this misinterpretation 
of S.1547, this legislation now creates the circumstances where a LPTV 
licensee can gain Class A status if it is engaged in digital data 
services but cannot gain Class A status as a television broadcast 
station. To correct this problem, CBA recommends the Committee simply 
include in this legislation clarifying language on the purpose of Sec. 
(f)(2)(c) of the CBPA and direct the Commission to implement public 
interest standards and appropriate regulations within a reasonable 
period not to exceed 12 months. The CBA board strongly recommends 
expedited approval of this legislation.
    To understand the value of data services and the importance of this 
legislation to underserved areas, you only need to look at the impact 
of the Internet on society. In its short period of existence, the 
Internet has grown to become an important medium for the conduct of 
commerce, the education of our children, and the maintenance of the 
informed and enlightened electorate necessary to our free society. 
Given its status in the United States as a substantial educational, 
promotional, sales and distribution channel, the Internet is one of the 
engines which is driving the United States economy to record levels of 
productivity and employment. Recent estimates are that e-commence will 
total some $300 billion by 2002. Enactment of S. 2454 will serve to 
facilitate full public access to the Internet which will, in turn, 
inure to the continued expansion of the economy.
    As Congress, the administration, and the FCC have all recognized, 
not every American has been able to enjoy fully the benefits of the 
Internet, especially high-speed Internet service. As FCC Chairman 
Kennard said just last week in a speech in Atlanta, ``The Internet can 
either be the great equalizer, or just another missed opportunity. 
Access . . . access makes the difference.'' \1\
---------------------------------------------------------------------------
    \1\ Remark of William E. Kennard at The Supercomm 2000 
International Dinner, Atlanta, GA (June 5, 2000).
---------------------------------------------------------------------------
    Access to high speed Internet service is severely restricted in 
this nation. Indeed, it has been suggested that we confront a ``digital 
divide.'' In its recent report on Advanced Telecommunications in Rural 
America, NTIA found that rural areas are currently lagging far behind 
urban areas in access to high-speed Internet service. The report found 
that broadband services were essentially limited to two technologies: 
cable modem and digital subscriber line (``DSL''). The report also 
pointed out that these technologies were primarily available only in 
urban areas. The report found that less than five percent of towns of 
10,000 or fewer have cable modem service, while 65 percent of cities of 
250,000 or more had such service. Both of those figures I submit are 
plainly inadequate.
    DSL service was likewise found chiefly limited to urban areas. Of 
cities of more than 100,000, only 56 percent had DSL service. However, 
fewer than five percent of cities of 10,000 or less had such service. 
And deployment of either cable modem or DSL service in rural areas was 
found to be even lower. The reason for these abysmally low rates of 
service in the rural areas was found to be economic. According to the 
Report, ``For wireline construction, the cost to serve a customer 
increases the greater the distance among customers.''
    The economics of wireless operations in rural areas, however, are 
much more favorable. However, there is a major problem in achieving the 
potential for wireless high-speed Internet access, which this Committee 
may help resolve by favorable action on S. 2454: the lack of sufficient 
and adequate spectrum. Currently, spectrum available for two-way 
wireless highspeed data services is restricted to LMDS/MMDS and 
unlicensed PCS spectrum. Other wireless spectrum suffers from technical 
or practical problems, including the high demand for mobile voice 
service. These currently available bands, however, are in the microwave 
area of the electromagnetic spectrum. Microwave spectrum is 
particularly unsuited to this type of service. It suffers signal 
degradation from rain; it is impeded by trees and foliage; and it 
cannot easily penetrate into building structures. Thus, existing 
wireless data applications require a relatively expensive outdoor 
antenna to bring signals into the home, the office or the classroom. 
And even then, there are distance limitations due to the lower 
propagation characteristics of the signal at those frequencies. LPTV 
stations operating in the UHF band, however, can deliver high-speed 
wireless Internet access to homes, offices and classrooms in most cases 
without the need for exterior antennae.
    The recent history of the telecommunications industry aptly 
illustrates the demand and utility of unwired access to digital 
services. Wireless telecommunications has been a substantial 
enhancement to the United States economy. Wireless Internet access 
promises similar economic benefits. The use of low-power television 
stations to provide high-speed digital Internet access is particularly 
appropriate given that such stations have struggled for market 
acceptance. Allowing their facilities to be used for wireless Internet 
access would facilitate the highest and best use of their facilities. 
Moreover, use of low-power television stations for wireless Internet 
access would facilitate the national priority of the provision of 
Internet access to schools and public libraries across the nation 
without the necessity for expensive and disruptive rewiring of those 
facilities. Rewiring the existing base of schools and public libraries 
runs the further substantial risk of adverse environmental consequences 
stemming from, among other things, asbestos release. Moreover, among 
the other uses for this novel service is to make available telemedicine 
of digital television quality. Telemedicine will enhance the ability of 
physicians and emergency room personnel to treat injured or ill 
patients from rural and remote areas.
    Allowing LPTV stations to provide digital data services--while it 
is certainly innovative--is fully in keeping with the policy goals the 
FCC has announced. In a July 20, 1999, speech, FCC Chairman Kennard 
described the Commission's program for flexible use of wireless 
spectrum as an effort aimed at promoting competition. Specifically, he 
stated, ``Since the early 1990s, the FCC has given holders of wireless 
licenses flexibility in their use. This opened the door for wireless 
Internet access, which is now available in dedicated modems or even in 
wireless phones themselves. We've continued to promote competition by 
making more spectrum available and doing so without restrictions as to 
[its] use.'' S. 2454 would provide that flexibility to LPTV operators 
as well.
    Furthermore, in a report to Congress, the FCC stated, ``It has 
become clear that wireless licensees providing fixed wireless services 
have the potential to create facilities-based competition beyond the 
traditional mobile markets.'' \2\ One example the Commission gave of 
entities promoting competition in this way were low-power TV licensees 
providing Internet access. According to the Commission, ``In addition 
to the traditional wireless cable operators, there are several wireless 
cable licensees who were not previously video programming distributors, 
but which instead provide Internet access. These entities tend to be 
start-up companies using MMDS or low-power television licenses.'' \3\
---------------------------------------------------------------------------
    \2\ Implementation of Section 6002(b) of the Omnibus Budged 
Reconciliation Act of 1993, 14 FCC Rcd 10145, Appendix F at 10255 ( 
June 24, 1999).
    \3\ Id.
---------------------------------------------------------------------------
    The need to provide high speed DSL quality Internet service to 
areas not currently served at a cost effective price is a key public 
interest concern as the FCC has repeatedly recognized. In a July 20, 
1999 speech, Chairman Kennard said, ``Our challenge is not just to 
build an Internet that goes faster, but that goes farther--that reaches 
all Americans. . . . We need to make sure that the opportunities that 
the Internet and new communications technologies provide are available 
to all Americans.'' \4\ This high priority initiative is also fully 
consistent with Congress's direction to the FCC in the 
Telecommunications Act of 1996 to promote the goal of widespread 
deployment of ``advanced services.''
---------------------------------------------------------------------------
    \4\ Remarks by FCC Chairman William E. Kennard Before the Federal 
Communications Bar, Northern California Chapter, San Francisco (July 
20, 1999).
---------------------------------------------------------------------------
    ``Advanced Services'' have been defined ``without regard to any 
transmission media or technology, as high-speed, switched, broadband 
telecommunications capability that enables users to originate and 
receive high-quality voice, data, graphics, and video 
telecommunications using any technology.'' \5\ The FCC states it is 
``committed to carrying out Congress's directive to ensure that 
advanced telecommunications capability is deployed in a reasonable and 
timely manner to all Americans.'' \6\
---------------------------------------------------------------------------
    \5\ Telecommunications Act of 1996, Pub.L. 104-104, Title VII, 
Sec. 706(c)(1), February 8, 1996, 110 Stat. 153, reproduced in the 
notes under 47 U.S.C. Sec. 157.
    \6\ Inquiry Concerning the Deployment of Advanced 
Telecommunications Capability to All Americans in a Reasonable and 
Timely Fashion, 14 FCC Rcd 2398 at 2402, (Feb. 2, 1999).
---------------------------------------------------------------------------
    The proposed legislation is directly responsive to this goal and 
will facilitate its achievement. The CBA urges its passage forthwith.

    Senator Burns. Thank you very much. Mr. Popham.

         STATEMENT OF JAMES J. POPHAM, VICE PRESIDENT/
GENERAL COUNSEL, ASSOCIATION OF LOCAL TELEVISION STATIONS, INC. 
                             (ALTV)

    Mr. Popham. Thank you, Mr. Chairman. It is a pleasure to be 
here today, and we appreciate the opportunity to express the 
views of local television stations on this legislation. ALTV, 
as you well know, represents the interests of stations not 
affiliated with ABC, CBS, and NBC, but I dare say virtually 
every television station shares the concerns we will express 
today.
    Let me start out by emphasizing that we are not here 
necessarily to rain on anyone's parade. We may want to rain 
down a few lightning bolts here and there. We may want to show 
you where the dark clouds on the horizon are, but our hope 
would be ultimately, I believe, to get that parade to the same 
point everyone wants it to get, but by a route that will not 
trample on our interests.
    Let me try to clarify the issue just a little bit. 
Certainly we do have a concern about interference. Certainly we 
want to be sure that everyone stays in their own lane. 
Everybody that is using spectrum in any way has that interest, 
and we share that.
    But the real issue, the more significant issue for us in 
this bill is not staying in the lane, but who gets the lane 
when two people want to use the same lane, and what this 
legislation in its present form would do would give first claim 
to that lane to an LPTV station providing digital data service, 
and that would have a preclusive effect on the use of that 
lane, or that channel, by any local television station in 
implementing the digital television convergence and transition.
    Let me set that a little bit in context and add a little 
detail to it. I think Roy Stewart from the commission also 
spoke very well on this issue. We are in some rough air now on 
the digital transition, and that maybe is not really a 
surprise, because we had many of the same problems when we 
converted from black and white to color television. We all 
remember green faces and brown sky and purple grass, but we 
have gotten beyond all of that, and we are facing some similar 
problems now in the DTV transition.
    We are not sure--there are many questions about over-the-
air transmission with the current modulation scheme. There is 
virtually no cable carriage of any of the 134 digital channels 
which are now operating. The FCC has at best dragged its feet 
on adopting must-carry rules to require carriage of local 
stations' digital signals.
    Continuing controversy continues to erupt over cable 
compatibility standards and labeling of sets, over copy 
protection, and all the related issues that go to being sure 
that the signal is processed in a way that stations can 
actually be seen by viewers in their receivers and that the 
receivers will actually connect to the set-top boxes, and to 
the systems, et cetera, et cetera, et cetera.
    All these issues remain pending, and are creating a great 
deal of uncertainty and risk for local stations in the digital 
transition. I have characterized it I think as something like 
an airplane in a critical stage of take-off. We are kind of 
just off the ground, but there are only so many obstacles that 
we can deal with, only so many problems we can have before we 
start wondering about whether we are really going to be able to 
fly or not.
    Unfortunately, as now written, this legislation would just 
create another problem. In particular what it would do, as I 
think Mr. Stewart said, it is going to prevent our stations, if 
need be, from using channels which might otherwise be available 
to maximize their service. This is a critical issue in 
particular to our member stations. Because many of our stations 
are UHF stations, we pushed very hard for the concept of 
maximization, and it is very critical for us to be able to 
provide service to the widest area possible.
    Many stations will also need to modify their facilities to 
accommodate interference concerns, to accommodate local zoning 
concerns, and for a number of other reasons.
    All stations are going to have to elect a channel as 
between their analog and their digital channel for their final 
operation at the end of the transition. There are a number of 
stations, 17 we believe, which have at this point channels that 
are in--or, rather, outside the core of channels that will be 
used for DTV, so neither of their channels will be available to 
them at the end of the transition.
    They are going to have to find a channel within the core 
channels and, to the extent there are low power services which 
have primary rights on those channels, it is going to limit 
their options considerably. They also foreclose options of 
other stations which are going to have to pick between their 
two core channels for their final digital channel.
    This is another bump in the road which frankly we do not 
need, in what has become the very difficult digital conversion.
    As Roy Stewart also recognized, what we are looking at here 
is a very dramatic change in the nature of low power 
television. We are moving it from a free television service to 
a subscription data service. It is a very different animal from 
what low power has always claimed itself to be, and has 
promoted itself as being, and that sort of thing I think takes 
a very hard look, because it is a very fundamental reallocation 
of broadcast spectrum.
    I would also point out that it is very possible and, 
indeed, is already being provided, to provide broadband 
services via satellite to rural and nonrural areas. Indeed, 
there are services, including DirecTV, EchoStar, Pegasus, 
Gilatt Satellite Systems, I-Skynet, EMS Technologies and 
others, which are now developing systems to provide satellite-
delivered broadband Internet access and, in fact, two of those 
services, DirecPC and Skyblaster, are available using KU band 
satellites. With the future development of spot beam KA band 
satellite that service will only grow and expand.
    So again, we urge you to take a hard look at the 
reallocation issue. We ask you to take a very hard look at our 
concerns about who gets precedence in the various lanes. We are 
anxious that you not invoke the law of unintended consequences 
here, and perhaps in the words of the song that came to mind, 
give us land, lots of land with starry skies above, but don't 
fence us in. Thank you.
    [The prepared statement of Mr. Popham follows:]

Prepared Statement of James J. Popham, Vice President/General Counsel, 
         Association of Local Television Stations, Inc. (ALTV)

Introduction
    We greatly appreciate this opportunity to make our views known to 
the Subcommittee. The Association of Local Television Stations, Inc. 
(``ALTV'') represents the interests of full service local broadcast 
television stations not affiliated with ABC, CBS, or NBC. Most of our 
member stations are affiliates of either the Fox, UPN, WB, or PaxTV 
networks. Some remain traditional ``independent'' stations, which 
continue to offer innovative programming to their communities. \1\ 
ALTV's membership includes stations from every region of the country. 
Their ownership spans the continuum from local single station owners to 
large media conglomerates. Their interests range from those of 
nationally distributed ``superstations'' to those of small home 
shopping and ``infomercial'' stations. All of our member stations are 
now involved heavily in the transition to digital television. As of 
today, 134 Of the nation's local television stations already have begun 
broadcasting from their new multimillion dollar digital broadcast 
facilities. The rest will be commencing operation in digital 
broadcasting between now and the FCC-imposed deadline of May 1, 2002. 
We would note at the outset that full power local digital television 
stations will enjoy the ability to provide digital data services, as 
well as free broadcast television service. Thus, the perspective of our 
membership is multi-faceted and wide-ranging, and we respectfully 
submit that consideration of their concerns will add materially to the 
debate on S. 2454.
---------------------------------------------------------------------------
    \1\ Indeed, ALTV previously was ``INTV,'' the Association of 
Independent Television Stations.
---------------------------------------------------------------------------
    ALTV considers the basic goal of S. 2454 laudable. Provision of 
digital data services via wireless transmissions offers the opportunity 
for more widespread availability of new avenues of data and information 
transmission to American consumers. Moreover, the inherent efficiency 
of point-to-multipoint wireless transmission--whether provided by 
satellite, MMDS, full power television, or low power television 
(``LPTV'')--might be exploited most readily to provide such services in 
rural and other low-population density areas. Indeed, all things' being 
equal, the wide open door to provision of digital data services via 
LPTV facilities offered by S. 2454 would draw only praise and support. 
However, all things are not equal. Therefore, ALTV must express its 
serious reservations about this legislation in its Present form.
    ALTV respectfully submits that S. 2454 in its original form would 
invoke the ``law of unintended consequences.'' Placed in the current' 
context of the ongoing transition to digital broadcasting, it would 
achieve, perhaps, short-run progress in expanding the availability of 
digital data services, but at the ultimate expense of attenuating the 
ability of many full power local broadcast television stations to 
provide truly full digital service to their communities.
    The troublesome provision of S. 2454 in ALTV's view is new 
paragraph 336(h)(3), embodied in section (2) of the bill. It directs 
the Federal Communications Commission to refuse to authorize ``any new 
service, television broadcast station, or modification of any existing 
authority that would result in the displacement of, or predicted 
interference with, a low power television station providing (digital 
data services).'' That provision essentially would protect any LPTV 
station offering digital data services from interference from or 
displacement by a new, full power television station, the modified 
facilities of an existing full power television station, or even any 
new, now unknown service. In simplest terms, such an LPTV station, 
operating on a particular channel, could preclude any use of that 
channel (or an adjacent channel) that would displace the LPTV station 
or interfere with the LPTV station's signal.
    This preclusive effect stands to be compounded by the use of 
``multiple transmitters at multiple locations'' as contemplated by new 
paragraph 336(h)(5) in section (2) of S. 2454. Thus, for example, such 
an LPTV station, using multiple transmitters on six different channels 
in a particular geographic area would preclude use of those six 
channels for full power service in that area. The preclusive effect of 
using these six channels for an LPTV-based service, however, does not 
stop there. Their use for full power television in surrounding areas 
also will be limited because use of the channels for full power service 
still would interfere with six LPTV channels in use nearby (and not so 
nearby) areas. This interference is a product of the simple fact that a 
television signal too weak to provide a viewable signal still will 
cause interference to signals on the same or adjacent channels.\2\ This 
problem is exacerbated by the fact that the LPTV station will be 
operating at a relatively low power level. Because the potential for 
interference is measured by the relative strength of the LPTV signal 
versus the potentially interfering signal from the full power station, 
a very weak full power signal would cause interference to an LPTV 
signal. In sum, the use of a channel by an LPTV station has widespread 
preclusive effect on the use of that channel and adjacent channels in 
the same and contiguous areas.
---------------------------------------------------------------------------
    \2\ Thus, under FCC rules, a television signal on channel 11, which 
provides coverage in an approximately 83 mile radius, may not be used 
by another station within 152 miles. 47 CFR Section 73.623(d).
---------------------------------------------------------------------------
    ALTV's inability to support S. 2454 is rooted in the impact of 
these preclusive effects on the digital broadcast conversion. To avoid 
an abrupt changeover from analog to digital broadcasting, the FCC has 
implemented a transition scheme. During the transition, scheduled to 
end in 2006, local television stations were granted authority to 
operate on an additional channel. Thus, during the transition, they 
will continue to provide analog service on their existing channels and 
initiate digital broadcasting on the second channel. Providing every 
local television station with two channels, of course, presented an 
enormous challenge. In congested areas like the Northeast, for example, 
finding a second channel for every station represented a near miracle. 
Even so, the FCC succeeded in providing most local television stations 
with a digital television channel that would enable them to replicate 
their current analog coverage areas. \3\ In the case of many existing 
UHF stations, however, replication alone still left them with 
materially smaller DTV coverage areas than those of the VHF television 
stations in their markets. To address this competitive disparity, the 
FCC, at ALTV's urging, adopted procedures whereby UHF stations could 
apply to the FCC for authority to ``maximize'' their DTV facilities, 
thereby expanding their coverage areas. Such authorizations were 
subject to stringent limitations on interference which might be caused 
to existing analog stations and new DTV facilities.
---------------------------------------------------------------------------
    \3\ Coverage area is important to consumers because the larger a 
station's coverage area, the more consumers have access to its signal 
and programming. From the station's perspective, the larger its 
coverage area, the larger, its potential audience. Because audience and 
revenue are virtually in direct proportion for local television 
stations, a station's ability to operate profitably and provide an 
attractive and responsive program service to its community is directly 
affected by the size of its coverage area.
---------------------------------------------------------------------------
    At the close of the transition, all local television stations must 
return one of their channels and continue digital broadcasting only on 
the remaining channel. Recognizing that this would create a number of 
vacant channels at the close of the transition, the FCC determined to 
reduce the amount of spectrum allotted to broadcasting. Consequently, 
at the close of the transition, part of the spectrum now allotted to 
broadcasting no longer will be available. Specifically, channels 52-69 
will be lopped off the broadcast spectrum. Whereas all stations' DTV 
facilities can be accommodated in channels 2-51 after the transition, 
the need to provide all stations a second channel during the transition 
has necessitated using channels 52-69 to provide some stations with a 
DTV ``loaner'' channel. Additionally, some stations already had been 
authorized to use channels between 52 and 69 for their analog service. 
None of these analog or DTV facilities will be able to remain on 
channels 52-69 after the transition.
    The ability of local television stations to select the optimum 
channel for their DTV facilities post-transition and/or to maximize or 
optimize their DTV facilities during and after the transition is 
critical to many local television stations. As noted above, coverage 
equals audience equals revenue equals viability and profitability 
equals service to the public. The locus of ALTV's concern with S. 2454 
is the potential for widespread preclusive use of channels by digital 
data LPTV facilities. Such preemptive use of television channels would 
place the following constraints on the development and expansion of 
full service DTV stations:

   The number of local television stations able to maximize or 
        otherwise modify their DTV facilities would be reduced. No 
        improvement in their DTV facilities would be permitted if it 
        interfered with an LPTV station providing digital data service. 
        This problem would be particularly acute for Stations with DTV 
        facilities forced to migrate from out-of-core channels (52-69) 
        to core channels at the conclusion of the transition. These 
        stations have no core DTV channel assigned to them today. Until 
        such time as stations are required to elect either their 
        current analog or DTV channels for permanent DTV operation, no 
        permanent channel can be assigned these stations. Therefore, no 
        means currently exists for them to apply for an authorization 
        to maximize their facilities. Their ability to maximize, thus, 
        will be constrained, if not eliminated, by the preclusive 
        effect of construction of digital data LPTV stations in the 
        interim. Some stations also may need to modify their DTV 
        facilities to address such problems as local zoning 
        restrictions. Their ability to do so also could be imperiled by 
        he preclusive effect of construction of digital data LPTV 
        stations.

   The channels available for the DTV facilities of stations 
        currently assigned out-of-core analog and DTV channels would be 
        diminished.\4\ Just finding them any channel might become 
        problematic, much less a channel suited to their circumstances. 
        For example, a station might be assigned a channel which would 
        permit the station to continue to use its existing DTV 
        transmitter, antenna, and tower site, although on a different 
        channel. On the other hand, the preclusive effect of LPTV 
        digital data deployment might force it to use a channel 
        requiring a new transmitter, antenna, or tower site, or resort 
        to a more expensive and technically complex directional 
        antenna.
---------------------------------------------------------------------------
    \4\ Seventeen local television stations currently suffer dual out-
of-core channel assignments.

   DTV channel selection options could be negated by preclusive 
        use of channels for LPTV digital data services. The many local 
        television stations with analog and DTV channel assignments in 
        the core (channels 2-51) are permitted to elect one or the 
        other of their channels for permanent DTV operation. This 
        election could be negated if, for example, preclusive LPTV 
        facilities hem in one of the channels and prevent maximization 
---------------------------------------------------------------------------
        or any improvement in facilities on that channel.

   The number of potential new post-transition DTV stations 
        could be reduced, perhaps, significantly. The preclusive use of 
        television channels by digital data LPTVs also could and, 
        likely, would, reduce the number of channels available for new 
        full service DTV stations. These channels, made available by 
        the return of numerous core channels at the conclusion of the 
        transition, offer the prospect for additional full service 
        broadcast DTV stations. New stations offer many potential 
        benefits, including more consumer choice and more 
        entrepreneurial opportunities, just to name a few.

Therefore, ALTV sees the potential for widespread preclusive effects on 
local television stations' DTV channel selection and facilities 
upgrades as the ``tragic flaw'' in S. 2454.
    In a similar vein, ALTV also is concerned about the difficulties of 
enforcing the ``no interference'' prescription in new section 
336(h)(4). It is one thing to forbid interference. It is quite another 
to police it. How many viewers will just watch another channel rather 
than complain to a station that its signal suddenly is not providing 
the same quality picture they have become accustomed to? Once 
interference is reported, isolating it and identifying its source is no 
slam dunk. If the interference then can be traced back to an LPTV 
station, then the full service station can expect a raft of denials, 
even if its calls are returned. If controversy remains and the FCC 
enters the fracas, then more testing, denials, and contretemps are 
likely to ensue before a remedy can be effectuated. Such disputes are a 
headache to the full service station, the LPTV station, and the FCC. 
Moreover, they represent dashed consumer expectations about the 
reliable availability of good quality reception of its local stations.
    ALTV also emphasizes that this hardly is the time to burden local 
television stations' digital conversion efforts with more uncertainty 
and limitations. Digital broadcasting has just left the ground after an 
extended, sometimes tortuous take-off roll. Now it begins its ascent 
toward a dark and roiling horizon. The path to success is obstructed by 
uncertainty on many fronts. Nonetheless, local television stations are 
confident of the ultimate appeal of new digital broadcasting services. 
At the same time, they also remain painfully aware that, as in the case 
of a plane only hundreds of feet off the ground, only so many things 
can go wrong before continued progress in flight is placed in jeopardy.
    As the FCC recognized when it launched an aggressive transition 
schedule, ``while the opportunities afforded by digital technology are 
great, so are the risks.'' \5\ Local television stations already are 
coping with considerable risks, many of which were anticipated, some of 
which were not. The transition to digital broadcasting remains plagued 
and delayed by uncertainty:
---------------------------------------------------------------------------
    \5\ Fifth Report and Order, 12 FCC Rcd 12809, 12811 (1997).

   Demonstrable off-air reception problems are under 
        investigation. The Commission itself recently sought comment on 
        this critical issue. More recently, the Advanced Television 
        Standards Committee (``ATSC''), which developed the current 
        8VSB transmission standard, initiated its own investigation and 
        analysis of reception problems.\6\ ATSC Chairman Robert Graves 
        reportedly stated, ``We know this debate is going on and 
        there's going to be a lot more debate and a lot more study. The 
        reliable reception issue has not gone away.'' \7\ Meanwhile, 
        one major set maker has halted new DTV receiver production in 
        light of this and other uncertainties (see below).
---------------------------------------------------------------------------
    \6\ ``ATSC Forms Task Force to Study RF System Performance,'' 
Communications Daily (March 22, 2000) at 1-2.
    \7\ Id. at 2.

   Cable carriage of local television stations' digital signals 
        is all but nonexistent. The Commission is into the second year 
        of its proceeding looking towards implementation of the digital 
        must carry requirement with resolution of the matter as elusive 
        as ever. In short, the ability of consumers to receive digital 
---------------------------------------------------------------------------
        broadcast signals today is in no way assured.

   Even if a reliable signal could be assured either off-air or 
        via cable, consumers still face uncertainty with respect to the 
        roll out of digital receivers. Delays in standard setting have 
        arrested receiver manufacture and sales. Negotiations over such 
        critical matters as standards and labels for cable-ready sets 
        have plodded to partial success, but only after the Commission 
        finally prodded the parties with threatened, then real 
        proceedings. As a result, cable-ready digital receivers likely 
        will be available for major retail sale campaigns no sooner 
        than the pre-Christmas sales period in 2001 or, perhaps, the 
        following year. In short, no link in the distribution chain--
        from program acquisition by local television stations to the 
        availability of a picture to view--is secure at this point.

   Many local television stations already have been forced to 
        apply for maximized facilities just to assure that their 
        upgrades would not be precluded by authorization of the new 
        Class A LPTV facilities. Notably, the dimension of the threat 
        of potential preclusion was limited in the case of Class A LPTV 
        stations. Only a finite number of existing LPTV stations were 
        eligible. Therefore, assessing the need to file a maximization 
        application was more manageable. In the case of new digital 
        data LPTV stations, the effect would be more widespread and 
        less predictable. Any number of existing or future LPTV 
        stations could elect to provide digital data services and 
        thereby have a preclusive effect on a station's need to modify 
        its facilities.

The appearance of such unanticipated bumps in the road hardly is a 
surprise. Anyone who remembers purple hair on green faces (in a pre-
Simpsons era) during the early years of color television could attest 
to the inevitability of debugging and improving the system. 
Nonetheless, now simply is not the time to complicate the DTV 
transition and curtail full power television stations' flexibility to 
secure authorizations for facilities enabling them to provide the best 
possible service to the public. Local television stations are facing 
enough problems in effectuating the transition to a fully digital local 
broadcast television service. S. 2454 in its present form would just 
add to the list.
    Finally, ALTV wishes to raise a matter of deep concern, although 
less of immediate practical consequence. S. 2454 essentially changes 
the nature of low power television. What is now a free broadcast 
service could evolve rapidly into a subscription digital service. In a 
digital environment distinctions between data and video disappear. Both 
are bitstreams. Few doubt that Streaming video someday (even someday 
soon) will provide the same quality full motion video picture as 
broadcast television. S. 2454, therefore, could open a door to 
widespread use of LPTV to provide subscription video services. Unlike 
full power DTV stations, such LPTV stations would have no concomitant 
obligation to provide even one channel free broadcast service. Congress 
has every right to direct the FCC to reallocate spectrum. However, such 
matters are weighty and deserve careful study. Again, ALTV urges a 
harder look at S. 2454 and its implications and consequences for free 
broadcast television service.\8\
---------------------------------------------------------------------------
    \8\ A matter of peripheral concern in this regard is the disparity 
between LPTV stations which offer digital data services and full 
service stations which offer such services. Full power stations must 
pay a five per cent gross revenue fee if they offer subscription 
services on their DTV channel during the transition. LPTV stations 
offering such services not only would have no obligation to provide 
free service; they also might have no obligation to pay the five per 
cent fee.
---------------------------------------------------------------------------
Conclusion
    The concerns ALTV has expressed counsel a harder look at S. 2454. 
In particular, new sections 336(h)(3) and (h)(5) require substantial 
revision to assure that full power broadcast DTV service is not 
inadvertently undermined by preemptive and preclusive deployment of 
LPTV digital data services. As beneficial as such services may be, they 
should not be implemented in such way as to place yet another stumbling 
block in the path of the broadcast digital transition.
    Therefore, ALTV very much looks forward to working with the 
Subcommittee on this legislation. If the Subcommittee is in need of any 
particular information which might be at our disposal, we would be 
happy to compile and provide it to you. Again, we greatly appreciate 
this opportunity to make our views known to you and the Subcommittee.

    Senator Burns. Thank you, Mr. Popham.
    Senator Breaux.
    Senator Breaux. Thank you, Mr. Chairman. I thank the panel.
    Mr. Popham, let me perhaps start with you, since you just 
concluded. I know that you start off in your summary saying the 
bill is laudable, but then you spend the rest of your time 
telling us why it is not so laudable.
    I take it that the principal concern, at least it seems to 
me, is this question of interference or displacement of the new 
full power stations that may be modified in the digital 
broadcast by what you call, I guess, the exclusive nature of 
what the low power stations would be granted by this 
legislation.
    Is there any way to protect, on the interference question, 
that the bill could address that perhaps does not address now? 
I mean, Mr. Mosely said he has been operating in Houston and 
has not had a single complaint about interference, and you have 
a number of major high power broadcast channels in the Houston 
area, and with all the millions of people, not to have any 
interference complaints seems fairly significant that it is not 
a problem.
    But is there anything in the legislation that could be 
included that would give you some relief about that concern 
that you have expressed on interference?
    Mr. Popham. Well, I do not want to denigrate the 
interference issue as a nonissue, because we do have concerns 
about it. I think as Mr. Hatfield testified it is a little more 
complicated issue than it is with just today's analog 
broadcast-to-broadcast, because we are dealing with one versus 
two channels, perhaps. We are dealing with digital versus 
analog. We are dealing with various sorts of modulation 
schemes, 8VSB, COFDM, QPSK, QAM, and now TDD, and all of these 
affect propagation, and they affect how interference might 
occur.
    So it is a more complicated process, and we would want to 
be sure that the legislation does give the commission complete 
authority to prevent interference, but I would point out the 
practical side of interference problems.
    When they do occur, it really creates a headache for the 
FCC, for the station involved, and for the station against whom 
a complaint might be lodged, and you end up going and almost 
looking at subscribers, or viewers' television sets, trying to 
figure out where is the source of interference, what kind of 
interference is it, how are we really going to fix this, and 
you almost end up with a food fight at the FCC every time this 
occurs. Certainly in one situation it has not happened yet, but 
that is not to say it cannot happen.
    But I really want to draw the emphasis back to the problem 
of not staying in the lane, but who gets the lane, and the 
difficulty again that we have is the preclusive effect of 
prohibiting the FCC from authorizing the new digital broadcast 
station, or modification, or maximization of one of those 
stations when it would cause interference to a data 
broadcasting LPTV station.
    The Community Broadcasters Act did include provisions which 
provided some protection, fairly substantial protection against 
incursions of DTV into our flexibility in the DTV environment. 
Protections along those lines, perhaps a little broader, 
because we are in a little different situation, but that is 
where we would look for some changes in the legislation.
    Senator Breaux. Mr. Mosely, what about that suggestion? Do 
you think anything like that is feasible to include in the 
legislation, or do you feel that it is really not necessary?
    Mr. Mosely. We have no problem with that sort of 
modification. It is our intention to protect existing 
television reception. We intend to. We will.
    Attached to my testimony are several letters from noted 
technologists that state that there will be no interference. We 
have no problem in additional language, if such is warranted, 
to protect existing and planned DTV roll-out.
    For example, when we acquire a station we make sure it fits 
within the table, the DTV channel table of allotments. We make 
sure that we are not going to interfere with either existing 
NTSC reception, nor will we be in conflict with the DTV-
allocated station, so we have no problem, if it is deemed 
necessary by the Committee and by Congress, to beef up the 
language. We would not have a problem with that.
    Senator Burns. Maybe if we just added the language out of 
the Community Television Protection Act, just add that 
language.
    Mr. Mosely. We have no problem with that, Senator.
    Senator Breaux. What everybody is trying to do is to ensure 
that you can go forward with this type of new utilization of 
the spectrum and yet make sure you do not interfere with 
anybody else who has their spectrum allocated, much of it 
through auction.
    Mr. Popham, I am just curious, why haven't any other 
stations that you represent used their spectrum for this type 
of digital broadband services?
    Mr. Popham. At this point, again, we are very early in the 
transition. We just have a few stations on the air. There are a 
relative handful of receivers at this point, and I think the 
plans that most broadcast entities have to provide data 
services are just now coming off the drawing board and getting 
into what I would call the entrepreneurial phase, where they 
are really putting them together, so I think we will see that 
develop very rapidly over the next several years.
    Senator Breaux. Mr. Morton, you talked about the public 
interest test, or public interest standard. What are you 
talking about when you are suggesting that?
    Mr. Morton. The Community Broadcaster Protection Act, there 
was a provision in Congress, two ways that a station could 
achieve a Class A license, and the commission in implementing 
this eliminated the second test of the public service, and just 
established a certain number of Class A stations, and kind of 
closed the door.
    The public service test needs to be brought in to allow 
future broadcasters who either were not on the air at the time 
or were not set up to broadcast the 18 hours a week, 3 hours of 
local programming, to give them a chance to fulfill the public 
service needs and become a Class A station and protect their 
spectrum.
    This is necessary, we feel, because under this bill if that 
does not happen they will quit broadcasting, because they can 
obtain permanent status by being a wireless Internet provider 
as opposed to a broadcaster, and that is not the intent of the 
bill, and we do not believe it was Congress' intent to ignore 
the public interest guidelines down the road and establish 
this, but the FCC has today done that. We would just like to 
see that mandated to establish that so the broadcaster will 
continue to be able to broadcast.
    Senator Breaux. Mr. Mosely, do you have any problems with 
that?
    Mr. Mosely. I do not believe so.
    Senator Breaux. Thank you.
    Senator Burns. I guess I have one question for Mr. Mosely. 
You are operating in Houston. Can you just give us an overview 
of any regulatory problems you have experienced in developing 
that service down there? Give us some challenges that you had 
that were of particular interest.
    Mr. Mosely. Well, the time delay, not so much with respect 
to our Houston operations, but with respect to rolling out 
future expansion cities is a concern, Mr. Chairman.
    We got our permanent license in May 1999 for Houston, and 
we filed for a similar authorization with the commission with 
respect to our Tampa operations, I think it was March 16 of 
1999. Well, it took 14 months to get that authorization from 
the FCC with respect to Tampa. It is that sort of regulatory 
delay that I think would be a severe impediment to our 
expansion.
    As you well know, wireless services are being rolled out 
across the country, and the pace of development is very rapid. 
For our company to have to file with the commission a request 
for expansion on a case-by-case basis would virtually render 
our expansion plans inoperable.
    Senator Burns. In your written testimony you mentioned the 
interest in rural telephone companies and electric cooperatives 
and associations in providing service. What involvement have 
these organizations had to date in terms of developing the type 
of service you would like to provide?
    Mr. Mosely. Well, we happen to have some rural telephone 
companies in New England that are investors in our company. 
They believe that what we want to do is an outstanding use of 
the spectrum and is an ideal way to deploy high speed wireless 
Internet access, especially in rural areas.
    Most of these telephone companies come from very small 
areas. I mean, very small population base areas of the country, 
and these are also sophisticated investors that have DSL 
operations, and yet notwithstanding that fact, they still feel 
that what we are doing is a superior method of delivering 
access.
    Senator Burns. Are there sufficient numbers of low power 
stations in rural areas to allow you to actually serve a 
significant number of people to make it profitable?
    Mr. Mosely. Yes, sir.
    Senator Burns. There is?
    Mr. Mosely. Yes, sir, there are. There definitely are.
    Senator Burns. Well, that is all the questions I have.
    Yes, go ahead, Senator Breaux.
    Senator Breaux. We are talking about the rural areas, and 
yet your first operation is in Houston, Texas. I was wondering, 
who are you serving in that area that would not have access to 
broadband over a wire service by one of the broadband carriers 
in the Houston area? I mean, you are talking about bringing 
services to rural areas, and yet you first started in the city 
of Houston.
    Mr. Mosely. Well, we are providing service in many areas 
that primarily are not even accessed by DSL, because they find 
that our service is superior with respect to the download 
speeds that we facilitate, but we had to start somewhere, and 
we wanted to start in a big city and establish the fact that 
our product would sell.
    Senator Breaux. I take it your customers in the Houston 
area would also have access to some other type of broadband 
Internet services over a wire carrier, perhaps.
    Mr. Mosely. Yes, sir.
    Senator Breaux. You are competing against them?
    Mr. Mosely. Yes, we are, and as we have primarily business 
customers, almost exclusively business customers in Houston, 
but upon passage of S. 2454 the bandwidth that would be 
available would facilitate our serving homeowners as well and, 
I might add, at a tremendous price reduction.
    We, for example, offer an information rate of T-1 download 
speed burstable to 4 megabits in Houston for $4.99 a month, and 
that is inclusive of all Internet access provider charges. Our 
plan is, assuming passage of S. 2454, is to slash our prices 
upon implementation of the two-way system to $199 a month for 
businesses, and $59 a month for homeowners, and that down the 
road in 5 years we are projecting that we would slash prices to 
$79 for businesses or thereabouts, and then down below $20 for 
consumers, and this is affording consumers tremendous bandwidth 
and burstable speeds up to 5 megabits a second.
    So Senator, we did start in Houston, but very frankly, the 
real power of what we have to offer is really evidenced in the 
rural areas, because those are areas that will likely not get 
wired service for many years.
    Senator Breaux. While you are providing Internet services 
over the air through wireless transmission, the consumer, I 
take it, is responding back through a wire line?
    Mr. Mosely. Yes, sir. Under the present configuration, the 
one-way configuration, yes. Upon passage of the legislation we 
would be able to have a high-speed symmetrical two-way 
communication within a single 6 megahertz channel. We would not 
get out of the lane, as the chairman has stated.
    This is done through what is called time division 
duplexing, and the bandwidth is allocated as the load is 
presented, so whoever needs the bandwidth gets it, and it is 
very efficient. It is a brilliant technology that gives, it is 
about 4 to 20 times the efficiency, or efficacy of frequency 
division duplexing, so the good thing about it is that we only 
have to acquire a single channel.
    Mr. Stewart and Mr. Hatfield were alluding to the fact that 
you may need a separate channel. The fact is that I think that 
is not going to be necessary. I know it will not be necessary 
with time division duplexing technology.
    Senator Burns. Have you visited with them on that? Have you 
and Mr. Hatfield had a private conversation to be sure that is 
possible, the technology that you are talking about, two-way 
within your same lane, without establishing another one for the 
return?
    Mr. Mosely. Mr. Chairman, are you inquiring whether we have 
talked with them?
    Senator Burns. Yes.
    Mr. Mosely. No, we have not. I would welcome the 
opportunity to discuss it with them and even bring in the 
technologist that adapted broadband to visit with them about 
that.
    Let me say that the technology is available at higher 
frequencies by adaptive broadband in Japan and Europe, and 
really in other areas throughout the world, and so this is not 
a technology that is speculative. It is merely a case of 
adapting the technology to a lower frequency, which we have 
been assured is an absolute no-brainer, and that there is no 
technological risk in making the technology available in the 
UHF spectrum, and Dr. Sharre points that out in his letter, 
which is attached to my statement.
    Senator Burns. Mr. Popham, do you agree with that?
    Mr. Popham. I believe--I do not think we can say for 
certain that interference would not be a problem. I think the 
technology would work, and I risk saying more as a lawyer and 
not an engineer at this point, and sometimes discretion is the 
better part of valor.
    Senator Burns. Well, that is all the questions I have, and 
I know there will be other Senators on this Committee that will 
have other questions, and we will leave the record open for 2 
weeks, and if other testimony is submitted, why, you will also 
be updated on that.
    Thank you for coming today, and I appreciate your coming. 
The Committee is adjourned.
    [Whereupon, at 11 a.m., the Subcommittee adjourned.]
                            A P P E N D I X

                                  Fox Broadcasting Company,
                                                     June 28, 2000.

Hon. Conrad Burns,
United States Senate,
Washington, DC.
                                                        Re: S. 2454
Dear Senator Burns:

    Fox Broadcasting Company, together with other television 
broadcasters, continues to have serious concerns over the draft 
legislation (S. 2454) that would permit low power television (LPTV) 
stations to provide ``digital data services'' without regard to the 
technology or modulation employed in delivering such service. While 
representatives of Fox and other broadcasters have had several cordial 
meetings with the representatives of AccelerNet to discuss 
broadcasters' concerns with S. 2454, we have not yet reached agreement 
on any of the major issues. Moreover, we remain troubled by the fact 
that our engineers have not yet been afforded an opportunity to discuss 
certain technical issues with AccelerNet's engineering representatives. 
A summary of Fox's chief concerns with S. 2454 is attached.
    As you are aware, Congress and the FCC have placed the highest 
priority on completing the transition from analog to digital television 
(DTV) in a timely manner. Although we support your goal to bridge the 
digital divide in rural areas, spectrum management and conversion to 
DTV is already an extremely complex task. Broadcasters are intensely 
concerned that permitting LPTVs to provide digital data-casting 
services on a two-way basis using any technology or modulation 
technique whatsoever could lead to interference that would cripple the 
DTV conversion.
    We look forward to continue working with you on S. 2454.
        Very truly yours,
                                                  Maureen O'Connell

                                                        Attachments

Fox Broadcasting Company's Concerns on
S. 2454 Low Power TV Digital Data Services Bill
 The goal of S. 2454, to bring broadband Internet services to 
    rural areas, is a laudable goal. Broadband Internet, however, can 
    be provided by a variety of technological means, including wired 
    (telephone or cable) and wireless technologies (satellite or non-
    satellite). Wireless technologies--satellite and non-satellite--
    provide the most promising means of serving less populated rural 
    areas. In fact, such service is already available NATIONWIDE to 
    rural and urban subscribers alike, by DirecTV, through its DirecPC 
    service (see www.direcpc.com). A second service offering 2-way 
    broadband Internet access will be available nationwide from Gilat 
    through a partnership with Echostar and Microsoft beginning in the 
    fall of 2000 (see www.gilat2home.com).

   Attached is a sample list of companies that are already 
        bridging the digital divide and providing terrestrial wireless 
        Internet access to rural areas in Montana.

   In addition, 13 certified eligible Class A stations in 
        Montana could provide digital data services (see attached).

 LPTV stations often provide vital broadcast service to rural 
    areas. It would be most unfortunate if rural television viewers 
    were deprived of free over-the-air television in the pursuit of 
    expanded Internet access. Indeed, in authorizing full-power 
    television stations to provide data services, the FCC mandated that 
    such data services not interfere with the provision of at least one 
    free over-the-air broadcast channel. Use of LPTV spectrum to 
    provide broadband Internet and other digital services therefore 
    should be allowed only if it does not affect the primary broadcast 
    purpose of the LPTV service, or negatively impact the integrity of 
    other broadcast services.

   As drafted, S. 2454 would not require LPTV stations to 
        provide ANY video programming to local viewers.

 Congress and the FCC have placed the highest priority on 
    completing the conversion to DTV. LPTVs providing digital data 
    services should not be protected from interference or displacement 
    from applicants seeking to facilitate and complete their conversion 
    to DTV. Flexibility is required if DTV conversion is to become 
    reality. For example, 17 full-service television stations have been 
    allotted both analog and DTV channels that lie outside the core DTV 
    spectrum; these licensees must be assigned new channels within the 
    core from spectrum recovered after the DTV transition.\1\
---------------------------------------------------------------------------
    \1\ These 17 stations are located in the following cities: 
Riverside, CA; San Mateo, CA; Stockton, CA; Aurora, IL; Joliet, IL; 
Springfield, MA; Newark, NJ; Vineland, NJ; Riverhead, NY; Bethlehem, 
PA; two stations in Arecibo, PR; Caguas, PR; Naranjito, PR; Providence, 
RI; Lake Dallas, TX; and Fairfax, VA.

   As drafted, S. 2454 does not even require LPTVs that 
        provide digital data-casting services to protect the DTV Table 
        of Allotments--much less maximization and other modification 
        applications filed pursuant to existing FCC rules or those 17 
        full-service television licensees who have yet to receive a 
---------------------------------------------------------------------------
        channel allotment within the DTV core spectrum.

 The spectrum allocated to broadcast services is already 
    extremely congested. And DTV conversion has only compounded the 
    complexities of spectrum management. Yet S. 2454 would permit the 
    use of this broadcast spectrum to provide two-way digital data 
    services without regard to the technology or modulation employed. 
    Because LPTV provision of digital data services on a two-way basis 
    has not even been tested in the U.S., further study and analysis is 
    required to determine whether operation of digital data-casting 
    services on a two-way basis would cause objectionable interference 
    to full-power television stations or otherwise hinder the 
    conversion to DTV.

   As drafted, S. 2454 would permit LPTVs without any prior 
        approval of the FCC to provide immediately digital data 
        services using two-way technology that has NEVER been tested in 
        the U.S. broadcast environment.

   As drafted. S. 2454 would permit LPTVs to use multiple 
        transmitters at multiple locations. This reference would 
        authorize the provision of cellular service on LPTV spectrum. 
        Cellular service or any other service employing multiple 
        transmitters at multiple locations would cause chaos in the 
        broadcast service, which was specifically designed and 
        constructed for service by a single transmitter at a single 
        location.

   As drafted, S. 2454 would permit LPTVs to use any 
        modulation technique in their provision of digital data 
        services--8VSB, COFDM, QAM, or any other modulation.

 Television broadcasters that use their digital channels to 
    provide digital data services to subscribers for a fee must pay 5% 
    of gross revenues from such services to the federal Treasury. 
    Fairness requires that LPTVs engaging in digital data services 
    should incur the same fee. S. 2454 should be modified to require 
    that Class A stations providing digital data services be subject to 
    the fees imposed by the FCC pursuant to section 336(e) of the 
    Communications Act.

                                                Companies Providing Wireless Internet Service in Montana
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                 monthly
        Provider            Location      Phone        Domain Maine      Backbone    Bandwidth  Ports   T1  ISDN  Wireless  xDSL  Cable  56kbps    rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
Access Montana/Ronan      Ronan, MT    406-676-277  ronan.net          Sprint IP    1.544       --     --   --    --        --    --     $15.95
 Telephone Company                      7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Avicom Inc                Bozeman, MT  406-587-617  AVICOM.NET         Cable & Wi   1.544       --     Yes  --    --        --    --     $20.00
                                        7
--------------------------------------------------------------------------------------------------------------------------------------------------------
BOSS Internet Group                    509-547-889  CBVCP.COM          MCI Worldc                                                        $19.95
                                        6
--------------------------------------------------------------------------------------------------------------------------------------------------------
BOSS Internet Group/                   509-664-900  TELEVAR.COM        MCI Worldc   45                                                   $19.95
 Televar                                4
--------------------------------------------------------------------------------------------------------------------------------------------------------
BIG SKY INTERNET          MISSOULA,    406-543-854  B-S-I.NET          UUNET        13.088      --     --   --    --        --    --     --
                           MT           4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Big Sky Net               Missoula,    406-728-373  BIGSKY.NET         Cable & Wi   0.000       --     Yes  Yes   --        --    --     --
                           MT           7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bozeman Daily Chronicle   Bozeman, MT  406-582-265  GOMONTANA.COM      Cable & Wi   1.544       --     Yes  --    --        --    --     $24.95
                                        4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Corporate SystemHouse     Great        406-268-000  systemhouse.net    --           --          --     Yes  Yes   --        --    --     --
 Internet                  Falls, MT    0
--------------------------------------------------------------------------------------------------------------------------------------------------------
C-Systems Inc.                         208-769-700  C-SYSTEMS.NET      AT/CW/FG/GT/ 45                                                   $21.95
                                        3                               MW
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cteck Internet Services                402-470-398  nebraskaweb        PS           45
                                        3
--------------------------------------------------------------------------------------------------------------------------------------------------------
CyberHighway Internet                  208-323-921  CYBERHIGHWAY.NET   EL/GS        45                                                   $19.95
 Services                               4
--------------------------------------------------------------------------------------------------------------------------------------------------------
CyberPort Montana LLC     Whitefish,   406-863-322  CYBERPORT.NET      MCI-Worldc   6.144       --     Yes  --    --        --    --     $17.76
                           MT           1
--------------------------------------------------------------------------------------------------------------------------------------------------------
CyberWorld Internet       Laurel, MT   406-628-233  CW2.COM            Sprint       0.256       --     --   --    --        --    --     --
 Services                               1
--------------------------------------------------------------------------------------------------------------------------------------------------------
Dakota Internet Access,                701-774-342  DIA.NET                         1.544                                                $19.95
 Inc.                                   1
--------------------------------------------------------------------------------------------------------------------------------------------------------
DigiSys Inc               Kalispell,   406-257-463  DIGISYS.NET        Cable & Wi   6.144       --     Yes  --    --        Yes   --     $19.95
                           MT           8
--------------------------------------------------------------------------------------------------------------------------------------------------------
G.V. Net                  Helena, MT   406-443-805  GOMER.NET          MCI          1.672       --     --   --    --        --    --     --
                                        7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Global Net l.l.c.         Bozeman, MT  406-587-509  THEGLOBAL.NET      AT&T         3.088       --     Yes  --    --        --    --     --
                                        5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Great Falls Internet      Great        406-727-545  gf-inter.net       Sprint lP    10.000      --     Yes  --    --        --    --     --
                           Falls, MT    0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Inter-Tech Inc.           Lewistown,   406-538-789  Lewistown On Line  AT&T         128         --     --   --    --        --    --     --
                           MT           1
--------------------------------------------------------------------------------------------------------------------------------------------------------
InterTech USA             Missoula,    406-549-899  IT-USA.COM         Cable & Wi   128         --     Yes  Yes   --        --    --     --
                           MT           8
--------------------------------------------------------------------------------------------------------------------------------------------------------
Intermountain Internet    Helena, MT   406-449-393  INITCO.NET         Sprint IP    1.544       --     Yes  Yes   --        --    --     --
 Corp                                   0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Internections Inc         Helena, MT   406-443-784  IXI.NET            Verio        1.544       --     Yes  --    --        --    --     --
                                        7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Internet Connect          Missoula,    406-541-495  MONTANA.COM        AT&T         6.144       --     Yes  Yes   --        Yes   --     --
 Services                  MT           2
--------------------------------------------------------------------------------------------------------------------------------------------------------
Internet Montana          Billings,    406-255-969  IMT.NET            --           6.144       --     Yes  --    --        --    --     --
                           MT           9
--------------------------------------------------------------------------------------------------------------------------------------------------------
KooteNet                  Libby, MT    406-293-353  LIBBY.ORG          Cable & Wi   1.544       --     --   --    --        --    --     --
                                        4
--------------------------------------------------------------------------------------------------------------------------------------------------------
MARSweb Internet          Missoula,    406-721-627  MARSWEB.COM        --           --          --     --   --    --        --    --     --
 Services Montana          MT           7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Montana Communications    Billings,    406-254-941  MCN.NET            MCI/UUNET    8.448       --     --   Yes   --        Yes   --     --
 Network                   MT           3
--------------------------------------------------------------------------------------------------------------------------------------------------------
MOCC, Inc.                Great        406-453-662  mocc.net           Cable & Wi   6.144       --     Yes  --    --        --    --     --
                           Falls, MT    2
--------------------------------------------------------------------------------------------------------------------------------------------------------
Montana Internet          Helena, MT   406-443-334  MT.NET             Cable & Wi   3.088       --     Yes  Yes   Yes       Yes   --     --
                                        7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Multi-Band                Bozeman, MT  406-587-535  www.rockymountain  MCI/UUNET    0.000       --     Yes  --    --        Yes   --     --
 Communications, Inc                    3            dsl
                                                    .com
--------------------------------------------------------------------------------------------------------------------------------------------------------
Nemont Communications,    Glasgow, MT  406-228-986  nemontel.net       MCI Worldc   3.088       --     --   --    --        --    --     --
 Inc.                                   6
--------------------------------------------------------------------------------------------------------------------------------------------------------
Net Tech                  Lewistown,   406-538-616  TEIN.NET           MW           1.544       --     Yes  --    Yes       --    --     --
                           MT           1
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Rocky Mountain Digital    Hamilton,    406-363-005  www.rmdbs.net      AT&T         45          --     --   --    --        --    --     --
 Bitterroot Service        MT           5
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Scoblaco                               253-838-828  MACPLUS.COM                     3.088
                                        1
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Sofast Internet Services  Great        406-268-000  sofast.net         Frontier G   0.000       --     Yes  --    Yes       --    --     --
                           Falls, MT    0
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Stellar Computer          Havre. MT    406-265-633  hi-line.net        --           --          --     Yes  --    --        --    --     --
 Consulting Co.                         3
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TMComputers               Helena, MT   406-449-270  TMCOM.COM          MCI Worldc   2.048       --     Yes  --    --        --    --     --
                                        2
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The Billings Gazette      Billings,    406-657-135  billingsgazette.c  --           10.0        --     Yes  --    --        --    --     $15.00
                           MT           4            om
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The Internet Store        Missoula,    406-721-336  CENTRIC.NET        Sprint IP    0.000       --     Yes  --    Yes       --    --     --
                           MT           6
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West Yellowstone Web      West         406-646-700  WYELLOWSTONE.COM   --           45          --     --   --    --        --    --     --
 Works                     Yellowston   6
                           e, MT
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Western Technology        Billings,    406-256-957  WTP.NET            Cable & Wi   3.088       --     Yes  Yes   --        --    --     --
 Partners                  MT           5
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In-State ISPs With
 Service in Area Code
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Blue Moon Technologies,   Dillon, MT   406-683-981  bmt.net            --           --          --     Yes  --    --        --    --     --
 Inc                                    6
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Internections             Helena, MT   866-663-937  ixi.net            Verio        0.000       --     Yes  --    --        --    --     --
                                        8
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SoFast Internet Services  Great        406-268-000  sofast.net         Frontier G   0.000       --     --   --    Yes       --    --     --
                           Falls, MT    0
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