[Federal Register Volume 68, Number 25 (Thursday, February 6, 2003)]
[Notices]
[Pages 6151-6167]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-2839]


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FEDERAL COMMUNICATIONS COMMISSION

[Report No. AUC-02-48-B (Auction No. 48); DA 02-3560]


Lower and Upper Paging Bands Auction Scheduled for May 13, 2003; 
Notice and Filing Requirements, Minimum Opening Bids, Upfront Payments 
and Other Auction Procedures

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: This document announces the procedures and minimum opening 
bids for the upcoming auction of licenses for the lower and upper 
paging bands scheduled for May 13, 2003. This document is intended to 
familiarize prospective bidders with the procedures and minimum opening 
bids for this auction.

DATES: Auction No. 48 is scheduled to begin on May 13, 2003.

FOR FURTHER INFORMATION CONTACT: Auctions and Industry Analysis 
Division: Rosemary Cabral, Legal Branch, at (202) 418-0660; Roy Knowles 
or Barbara Sibert, Auctions Operations Branch, at (717) 338-2888, Media 
Contact: Lauren Kravetz at (202) 418-7944, Commercial Wireless 
Division: Amal Abdallah, Policy and Rules Branch, at (202) 418-7307; 
Bettye Woodward or Dwain Livingston, Licensing and Technical Analysis 
Branch, at (202) 418-0620.

SUPPLEMENTARY INFORMATION: This is a summary of the Auction No. 48 
Procedures Public Notice released on December 20, 2002. The complete 
text of the Auction No. 48 Procedures Public Notice, including 
attachments and statements, is available for public inspection and 
copying during regular business hours at the FCC Reference Information 
Center, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 
20554. The Auction No. 48 Procedures Public Notice may also be 
purchased from the Commission's duplicating contractor, Qualex 
International, Portals II, 445 12th Street, SW., Room CY-B402, 
Washington, DC 20554, telephone (202) 863-2893, facsimile (202) 863-
2898, or via e-mail [email protected].

I. General Information

A. Introduction

    1. By the Auction No. 48 Procedures Public Notice, the Wireless 
Telecommunications Bureau (``Bureau'') announces the procedures and 
minimum opening bids for the upcoming auction of licenses for the lower 
and upper paging bands (Auction No. 48) scheduled for May 13, 2003. In 
accordance with the Balanced Budget Act of 1997, the Bureau released a 
public notice on November 7, 2002, seeking comment on reserve prices or 
minimum opening bids and the procedures to be used in Auction No. 48. 
The Bureau received two comments and no reply comments in response to 
the Auction No. 48 Comment Public Notice, 67 FR 72683 (December 6, 
2002).

[[Page 6152]]

i. Background of Proceeding
    2. In the Paging Second Report and Order, 62 FR 11616 (March 12, 
1997), the Commission adopted rules governing geographic licensing for 
exclusive channels in the 35 MHz, 43 MHz, 152 and 158 MHz, 454 MHz and 
459 MHz, 929 MHz, and 931 MHz bands allocated for paging, and 
competitive bidding procedures for granting mutually exclusive 
applications for non-nationwide geographic area licenses in those 
bands. In order to facilitate geographic licensing, the Commission 
dismissed all pending mutually exclusive paging applications and all 
non-mutually exclusive paging applications filed after July 31, 1996. 
In part, the Commission developed a standard methodology for providing 
protection to incumbent licensees from co-channel interference for the 
929-930 MHz and 931-932 MHz paging bands to supplement the existing 
formulas for determining interference contours on other paging bands.
ii. Licenses To Be Auctioned
    3. The licenses available in Auction No. 48 include 8,874 lower 
paging bands (35 MHz, 43 MHz, 152 and 158 MHz, 454 MHz and 459 MHz, 929 
MHz, 931 MHz bands) licenses, as well as 1,328 upper paging bands (929-
931 MHz) licenses that remained unsold from a previous auction or were 
defaulted on by a winning bidder in a previous auction. The lower bands 
licenses will be offered in each of the 175 geographic areas known as 
Economic Areas (EAs) and the upper bands licenses will be offered in 
all but three of the 51 geographic areas known as Major Economic Areas 
(MEAs). These EAs and MEAs both encompass the United States, Guam and 
Northern Mariana Islands, Puerto Rico and the United States Virgin 
Islands, and American Samoa. The tables contain the block/frequency 
cross-reference list for the paging bands. Due to the large volume of 
licenses in Auction No. 48, the complete list of licenses available for 
this auction will be provided in electronic format only, available as 
``Attachment A'' of the Auction No. 48 Procedures Public Notice at 
http://wireless.fcc.gov/auctions/48/.

                          35 MHz Lower Band Paging--20 kHz Per Block, Unpaired Channels
----------------------------------------------------------------------------------------------------------------
           Center frequency             Center frequency             Center frequency                 Center
  Block          (MHz)         Block          (MHz)         Block          (MHz)         Block   frequency (MHz)
----------------------------------------------------------------------------------------------------------------
CA         35.20...........  CE         35.30...........  CI         35.46...........  CM        35.58
CB         35.22...........  CF         35.34...........  CJ         35.50...........  CN        35.60
CC         35.24...........  CG         35.38...........  CK         35.54...........  CO        35.62
CD         35.26...........  CH         35.42...........  CL         35.56...........  CP        35.66
----------------------------------------------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channel to be auctioned in each block.

                          43 MHz Lower Band Paging--20 kHz Per Block, Unpaired Channels
----------------------------------------------------------------------------------------------------------------
           Center frequency             Center frequency             Center frequency                 Center
  Block          (MHz)         Block          (MHz)         Block          (MHz)         Block   frequency (MHz)
----------------------------------------------------------------------------------------------------------------
DA         43.20...........  DE         43.30...........  DI         43.46...........  DM        43.58
DB         43.22...........  DF         43.34...........  DJ         43.50...........  DN        43.60
DC         43.24...........  DG         43.38...........  DK         43.54...........  DO        43.62
DD         43.26...........  DH         43.42...........  DL         43.56...........  DP        43.66
----------------------------------------------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channel to be auctioned in each block.

 152 and 158 MHz Lower Bands Paging--20 kHz Per Block, Unpaired Channels
------------------------------------------------------------------------
   Block      Center frequency (MHz)     Block    Center frequency (MHz)
------------------------------------------------------------------------
EA           152.24.................  EC          158.10
EB           152.84.................  ED          158.70
------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channel to be auctioned in each block.

   152 and 158 MHz Lower Bands Paging--40 kHz Per Block, Paired 20 kHz
                                Channels
------------------------------------------------------------------------
                Center frequencies                  Center frequencies
   Block              (MHz)              Block             (MHz)
------------------------------------------------------------------------
FA           152.03 / 158.49........  FJ          152.57 / 157.83
FB           152.06 / 158.52........  FK          152.60 / 157.86
FC           152.09 / 158.55........  FL          152.63 / 157.89
FD           152.12 / 158.58........  FM          152.66 / 157.92
FE           152.15 / 158.61........  FN          152.69 / 157.95
FF           152.18 / 158.64........  FO          152.72 / 157.98
FG           152.21 / 158.67........  FP          152.75 / 158.01
FH           152.51 / 157.77........  FQ          152.78 / 158.04
FI           152.54 / 157.80........  FR          152.81 / 158.07
------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channels to be auctioned in each block.

[[Page 6153]]



 454 MHz and 459 MHz Lower Bands Paging--40 kHz Per Block, Paired 20 kHz
                                Channels
------------------------------------------------------------------------
                Center frequencies                  Center frequencies
   Block              (MHz)              Block             (MHz)
------------------------------------------------------------------------
GA           454.025 / 459.025......  GN          454.350 / 459.350
GB           454.050 / 459.050......  GO          454.375 / 459.375
GC           454.075 / 459.075......  GP          454.400 / 459.400
GD           454.100 / 459.100......  GQ          454.425 / 459.425
GE           454.125 / 459.125......  GR          454.450 / 459.450
GF           454.150 / 459.150......  GS          454.475 / 459.475
GG           454.175 / 459.175......  GT          454.500 / 459.500
GH           454.200 / 459.200......  GU          454.525 / 459.525
GI           454.225 / 459.225......  GV          454.550 / 459.550
GJ           454.250 / 459.250......  GW          454.575 / 459.575
GK           454.275 / 459.275......  GX          454.600 / 459.600
GL           454.300 / 459.300......  GY          454.625 / 459.625
GM           454.325 / 459.325......  GZ          454.650 / 459.650
------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channels to be auctioned in each block.

     929 MHz Upper Band Paging--20 kHz Per Block, Unpaired Channels
------------------------------------------------------------------------
   Block      Center frequency (MHz)     Block    Center frequency (MHz)
------------------------------------------------------------------------
A            929.0125...............  G           929.4625
B            929.1125...............  H           929.6375
C            929.2375...............  I           929.6875
D            929.3125...............  J           929.7875
E            929.3875...............  K           929.9125
F            929.4375...............  L           929.9625
------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channel to be auctioned in each block.

                         931 MHz Upper Band Paging--20 kHz Per Block, Unpaired Channels
----------------------------------------------------------------------------------------------------------------
                   Center frequency                      Center frequency                     Center frequency
     Block              (MHz)               Block              (MHz)             Block              (MHz)
----------------------------------------------------------------------------------------------------------------
AA              931.0125.............  AN              931.3375............  BA             931.6625
AB              931.0375.............  AO              931.3625............  BB             931.6875
AC              931.0625.............  AP              931.3875............  BC             931.7125
AD              931.0875.............  AQ              931.4125............  BD             931.7375
AE              931.1125.............  AR              931.4375............  BE             931.7625
AF              931.1375.............  AS              931.4625............  BF             931.7875
AG              931.1625.............  AT              931.4875............  BG             931.8125
AH              931.1875.............  AU              931.5125............  BH             931.8375
AI              931.2125.............  AV              931.5375............  BI             931.8625
AJ              931.2375.............  AW              931.5625............  BJ             931.9625
AK              931.2625.............  AX              931.5875............  BK             931.9875
AL              931.2875.............  AY              931.6125............
AM              931.3125.............  AZ              931.6375............
----------------------------------------------------------------------------------------------------------------

    Each frequency listed in this chart is the center frequency of the 
channel to be auctioned in each block.

    Note: In Auction No. 48, for each block listed in the tables, 
licenses are not available in every market. The complete list of 
licenses available for Auction No. 48 will be provided in electronic 
format only, available as ``Attachment A'' of the Auction No. 48 
Procedures Public Notice at http://wireless.fcc.gov/auctions/48/. 
The format of the frequency tables has been modified from the tables 
presented in the Auction No. 48 Comment Public Notice, however, the 
spectrum represented by the tables is the same.

B. Rules and Disclaimers

i. Relevant Authority
    4. Prospective bidders must familiarize themselves thoroughly with 
the Commission's rules relating to the paging services, contained in 
title 47, part 22 and part 90 of the Code of Federal Regulations, and 
those relating to application and auction procedures, contained in 
title 47, part 1 of the Code of Federal Regulations. Prospective 
bidders must also be thoroughly familiar with the procedures, terms and 
conditions (collectively, ``Terms'') contained in the Auction No. 48 
Procedures Public Notice; the Auction No. 48 Comment Public Notice; the 
Part 1 Fifth Report and Order 65 FR 52401 (August 29, 2000), (as well 
as prior and subsequent Commission proceedings regarding competitive 
bidding procedures); the Paging Notice; the Paging First Report and 
Order; the First Paging Reconsideration Order; the Paging Second Report 
and Order; the Second Paging Reconsideration Order; the Paging Third 
Report and Order; and the Third Paging Reconsideration Order.
    5. The terms contained in the Commission's rules, relevant orders, 
and public notices are not negotiable. The Commission may amend or 
supplement the information contained in our public notices at any time, 
and will issue public notices to convey any new or supplemental 
information to bidders. It is the responsibility of all prospective 
bidders to remain current with all Commission rules and with all

[[Page 6154]]

public notices pertaining to this auction. Copies of most Commission 
documents, including public notices, can be retrieved from the FCC 
Auctions Internet site at http://wireless.fcc.gov/auctions. 
Additionally, documents are available for public inspection and copying 
during regular business hours at the FCC Reference Information Center, 
Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC, 20554 
or may be purchased from the Commission's duplicating contractor, 
Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, 
Washington, DC 20554, telephone 202-863-2893, facsimile 202-863-2898, 
or via e-mail [email protected]. When ordering documents from Qualex, 
please provide the appropriate FCC number (for example, FCC 99-98 for 
the Paging Third Report and Order).
ii. Prohibition of Collusion
    6. To ensure the competitiveness of the auction process, the 
Commission's rules prohibit applicants for the same geographic license 
area from communicating with each other during the auction about bids, 
bidding strategies, or settlements. This prohibition begins at the 
short-form application filing deadline and ends at the down payment 
deadline after the auction. Bidders competing for licenses in the same 
geographic license areas are encouraged not to use the same individual 
as an authorized bidder. A violation of the anti-collusion rule could 
occur if an individual acts as the authorized bidder for two or more 
competing applicants, and conveys information concerning the substance 
of bids or bidding strategies between the bidders he or she is 
authorized to represent in the auction. A violation could similarly 
occur if the authorized bidders are different individuals employed by 
the same organization (e.g., law firm or consulting firm). In such a 
case, at a minimum, applicants should certify on their applications 
that precautionary steps have been taken to prevent communication 
between authorized bidders and that applicants and their bidding agents 
will comply with the anti-collusion rule.
    7. However, the Bureau cautions that merely filing a certifying 
statement as part of an application will not outweigh specific evidence 
that collusive behavior has occurred, nor will it preclude the 
initiation of an investigation when warranted. The Commission's anti-
collusion rules allow applicants to form certain agreements during the 
auction, provided the applicants have not applied for licenses covering 
the same geographic areas. Note that in Auction No. 48, applicants for 
licenses in overlapping EAs and MEAs will not be able to take advantage 
of these rule provisions, even though the licenses are not completely 
co-extensive. For example, assume that one applicant applies for 
several lower paging bands licenses, i.e., licenses covering EAs, in 
its Auction No. 48 FCC Form 175 and that a second applicant applies for 
licenses in the upper paging bands, i.e., licenses covering MEAs, in 
its Auction No. 48 FCC Form 175. If the first applicant selects 
licenses for EAs that are within MEAs covered by licenses selected by 
the second applicant, the two parties will have applied for licenses 
covering the same geographic areas. Consequently, unlike applicants who 
have applied for licenses that do not cover the same geographic areas, 
these two applicants will not be permitted to form a consortium or bid 
jointly for licenses after they file FCC Form 175. However, all 
applicants may enter into bidding agreements before filing FCC Form 
175, as long as they disclose the existence of the agreement(s) in 
their FCC Form 175. If parties agree in principle on all material terms 
prior to the short-form filing deadline, those parties must be 
identified on the short-form application pursuant to Sec.  1.2105(c), 
even if the agreement has not been reduced to writing. If the parties 
have not agreed in principle by the filing deadline, an applicant would 
not include the names of those parties on its application, and may not 
continue negotiations with other applicants for licenses covering the 
same geographic areas. By signing their FCC Form 175 short-form 
applications, applicants are certifying their compliance with Sec.  
1.2105(c).
    8. In addition, Sec.  1.65 of the Commission's rules requires an 
applicant to maintain the accuracy and completeness of information 
furnished in its pending application and to notify the Commission 
within 30 days of any substantial change that may be of decisional 
significance to that application. Thus, Sec. Sec.  1.65 and 1.2105 
require an auction applicant to notify the Commission of any violation 
of the anti-collusion rules upon learning of such violation. Bidders 
therefore are required to make such notification to the Commission 
immediately upon discovery.
    9. A summary listing of documents from the Commission and the 
Bureau addressing the application of the anti-collusion rules may be 
found in Attachment F of the Auction No. 48 Procedures Public Notice.
iii. Incumbent Licensees
    10. Incumbent (non-geographic) paging licensees operating under 
their existing authorizations are entitled to full protection from co-
channel interference. Geographic area licensees are likewise afforded 
co-channel interference protection from incumbent licensees. Adjacent 
geographic area licensees are obligated to resolve possible 
interference concerns of adjacent geographic area licensees by 
negotiating a mutually acceptable agreement with the neighboring 
geographic licensee. Incumbency issues are further discussed.
iv. Due Diligence
    11. Potential bidders are reminded that there are a number of 
incumbent licensees already licensed and operating on frequencies that 
will be subject to the upcoming auction. Geographic area licensees in 
accordance with the Commission's rules must protect such incumbents 
from harmful interference. See 47 CFR 22.503(i). These limitations may 
restrict the ability of such geographic area licensees to use certain 
portions of the electromagnetic spectrum or provide service to certain 
areas in their geographic license areas.
    12. In addition, potential bidders seeking licenses for geographic 
areas adjacent to the Canadian and Mexican border should be aware that 
the use of some or all of the channels they acquire in the auction 
could be restricted as a result of current or future agreements with 
Canada or Mexico. Licensees on the lower paging channels must submit a 
Form 601 to obtain authorization to operate stations north of Line A or 
east of Line C because these channels are subject to the Above 30 
Megacycles per Second Agreement with Industry Canada. Although the 
upper paging channels do not require coordination with Canada, the 
U.S.-Canada Interim Coordination Considerations for the Band 929-932 
MHz, as amended, assigns specific 929 and 931 MHz frequencies to the 
United States for licensing along certain longitudes above Line A, and 
assigns other specific 929 and 931 MHz frequencies to Canada for 
licensing along certain longitudes along the U.S.-Canada border. In 
addition, the 929 and 931 MHz frequencies assigned to Canada are 
unavailable for use by U.S. licensees above Line A as set out in the 
agreement. Also, licensees in some EAs and MEAs may be required to 
protect quiet zones.
    13. Potential bidders should also be aware that certain 
applications (including those for modification), petitions for 
rulemaking, requests for

[[Page 6155]]

special temporary authority (``STA''), waiver requests, petitions to 
deny, petitions for reconsideration, and applications for review may be 
pending before the Commission and relate to particular applicants or 
incumbent licensees. In addition, certain judicial proceedings that may 
relate to particular applicants or incumbent licensees, on the licenses 
available in Auction No. 48 may be commenced, or may be pending, or may 
be subject to further review. We note that resolution of these matters 
could have an impact on the availability of spectrum in Auction No. 48. 
Some of these matters (whether before the Commission or the Courts) may 
not be resolved by the time of the auction.
    14. Potential bidders are solely responsible for identifying 
associated risks, and investigating and evaluating the degree to which 
such matters may affect their ability to bid on, otherwise acquire, or 
make use of licenses available in Auction No. 48.
    15. To aid potential bidders, Attachment G of the Auction No. 48 
Procedures Public Notice lists paging matters pending before the 
Commission that relate to licenses or applications in the bands being 
auctioned. The Commission makes no representations or guarantees that 
the listed matters are the only pending matters that could affect 
spectrum availability in these bands.
    16. Copies of pleadings from pending cases relating to paging 
matters identified in Attachment G of the Auction No. 48 Procedures 
Public Notice are available for public inspection and copying during 
normal reference room hours at: Office of Public Affairs (OPA), 
Reference Operations Division, 445 12th Street, SW., Room CY-C314, 
Washington, DC 20554.
    17. In addition, potential bidders may research the Bureau's 
licensing database on the Internet in order to determine which 
frequencies are already licensed to incumbent licensees. The Commission 
makes no representations or guarantees regarding the accuracy or 
completeness of information in its databases or any third party 
databases, including, for example, court docketing systems. 
Furthermore, the Commission makes no representations or guarantees 
regarding the accuracy or completeness of information that has been 
provided by incumbent licensees and incorporated into the database. 
Potential bidders are strongly encouraged to physically inspect any 
sites located in, or near, the EA or MEA for which they plan to bid.
    18. Licensing records for paging are contained in the Bureau's 
Universal Licensing System (ULS) and may be researched on the Internet 
at http://wireless.fcc.gov/uls. Potential bidders may query the 
database online and download a copy of their search results if desired. 
Detailed instructions on using License Search (including frequency 
searches and the GeoSearch capability) and downloading query results 
are available online by selecting the ``?'' button at the upper right-
hand corner of the License Search screen.
    19. Potential bidders should direct questions regarding the search 
capabilities to the FCC Technical Support hotline at (202) 414-1250 
(voice) or (202) 414-1255 (TTY), or via e-mail at [email protected]. The 
hotline is available to assist with questions Monday through Friday, 
from 8 a.m. to 6 p.m. e.t. In order to provide better service to the 
public, all calls to the hotline are recorded.
 v. Bidder Alerts
    20. All applicants must certify on their FCC Form 175 applications 
under penalty of perjury that they are legally, technically, 
financially and otherwise qualified to hold a license, and not in 
default on any payment for Commission licenses (including down 
payments) or delinquent on any non-tax debt owed to any Federal agency. 
Prospective bidders are reminded that submission of a false 
certification to the Commission is a serious matter that may result in 
severe penalties, including monetary forfeitures, license revocations, 
exclusion from participation in future auctions, and/or criminal 
prosecution.
    21. The FCC makes no representations or warranties about the use of 
this spectrum for particular services. Applicants should be aware that 
an FCC auction represents an opportunity to become an FCC licensee in 
this service, subject to certain conditions and regulations. An FCC 
auction does not constitute an endorsement by the FCC of any particular 
services, technologies or products, nor does a FCC license constitute a 
guarantee of business success. Applicants and interested parties should 
perform their own due diligence before proceeding, as they would with 
any new business venture.
    22. As is the case with many business investment opportunities, 
some unscrupulous entrepreneurs may attempt to use Auction No. 48 to 
deceive and defraud unsuspecting investors. Common warning signals of 
fraud include the following:
    [sbull] The first contact is a ``cold call'' from a telemarketer, 
or is made in response to an inquiry prompted by a radio or television 
infomercial.
    [sbull] The offering materials used to invest in the venture appear 
to be targeted at IRA funds, for example, by including all documents 
and papers needed for the transfer of funds maintained in IRA accounts.
    [sbull] The amount of investment is less than $25,000.
    [sbull] The sales representative makes verbal representations that: 
(a) The Internal Revenue Service (``IRS''), Federal Trade Commission 
(``FTC''), Securities and Exchange Commission (``SEC''), FCC, or other 
government agency has approved the investment; (b) the investment is 
not subject to State or Federal securities laws; or (c) the investment 
will yield unrealistically high short-term profits. In addition, the 
offering materials often include copies of actual FCC releases, or 
quotes from FCC personnel, giving the appearance of FCC knowledge or 
approval of the solicitation.
    23. Information about deceptive telemarketing investment schemes is 
available from the FTC at (202) 326-2222 and from the SEC at (202) 942-
7040. Complaints about specific deceptive telemarketing investment 
schemes should be directed to the FTC, the SEC, or the National Fraud 
Information Center at (800) 876-7060. Consumers who have concerns about 
specific proposals regarding Auction No. 48 may also call the FCC 
Consumer Center at (888) CALL-FCC ((888) 225-5322).
vi. National Environmental Policy Act (``NEPA'') Requirements
    24. Licensees must comply with the Commission's rules regarding the 
National Environmental Policy Act (NEPA). The construction of a 
wireless antenna facility is a Federal action and the licensee must 
comply with the Commission's NEPA rules for each such facility. The 
Commission's NEPA rules require, among other things, that the licensee 
consult with expert agencies having NEPA responsibilities, including 
the U.S. Fish and Wildlife Service, the State Historic Preservation 
Office, the Army Corp of Engineers and the Federal Emergency Management 
Agency (through the local authority with jurisdiction over 
floodplains). The licensee must prepare environmental assessments for 
facilities that may have a significant impact in or on wilderness 
areas, wildlife preserves, threatened or endangered species or 
designated critical habitats, historical or archaeological sites, 
Indian religious sites, floodplains, and surface features. The licensee 
must also prepare environmental assessments for facilities that include 
high intensity white lights in residential neighborhoods or excessive 
radio frequency emission.

[[Page 6156]]

C. Auction Specifics

i. Auction Date
    25. The auction will begin on Tuesday, May 13, 2003. The initial 
schedule for bidding will be announced by public notice at least one 
week before the start of the auction. Unless otherwise announced, 
bidding on all licenses will be conducted on each business day until 
bidding has stopped on all licenses.
ii. Auction Title
    26. Auction No. 48--Lower and Upper Paging.
iii. Bidding Methodology
    27. The bidding methodology for Auction No. 48 will be simultaneous 
multiple round bidding. The Commission will conduct this auction over 
the Internet. Telephonic bidding will also be available. As a 
contingency, the FCC Wide Area Network will be available as well. 
Qualified bidders are permitted to bid telephonically or 
electronically.
iv. Pre-Auction Dates and Deadlines
    28. Listed are important dates associated with Auction No. 32:
    Auction seminar: March 6, 2003.
    Short-form application (FCC Form 175): March 21, 2003; 6 p.m. e.t.
    Upfront payments (via wire transfer): April 14, 2003; 6 p.m. e.t.
    Mock auction: May 8, 2003.
    Auction begins: May 13, 2003.
v. Requirements for Participation
    29. Those wishing to participate in the auction must:
    [sbull] Submit a short-form application (FCC Form 175) 
electronically by 6 p.m. e.t., March 21, 2003.
    [sbull] Submit a sufficient upfront payment and an FCC Remittance 
Advice Form (FCC Form 159) by 6 p.m. e.t., April 14, 2003.
    [sbull] Comply with all provisions outlined in the Auction No. 48 
Procedures Public Notice.
vi. General Contact Information
    30. The following is a list of general contact information relating 
to Auction No. 32.
    General Auction Information: General Auction Questions, Seminar 
Registration.
    FCC Auctions Hotline, (888) 225-5322, Press Option 2, or 
direct (717) 338-2888. Hours of service: 8 a.m.--5:30 p.m. e.t.
    Auction Legal Information: Auction Rules, Policies, Regulations.
    Auctions and Industry Analysis Division, Legal Branch (202) 418-
0660.
    Licensing Information: Rules, Policies, Regulations, Licensing 
Issues, Due Diligence, Incumbency Issues.
    Commercial Wireless Division (202) 418-0620.
    Technical Support: Electronic Filing, Automated Auction System.
    FCC Auctions Technical Support Hotline, (202) 414-1250 (Voice), 
(202) 414-1255 (TTY). Hours of service: Monday through Friday 8 a.m. to 
6 p.m. e.t.
    Payment Information: Wire Transfers, Refunds.
    FCC Auctions Accounting Branch, (202) 418-0578 or (202) 418-0496, 
(202) 418-2843 (Fax).
    Telephonic Bidding: Will be furnished only to qualified bidders.
    FCC Copy Contractor: Additional Copies of Commission Documents.
    Qualex International, Portals II, 445 12th Street, SW., Room CY-
B402, Washington, DC 20554. (202) 863-2893, (202) 863-2898 (Fax), 
[email protected] (E-mail).
    Press Information: Lauren Kravetz (202) 418-7944.
    FCC Forms: (800) 418-3676 (outside Washington, DC), (202) 418-3676 
(in the Washington Area), http://www.fcc.gov/formpage.html.
    FCC Internet Sites: http://www.fcc.gov. http://wireless.fcc.gov/auctions. http://wireless.fcc.gov/uls.

II. Short-Form (FCC Form 175) Application Requirements

    31. Guidelines for completion of the short-form (FCC Form 175) are 
set forth in Attachment D of the Auction No. 48 Procedures Public 
Notice. The short-form application seeks the applicant's name and 
address, legal classification, status, small business bidding credit 
eligibility, identification of the license(s) sought, the authorized 
bidders and contact persons. Applicants must certify on their FCC Form 
175 applications under penalty of perjury that they are legally, 
technically, financially and otherwise qualified to hold a license and, 
as discussed in section II.E (Provisions Regarding Defaulters and 
Former Defaulters), that they are not in default on any payment for 
Commission licenses (including down payments) or delinquent on any non-
tax debt owed to any Federal agency.

A. License Selection

    32. In Auction No. 48, Form 175 will include a mechanism that 
allows an applicant to filter the 10,202 licenses by paging service, 
frequency band, market area, and/or channel block/license suffix to 
create customized lists of licenses. The applicant will make selections 
for one or more of the filter criteria and the system will produce a 
list of licenses satisfying the specified criteria. The applicant may 
apply for all the licenses in the customized list by using the ``Select 
All'' option; select individual licenses separately from the list; or 
create a second customized list without selecting any of the licenses 
from the first list. Applicants also will be able to select licenses 
from one customized list and then create a second customized list to 
select additional licenses.

B. Ownership Disclosure Requirements (FCC Form 175 Exhibit A)

    33. All applicants must comply with the uniform part 1 ownership 
disclosure standards and provide information required by Sec. Sec.  
1.2105 and 1.2112 of the Commission's rules. Specifically, in 
completing FCC Form 175, applicants will be required to file an 
``Exhibit A'' providing a full and complete statement of the ownership 
of the bidding entity. The ownership disclosure standards for the 
short-form are set forth in Sec.  1.2112 of the Commission's rules.

C. Consortia and Joint Bidding Arrangements (FCC Form 175 Exhibit B)

    34. Applicants will be required to identify on their short-form 
applications any parties with whom they have entered into any 
consortium arrangements, joint ventures, partnerships or other 
agreements or understandings which relate in any way to the licenses 
being auctioned, including any agreements relating to post-auction 
market structure. Applicants will also be required to certify on their 
short-form applications that they have not entered into any explicit or 
implicit agreements, arrangements or understandings of any kind with 
any parties, other than those identified, regarding the amount of their 
bids, bidding strategies, or the particular licenses on which they will 
or will not bid. As discussed, if an applicant has had discussions, but 
has not reached a joint bidding agreement by the short-form deadline, 
it would not include the names of parties to the discussions on its 
applications and may not continue discussions with applicants after the 
deadline. Where applicants have entered into consortia or joint bidding 
arrangements, applicants must submit an ``Exhibit B'' to the FCC Form 
175.
    35. A party holding a non-controlling, attributable interest in one 
applicant will be permitted to acquire an ownership interest in, form a 
consortium with, or enter into a joint bidding arrangement with other 
competing applicants provided that (i)

[[Page 6157]]

the attributable interest holder certifies that it has not and will not 
communicate with any party concerning the bids or bidding strategies of 
more than one of the applicants in which it holds an attributable 
interest, or with which it has formed a consortium or entered into a 
joint bidding arrangement; and (ii) the arrangements do not result in a 
change in control of any of the applicants. While the anti-collusion 
rules do not prohibit non-auction related business negotiations among 
auction applicants, bidders are reminded that certain discussions or 
exchanges could touch upon impermissible subject matters because they 
may convey pricing information and bidding strategies.

D. Eligibility

i. Small Business Bidding Credit Eligibility (FCC Form 175 Exhibit C)
    36. In the Paging Second Report and Order, the Commission adopted 
small business bidding credits to promote and facilitate the 
participation of small businesses in competitive bidding for licenses 
in the paging service. In the Second Paging Reconsideration Order, the 
Commission subsequently increased the size of the bidding credits.
    37. Bidding credits are available to small businesses, or consortia 
thereof, (as defined in 47 CFR 1.2110(c) and 22.217(a)). A bidding 
credit represents the amount by which a bidder's winning bids are 
discounted. The size of the bidding credit depends on the average of 
the aggregated annual gross revenues for each of the preceding three 
years of the bidder, its affiliates, its controlling interests, and the 
affiliates of its controlling interests:
    [sbull] A bidder with attributed average annual gross revenues of 
not more than $15 million for the preceding three years receives a 25 
percent discount on its winning bids for paging licenses;
    [sbull] A bidder with attributed average annual gross revenues of 
not more than $3 million for the preceding three years receives a 35 
percent discount on its winning bids for paging licenses.
    38. Bidding credits are not cumulative; a qualifying applicant 
receives either the 25 percent or the 35 percent bidding credit on its 
winning bids, but not both.
ii. Tribal Land Bidding Credit
    39. To encourage the growth of wireless services in federally 
recognized tribal lands the Commission has implemented a tribal land 
bidding credit. See part V.D. of the Auction No. 48 Procedures Public 
Notice.
iii. Applicability of Part 1 Attribution Rules
    40. Controlling interest standard. On August 14, 2000, the 
Commission released the Part 1 Fifth Report and Order, in which the 
Commission, inter alia, adopted a ``controlling interest'' standard for 
attributing to auction applicants the gross revenues of their investors 
and affiliates in determining small business eligibility for future 
auctions. The Commission observed that the rule modifications adopted 
in the various part 1 orders would result in discrepancies and/or 
redundancies between certain of the new part 1 rules and existing 
service-specific rules, and the Commission delegated to the Bureau the 
authority to make conforming edits to the Code of Federal Regulations 
(CFR) consistent with the rules adopted in the part 1 proceeding. Part 
1 rules that superseded inconsistent service-specific rules will 
control in Auction No. 48. Accordingly, the ``controlling interest'' 
standard as set forth in the part 1 rules will be in effect for Auction 
No. 48.
    41. Control. The term ``control'' includes both de facto and de 
jure control of the applicant. Typically, ownership of at least 50.1 
percent of an entity's voting stock evidences de jure control. De facto 
control is determined on a case-by-case basis. The following are some 
common indicia of de facto control:
    [sbull] The entity constitutes or appoints more than 50 percent of 
the board of directors or management committee;
    [sbull] The entity has authority to appoint, promote, demote, and 
fire senior executives that control the day-to-day activities of the 
licensee; or
    [sbull] The entity plays an integral role in management decisions.
    42. Attribution for small business eligibility. In determining 
which entities qualify as small businesses, the Commission will 
consider the gross revenues of the applicant, its affiliates, its 
controlling interests, and the affiliates of its controlling interests. 
The Commission does not impose specific equity requirements on 
controlling interest holders. Once the principals or entities with a 
controlling interest are determined, only the revenues of those 
principals or entities, the affiliates of those principals or entities, 
the applicant and its affiliates, will be counted in determining small 
business eligibility.
    43. A consortium of small businesses is a ``conglomerate 
organization formed as a joint venture between or among mutually 
independent business firms,'' each of which individually must satisfy 
the definition of small business in Sec. Sec.  1.2110(f) and 22.223(b). 
Thus, each consortium member must disclose its gross revenues along 
with those of its affiliates, its controlling interests, and the 
affiliates of its controlling interests. The Bureau notes that although 
the gross revenues of the consortium members will not be aggregated for 
purposes of determining eligibility for small business credits, this 
information must be provided to ensure that each individual consortium 
member qualifies for any bidding credit awarded to the consortium.
iv. Supporting Documentation
    44. Applicants should note that they will be required to file 
supporting documentation to their FCC Form 175 short-form applications 
to establish that they satisfy the eligibility requirements to qualify 
as small businesses (or consortia of small businesses) for this 
auction.
    45. Applicants should further note that submission of an FCC Form 
175 application constitutes a representation by the certifying official 
that he or she is an authorized representative of the applicant, has 
read the form's instructions and certifications, and that the contents 
of the application and its attachments are true and correct. Submission 
of a false certification to the Commission may result in penalties, 
including monetary forfeitures, license forfeitures, ineligibility to 
participate in future auctions, and/or criminal prosecution.
    46. Small business eligibility (Exhibit C). Entities applying to 
bid as small businesses (or consortia of small businesses) will be 
required to disclose on Exhibit C to their FCC Form 175 short-form 
applications, separately and in the aggregate, the gross revenues for 
the preceding three years of each of the following: (i) the applicant, 
(ii) its affiliates, (iii) its controlling interests, and (iv) the 
affiliates of its controlling interests. Certification that the average 
annual gross revenues for the preceding three years do not exceed the 
applicable limit is not sufficient. A statement of the total gross 
revenues for the preceding three years is also insufficient. The 
applicant must provide separately for itself, its affiliates, its 
controlling interests, and the affiliates of its controlling interests, 
a schedule of gross revenues for each of the preceding three years, as 
well as a statement of total average gross revenues for the three-year 
period. If the applicant is applying as a consortium of small 
businesses, this information must be provided for each consortium 
member.

[[Page 6158]]

E. Provisions Regarding Defaulters and Former Defaulters (FCC Form 175 
Exhibit D)

    47. Each applicant must certify on its FCC Form 175 application 
that it is not in default on any Commission licenses and that it is not 
delinquent on any non-tax debt owed to any Federal agency. In addition, 
each applicant must attach to its FCC Form 175 application a statement 
made under penalty of perjury indicating whether or not the applicant, 
its affiliates, its controlling interests, or the affiliates of its 
controlling interest have ever been in default on any Commission 
licenses or have ever been delinquent on any non-tax debt owed to any 
Federal agency. The applicant must provide such information for itself, 
its affiliates, its controlling interests, and the affiliates of its 
controlling interests, as defined by Sec.  1.2110 of the Commission's 
rules (as amended in the Part 1 Fifth Report and Order). Applicants 
must include this statement as Exhibit D of the FCC Form 175. 
Prospective bidders are reminded that the statement must be made under 
penalty of perjury and, further, submission of a false certification to 
the Commission is a serious matter that may result in severe penalties, 
including monetary forfeitures, license revocations, exclusion from 
participation in future auctions, and/or criminal prosecution.
    48. ``Former defaulters''--i.e., applicants, including their 
attributable interest holders, that in the past have defaulted on any 
Commission licenses or been delinquent on any non-tax debt owed to any 
Federal agency, but that have since remedied all such defaults and 
cured all of their outstanding non-tax delinquencies--are eligible to 
bid in Auction No. 48, provided that they are otherwise qualified. 
However, as discussed infra in section III.D.iii, former defaulters are 
required to pay upfront payments that are fifty percent more than the 
normal upfront payment amounts.

F. Installment Payments

    49. Installment payment plans will not be available in Auction No. 
48.

G. Other Information (FCC Form 175 Exhibits E and F)

    50. Applicants owned by minorities or women, as defined in 47 CFR 
1.2110(c)(2), may attach an exhibit (Exhibit E) regarding this status. 
This applicant status information is collected for statistical purposes 
only and assists the Commission in monitoring the participation of 
``designated entities'' in its auctions. Applicants wishing to submit 
additional information may do so, on Exhibit F (Miscellaneous 
Information) to the FCC Form 175.

H. Minor Modifications to Short-Form Applications (FCC Form 175)

    51. After the short-form filing deadline (March 21, 2003), 
applicants may make only minor changes to their FCC Form 175 
applications. Applicants will not be permitted to make major 
modifications to their applications (e.g., change their license 
selections or proposed service areas, change the certifying official, 
change control of the applicant or change bidding credits). See 47 CFR 
1.2105. Permissible minor changes include, for example, deletion and 
addition of authorized bidders (to a maximum of three) and revision of 
exhibits. Applicants must make these modifications to their FCC Form 
175 electronically and should submit a letter, briefly summarizing the 
changes, by electronic mail to the attention of Margaret Wiener, Chief, 
Auctions and Industry Analysis Division, at the following address: 
[email protected]. The electronic mail summarizing the changes should 
include a subject or caption referring to Auction No. 48. The Bureau 
requests that parties format any attachments to electronic mail as 
Adobe[reg] Acrobat[reg] (pdf) or Microsoft[reg] Word documents.
    52. A separate copy of the letter should be faxed to the attention 
of Kathryn Garland at (717) 338-2850. Questions about other changes 
should be directed to Rosemary Cabral of the Auctions and Industry 
Analysis Division at (202) 418-0660.

I. Maintaining Current Information in Short-Form Applications (FCC Form 
175)

    53. Applicants have an obligation under 47 CFR 1.65, to maintain 
the completeness and accuracy of information in their short-form 
applications. Amendments reporting substantial changes of possible 
decisional significance in information contained in FCC Form 175 
applications, as defined by 47 CFR 1.2105(b)(2), will not be accepted 
and may in some instances result in the dismissal of the FCC Form 175 
application.

III. Pre-Auction Procedures

A. Auction Seminar

    54. On Thursday, March 6, 2003, the FCC will sponsor a free seminar 
for Auction No. 48 at the Federal Communications Commission, located at 
445 12th Street, SW., Washington, DC. The seminar will provide 
attendees with information about pre-auction procedures, conduct of the 
auction, the FCC Automated Auction System, and the paging and auction 
rules. The seminar will also provide an opportunity for prospective 
bidders to ask questions of FCC staff.
    55. To register, complete the registration form found in Attachment 
B of the Auction No. 48 Procedures Public Notice and submit it by 
Tuesday, March 4, 2003. Registrations are accepted on a first-come, 
first-served basis.

B. Short-Form Application (FCC Form 175)--Due March 21, 2003

    56. In order to be eligible to bid in this auction, applicants must 
first submit a FCC Form 175 application. This application must be 
submitted electronically and received at the Commission no later than 6 
p.m. e.t. on March 21, 2003. Late applications will not be accepted.
    57. There is no application fee required when filing an FCC Form 
175. However, to be eligible to bid, an applicant must submit an 
upfront payment. See Part III.D.
i. Electronic Filing
    58. Applicants must file their FCC Form 175 applications 
electronically. Applications may generally be filed at any time 
beginning at noon ET on March 6, 2003, until 6 p.m. e.t. on March 21, 
2003. Applicants are strongly encouraged to file early and are 
responsible for allowing adequate time for filing their applications. 
Applicants may update or amend their electronic applications multiple 
times until the filing deadline on March 21, 2003.
    59. Applicants must press the ``SUBMIT Application'' button on the 
``Submission'' page of the electronic form to successfully submit their 
FCC Form 175s. Any form that is not submitted will not be reviewed by 
the FCC. Information about accessing the FCC Form 175 is included in 
Attachment C of the Auction No. 48 Procedures Public Notice. Technical 
support is available at (202) 414-1250 (voice) or (202) 414-1255 (text 
telephone (TTY)); hours of service Monday through Friday, from 8 a.m. 
to 6 p.m. e.t. In order to provide better service to the public, all 
calls to the hotline are recorded.
    60. Applicants can also contact Technical Support via e-mail. To 
obtain the address, click the Support tab on the Form 175 Homepage.
ii. Completion of the FCC Form 175
    61. Applicants should carefully review 47 CFR 1.2105, and must 
complete all items on the FCC Form

[[Page 6159]]

175. Instructions for completing the FCC Form 175 are in Attachment D 
of the Auction No. 48 Procedures Public Notice. Applicants are 
encouraged to begin preparing the required attachments for FCC Form 175 
prior to submitting the form. Attachments C and D of the Auction No. 48 
Procedures Public Notice provide information on the required 
attachments and appropriate formats.
iii. Electronic Review of FCC Form 175
    62. The FCC Form 175 electronic review system may be used to locate 
and print applicants' FCC Form 175 information. Applicants may also 
view other applicants' completed FCC Form 175s after the filing 
deadline has passed and the FCC has issued a public notice explaining 
the status of the applications. Note: Applicants should not include 
sensitive information (i.e., TIN/EIN) on any exhibits to their FCC Form 
175 applications. There is no fee for accessing this system. See 
Attachment C of the Auction No. 48 Procedures Public Notice for details 
on accessing the review system.

C. Application Processing and Minor Corrections

    63. After the deadline for filing the FCC Form 175 applications has 
passed, the FCC will process all timely-submitted applications to 
determine which are acceptable for filing, and subsequently will issue 
a public notice identifying: (i) Those applications accepted for 
filing; (ii) those applications rejected; and (iii) those applications 
which have minor defects that may be corrected, and the deadline for 
filing such corrected applications.
    64. As described more fully in the Commission's rules, after the 
March 21, 2003, short-form filing deadline, applicants may make only 
minor corrections to their FCC Form 175 applications. Applicants will 
not be permitted to make major modifications to their applications 
(e.g., change their license selections, change the certifying official, 
change control of the applicant, or change bidding credit eligibility).

D. Upfront Payments--Due April 14, 2003

    65. In order to be eligible to bid in the auction, applicants must 
submit an upfront payment accompanied by a FCC Remittance Advice Form 
(FCC Form 159). After completing the FCC Form 175, filers will have 
access to an electronic version of the FCC Form 159 that can be printed 
and faxed to Mellon Bank in Pittsburgh, PA. All upfront payments must 
be received at Mellon Bank by 6 p.m. e.t. on April 14, 2003.
    Please note that:
    [sbull] All payments must be made in U.S. dollars.
    [sbull] All payments must be made by wire transfer.
    [sbull] Upfront payments for Auction No. 48 go to a lockbox number 
different from the lockboxes used in previous FCC auctions, and 
different from the lockbox number to be used for post-auction payments.
    [sbull] Failure to deliver the upfront payment by the April 14, 
2003, deadline will result in dismissal of the application and 
disqualification from participation in the auction.
i. Making Auction Payments by Wire Transfer
    66. Wire transfer payments must be received by 6 p.m. e.t. on April 
14, 2003. To avoid untimely payments, applicants should discuss 
arrangements (including bank closing schedules) with their banker 
several days before they plan to make the wire transfer, and allow 
sufficient time for the transfer to be initiated and completed before 
the deadline. Applicants will need the following information:
    ABA Routing Number: 043000261.
    Receiving Bank: Mellon Pittsburgh.
    Beneficiary: FCC/Account  910-1182.
    OBI Field: (Skip one space between each information item) 
``Auctionpay''
    FCC Registration Number (FRN): (same as FCC Form 159, block 11 and/
or 21).
    Payment Type Code (same as FCC Form 159, block 24A: A48U).
    FCC Code 1 (same as FCC Form 159, block 28A: ``48'').
    Payer Name (same as FCC Form 159, block 2).
    Lockbox No.  358415.

    Note: The BNF and Lockbox number are specific to the upfront 
payments for this auction; do not use BNF or Lockbox numbers from 
previous auctions.

    67. Applicants must fax a completed FCC Form 159 (Revised 2/00) to 
Mellon Bank at (412) 209-6045 at least one hour before placing the 
order for the wire transfer (but on the same business day). On the 
cover sheet of the fax, write ``Wire Transfer--Auction Payment for 
Auction Event No. 48.'' Bidders should confirm receipt of their upfront 
payment at Mellon Bank by contacting their sending financial 
institution.
ii. FCC Form 159
    68. A completed FCC Remittance Advice Form (FCC Form 159, Revised 
2/00) must be faxed to Mellon Bank in order to accompany each upfront 
payment. Proper completion of FCC Form 159 (Revised 2/00) is critical 
to ensuring correct credit of upfront payments. Detailed instructions 
for completion of FCC Form 159 are included in Attachment E of the 
Auction No. 48 Procedures Public Notice. An electronic version of the 
FCC Form 159 is available after filing the FCC Form 175. The FCC Form 
159 can be completed electronically, but must be filed with Mellon Bank 
via facsimile.
iii. Amount of Upfront Payment
    69. In the Part 1 Order the Commission delegated to the Bureau the 
authority and discretion to determine appropriate upfront payment(s) 
for each auction. In addition, in the Part 1 Fifth Report and Order, 
the Commission ordered that ``former defaulters,'' i.e., applicants 
that have ever been in default on any Commission license or have ever 
been delinquent on any non-tax debt owed to any Federal agency, be 
required to pay upfront payments fifty percent greater than non-
``former defaulters.'' For purposes of this calculation, the 
``applicant'' includes the applicant itself, its affiliates, its 
controlling interests, and affiliates of its controlling interests, as 
defined by Sec.  1.2110 of the Commission's rules (as amended in the 
Part 1 Fifth Report and Order).
    70. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed that the amount of the upfront payment would determine the 
number of bidding units on which a bidder may place bids. In order to 
bid on a license, otherwise qualified bidders that applied for that 
license on Form 175 must have an eligibility level that meets or 
exceeds the number of bidding units assigned to that license. At a 
minimum, therefore, an applicant's total upfront payment must be enough 
to establish eligibility to bid on at least one of the licenses applied 
for on Form 175, or else the applicant will not be eligible to 
participate in the auction. An applicant does not have to make an 
upfront payment to cover all licenses for which the applicant has 
applied on Form 175, but rather to cover the maximum number of bidding 
units that are associated with licenses on which the bidder wishes to 
place bids and hold high bids at any given time.
    71. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed setting upfront payments for each license equal to the 
license's minimum opening bid. The Bureau further proposed setting the 
bidding units for each license equal to the license's upfront payment 
on a bidding unit for dollar basis. The bidding unit level for each 
license will remain constant throughout the auction. The Bureau

[[Page 6160]]

received no comments on this issue. The Bureau adopts its proposed 
upfront payments. The specific upfront payments and bidding units for 
each license are set forth in the list of licenses available for 
Auction No. 48 (``Attachment A''), available with the Auction No. 48 
Procedures Public Notice at http://wireless.fcc.gov/auctions/48/.
    72. In calculating its upfront payment amount, an applicant should 
determine the maximum number of bidding units on which it may wish to 
be active (bidding units associated with licenses on which the bidder 
has the standing high bid from the previous round and licenses on which 
the bidder places a bid in the current round) in any single round, and 
submit an upfront payment covering that number of bidding units. In 
order to make this calculation, an applicant should add together the 
upfront payments for all licenses on which it seeks to bid in any given 
round. Bidders should check their calculations carefully, as there is 
no provision for increasing a bidder's maximum eligibility after the 
upfront payment deadline.
    73. Former defaulters should calculate their upfront payment for 
all licenses by multiplying the number of bidding units they wish to 
purchase by 1.5. In order to calculate the number of bidding units to 
assign to former defaulters, the Commission will divide the upfront 
payment received by 1.5 and round the result up to the nearest bidding 
unit.

    Note: An applicant may, on its FCC Form 175, apply for every 
applicable license being offered, but its actual bidding in any 
round will be limited by the bidding units reflected in its upfront 
payment.

iv. Applicant's Wire Transfer Information for Purposes of Refunds of 
Upfront Payments
    74. The Commission will use wire transfers for all Auction No. 48 
refunds. To ensure that refunds of upfront payments are processed in an 
expeditious manner, the Commission is requesting that all pertinent 
information as listed be supplied to the FCC. Applicants can provide 
the information electronically during the initial short-form filing 
window after the form has been submitted. Wire Transfer Instructions 
can also be manually faxed to the FCC, Financial Operations Center, 
Auctions Accounting Group, ATTN: Tim Dates or Gail Glasser, at (202) 
418-2843 by April 14, 2003. All refunds will be returned to the payer 
of record as identified on the FCC Form 159 unless the payer submits 
written authorization instructing otherwise. For additional 
information, please call Gail Glasser at (202) 418-0578 or Tim Dates at 
(202) 418-0496.
    Name of Bank; ABA Number; Contact and Phone Number; Account Number 
to Credit; Name of Account Holder; FCC Registration Number (FRN); 
Taxpayer Identification Number; Correspondent Bank (if applicable); ABA 
Number; Account Number.
    (Applicants should also note that implementation of the Debt 
Collection Improvement Act of 1996 requires the FCC to obtain a 
Taxpayer Identification Number (TIN) before it can disburse refunds.) 
Eligibility for refunds is discussed in part V.F.

E. Auction Registration

    75. Approximately ten days before the auction, the FCC will issue a 
public notice announcing all qualified bidders for the auction. 
Qualified bidders are those applicants whose FCC Form 175 applications 
have been accepted for filing and have timely submitted upfront 
payments sufficient to make them eligible to bid on at least one of the 
licenses for which they applied.
    76. All qualified bidders are automatically registered for the 
auction. Registration materials will be distributed prior to the 
auction by two separate overnight mailings, one containing the 
confidential bidder identification number (BIN) required to place bids 
and the other containing the SecurID cards. These mailings will be sent 
only to the contact person at the contact address listed in the FCC 
Form 175.
    77. Applicants that do not receive both registration mailings will 
not be able to submit bids. Therefore, any qualified applicant that has 
not received both mailings by noon on Tuesday, May 6, 2003, should 
contact the Auctions Hotline at (717) 338-2888. Receipt of both 
registration mailings is critical to participating in the auction and 
each applicant is responsible for ensuring it has received all of the 
registration material.
    78. Qualified bidders should note that lost bidder identification 
numbers or SecurID cards can be replaced only by appearing in person at 
the FCC Auction Headquarters located at 445 12th St., SW., Washington, 
DC 20554. Only an authorized representative or certifying official, as 
designated on an applicant's FCC Form 175, may appear in person with 
two forms of identification (one of which must be a photo 
identification) in order to receive replacement codes. Qualified 
bidders requiring replacements must call technical support prior to 
arriving at the FCC.

F. Electronic Bidding

    79. The Commission will conduct this auction over the Internet. 
Telephonic bidding will also be available. As a contingency, the FCC 
Wide Area Network will be available as well. Qualified bidders are 
permitted to bid electronically or telephonically, i.e., over the 
Internet or the FCC's Wide Area Network. In either case, each 
authorized bidder must have its own Remote Security Access SecurID 
card, which the FCC will provide at no charge. Each applicant with less 
than three authorized bidders will be issued two SecurID cards, while 
applicants with three authorized bidders will be issued three cards. 
For security purposes, the SecurID cards and the FCC Automated Auction 
System user manual are only mailed to the contact person at the contact 
address listed on the FCC Form 175. Please note that each SecurID card 
is tailored to a specific auction, therefore, SecurID cards issued for 
other auctions or obtained from a source other than the FCC will not 
work for Auction No. 48. The telephonic bidding phone number will be 
supplied in the first overnight mailing, which also includes the 
confidential bidder identification number. Each applicant should 
indicate its bidding preference--electronic or telephonic--on the FCC 
Form 175.
    80. Please note that the SecurID cards can be recycled, and the 
Bureau encourages bidders to return the cards to the FCC. The Bureau 
will provide pre-addressed envelopes that bidders may use to return the 
cards once the auction is over.
a. Mock Auction
    81. All qualified bidders will be eligible to participate in a mock 
auction on Thursday, May 8, 2003. The mock auction will enable 
applicants to become familiar with the FCC Automated Auction System 
prior to the auction. Participation by all bidders is strongly 
recommended. Details will be announced by public notice.

IV. Auction Event

    82. The first round of bidding for Auction No. 48 will begin on 
Tuesday, May 13, 2003. The initial bidding schedule will be announced 
in a public notice listing the qualified bidders, which is released 
approximately 10 days before the start of the auction.

A. Auction Structure

i. Simultaneous Multiple Round Auction
    83. In the Auction No. 48 Comment Public Notice, we proposed to 
award all licenses in Auction No. 48 in a

[[Page 6161]]

simultaneous multiple round auction. The Bureau received no comments on 
this issue. The Bureau concludes that it is operationally feasible and 
appropriate to auction the paging licenses through a simultaneous 
multiple round auction. Unless otherwise announced, bids will be 
accepted on all licenses in each round of the auction. This approach, 
the Bureau believes, allows bidders to take advantage of any synergies 
that exist among licenses and is administratively efficient.
ii. Maximum Eligibility and Activity Rules
    84. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed that the amount of the upfront payment submitted by a bidder 
would determine the initial maximum eligibility (as measured in bidding 
units) for each bidder. The Bureau received no comments on this issue.
    85. For Auction No. 48, the Bureau adopts this proposal. The amount 
of the upfront payment submitted by a bidder determines the number of 
bidding units on which a bidder may place bids. Note again that each 
license is assigned a specific number of bidding units equal to the 
upfront payment, listed in the license inventory available for Auction 
No. 48 (``Attachment A''), available with the Auction No. 48 Procedures 
Public Notice at http://wireless.fcc.gov/auctions/48/, on a bidding 
unit per dollar basis. The total upfront payment defines the maximum 
number of bidding units on which the applicant will be permitted to bid 
and hold high bids during any given round. As there is no provision for 
increasing a bidder's eligibility after the upfront payment deadline, 
prospective bidders are cautioned to calculate their upfront payments 
carefully. The total upfront payment does not affect the total dollar 
amount a bidder may bid on any given license.
    86. In order to ensure that the auction closes within a reasonable 
period of time, an activity rule requires bidders to bid actively 
throughout the auction, rather than wait until the end before 
participating. Bidders are required to be active on a specific 
percentage of their current eligibility during each round of the 
auction.
    87. A bidder's activity level in a round is the sum of the bidding 
units associated with licenses on which the bidder is active. A bidder 
is considered active on a license in the current round if it is either 
the high bidder at the end of the previous bidding round and does not 
withdraw the high bid in the current round, or if it submits a bid in 
the current round (see ``Bid Increments and Minimum Acceptable Bids'' 
in Part IV.B.(iii)). The minimum required activity is expressed as a 
percentage of the bidder's current bidding eligibility, and increases 
by stage as the auction progresses. Because these procedures have 
proven successful in maintaining the pace of previous auctions (as set 
forth under ``Auction Stages'' in part IV.A.iii and ``Stage 
Transitions'' in part IV.A.iv), we adopt them for Auction No. 48.
iii. Auction Stages
    88. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed to conduct the auction in three stages and employ an activity 
rule. The Bureau further proposed that, in each round of Stage One, a 
bidder desiring to maintain its current eligibility would be required 
to be active on licenses encompassing at least 80 percent of its 
current bidding eligibility. In each round of Stage Two, a bidder 
desiring to maintain its current eligibility would be required to be 
active on at least 90 percent of its current bidding eligibility. 
Finally, the Bureau proposed that a bidder in Stage Three, in order to 
maintain its current eligibility, would be required to be active on 98 
percent of its current eligibility. The Bureau received no comments on 
this proposal.
    89. The Bureau will adopt its proposals for the activity rules. 
Listed are the activity levels for each stage of the auction. The FCC 
reserves the discretion to further alter the activity percentages 
before and/or during the auction.
    Stage One: During the first stage of the auction, a bidder desiring 
to maintain its current eligibility will be required to be active on 
licenses that represent at least 80 percent of its current bidding 
eligibility in each bidding round. Failure to maintain the required 
activity level will result in a reduction in the bidder's bidding 
eligibility in the next round of bidding (unless an activity rule 
waiver is used). During Stage One, reduced eligibility for the next 
round will be calculated by multiplying the bidder's current activity 
(the sum of bidding units of the bidder's standing high bids and bids 
during the current round) by five-fourths (\5/4\).
    Stage Two: During the second stage of the auction, a bidder 
desiring to maintain its current eligibility is required to be active 
on 90 percent of its current bidding eligibility. Failure to maintain 
the required activity level will result in a reduction in the bidder's 
bidding eligibility in the next round of bidding (unless an activity 
rule waiver is used). During Stage Two, reduced eligibility for the 
next round will be calculated by multiplying the bidder's current 
activity (the sum of bidding units of the bidder's standing high bids 
and bids during the current round) by ten-ninths (\10/9\).
    Stage Three: During the third stage of the auction, a bidder 
desiring to maintain its current eligibility is required to be active 
on 98 percent of its current bidding eligibility. Failure to maintain 
the required activity level will result in a reduction in the bidder's 
bidding eligibility in the next round of bidding (unless an activity 
rule waiver is used). In this stage, reduced eligibility for the next 
round will be calculated by multiplying the bidder's current activity 
(the sum of bidding units of the bidder's standing high bids and bids 
during the current round) by fifty-forty ninths (\50/49\).
    Caution: Since activity requirements increase in each auction 
stage, bidders must carefully check their current activity during the 
bidding period of the first round following a stage transition. This is 
especially critical for bidders that have standing high bids and do not 
plan to submit new bids. In past auctions, some bidders have 
inadvertently lost bidding eligibility or used an activity rule waiver 
because they did not re-verify their activity level at stage 
transitions. Bidders may check their activity against the required 
activity level by using the bidding system's bidding module.
    90. Because the foregoing procedures have proven successful in 
maintaining proper pace in previous auctions, the Bureau adopts them 
for Auction No. 48.
iv. Stage Transitions
    91. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed that the auction would generally advance to the next stage 
(i.e., from Stage One to Stage Two, and from Stage Two to Stage Three) 
when the auction activity level, as measured by the percentage of 
bidding units receiving new high bids, is below 20 percent for three 
consecutive rounds of bidding in each Stage. The Bureau further 
proposed that it would retain the discretion to change stages 
unilaterally by announcement during the auction. This determination, 
the Bureau proposed, would be based on a variety of measures of bidder 
activity, including, but not limited to, the auction activity level, 
the percentages of licenses (as measured in bidding units) on which 
there are new bids, the number of new bids, and the percentage increase 
in revenue. The Bureau received no comments on this subject.
    92. The Bureau adopts its proposal. Thus, the auction will start in 
Stage One

[[Page 6162]]

and will advance to the next stage (i.e., from Stage One to Stage Two, 
and from Stage Two to Stage Three) when, in each of three consecutive 
rounds of bidding, the high bid has increased on 20 percent or less of 
the licenses being auctioned (as measured in bidding units). In 
addition, the Bureau will retain the discretion to regulate the pace of 
the auction by announcement. This determination will be based on a 
variety of measures of bidding activity, including, but not limited to, 
the auction activity level, the percentages of licenses (as measured in 
bidding units) on which there are new bids, the number of new bids, and 
the percentage increase in revenue. The Bureau believes that these 
stage transition rules, having proven successful in prior auctions, are 
appropriate for use in Auction No. 48.
v. Activity Rule Waivers and Reducing Eligibility
    93. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed that each bidder in the auction would be provided five 
activity rule waivers. Bidders may use an activity rule waiver in any 
round during the course of the auction. The Bureau received no comments 
on this subject.
    94. Based upon our experience in previous auctions, the Bureau 
adopts its proposal that each bidder be provided five activity rule 
waivers that may be used in any round during the course of the auction. 
Use of an activity rule waiver preserves the bidder's current bidding 
eligibility despite the bidder's activity in the current round being 
below the required level. An activity rule waiver applies to an entire 
round of bidding and not to a particular license. The Bureau is 
satisfied that its practice of providing five waivers over the course 
of the auction provides a sufficient number of waivers and flexibility 
to the bidders, while safeguarding the integrity of the auction.
    95. The Automated Auction System assumes that bidders with 
insufficient activity would prefer to use an activity rule waiver (if 
available) rather than lose bidding eligibility. Therefore, the system 
will automatically apply a waiver (known as an ``automatic waiver'') at 
the end of any round where a bidder's activity level is below the 
minimum required unless: (i) There are no activity rule waivers 
available; or (ii) the bidder overrides the automatic application of a 
waiver by reducing eligibility, thereby meeting the required activity 
level. If a bidder has no waivers remaining and does not satisfy the 
required activity level, the current eligibility will be permanently 
reduced, possibly eliminating the bidder from the auction.
    96. A bidder with insufficient activity that wants to reduce its 
bidding eligibility rather than use an activity rule waiver must 
affirmatively override the automatic waiver mechanism during the round 
by using the ``reduce eligibility'' function in the bidding system. In 
this case, the bidder's eligibility is permanently reduced to bring the 
bidder into compliance with the activity rules as described in 
``Auction Stages'' (see part IV.A.iii). Once eligibility has been 
reduced, a bidder will not be permitted to regain its lost bidding 
eligibility.
    97. Finally, a bidder may proactively use an activity rule waiver 
as a means to keep the auction open without placing a bid. If a bidder 
submits a proactive waiver (using the proactive waiver function in the 
Automated Auction System) during a round in which no bids are 
submitted, the auction will remain open and the bidder's eligibility 
will be preserved. However, an automatic waiver triggered during a 
round in which there are no new bids or withdrawals will not keep the 
auction open.

    Note: Once a proactive waiver is placed during a round, that 
waiver cannot be unsubmitted.

vi. Auction Stopping Rules
    98. For Auction No. 48, the Bureau proposed to employ a 
simultaneous stopping rule approach. The Bureau also sought comment on 
a modified version of the stopping rule. The modified version of the 
stopping rule would close the auction for all licenses after the first 
round in which no bidder submits a proactive waiver, a withdrawal, or a 
new bid on any license on which it is not the standing high bidder. 
Thus, absent any other bidding activity, a bidder placing a new bid on 
a license for which it is the standing high bidder would not keep the 
auction open under this modified stopping rule.
    99. The Bureau further proposed retaining the discretion to keep 
the auction open even if no new acceptable bids or proactive waivers 
are submitted and no previous high bids are withdrawn in a round. In 
this event, the effect will be the same as if a bidder had submitted a 
proactive waiver. Thus, the activity rule will apply as usual, and a 
bidder with insufficient activity will either use an activity rule 
waiver (if it has any left) or lose bidding eligibility.
    100. In addition, the Bureau proposed that it reserve the right to 
declare that the auction will end after a designated number of 
additional rounds (``special stopping rule''). If the Bureau invokes 
this special stopping rule, it will accept bids in the final round(s) 
only for licenses on which the high bid increased in at least one of 
the preceding specified number of rounds. The Bureau proposed to 
exercise this option only in circumstances such as where the auction is 
proceeding very slowly, where there is minimal overall bidding activity 
or where it appears likely that the auction will not close within a 
reasonable period of time. Before exercising this option, the Bureau is 
likely to attempt to increase the pace of the auction by, for example, 
moving the auction into the next stage (where bidders will be required 
to maintain a higher level of bidding activity), increasing the number 
of rounds per day and/or adjusting the minimum acceptable bids and bid 
increments for the licenses.
    101. The Bureau received no comments concerning the auction 
stopping rules; therefore, it adopts the proposals. Auction No. 48 will 
begin under the simultaneous stopping rule, and the Bureau will retain 
the discretion to invoke the other versions of the stopping rule. The 
Bureau believes that these stopping rules are most appropriate for 
Auction No. 48, because its experience in prior auctions demonstrates 
that the auction stopping rules balance the interests of administrative 
efficiency and maximum bidder participation.
vii. Auction Delay, Suspension, or Cancellation
    102. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed that, by public notice or by announcement during the auction, 
the Bureau may delay, suspend, or cancel the auction in the event of 
natural disaster, technical obstacle, evidence of an auction security 
breach, unlawful bidding activity, administrative or weather necessity, 
or for any other reason that affects the fair conduct of competitive 
bidding.
    103. Because this approach has proven effective in resolving 
exigent circumstances in previous auctions, the Bureau adopts its 
proposed auction cancellation rules. By public notice or by 
announcement during the auction, the Bureau may delay, suspend, or 
cancel the auction in the event of natural disaster, technical 
obstacle, evidence of an auction security breach, unlawful bidding 
activity, administrative or weather necessity, or for any other reason 
that affects the fair and competitive conduct of competitive bidding. 
In such cases, the Bureau, in its sole discretion, may elect to resume 
the auction starting from the beginning of

[[Page 6163]]

the current round, resume the auction starting from some previous 
round, or cancel the auction in its entirety. Network interruption may 
cause the Bureau to delay or suspend the auction. The Bureau emphasizes 
that exercise of this authority is solely within the discretion of the 
Bureau, and its use is not intended to be a substitute for situations 
in which bidders may wish to apply their activity rule waivers.

B. Bidding Procedures

i. Round Structure
    104. The initial bidding schedule will be announced in the public 
notice listing the qualified bidders, which is released approximately 
10 days before the start of the auction. Each bidding round is followed 
by the release of the round results. Multiple bidding rounds may be 
conducted in a given day. Details regarding round results formats and 
locations will also be included in the qualified bidders public notice.
    105. The FCC has discretion to change the bidding schedule in order 
to foster an auction pace that reasonably balances speed with the 
bidders' need to study round results and adjust their bidding 
strategies. The Bureau may increase or decrease the amount of time for 
the bidding rounds and review periods, or the number of rounds per day, 
depending upon the bidding activity level and other factors.
ii. Reserve Price or Minimum Opening Bid
    106. Background. The Balanced Budget Act calls upon the Commission 
to prescribe methods by which a reasonable reserve price will be 
required or a minimum opening bid established when FCC licenses are 
subject to auction (i.e., because they are mutually exclusive), unless 
the Commission determines that a reserve price or minimum opening bid 
is not in the public interest. Consistent with this mandate, the 
Commission directed the Bureau to seek comment on the use of a minimum 
opening bid and/or reserve price prior to the start of each auction. 
Among other factors, the Bureau should consider the amount of spectrum 
being auctioned, levels of incumbency, the availability of technology 
to provide service, the size of the geographic service areas, the 
extent of interference with other spectrum bands, and any other 
relevant factors that could have an impact on the spectrum being 
auctioned. The Commission concluded that the Bureau should have the 
discretion to employ either or both of these mechanisms for future 
auctions.
    107. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed to establish minimum opening bids for Auction No. 48 and to 
retain discretion to lower the minimum opening bids. Specifically, for 
Auction No. 48, the Bureau proposed the following formula for minimum 
opening bids:
    [sbull] For a license being auctioned by MEA, the minimum opening 
bid will be 20% of the average gross high bid received in Auction No. 
40 in the same MEA and the same band.
    [sbull] For a license being auctioned by EA, the minimum opening 
bid will be 20% of the average gross high bid received in Auction No. 
40 in the same EA and the same band.
    108. The Bureau will set a ``floor'' for minimum opening bids at 
$500 for licenses in both the upper paging bands (929-931 MHz) and the 
lower paging bands (35 MHz, 43 MHz, 152 and 158 MHz, 454 MHz and 459 
MHz, 929 MHz, 931 MHz).
    109. In the alternative, the Bureau sought comment on whether, 
consistent with the Balanced Budget Act, the public interest would be 
served by having no minimum opening bid or reserve price. The Bureau 
received one comment regarding this issue, suggesting that there be no 
minimum bid on all licenses that remain unsold from a previous auction.
    110. After reviewing the comment, the Bureau has concluded that it 
should adopt its original proposal and the minimum opening bids listed 
in the Auction No. 48 Comment Paging Notice. The Bureau believes that 
the use of minimum opening bids is in the public interest because 
parties unable or unwilling to make proposed minimum opening bids most 
likely will be unable or unwilling to use the licenses to provide 
service to the public. The Bureau has concluded that the proposed 
absolute minimum opening bid of $500 will not impede any party willing 
and able to use the license to provide paging service. Under the 
Commission's current rules, the filing fee for a new paging service 
license or to make major modifications to an existing paging service 
license is $325. This fee is waived for applicants that obtained 
licenses through the auction process. Finally, small businesses 
qualifying for a thirty-five percent (35%) bidding credit and winning a 
lower paging bands license for the minimum opening bid of $500 will 
have to pay $325 for the license. Thus, even absent an auction, service 
providers would have to meet costs comparable to the proposed absolute 
minimum opening bids in order to obtain a license.
    111. The Bureau will adopt minimum opening bids for Auction No. 48, 
that are reducible at the discretion of the Bureau. The Bureau 
emphasizes, however, that such discretion will be exercised, if at all, 
sparingly and early in the auction, i.e., before bidders lose all 
waivers and begin to lose substantial eligibility. During the course of 
the auction, the Bureau will not entertain requests to reduce the 
minimum opening bid on specific licenses.
    112. The specific minimum opening bid for each license available in 
Auction No. 48 is set forth in the list of licenses provided in 
electronic format as the Auction No. 48 Procedures Public Notice at 
http://wireless.fcc.gov/auctions/48/.
iii. Minimum Acceptable Bids and Bid Increments
    113. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed to set the minimum acceptable bid as the minimum opening bid 
or the standing high bid plus the defined increment. Eligible bidders 
will be able to place bids on a given license in any of nine different 
amounts. Until a bid has been placed on a license, the minimum 
acceptable bid for that license will be equal to its minimum opening 
bid. In the rounds after a bid is placed on a license, the minimum 
acceptable bid for that license will be equal to the standing high bid 
plus the defined increment. With respect to calculating the defined 
increment, the Bureau proposed basing the defined increment on a 
percentage of the standing high bid or, if no standing high bid had 
been placed, on a percentage of the minimum opening bid. The Bureau 
proposed that at the outset of the auction, it would use twenty percent 
of the standing high bid or minimum opening bid to calculate the 
increment. The Bureau further proposed to retain the discretion to 
change the percentage used to calculate the defined increment if 
circumstances so dictate and to set a floor for the increment used to 
calculate the minimum acceptable bid at an absolute dollar amount. 
Finally, the Bureau proposed that it have discretion to use a smaller 
percentage to calculate the increment used in setting acceptable bids 
higher than the minimum acceptable bid. In all other respects, such as 
rounding, the smaller defined increment would be calculated in the same 
manner as the defined increment used to set the minimum acceptable bid.
    114. For Auction No. 48, the Bureau proposed to use a fixed 20 
percent bid increment. This means that the minimum acceptable bid for a 
license will be approximately 20 percent greater

[[Page 6164]]

than the previous standing high bid received on the license. The 
minimum acceptable bid amount will be calculated by multiplying the 
standing high bid times one plus the fixed percentage--i.e., minimum 
acceptable bid amount = (standing high bid) * (1.20){rounded{time} . 
The Bureau will round the result using its standard rounding procedure 
for minimum acceptable bid calculations: Results above $10,000 are 
rounded to the nearest $1,000; results below $10,000 but above $1,000 
are rounded to the nearest $100; and results below $1,000 are rounded 
to the nearest $10.
    115. At the start of the auction and until a bid has been placed on 
a license, the minimum acceptable bid for that license will be equal to 
its minimum opening bid. Corresponding additional bid amounts will be 
calculated using bid increments defined as the difference between the 
minimum opening bid times one plus the percentage increment, rounded as 
described, and the minimum opening bid--i.e., bid increment = (minimum 
opening bid)(1 + percentage increment){rounded{time} --(minimum opening 
bid). At the start of the auction and until a bid has been placed on a 
license, the nine acceptable bid amounts for each license consist of 
the minimum opening bid and additional amounts are calculated using 
multiple bid increments (i.e., the second bid amount equals the minimum 
opening bid plus the bid increment, the third bid amount equals the 
minimum opening bid plus two times the bid increment, etc.).
    Example bid amount calculation for licenses at the start of the 
auction and without standing high bids:

1st bid amount = minimum opening bid
2nd bid amount = minimum opening bid + (bid increment)
3rd bid amount = minimum opening bid + 2(bid increment) * * *
9th bid amount = minimum opening bid + 8(bid increment)

    116. Once there is a standing high bid on the license, the 
Automated Auction System will calculate a minimum acceptable bid for 
that license for the following round, as described. The difference 
between the minimum acceptable bid and the standing high bid for each 
license will define the bid increment--i.e., bid increment = (minimum 
acceptable bid) - (standing high bid). The nine acceptable bid amounts 
for each license consist of the minimum acceptable bid (the standing 
high bid plus one bid increment) and additional amounts calculated 
using multiple bid increments (i.e., the second bid amount equals the 
standing high bid plus two times the bid increment, the third bid 
amount equals the standing high bid plus three times the bid increment, 
etc.).
    Example bid amount calculation for a license with standing high 
bids:

1st bid amount (minimum acceptable bid) = standing high bid + bid 
increment
2nd bid amount = standing high bid +2(bid increment)
3rd bid amount = standing high bid +3(bid increment) * * *
9th bid amount = standing high bid +9(bid increment)

    117. The Bureau retains the discretion to change the minimum 
acceptable bids and bid increments and the methodology for determining 
the minimum acceptable bids and bid increments if it determines 
circumstances so dictate. The Bureau will do so by announcement in the 
FCC Automated Auction System. The Bureau may also use its discretion to 
adjust the minimum bid increment without prior notice if circumstances 
warrant.
    118. The Bureau will adopt its proposals contained in the Auction 
No. 48 Comment Public Notice. In doing so, the Bureau will retain the 
discretion to set the percentages being used. Advance notice of the 
Bureau's decision to exercise its discretion with regard to acceptable 
bids in any manner will be announced via the Automated Auction System.
iv. High Bids
    119. At the end of each bidding round, the high bids will be 
determined based on the highest gross bid amount of the bids received 
for each license.
    120. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed to use a random number generator to select a high bid in the 
event of identical high bids on a license in a given round (i.e., tied 
bids). A random number will be assigned to each bid. The tied bid 
having the highest random number will become the standing high bid. The 
remaining bidders, as well as the high bidder, will be able to submit a 
higher bid in a subsequent round. If no bidder submits a higher bid in 
a subsequent round, the high bid from the previous round will win the 
license. If any bids are received on the license in a subsequent round, 
the high bid will once again be determined on the highest gross bid 
amount received for the license. The Bureau received no comments on 
this issue. Therefore, the Bureau adopts its proposal.
v. Bidding
    121. During a round, a bidder may submit bids for as many licenses 
as it wishes (subject to its eligibility), withdraw high bids from 
previous bidding rounds, remove bids placed in the same bidding round, 
or permanently reduce eligibility. Bidders also have the option of 
making multiple submissions and withdrawals in each round. If a bidder 
submits multiple bids for a single license in the same round, the 
system takes the last bid entered as that bidder's bid for the round. 
Bidders should note that the bidding units associated with licenses for 
which the bidder has removed or withdrawn its bid do not count towards 
the bidder's activity at the close of the round.
    122. Please note that all bidding will take place remotely either 
through the Automated Auction System or by telephonic bidding. 
(Telephonic bid assistants are required to use a script when entering 
bids placed by telephone. Telephonic bidders are therefore reminded to 
allow sufficient time to bid by placing their calls well in advance of 
the close of a round. Normally, five to 10 minutes are necessary to 
complete a bid submission. Due to the large number of licenses in 
Auction No. 48, bidders may require more time to submit their bids than 
in past auctions.) There will be no on-site bidding during Auction No. 
48.
    123. A bidder's ability to bid on specific licenses in the first 
round of the auction is determined by two factors: (i) the licenses 
applied for on FCC Form 175 and (ii) the upfront payment amount 
deposited. The bid submission screens will allow bidders to submit bids 
on only those licenses for which the bidder applied on its FCC Form 
175.
    124. In order to access the bidding functions of the Automated 
Auction System, bidders must be logged in during the bidding round 
using the bidder identification number provided in the registration 
materials, and the generated SecurID code. Bidders are strongly 
encouraged to print bid confirmations for each round after they have 
completed all of their activity for that round.
    125. In each round, eligible bidders will be able to place bids on 
a given license in any of nine different amounts. For each license, the 
Automated Auction System interface will list the nine acceptable bid 
amounts in a drop-down box. Bidders may use the drop-down box to select 
from among the nine acceptable bid amounts. The Automated Auction 
System also includes an import function that allows bidders to upload 
text files containing their bid information.
    126. Until a bid has been placed on a license, the minimum 
acceptable bid for that license will be equal to its

[[Page 6165]]

minimum opening bid. In the rounds after an acceptable bid is placed on 
a license, the minimum acceptable bid for that license will be equal to 
the standing high bid plus the defined increment.
    127. As detailed, for each license in Auction No. 48, the defined 
increment for the minimum acceptable bid is based on a percentage of 
the standing high bid on the license or, if no bid has been placed on 
the license, a percentage of the minimum opening bid for the license. 
Presuming, for example, that the percentage being used is 20 percent--
the initial value at the start of the auction--and the standing high 
bid for a license is $10,000, the minimum acceptable bid will be 
$12,000.
    128. In addition, the Bureau proposed discretion to use a smaller 
defined increment to calculate acceptable bids higher than the minimum 
acceptable bid. The smaller defined increment would be calculated using 
a smaller percentage than the percentage used to calculate the defined 
increment that sets the minimum acceptable bid. For example, 20 percent 
might be used to calculate the defined increment for the minimum 
acceptable bid and 10 percent might be used to calculate the smaller 
defined increment used to calculate higher acceptable bids. In all 
other respects, the smaller defined increment would be calculated in 
exactly the manner described for the initial defined increment, 
including rounding. In this case, for the example in which the standing 
high bid for a license is $10,000 and the minimum acceptable bid is 
$12,000, the values for the minimum acceptable bid and higher amounts 
will be calculated as follows:

Defined Increment
    = (Standing High Bid * 1.2{rounded{time} ) - Standing High Bid
    = ($10,000 * 1.2{rounded{time} ) - $10,000
    = ($12,000{rounded{time} ) - $10,000
    = $12,000 - $10,000
    = $2,000
Smaller Defined Increment
    = (Standing High Bid * 1.1{rounded{time} ) - Standing High Bid
    = ($10,000 * 1.1{rounded{time} ) - $10,000
    = ($11,000{rounded{time} ) - $10,000
    = $11,000 - $10,000
    = $1,000
Minimum Acceptable Bid
    = Standing High Bid + Defined Increment
    = $10,000 + $2,000
    = $12,000
One Increment Higher Than Minimum Acceptable Bid
    = Minimum Acceptable Bid + (Smaller Defined Increment * 1)
    = $12,000 + ($1,000 * 1)
    = $12,000 + $1,000
    = $13,000
Two Increments Higher Than Minimum Acceptable Bid
    = Minimum Acceptable Bid + (Smaller Defined Increment * 2)
    = $12,000 + ($1,000 * 2)
    = $12,000 + $2,000
    = $14,000

    129. This procedure would enable bidders unwilling to raise the 
standing high bid by twice the defined increment to place bids higher 
than the minimum acceptable bid. Thus, in the example, a bidder wanting 
to bid above the minimum acceptable bid but unwilling to raise the 
standing high bid of $10,000 by twice the defined increment of $2,000 
($4,000 or 40 percent) would have the flexibility to bid $13,000, 
raising the standing high bid by $3,000. In the case of a license for 
which the standing high bid has been withdrawn, the minimum acceptable 
bid will equal the second highest bid received for the license. The 
additional bid amounts are calculated using the defined increment, as 
stated. The Bureau will adopt these proposals for Auction No. 48.
    130. Finally, bidders are cautioned in selecting their bid amounts 
because, as explained in the following section, bidders who withdraw a 
standing high bid from a previous round, even if mistakenly or 
erroneously made, are subject to bid withdrawal payments.
vi. Bid Removal and Bid Withdrawal
    131. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed bid removal and bid withdrawal procedures. With respect to bid 
withdrawals, the Bureau proposed limiting each bidder to withdrawals in 
no more than two rounds during the course of the auction. The two 
rounds in which withdrawals are utilized, the Bureau proposed, would be 
at the bidder's discretion. The Bureau received no comments on this 
issue.
    132. Procedures. Before the close of a bidding round, a bidder has 
the option of removing any bids placed in that round. By using the 
``remove bid'' function in the bidding system, a bidder may effectively 
``unsubmit'' any bid placed within that round. A bidder removing a bid 
placed in the same round is not subject to withdrawal payments. 
Removing a bid will affect a bidder's activity for the round in which 
it is removed, i.e., a bid that is subsequently removed does not count 
toward the bidder's activity requirement. This procedure, about which 
the Bureau received no comments, will enhance bidder flexibility during 
the auction. Therefore, the Bureau will adopt these procedures for 
Auction No. 48.
    133. Once a round closes, a bidder may no longer remove a bid. 
However, in later rounds, a bidder may withdraw standing high bids from 
previous rounds using the withdraw bid function in the Automated 
Auction System (assuming that the bidder has not exhausted its 
withdrawal allowance). A high bidder that withdraws its standing high 
bid from a previous round during the auction is subject to the bid 
withdrawal payments specified in 47 CFR 1.2104(g).

    Note:  Once a withdrawal is placed during a round, that 
withdrawal cannot be unsubmitted.

    134. In previous auctions, the Bureau has detected bidder conduct 
that, arguably, may have constituted strategic bidding through the use 
of bid withdrawals. While the Bureau continues to recognize the 
important role that bid withdrawals play in an auction, i.e., reducing 
risk associated with efforts to secure various licenses in combination, 
it concludes that, for Auction No. 48, adoption of a limit on their use 
to two rounds per bidder is the most appropriate outcome. By doing so 
the Bureau believes it strikes a reasonable compromise that will allow 
bidders to use withdrawals. The Bureau's decision on this issue is 
based upon our experience in prior auctions, particularly the PCS D, E 
and F block auctions, and 800 MHz SMR auction, and is in no way a 
reflection of its view regarding the likelihood of any speculation or 
``gaming'' in this auction.
    135. The Bureau will therefore limit the number of rounds in which 
each bidder may place withdrawals to two rounds. These rounds will be 
at the bidder's discretion, and there will be no limit on the number of 
bids that may be withdrawn in either of these rounds. Withdrawals 
during the auction will still be subject to the bid withdrawal payments 
specified in 47 CFR 1.2104(g). Bidders should note that abuse of the 
Commission's bid withdrawal procedures could result in the denial of 
the ability to bid on a market.
    136. If a high bid is withdrawn, the minimum acceptable bid will 
equal the second highest bid received for the license, which may be 
less than, or equal to, in the case of tied bids, the amount of the 
withdrawn bid. To set the additional bid amounts, the second highest 
bid also will be used in place of the standing high bid in the formula 
used to calculate bid increments. The Commission will serve as a 
``place holder'' high bidder on the license until a new bid is 
submitted on that license.
    137. Calculation. Generally, the Commission imposes payments on

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bidders that withdraw high bids during the course of an auction. If a 
bidder withdraws its bid and there is no higher bid in the same or 
subsequent auction(s), the bidder that withdrew its bid is responsible 
for the difference between its withdrawn bid and the net high bid in 
the same or subsequent auction(s). In the case of multiple bid 
withdrawals on a single license, within the same or subsequent 
auctions(s), the payment for each bid withdrawal will be calculated 
based on the sequence of bid withdrawals and the amounts withdrawn. No 
withdrawal payment will be assessed for a withdrawn bid if either the 
subsequent winning bid or any of the intervening subsequent withdrawn 
bids, in either the same or subsequent auctions(s), equals or exceeds 
that withdrawn bid. Thus, a bidder that withdraws a bid will not be 
responsible for any withdrawal payments if there is a subsequent higher 
bid in the same or subsequent auction(s). This policy allows bidders 
most efficiently to allocate their resources as well as to evaluate 
their bidding strategies and business plans during an auction while, at 
the same time, maintaining the integrity of the auction process. The 
Bureau retains the discretion to scrutinize multiple bid withdrawals on 
a single license for evidence of anti-competitive strategic behavior 
and take appropriate action when deemed necessary.
    138. In the Part 1 Fifth Report and Order, the Commission modified 
Sec.  1.2104(g)(1) of the rules regarding assessments of interim bid 
withdrawal payments. As amended, Sec.  1.2104(g)(1) provides that in 
instances in which bids have been withdrawn on a license that is not 
won in the same auction, the Commission will assess an interim 
withdrawal payment equal to 3 percent of the amount of the withdrawn 
bids. The 3 percent interim payment will be applied toward any final 
bid withdrawal payment that will be assessed after subsequent auction 
of the license. Assessing an interim bid withdrawal payment ensures 
that the Commission receives a minimal withdrawal payment pending 
assessment of any final withdrawal payment. The Part 1 Fifth Report and 
Order provides specific examples showing application of the bid 
withdrawal payment rule
vii. Round Results
    139. In the Auction No. 48 Comment Public Notice, the Bureau 
proposed disclosing all information relating to the bids during Auction 
No. 48 after each round of bidding closes, including all bids and 
withdrawals placed in each round, the identity of the bidder placing 
each bid or withdrawal, and the net and gross amounts of each bid or 
withdrawal. Accordingly, the Bureau will adopt the proposal in the 
Auction No. 48 Comment Public Notice.
    140. Bids placed during a round will not be published until the 
conclusion of that bidding period. After a round closes, the Bureau 
will compile reports of all bids placed, bids withdrawn, current high 
bids, new minimum acceptable bids, and bidder eligibility status 
(bidding eligibility and activity rule waivers), and post the reports 
for public access. Reports reflecting bidders' identities and bidder 
identification numbers for Auction No. 48 will be available before and 
during the auction. Thus, bidders will know in advance of this auction 
the identities of the bidders against which they are bidding.
viii. Auction Announcements
    141. The FCC will use auction announcements to announce items such 
as schedule changes and stage transitions. All FCC auction 
announcements will be available by clicking a link on the Automated 
Auction System.
ix. Maintaining the Accuracy of FCC Form 175 Information
    142. As noted in part II.H., after the short-form filing deadline, 
applicants may make only minor changes to their FCC Form 175 
applications. For example, permissible minor changes include deletion 
and addition of authorized bidders (to a maximum of three) and certain 
revision of exhibits. Applicants must make these modifications to their 
FCC Form 175 electronically and submit a letter, briefly summarizing 
the changes, by electronic mail to the attention of Margaret Wiener, 
Chief, Auctions and Industry Analysis Division at the following 
address: [email protected]. The electronic mail summarizing the changes 
should include a subject or caption referring to Auction No. 48. The 
Bureau requests that parties format any attachments to electronic mail 
as Adobe[reg] Acrobat[reg] (pdf) or Microsoft[reg] Word documents.
    143. A separate copy of the letter should be faxed to the attention 
of Kathryn Garland at (717) 338-2850. Questions about other changes 
should be directed to Rosemary Cabral of the Auctions and Industry 
Analysis Division at (202) 418-0660.

V. Post-Auction Procedures

A. Down Payments and Withdrawn Bid Payments

    144. After bidding has ended, the Commission will issue a public 
notice declaring the auction closed, identifying winning bidders, down 
payments and any withdrawn bid payments due.
    145. Within 10 business days after release of the auction closing 
notice, each winning bidder must submit sufficient funds (in addition 
to its upfront payment) to bring its total amount of money on deposit 
with the Government to 20 percent of its net winning bids (actual bids 
less any applicable small business bidding credits). See 47 CFR 
1.2107(b). In addition, by the same deadline all bidders must pay any 
bid withdrawal payments due under 47 CFR 1.2104(g), as discussed in 
``Bid Removal and Bid Withdrawal,'' Part IV.B.vi. (Upfront payments are 
applied first to satisfy any withdrawn bid liability, before being 
applied toward down payments.)

B. Auction Discount Voucher

    146. On June 8, 2000, the Commission awarded Qualcomm, Inc. a 
transferable Auction Discount Voucher (``ADV'') in the amount of 
$125,273,878.00. This ADV may be used by Qualcomm or its transferee, in 
whole or in part, to adjust a winning bid in any spectrum auction prior 
to June 8, 2003, subject to terms and conditions set forth in the 
Commission's Order. Qualcomm transferred $10,848,000.00 of the ADV to a 
winning bidder in FCC Auction No. 35 and the transferee used its 
portion of the ADV to pay a portion of one of its winning bids in 
Auction No. 35. The remaining portion of Qualcomm's ADV could be used 
to adjust winning bids in another FCC auction, including Auction No. 
48.

C. Long-Form Application

    147. Within 10 business days after release of the auction closing 
notice, winning bidders must electronically submit a properly completed 
long-form application (FCC Form 601) and required exhibits for each 
license won through Auction No. 48. Winning bidders that are small 
businesses must include an exhibit demonstrating their eligibility for 
small business bidding credits. See 47 CFR 1.2112(b), 24.709(c)(2)(i). 
Further filing instructions will be provided to auction winners at the 
close of the auction.

D. Tribal Land Bidding Credit

    148. A winning bidder that intends to use its license(s) to deploy 
facilities and provide services to federally-recognized

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tribal lands that are unserved by any telecommunications carrier or 
that have a telephone service penetration rate equal to or below 70 
percent is eligible to receive a tribal land bidding credit as set 
forth in 47 CFR 1.2107 and 1.2110(f). A tribal land bidding credit is 
in addition to, and separate from, any other bidding credit for which a 
winning bidder may qualify.
    149. Unlike other bidding credits that are requested prior to the 
auction, a winning bidder applies for the tribal land bidding credit 
after winning the auction when it files its long-form application (FCC 
Form 601). When filing the long-form application, the winning bidder 
will be required to advise the Commission whether it intends to seek a 
tribal land bidding credit, for each market won in the auction, by 
checking the designated box(es). After stating its intent to seek a 
tribal land bidding credit, the applicant will have 90 days from the 
close of the long-form filing window to amend its application to select 
the specific tribal lands to be served and provide the required tribal 
government certifications. Licensees receiving a tribal land bidding 
credit are subject to performance criteria as set forth in 47 CFR 
1.2110(f).
    150. For additional information on the tribal land bidding credit, 
including how the amount of the credit is calculated, applicants should 
review the Commission's rule making proceeding regarding tribal land 
bidding credits and related public notices. Relevant documents can be 
viewed on the Commission's web site by going to http://wireless.fcc.gov/auctions and clicking on the Tribal Land Credits link.

E. Default and Disqualification

    151. Any winning bidder that defaults or is disqualified after the 
close of the auction (i.e., fails to remit the required down payment 
within the prescribed period of time, fails to submit a timely long-
form application; fails to make full payment, or is otherwise 
disqualified) will be subject to the payments described in 47 CFR 
1.2104(g)(2). In such event the Commission may re-auction the license 
or offer it to the next highest bidder (in descending order) at its 
final bid. In addition, if a default or disqualification involves gross 
misconduct, misrepresentation, or bad faith by an applicant, the 
Commission may declare the applicant and its principals ineligible to 
bid in future auctions, and may take any other action that it deems 
necessary, including institution of proceedings to revoke any existing 
licenses held by the applicant.

F. Refund of Remaining Upfront Payment Balance

    152. All applicants that submitted upfront payments but were not 
winning bidders for a license in Auction No. 48 may be entitled to a 
refund of their remaining upfront payment balance after the conclusion 
of the auction. No refund will be made unless there are excess funds on 
deposit from that applicant after any applicable bid withdrawal 
payments have been paid. All refunds will be returned to the payer of 
record, as identified on the FCC 159, unless the payer submits written 
authorization instructing otherwise.
    153. Bidders that drop out of the auction completely may be 
eligible for a refund of their upfront payments before the close of the 
auction. Qualified bidders that have exhausted all of their activity 
rule waivers, have no remaining bidding eligibility, and have not 
withdrawn a high bid during the auction must submit a written refund 
request. If you have completed the refund instructions electronically, 
then only a written request for the refund is necessary. If not, the 
request must also include wire transfer instructions, Taxpayer 
Identification Number (TIN) and FCC Registration Number (FRN). Send 
refund request to: Federal Communications Commission, Financial 
Operations Center, Auctions Accounting Group, Gail Glasser or Tim 
Dates, 445 12th Street, SW, Room 1-C863, Washington, DC 20554.
    154. Bidders are encouraged to file their refund information 
electronically using the refund information portion of the FCC Form 
175, but bidders can also fax their information to the Auctions 
Accounting Group at (202) 418-2843. Once the information has been 
approved, a refund will be sent to the party identified in the refund 
information.

    Note: Refund processing generally takes up to two weeks to 
complete. Bidders with questions about refunds should contact Tim 
Dates at (202) 418-0496 or Gail Glasser at (202) 418-0578.


Federal Communications Commission.
Margaret Wiener,
Chief, Auctions and Industry Analysis Division, WTB.
[FR Doc. 03-2839 Filed 2-5-03; 8:45 am]
BILLING CODE 6712-01-P