[Federal Register Volume 66, Number 207 (Thursday, October 25, 2001)]
[Rules and Regulations]
[Pages 53960-53965]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-26841]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 2

[ET Docket No. 00-258; FCC 01-256]


New Advanced Wireless Services

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This document adds a mobile allocation to the 2500-2690 MHz 
band to provide additional near-term and long-term flexibility for use 
of this spectrum, thereby making this band potentially available for 
advanced mobile and fixed terrestrial wireless services, including 
third generation and future generations of wireless systems. This 
action promotes the continued introduction of fixed wireless broadband 
services; provides for the introduction of new advanced wireless 
services to the public, consistent with its obligations under section 
706 of the Telecommunications Act; and promotes increased competition 
among terrestrial services.

DATES: Effective November 26, 2001.

FOR FURTHER INFORMATION CONTACT: Rodney Small, Office of Engineering 
and Technology, (202) 418-2452.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's First 
Report and Order, ET Docket No. 00-258, FCC 01-256, adopted September 
6, 2001, and released September 24, 2001. The full text of this 
Commission decision is available on the Commission's Internet site at 
www.fcc.gov. It is available for inspection and copying during normal 
business hours in the FCC Reference Information Center, Room CY-A257, 
445 12th Street, SW., Washington, DC, and also may be purchased from 
the Commission's duplication contractor, Qualex International, (202) 
863-2893, Room CY-B402, 445 12th Street, SW., Washington, DC 20554.

Summary of the First Report and Order

    1. In the Notice of Proposed Rule Making (``Advanced Wireless 
Services NPRM''), 66 FR 7483, January 23, 2001 in this proceeding, the 
Commission explored the possibility of introducing advanced wireless 
services in frequency bands currently used for cellular, broadband 
Personal Communications Service (``PCS''), and Specialized Mobile Radio 
services; in certain frequency bands already allocated for Fixed and 
Mobile services that could be used to deploy new advanced wireless 
services; and in five other frequency bands: 1710-1755 MHz, 1755-1850 
MHz, 2110-2150 MHz, 2160-2165 MHz, and 2500-2690 MHz. Pursuant to its 
independent spectrum management responsibilities, the Commission 
undertook a study of the 2500-2690 MHz band. An Interim Report 
regarding this band was issued in November 2000, and a Final Report was 
issued in March 2001.
    2. As commenters note, the 2500-2690 MHz band has been used for a 
number of years to provide one-way analog fixed services and is now 
being increasingly used to provide two-way digital, including 
broadband, fixed services. Nationwide deployment of two-way, digital 
Instructional Television Fixed Service (``ITFS'') and Multichannel 
Multipoint Distribution Services (``MMDS'') systems will provide 
Americans with another option for high-speed broadband access, 
furthering competition with other service providers such as digital 
subscriber line (``DSL''), cable modem, or satellite-based services 
provided by incumbent telephone companies, cable operators, or 
satellite operators. We will add a mobile allocation to this band in 
order to provide additional flexibility for use of this spectrum and 
promote more efficient use, thereby serving the public interest. 
However, we also conclude that we will not relocate, displace, or 
otherwise modify incumbent ITFS/MMDS operations. We will rely instead 
on a market-based approach to introduce additional flexibility in this 
band. We note that such additional flexibility will not necessarily 
result in any change in service offerings in the 2500-2690 MHz band 
because fixed uses could prove to be more highly-valued by the market 
than mobile uses.
    3. We find that adding a mobile allocation to the 2500-2690 MHz 
band will further promote the public interest by providing an 
additional option to service providers in that band. As was stated in 
our November 1999 Policy Statement on principles for reallocation of 
spectrum: ``Flexible allocations may result in more efficient spectrum 
markets.'' We recognize that with flexible allocations, spectrum 
efficiencies can be accomplished in a number of ways. For example, 
licensees can negotiate among themselves arrangements for avoiding 
interference rather than relying on mandatory technical rules to 
control interference; relaxed service rules would allow licensees 
greater freedom in determining the specific services to be offered; and 
rules for similar services can be harmonized to provide regulatory 
neutrality to help establish a level playing field across technologies 
and foster more effective competition. We have already provided such 
flexibility in many services, including PCS, Wireless Communications 
Service, and new services operating on television channels 60-69; and 
have proposed flexibility in other services, including new services 
operating on television channels 52-59. In permitting new services to 
operate on television channels 60-69, we added Fixed and Mobile 
services to the Broadcasting allocation in the 746-806 MHz band. In our 
related proceeding that developed service rules for the 746-764 MHz and 
776-794 MHz bands, we stated that our goal was ``enabling the broadest 
possible use of this spectrum, consistent with sound spectrum 
management * * *.'' We adopted service rules primarily oriented toward 
fulfilling the need for a variety of fixed and mobile wireless services 
in those bands, but did not structure the rules to establish a 
particular service configuration. Rather, the service rules would allow 
licensees to make determinations respecting the services provided and 
the technologies to be used, including new broadcast-type services so 
long as they complied with the technical rules adopted for the bands. 
In proposing to permit new services to operate on television channels 
52-59, we also proposed a co-primary Fixed, Mobile, and Broadcasting 
allocation to ``enable service providers to select the

[[Page 53961]]

technology they wish to use to provide new broadband services in order 
to make the best use of this spectrum.'' Thus, we have provided 
flexible spectrum use for many services and are proposing to provide 
flexible spectrum use for other services.
    4. Specifically with regard to ITFS/MMDS, we already have provided 
licensees with additional operational flexibility. First, in 1995 we 
expanded the protected service area contour for site-based MMDS 
licensees from a 15 mile radius to a 35 mile radius. Second, in 1996 we 
implemented rules for the use of digital modulation schemes, thereby 
allowing ITFS/MMDS licensees to provide multiple channels of video 
programming and high-speed data applications such as Internet access. 
Third, in 1998 we authorized the use of two-way transmissions on ITFS/
MMDS frequencies, effectively enabling the provision of voice, video 
and data services and granted a 35-mile protected service area to every 
ITFS licensee. With the advent of two-way technology, ITFS/MMDS has 
become a vehicle for offering high-speed Internet access and broadband 
service to educational, residential and small office/home office 
customers. Finally, we note that, although many MMDS licenses were 
granted subject to area-wide (Basic Trading Areas or ``BTAs'') auctions 
in 1996, the secondary market for both MMDS licenses and ITFS spectrum 
on a leased basis has been very vibrant. Since 1998 WorldCom and Sprint 
have invested over $2 billion dollars in the acquisition, by purchase 
or lease, of MMDS and ITFS channel rights covering 60 million 
households.
    5. The Communications Act of 1934, as amended, specifically 
authorizes the Commission to allocate spectrum to provide flexibility 
of use, if--
    (1) such use is consistent with international agreements to which 
the United States is a party; and
    (2) the Commission finds, after notice and an opportunity for 
public comment, that--
    (A) such an allocation would be in the public interest;
    (B) such use would not deter investment in communications services 
and systems, or technology development; and
    (C) such use would not result in harmful interference among users.
    6. With regard to the 2500-2690 MHz band, we find that the above 
conditions are met and that adding a mobile allocation to the band is 
in the public interest. First, as noted above and in the Advanced 
Wireless Services NPRM, the 2500-2690 MHz band is allocated in Region 2 
on a primary basis to the Fixed, Fixed Satellite, Mobile except 
aeronautical mobile, and Broadcasting-Satellite Services. The 2000 
World Radiocommunication Conference identified the 2500-2690 MHz band 
for possible terrestrial third generation mobile, or IMT-2000, use. 
While it is unclear whether other countries will use this band for 
advanced mobile systems, the band is potentially available in many 
countries, and it is possible that advanced wireless use will evolve 
there on a regional or worldwide basis. Therefore, adding a mobile 
allocation to the 2500-2690 MHz band in the United States is consistent 
with international agreements to which the United States is a party and 
will permit the possibility of long-term harmonized use of the band.
    7. Second, we find that adding a mobile allocation to the band 
would not deter investment in current fixed wireless operations, and 
would not result in harmful interference if appropriate protective 
measures are taken. As discussed above, the public interest is served 
because a flexible allocation allows licensees to make efficient use of 
spectrum, especially if licensees are given greater freedom in 
determining the specific services to be offered. We also conclude that 
investment in communications services and systems and technology 
development would not be deterred by a flexible allocation in this 
band. While some ITFS/MMDS incumbents indicate that investment in the 
band, particularly for fixed broadband deployment, could be deterred 
and interference to incumbents could be caused if we were to add a 
mobile allocation to the band, we believe that a flexible allocation 
will actually encourage investment in and the development of new and 
innovative technology and services. For example, investment in ITFS/
MMDS increased as the result of the Commission's decision to allow for 
two-way digital services in this band, thereby allowing for the 
deployment of fixed broadband services. A flexible allocation that 
permits mobile service will spur new technology developments and 
investment.
    8. Third, we note that there is support for potentially using this 
spectrum for mobile services. Further, IPWireless, Inc. has developed 
and is testing technology for portable data services that it claims can 
operate under existing ITFS/MMDS service rules (i.e., not cause harmful 
interference to incumbent one-way and two-way fixed services) without 
disrupting the provision of fixed services in the 2500-2690 MHz band. 
The addition of a mobile allocation will facilitate the introduction of 
these types of services and will provide flexibility for introducing 
other mobile applications in the future, thereby encouraging technology 
development and investment. We emphasize that this addition merely 
increases options for incumbents to employ spectrum in its highest-
valued use, consistent with prior Commission policy, and does not 
change existing ITFS/MMDS service or technical rules.
    9. Finally, we conclude that the introduction of additional mobile 
uses in the 2500-2690 MHz band can be accomplished without causing 
harmful interference to incumbent ITFS/MMDS operators. We emphasize 
that existing technical rules, including interference rules, will be 
maintained until a rulemaking proceeding has been completed that will 
address any changes to those rules that may be necessary. More 
importantly, we emphasize that until that occurs, any mobile use 
introduced in this band would be subject to existing technical rules or 
interference agreements between incumbent users and new mobile users. 
We note that changes in geographic or service applications by incumbent 
ITFS/MMDS operators may permit other types of mobile uses to be 
introduced in this band, licensees may partition their service areas, 
and parties may develop non-interference agreements. Under those 
circumstances, additional technical service rules would have to be 
established to protect incumbent operations.
    10. We disagree with AT&T that our action here will necessarily 
result in a ``windfall'' to incumbent ITFS/MMDS licensees. Permitting 
mobile use of the 2500-2690 MHz band simply allows incumbent licensees 
an additional option, but it is entirely possible that fixed use of the 
band will continue to predominate. Additionally, we note that certain 
types of mobile applications could be deployed in the near-term under 
existing service rules; thus, as noted, our action is consistent with 
the type of flexibility already afforded other types of licensees, such 
as cellular and broadband PCS. Finally, it is reasonable for us to 
conclude that, on balance, although incumbents may enjoy some benefits 
by adding a mobile allocation to the band, permitting mobile use of the 
band by new service providers would pose a very high risk of disrupting 
important incumbent fixed operations that our decision does not pose. 
Accordingly, we find it in the public interest to permit ITFS/MMDS 
licensees the flexibility to offer mobile services, and we are adding a 
``Mobile except aeronautical mobile'' allocation for the

[[Page 53962]]

United States to the 2500-2690 MHz band.
    11. While we find that adding a mobile allocation in the 2500-2690 
MHz band would be in the public interest, we find that relocating 
incumbent ITFS/MMDS operations would jeopardize the provision of 
important fixed wireless broadband services. The FCC staff's Final 
Report studied whether the band could be shared with or reallocated, in 
whole or in part, for new advanced mobile service providers. The FCC 
staff's Final Report concludes that in many cases lack of uniform 
geographic use in the band precludes co-frequency sharing between ITFS/
MMDS and advanced mobile service providers. The FCC staff's Final 
Report recognized that although voluntary partitioning between 
incumbent users and new advanced mobile service operators offered some 
promise of sharing as an interim measure in some geographic areas, 
sufficient spectrum does not appear to be available in populated areas 
to support viable advanced mobile services operations. That conclusion 
is unchallenged by any party to this proceeding. The FCC staff's Final 
Report also studied permitting mobile use by new service providers by 
reallocating all or a portion of the 2500-2690 MHz band from fixed to 
mobile services. However, even the 60 MHz reallocation proposed by 
Verizon would cause severe disruptions to ITFS/MMDS incumbents if they 
were forced to vacate a segment of the band. Further, the option of 
relocating ITFS/MMDS incumbents to another band would likely impose 
even greater overall costs because existing licensees in all candidate 
relocation bands examined by the FCC staff's Final Report would also 
need to be relocated to accommodate displaced ITFS/MMDS incumbents. 
Based on this record, we find that relocating ITFS/MMDS incumbents 
would not be cost-effective or desirable.
    12. Our assessment is shared by the majority of parties to this 
proceeding. Some parties contend that there will likely be insufficient 
spectrum for advanced mobile services if a portion of the 2500-2690 MHz 
band is not reallocated for exclusive mobile use. However, in our 
recent Further NPRM in this proceeding, we solicited comment on 
allocating additional bands for advanced mobile services. Further, as 
discussed above, we are adding a mobile allocation to the 2500-2690 MHz 
band to permit flexibility for incumbent licensees. We will be 
addressing the issue of how much additional spectrum from other bands 
is required for advanced mobile services in a forthcoming decision in 
this proceeding. Moreover, we have encouraged the provision of both 
advanced mobile and fixed services and note that the services currently 
being provided and planned in the 2500-2690 MHz band--while fixed in 
nature--have significant value. Accordingly, we find that displacing 
ITFS/MMDS incumbents to permit advanced mobile use of the 2500-2690 MHz 
band by new service providers would be detrimental to the public 
interest.
    13. We recognize that, under current technology and service rules, 
fixed and mobile (other than portable) sharing of the 2500-2690 MHz 
band does not appear feasible, but we anticipate advances in technology 
that may permit such sharing. We further recognize that we will have to 
explore in a separate future proceeding the service rules that will 
apply to permit mobile operations in the band. The FCC staff's Final 
Report cites the possibility of interference to incumbent ITFS/MMDS 
operations from new advanced mobile service providers, and we would 
want to provide service and technical rules that would allow both 
incumbent ITFS/MMDS and mobile operations to co-exist in the band. As 
noted, in developing service rules for the 746-764 MHz and 776-794 MHz 
bands, we struck a balance in developing rules that would facilitate 
licensees' flexibility to provide either fixed or mobile services as 
well as certain broadcast-type services on a non-interference basis. We 
would want to strike the same balance for the 2500-2690 MHz band so 
that mobile use of the band will not impair fixed use of the band. We 
emphasize that if fixed and mobile sharing of the band continues to be 
infeasible in the long run, our service rules would ensure the 
protection of fixed operations.

Final Regulatory Flexibility Certification

    14. The Regulatory Flexibility Act of 1980, as amended (``RFA'')\1\ 
requires that a regulatory flexibility analysis be prepared for 
rulemaking proceedings, unless the agency certifies that ``the rule 
will not have a significant economic impact on a substantial number of 
small entities.''\2\ The RFA generally defines ``small entity'' as 
having the same meaning as the terms ``small business,'' ``small 
organization,'' and ``small governmental jurisdiction.''\3\ In 
addition, the term ``small business'' has the same meaning as the term 
``small business concern'' under the Small Business Act.\4\ A small 
business concern is one which: (1) Is independently owned and operated; 
(2) is not dominant in its field of operation; and (3) satisfies any 
additional criteria established by the Small Business Administration 
(SBA).\5\
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    \1\ The RFA, see 5 U.S.C. S 601 et. seq., has been amended by 
the Contract With America Advancement Act of 1996, Pub. L. 104-121, 
110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA is the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA).
    \2\ 5 U.S.C. 605(b).
    \3\ 5 U.S.C. 601(6).
    \4\ 5 U.S.C. 601(3) (incorporating by reference the definition 
of ``small business concern'' in Small Business Act, 15 U.S.C. S 
632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a 
small business applies ``unless an agency, after consultation with 
the Office of Advocacy of the Small Business Administration and 
after opportunity for public comment, establishes one or more 
definitions of such term which are appropriate to the activities of 
the agency and publishes such definition(s) in the Federal 
Register.''
    \5\ Small Business Act, 15 U.S.C. S 632.
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    15. In this First Report and Order, ``the Commission adds a mobile 
allocation to the 2500-2690 MHz band and thus provides ITFS/MMDS 
incumbent users of that band additional flexibility to offer mobile, as 
well as current fixed, services. This change may provide new 
opportunities for ITFS/MMDS incumbents, but will not adversely affect 
any incumbents because mobile use of the band will be at their 
discretion. As noted in paragraph 26 of the First Report and Order, the 
introduction of additional mobile uses in the 2500-2690 MHz band can be 
accomplished without causing harmful interference to incumbent ITFS/
MMDS operators because * * * the incumbent licensees will have the 
flexibility to determine the specific services to be offered.'' 
Therefore, we certify that the requirements of this First Report and 
Order will not have a significant economic impact on a substantial 
number of small entities. The Commission will send a copy of the First 
Report and Order, including a copy of this final certification, in a 
report to Congress pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A). In addition, the First Report and Order and this 
certification will be sent to the Chief Counsel for Advocacy of the 
Small Business Administration. See 5 U.S.C. 605(b).
    16. Authority for issuance of the First Report and Order is 
contained in sections 1, 4(i), 7(a), 301, 303(c), 303(f), 303(g), 
303(r), 308, and 309(j) of the Communications Act of 1934, as amended, 
47 U.S.C. 151, 154(i), 157(a), 301, 303(c), 303(f), 303(g), 303(r), 
308, and 309(j).

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List of Subjects in 47 CFR Part 2

    Communications equipment, Radio, Table of frequency allocation.

Federal Communications Commission.
Magalie Roman Salas,
Secretary.

Rules Changes

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR, part 2 as follows:

PART 2--FREQUENCY ALLOCATIONS AND RADIO TREATY MATTERS; GENERAL 
RULES AND REGULATIONS

    1. The authority citation for part 2 continues to read as follows:

    Authority: 47 U.S.C. 154, 302a, 303, and 336, unless otherwise 
noted.


    2. Section 2.106, the Table of Frequency Allocations, is amended by 
revising pages 52 and 53. The revisions read as follows:


Sec. 2.106  Table of Frequency Allocations.

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[FR Doc. 01-26841 Filed 10-24-01; 8:45 am]
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