[Federal Register Volume 70, Number 52 (Friday, March 18, 2005)]
[Proposed Rules]
[Pages 13143-13151]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-5406]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 90

[WT Docket No. 05-62; FCC 05-31]


Amendment of the Commission's Rules to Provide for Flexible Use 
of the 896-901 MHz and 935-940 MHz Bands Allotted to the Business and 
Industrial Land Transportation Pool, and Oppositions

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Commission proposes amendments of its 
rules to facilitate more flexible use of the 199 channels allocated to 
the Business and Industrial Land Transportation (B/ILT) Pools in the 
896-901/935-940 MHz (900 MHz) bands, by permitting any use of the B/ILT 
channels in the 900 MHz band that is consistent with the band's fixed 
and mobile allocations. In addition, the Commission proposes to license 
the remaining spectrum using a geographic area licensing scheme, and to 
adopt service rules, including licensing, technical and operational 
rules for the new geographic licensees. Further, the Commission seeks 
comment on competitive bidding rules and procedures to be used in the 
event that mutually exclusive applications are filed for the 900 MHz 
proposed geographic licenses.

DATES: Comments are due on or before April 18, 2005. Reply comments are 
due May 2, 2005.

ADDRESSES: You may submit comments, identified by WT Docket No. 05-62, 
by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
     Email: To receive filing instructions for e-mail comments, 
commenters should send an e-mail to [email protected], and should include 
the following words in the body of the message, ``get form .'' A sample form and directions will be sent in reply. Include 
the docket number(s) in the subject line of the message.
     Mail: Appropriate addresses for submitting comments and 
reply comments may be found in the SUPPLEMENTARY INFORMATION section of 
this document.
     People with Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format documents, sign language 
interpreters, CART, etc.) by e-mail: [email protected] or phone: 202-418-
0530 or TTY: 202-418-0432.

For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.
    In addition to filing comments with the Secretary, a copy of any 
comments on the Paperwork Reduction Act information collection 
requirements contained herein should be submitted to Judith B. Herman, 
Federal Communications Commission, Room 1-C804, 445 12th Street, SW., 
Washington, DC 20554, or via the Internet to [email protected], 
and to Kristy L. LaLonde, OMB Desk Officer, Room 10234 NEOB, 725 17th 
Street, NW., Washington, DC 20503, via the Internet to Kristy--L. 
[email protected], or via fax at 202-395-5167.

FOR FURTHER INFORMATION CONTACT: Michael Connelly, Wireless 
Telecommunications Bureau, at (202) 418-0620.

SUPPLEMENTARY INFORMATION: This is a summary of the Federal 
Communications Commission's Notice and Proposed Rulemaking (NPRM), FCC 
05-31, in WT Docket No. 05-62, adopted February 10, 2005, and released 
February 16, 2005. The full text of this document is available for 
public inspection during regular business hours at the FCC Reference 
Information Center, 445 12th St., SW., Room CY-A257, Washington, DC 
20554. The complete text may be purchased from the Commission's 
duplicating contractor: Best Copy & Printing, Inc., 445 12th Street, 
SW., Room CY-B402, Washington, DC, 20554, telephone 800-378-3160, 
facsimile 202-488-5563, or via e-mail at [email protected].

Paperwork Reduction Act

    This document does not contain proposed information collection 
requirements subject to the Paperwork Reduction Act of 1995, Public Law 
104-13. In addition, therefore, it does not contain any proposed 
information collection burden ``for small business concerns with fewer 
than 25 employees,'' pursuant to the Small Business Paperwork Relief 
Act of 2002,

[[Page 13144]]

Public Law 107-198, see 44 U.S.C. 3506(c)(4).
    Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's rules, 
47 CFR 1.415, 1.419, interested parties may file comments and reply 
comments on or before the dates indicated on the first page of this 
document. Comments may be filed using: (1) The Commission's Electronic 
Comment Filing System (ECFS), (2) the Federal Government's eRulemaking 
Portal, or (3) by filing paper copies. See Electronic Filing of 
Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ 
or the Federal eRulemaking Portal: http://www.regulations.gov. Filers 
should follow the instructions provided on the website for submitting 
comments.
     For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Parties may also submit 
an electronic comment by Internet e-mail. To get filing instructions, 
filers should send an e-mail to [email protected], and include the following 
words in the body of the message, ``get form.'' A sample form and 
directions will be sent in response.
     Paper Filers: Parties who choose to file by paper must 
file an original and four copies of each filing. If more than one 
docket or rulemaking number appears in the caption of this proceeding, 
filers must submit two additional copies for each additional docket or 
rulemaking number.
    Filings can be sent by hand or messenger delivery, by commercial 
overnight courier, or by first-class or overnight U.S. Postal Service 
mail (although we continue to experience delays in receiving U.S. 
Postal Service mail). All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail should be addressed to 445 12th Street, SW., Washington DC 20554.
    People with Disabilities: Contact the FCC to request materials in 
accessible formats (braille, large print, electronic files, audio 
format, etc.) by e-mail at [email protected] or call the Consumer & 
Governmental Affairs Bureau at 202-418-0531 (voice), 202-418-7365 
(TTY).

Synopsis of Notice of Proposed Rulemaking

I. Background

    1. In 1986, the Commission established a pool structure for the 900 
MHz PLMR spectrum and allocated 2.5 MHz for the Industrial/Land 
Transportation Pool (99 channels) and 2.5 MHz for the Business Pool 
(100 channels) (collectively, the B/ILT Pools). The B/ILT Pools were 
established for use by site-by-site licensees engaged in commercial 
activities, the operation of educational, philanthropic, or 
ecclesiastical institutions, clergy activities, or the operation of 
hospitals, clinics, or medical associations. In addition, eligibility 
was also provided for any corporations furnishing nonprofit radio 
communication service to its parent corporation or subsidiary. 
Currently, applications for use of the B/ILT frequencies are limited to 
private, internal use systems.
    2. On July 8, 2004, in its 800 MHz Report and Order, 69 FR 67,823, 
the Commission adopted significant technical and procedural measures 
designed to address the problem of interference to public safety 
communications in the 800 MHz band. As part of its reconfiguration plan 
at 800 MHz, the Commission consolidated the B/ILT Pools in the 800 MHz 
and 900 MHz bands, allowing any eligible B/ILT licensee to be licensed 
on the consolidated channels. The Commission also provided for 
additional flexibility in the 900 MHz band by allowing 900 MHz PLMR 
licensees to initiate CMRS operations on their currently authorized 
spectrum or to assign their authorizations to others for CMRS use. The 
Commission reasoned that since it permitted CMRS use of PLMR 
frequencies in the 800 MHz land mobile band, similar rules should apply 
in the 900 MHz land mobile spectrum, in the interest of regulatory 
symmetry. The Commission also noted that in order to provide the 
``green space'' necessary to effect reconfiguration of the 800 MHz 
band, some operations may need to shift from the 800 MHz to 900 MHz 
band.

II. Discussion

A. Flexible Use, Regulatory Framework, and Assignment of Licenses

    3. The Commission proposes service rules for the new 900 MHz 
channels that would provide licensees flexible use. The Commission 
expects the economic efficiencies of flexibility to foster, not deter, 
technology development and investment in communications services and 
systems. The Commission seeks comment on its tentative conclusion to 
continue to license these bands under the framework of part 90 of our 
rules.

B. Band Plan and Size of Geographic Service Areas

    4. The Commission tentatively concludes that it should license this 
900 MHz spectrum using a geographic area licensing scheme, believing 
that geographic area licensing will maximize flexibility, permit new 
and innovative technologies to rapidly develop in these bands, and 
allow a licensee substantial flexibility to respond to market demand, 
resulting in significant improvements in spectrum utilization. Should 
the Commission adopt a geographic area approach for licensing the 
flexible-use spectrum, it seeks comment on the appropriate size of that 
geographic area. In particular, the Commission asks whether it should 
adopt Major Economic Areas (MEAs) or Basic Economic Areas (EAs). The 
Commission notes that MEAs may have the effect of creating 
opportunities for both existing licensees and new entrants to meet 
customer demands for wide-area service, increasing spectrum efficiency, 
providing better quality service to end users, and allowing service to 
reach potential end users that may otherwise be without adequate 
communication options, while Basic Economic Areas (EAs) may provide 
greater opportunities for small and medium-sized businesses to 
successfully compete against larger, well-financed bidders, and that 
EAs may facilitate the ability of incumbents and other small and 
medium-sized operators of smaller systems to participate in geographic 
area licensing.

C. Channel Block Size

    5. The Commission seeks comment on its proposal to license the 900 
MHz flexible-use channels in nineteen blocks of ten contiguous channels 
each, and one block of nine contiguous channels.

[[Page 13145]]

The Commission believes the proposed configuration can provide 
operational flexibility and efficiency by allowing providers to use new 
technologies and compete effectively with other commercial providers, 
and avoids the transaction costs associated with reaggregation of 
spectrum, while promoting the flexibility necessary to facilitate 
secondary market uses. The Commission also asks whether a more viable 
option under an EA-based licensing approach might include nine blocks 
of twenty non-contiguous channels each and one block of nineteen non-
contiguous channels, which would allow potential bidders to acquire a 
larger number of channels, albeit in smaller geographic areas. 
Commenters might also consider the option of dedicating the upper four 
channel blocks (i.e., QQ, RR, SS, TT) to traditional B/ILT services. 
The Commission also asks commenters to consider whether to permit 
potential bidders to bid on licenses comprising multiple band plans 
according to the band plan configuration they prefer and use the 
bidders' collective valuation of licenses consistent with each band 
plan in determining which band plan to implement. The Commission seeks 
comment on its proposal to permit licensees to aggregate blocks and to 
allow both incumbents and new entrants to bid on the spectrum.

D. Operational Flexibility

    6. The Commission seeks comment on its tentative conclusion that 
geographic area licensees in the 900 MHz band should be permitted to 
construct stations at any authorized site and on any available channel 
within their licensing area, and that geographic area licensees may 
expand or modify facilities throughout their service areas without 
prior Commission approval, so long as the systems continue to be in 
compliance with the Commission's technical and operational rules, 
protect incumbents, and are consistent with international requirements 
and approvals.

E. Treatment of Incumbent Systems

    7. The Commission proposes that geographic area licensees afford 
the same protection to incumbent B/ILT systems as is provided to 
incumbents by existing 900 MHz SMR MTA licensees, and tentatively 
concludes that the geographic area licensee's co-channel obligations 
cease upon the deletion of a revoked or terminated co-channel station 
authorization from the Commission's licensing records. Although the 
Commission believes this interference protection proposal will 
adequately protect incumbent operations, it asks commenters to consider 
whether additional interference protection requirements are needed. The 
Commission notes that licensees may be faced with the same interference 
problems that necessitated the remedies adopted in the 800 MHz R&O 
unless equivalent interference abatement requirements are established 
at 900 MHz. Also, the Commission proposes to define the existing 
service area of an incumbent B/ILT system by its originally-licensed 40 
dB[mu]V/m field strength contour, and to permit incumbent licensees to 
add or modify transmit sites in their existing service area, without 
prior approval or without post construction notification to the 
Commission, so long as their original 40 dB[mu]V/m signal is not 
expanded.
    8.The Commission also seeks comment on whether to provide an option 
for incumbent licensees to return their licensees through an auction 
that includes the new geographic area overlay licenses for white space 
as well as any site-based licenses currently held by incumbent 
licensees who may be willing to exchange or sell their licenses. In 
versions of this general form of auction discussed by the Commission, 
existing licensees would not be required to relinquish their rights, 
but they would be likely to do so if compensation for their license 
exceeded the value to them of continuing with their current use. Such a 
mechanism to promote the efficient transition of incumbent users may be 
most useful in situations in which the anticipated use of the spectrum 
under new service rules is incompatible with the continued existence of 
incumbents operating legacy systems in the band. While the Commission 
expects that the overlay licenses it makes available in this proceeding 
will be useful for providing new services regardless of the existence 
of site-based B/ILT users, the availability of incumbent providers' 
licenses may encourage a quicker and smoother transition of the 900 MHz 
spectrum to uses consistent with the more flexible service rules 
proposed here.

F. Emission and Field Strength Limits

    9. Regarding emissions, the Commission seeks comment on its 
proposal that, on any frequency in a geographic area licensee's 
spectrum block that is adjacent to a non-geographic area frequency, the 
power of any emission shall be attenuated below the transmitter power 
(P) by at least 43 plus 10 log10 (P) decibels or 80 
decibels, whichever is the lesser attenuation; the Commission 
tentatively concludes that this emission mask would adequately protect 
licensees in neighboring spectrum. Regarding field strength limits, the 
Commission requests comment on whether 40 dB[mu]V/m is an appropriate 
field strength level for a geographic area licensee's operations at its 
service area border, and asks commenters to address whether this limit 
furthers the Commission's goal of avoiding harmful interference or 
whether stricter requirements are necessary.

G. Performance Requirements and Other Operating and Technical Rules

    10. The Commission proposes to require new 900 MHz licensees to 
submit to the Commission a showing of substantial service (as opposed 
to a population benchmark) in their licensed area within either five or 
ten years of being licensed, believing that this performance 
requirement could provide greater flexibility for parties interested in 
entering into spectrum leasing arrangements involving this spectrum, as 
well as for providing service to rural or sparsely populated areas. The 
Commission also seeks comment on whether it should modify existing 
coverage requirements for 900 MHz SMR services to mirror the proposed 
substantial service showing for those 900 MHz licensees permitted 
flexible spectrum use; whether to retain or eliminate loading 
requirements as they apply to existing B/ILT authorizations; and 
whether the general provisions of part 90 to the 900 MHz B/ILT ``white 
space'' spectrum is appropriate.

H. Competitive Bidding Procedures

    11. The Commission proposes to conduct the auction for these 900 
MHz channel licenses under the general competitive bidding rules 
established in part 1, subpart Q of the Commission's Rules, and 
substantially consistent with the bidding procedures that have been 
employed in previous Commission auctions, including rules governing 
designated entities, application and payment procedures, reporting 
requirements, collusion issues, and unjust enrichment. The Commission 
also proposes small business bidding credits to further the statutory 
goals of ensuring that small businesses, rural telephone companies, and 
businesses owned by members of minority groups and women are given the 
opportunity to participate in the provision of spectrum-based services. 
The Commission seeks comment on its proposal to define a small business 
as an entity with average annual gross revenues for the three preceding 
years not to exceed $15 million, and to define a very small

[[Page 13146]]

business as an entity with average annual gross revenues for the three 
preceding years not to exceed $3 million. The Commission seeks comment 
on these proposals.

III. Procedural Matters

A. Initial Regulatory Flexibility Act Analysis

    12. As required by the Regulatory Flexibility Act of 1980 (RFA), 
the Commission has prepared an Initial Regulatory Flexibility Analysis 
(IRFA) of the possible significant economic impact on small entities of 
the policies and rules proposed in the Notice. The analysis is found in 
Appendix B of the NPRM. The Commission requests written public comment 
on the analysis. Comments must be filed by the same dates as listed in 
paragraph 70 of the NPRM, and must have a separate and distinct heading 
designating them as responses to the IRFA. The Commission's Consumer 
and Governmental Affairs Bureau, Reference Information Center, will 
send a copy of the NPRM, including the IRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration.

B. Need for, and Objectives of, the Notice of Proposed Rulemaking and 
Memorandum Opinion and Order

    13. In the NPRM, the Commission proposes amendments to part 90 of 
its rules to facilitate more flexible use of the 199 channels allocated 
to the Business and Industrial Land Transportation (B/ILT) Pool in the 
896-901/935-940 MHz (900 MHz) bands. The Commission proposes to permit 
any use of the B/ILT channels in the 900 MHz band that is consistent 
with the band's fixed and mobile allocations, and to license the 
remaining spectrum or ``white space'' using a geographic area licensing 
scheme and propose competitive bidding rules to select from among 
mutually exclusive applicants. The Commission also sets forth proposals 
for auction procedures for the remaining 900 MHz spectrum in the B/ILT 
category channels. The Commission believes these proposed rules will 
serve its twin goals of providing service to the public consistently 
and expeditiously, and allowing the marketplace to respond to consumer 
demands, and notes that allowing for flexible use of this spectrum will 
greatly aid in facilitating band reconfiguration occurring at 800 MHz. 
The Commission believes that the rules and policies proposed in the 
NPRM strike a fair and equitable balance between the interests of 
incumbent B/ILT licensees, and those seeking to provide geographic area 
service, and further believes that these rules and policies will 
promote competition, while providing opportunities for incumbents to 
continue to pursue their business plans.

C. Description and Estimate of the Number of Small Entities to Which 
the Rules Will Apply

    14. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules and policies, if adopted. The RFA 
generally defines the term ``small entity'' as having the same meaning 
as the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' In addition, the term ``small business'' 
has the same meaning as the term ``small business concern'' under the 
Small Business Act. A ``small business concern'' is one which: (1) Is 
independently owned and operated; (2) is not dominant in its field of 
operation; and (3) satisfies any additional criteria established by the 
SBA.
    15. Small Businesses. Nationwide, there are a total of 22.4 million 
small businesses, according to SBA data.
    16. Small Organizations. Nationwide, there are approximately 1.6 
million small organizations.
    17. Small Governmental Jurisdictions. The term ``small governmental 
jurisdiction'' is defined as ``governments of cities, towns, townships, 
villages, school districts, or special districts, with a population of 
less than fifty thousand.'' As of 1997, there were approximately 87,453 
governmental jurisdictions in the United States. This number includes 
39,044 county governments, municipalities, and townships, of which 
37,546 (approximately 96.2%) have populations of fewer than 50,000, and 
of which 1,498 have populations of 50,000 or more. Thus, we estimate 
the number of small governmental jurisdictions overall to be 84,098 or 
fewer.
    18. The Commission has determined that 1,040, or more, licenses 
will be awarded in the 896-901 MHz and 935-940 MHz B/ILT MHz bands; the 
Commission does not yet know how many applicants or licensees in these 
bands will be small entities. Thus, the Commission assumes, for 
purposes of this IRFA, that all prospective licensees are small 
entities as that term is defined by the SBA or by our proposed small 
business definitions for these bands. The Commission invites comment on 
this analysis.
    19. Wireless Service Providers. The SBA has developed a small 
business size standard for wireless firms within the two broad economic 
census categories of ``Paging'' and ``Cellular and Other Wireless 
Telecommunications.'' Under both SBA categories, a wireless business is 
small if it has 1,500 or fewer employees. For the census category of 
Paging, Census Bureau data for 1997 show that there were 1,320 firms in 
this category, total, that operated for the entire year. Of this total, 
1,303 firms had employment of 999 or fewer employees, and an additional 
17 firms had employment of 1,000 employees or more. Thus, under this 
category and associated small business size standard, the great 
majority of firms can be considered small. For the census category 
Cellular and Other Wireless Telecommunications, Census Bureau data for 
1997 show that there were 977 firms in this category, total, that 
operated for the entire year. Of this total, 965 firms had employment 
of 999 or fewer employees, and an additional 12 firms had employment of 
1,000 employees or more. Thus, under this second category and size 
standard, the great majority of firms can, again, be considered small.
    20. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services, and specialized mobile radio 
telephony carriers. The SBA has developed a small business size 
standard for ``Cellular and Other Wireless Telecommunications'' 
services. Under that SBA small business size standard, a business is 
small if it has 1,500 or fewer employees. According to Commission data, 
447 carriers reported that they were engaged in the provision of 
wireless telephony. We have estimated that 245 of these are small under 
the SBA small business size standard.
    21. Broadband Personal Communications Service. The broadband 
personal communications services (PCS) spectrum is divided into six 
frequency blocks designated A through F, and the Commission has held 
auctions for each block. The Commission has created a small business 
size standard for Blocks C and F as an entity that has average gross 
revenues of less than $40 million in the three previous calendar years. 
For Block F, an additional small business size standard for ``very 
small business'' was added and is defined as an entity that, together 
with its affiliates, has average gross revenues of not more than $15 
million for the preceding three calendar years. These small business 
size standards, in the context of broadband PCS auctions, have been 
approved by the SBA. No small businesses within the SBA-approved small 
business size standards bid successfully for licenses

[[Page 13147]]

in Blocks A and B. There were 90 winning bidders that qualified as 
small entities in the Block C auctions. A total of 93 ``small'' and 
``very small'' business bidders won approximately 40 percent of the 
1,479 licenses for Blocks D, E, and F. On March 23, 1999, the 
Commission reauctioned 155 C, D, E, and F Block licenses; there were 
113 small business winning bidders.
    22. On January 26, 2001, the Commission completed the auction of 
422 C and F Broadband PCS licenses in Auction No. 35. Of the 35 winning 
bidders in this auction, 29 qualified as ``small'' or ``very small'' 
businesses. Subsequent events concerning Auction 35, including judicial 
and agency determinations, resulted in a total of 163 C and F Block 
licenses being available for grant.
    23. Cellular Licensees. The SBA has developed a small business size 
standard for wireless firms within the broad economic census category 
``Cellular and Other Wireless Telecommunications.'' Under this SBA 
category, a wireless business is small if it has 1,500 or fewer 
employees. For the census category Cellular and Other Wireless 
Telecommunications firms, Census Bureau data for 1997 show that there 
were 977 firms in this category, total, that operated for the entire 
year. Of this total, 965 firms had employment of 999 or fewer 
employees, and an additional 12 firms had employment of 1,000 employees 
or more. Thus, under this category and size standard, the great 
majority of firms can be considered small. According to Commission 
data, 447 carriers reported that they were engaged in the provision of 
cellular service, personal communications service, or specialized 
mobile radio telephony services, which are placed together in the data. 
We have estimated that 245 of these are small, under the SBA small 
business size standard.

D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements

    24. The NPRM proposes to amend part 90 of the Commission's rules to 
facilitate more flexible use of the 199 channels allocated to the 
Business and Industrial Land Transportation (B/ILT) Pools in the 896-
901/935-940 MHz (900 MHz) bands, to permit any use of the B/ILT 
channels in the 900 MHz band that is consistent with the band's fixed 
and mobile allocations. It also proposes to license the unencumbered 
spectrum through geographic area licensing. Accordingly, the Commission 
proposes service rules, including licensing, technical and operational 
rules for the new geographic licensees, and seeks comment on defining 
the rights of B/ILT licensees already operating in the 900 MHz band. 
The Commission also seeks comment on competitive bidding rules and 
procedures to be used in the event that mutually exclusive applications 
are filed for the 900 MHz proposed geographic licenses.
    25. In paragraphs 12-14 of the NPRM, the Commission proposes 
service rules for the new 900 MHz channels that would provide licensees 
with the flexibility to employ this spectrum for any use permitted by 
the United States Table of Frequency Allocations contained in part 2 of 
our rules (i.e., fixed or mobile services), believing that such 
flexibility fully meets criteria set forth in section 303(y) of the 
Communications Act of 1934, as amended. The NPRM tentatively concludes 
that such use would be consistent with applicable international 
agreements, and that the public interest benefits of flexibility are 
numerous, and notes that the Commission has identified the 
establishment of maximum feasible flexibility in both spectrum 
designations and allocations and service rules as a critical means of 
ensuring that spectrum is put to its most beneficial use.
    The Commission believes that the economic efficiencies of 
flexibility foster, rather than deter, technology development and 
investment in communications services and systems.
    26. In paragraphs 17-19 of the NPRM, the Commission seeks comment 
on its proposal to license this 900 MHz spectrum using geographic area 
licensing, believing that such a licensing scheme is well-suited for 
the types of fixed and mobile services that will likely develop in this 
overlay band. The Commission invites commenters to explain any 
opposition and the costs and benefits associated with any preferable 
licensing proposal. In paragraphs 21-25, the Commission seeks comment 
on its proposal to adopt Major Economic Areas (``MEAs''), or, in the 
alternative, Economic Areas (``EAs'') as the appropriate geographic 
size. On the one hand, allowing the new 900 MHz licensees the use of 
frequencies for systems providing coverage across wide areas will 
increase spectrum efficiency, provide better quality service to end 
users, and allow service to reach potential end users that may 
otherwise be without adequate communication options, and that the MEA-
based licensees will be in a better position to address the needs of 
system users, customers, or lessees that have wide-area requirements; 
on the other hand, EAs, which are more than three times the number of 
delineated economic areas than MEAs, may facilitate the ability of 
incumbents and other small and medium-sized operators of smaller 
systems to participate in geographic area licensing. Adopting an EA-
based licensing scheme may permit small bidders and rural companies 
wishing smaller license areas to obtain them directly at auction rather 
than facing the uncertainty and transaction costs of working out post-
auction partitioning agreements.
    27. In paragraphs 26-30 of the NPRM, the Commission proposes to 
license the 900 MHz flexible-use channels in nineteen blocks of ten 
contiguous channels each, and one block of nine contiguous channels, 
with each ten-channel block separately licensed. Under the Commission's 
proposal, applicants would be permitted to aggregate blocks if they 
wish, without eligibility restriction for any channel block. The 
Commission seeks comment on whether the proposed 900 MHz channel block 
plan strikes a balance in affording small, medium and large operators 
the opportunity to obtain sufficient spectrum to establish viable and 
competitive wide-area systems, and whether the plan offers a middle 
ground between larger channel blocks that may block entry to new, 
smaller operators, and smaller block sizes that may hinder wide-area 
operations.
    28. In paragraphs 45-51 of the NPRM, the Commission proposes that 
the new 900 MHz licensees submit to the Commission a showing of 
substantial service in their licensed area within five or ten years of 
being licensed. In making this proposal, the Commission notes that a 
population-based benchmark may be a considerable obstacle for the 
provision of services in rural or sparsely populated areas, and that 
population-based coverage requirements may be difficult to achieve due 
to existing band encumbrances. The Commission also believes that the 
ten-year substantial service requirement provides greater flexibility 
for parties interested in entering into spectrum leasing arrangements 
involving this spectrum.
    29. In paragraphs 58-63 of the NPRM, the Commission proposes small 
business bidding credits to further the goals of ensuring that small 
businesses, rural telephone companies, and businesses owned by members 
of minority groups and women are given the opportunity to participate 
in the provision of spectrum-based services, and promoting economic 
opportunity and competition by avoiding excessive concentration of 
licenses and by disseminating licenses among a wide variety of 
applicants, including small businesses, rural telephone companies,

[[Page 13148]]

and businesses owned by members of minority groups and women. To that 
end, the Commission proposes a 10 percent bidding credit for small 
business and a 15 percent bidding credit for very small businesses.
    30. The Commission requests comment on how these proposed rules may 
be modified to reduce the burden on small entities and still meet the 
objectives of the proceeding.

E. Steps Taken To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    31. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its proposed approach, 
which may include the following four alternatives (among others): (1) 
The establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small entities; 
(3) the use of performance rather than design standards; and (4) an 
exemption from coverage of the rule, or any part thereof for small 
entities.
    32. The NPRM proposes to establish small business bidding credits 
to further the goals of ensuring that small businesses, rural telephone 
companies, and businesses owned by members of minority groups and women 
are given the opportunity to participate in the provision of spectrum-
based services, with a 10 percent bidding credit for small business and 
a 15 percent bidding credit for very small businesses. In addition, the 
NPRM solicits comment on a number of proposals and alternatives 
regarding the service rules for the 900 MHz band, and seeks to adopt 
rules that will reduce regulatory burdens, promote innovate services 
and encourage flexible use of this spectrum. The Commission believes 
the proposed rules will open up economic opportunities to a variety of 
spectrum users, which could include small businesses. Because the 
Commission seeks to minimize, to the extent possible, the economic 
impact on small businesses, the NPRM sets forth various proposals and 
alternatives for parties to consider.
    33. The NPRM invites comment on various alternative licensing and 
service rules and on a number of issues relating to how the Commission 
should craft service rules for this spectrum that could have an impact 
on small entities. The NPRM proposes a geographic area approach to 
service areas, as opposed to a station-defined licensing approach, and 
seeks comment on the appropriate size of service areas. Specifically, 
the NPRM asks for comment on whether smaller geographic areas would 
better serve the needs of small entities.
    34. The regulatory burdens proposed in the NPRM appear necessary in 
order to ensure that the public receives the benefits of innovative new 
services, or enhanced existing services, in a prompt and efficient 
manner. The Commission will continue to examine alternatives in the 
future with the objectives of eliminating unnecessary regulations and 
minimizing any significant economic impact on small entities. The 
Commission invites comment on any additional significant alternatives 
parties believe should be considered and on how the approach outlined 
in the NPRM will impact small entities, including small businesses and 
small government entities.

IV. Ordering Clauses

    35. Pursuant to the authority of sections 1, 2, 4(i), 7, 10, 201, 
214, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332 and 333 of the 
Communications Act of 1934, 47 U.S.C. 151, 152, 154(i), 157, 160, 201, 
214, 301, 302, 303, 307, 308, 309, 310, 319, 324, 332, 333, this Notice 
of Proposed Rulemaking is adopted.

List of Subjects of 47 CFR part 90

    Communications common carriers.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Proposed Rule Changes

    For the reasons discussed in the preamble, the Federal 
Communications Commission proposes to amend 47 CFR part 90 as follows:

PART 90--PRIVATE LAND MOBILE RADIO SERVICES

    1. The authority citation of part 90 continues to read as follows:

    Authority: Sections 4(i), 11, 303(g), 303(r), and 332(c)(7) of 
the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 161, 
303(g), 303(r), 332(c)(7).

    2. Amend Sec.  90.7 by adding the definitions ``Major Economic Area 
(MEA)'' and ``MEA-based license or MEA license'' in alphabetical order 
to read as follows:


Sec.  90.7  Definitions.

* * * * *
    Major Economic Area (MEA). An aggregation of Basic Economic Areas 
(BEAs) into 52 regions, including the Gulf of Mexico.
* * * * *
    MEA-based license or MEA license. A license authorizing the right 
to use a specified block of SMR spectrum with one of the 52 Major 
Economic Areas (``MEAs'').
* * * * *


Sec.  90.210  [Amended]

    3. Amend Sec.  90.210 as follows:
    (a) In the entry for 5850-5925 of the table ``APPLICABLE EMISSIONS 
MASKS'' redesignate footnote 4 as footnote 5; and
    (b) In the same table amend the entry for 896-901/935-940 Frequency 
band MHz by adding a new footnote 4.


Sec.  90.210  Emission masks.

* * * * *

                        Applicable Emission Masks
------------------------------------------------------------------------
                               Mask for equipment    Mask for equipment
    Frequency band (MHz)       with audio low pass    without audio low
                                     filter              pass filter
------------------------------------------------------------------------
 
                              * * * * * * *
896-901/935-940 \4\.........  I                     J
 
                             * * * * * * *
------------------------------------------------------------------------
\4\ Equipment used in this band licensed to MTA, EA or MEA or non
  geographic based systems shall comply with the emission mask
  provisions of Sec.   90.669 of this chapter.


[[Page 13149]]

* * * * *
    4. Amend Sec.  90.617 by revising the section heading, revising 
paragraph (c) preceding Table 3, by removing the undesignated paragraph 
also preceding Table 3 (Table 3 remains unchanged), by revising 
paragraph (f) preceding Table 6 (Table 6 remains unchanged), and by 
adding Table 7 and a Note to Table 7 to paragraph (f) to read as 
follows:


Sec.  90.617  Frequencies in the 809.750-824/854.750-869 MHz, and 896-
901/935-940 MHz bands available for trunked, conventional, or cellular 
system use in non-border areas.

* * * * *
    (c) The channels listed in Table 3 are available to applicants 
eligible in the Industrial/Business Pool of subpart C of this part but 
exclude Special Mobilized Radio Systems as defined in Sec.  90.603(c). 
These frequencies are available in non-border areas. Specialized Mobile 
Radio (SMR) systems may be authorized on these frequencies after 
[Effective date of Report and Order]. For multi-channel systems, 
channels may be grouped vertically or horizontally as they appear in 
the following table.
* * * * *
    (f) The channels listed in Table 6 are available for operations 
only to eligibles in the SMR category--which consists of Specialized 
Mobile Radio (SMR) stations and eligible end users. These frequencies 
are available in non-border areas.
* * * * *

    Note to Table 7: The channels listed in Table 7 are available to 
Business/Industrial/Land Transportation of SMR eligibles for EA-
based or MEA-based licensing.


 Table 7.--896-901/935-940 MHz Band Channels (199 Channels) Available After [Effective Date of Report and Order]
        for Business/Industrial/Land Transportation or SMR Eligibles for EA-Based or MEA-Based Licensing
----------------------------------------------------------------------------------------------------------------
             Block                                                 Channel Nos.
----------------------------------------------------------------------------------------------------------------
AA.............................  11-12-13-14-15-16-17-18-19-20
BB.............................  31-32-33-34-35-36-37-38-39-40
CC.............................  51-52-53-54-55-56-57-58-59-60
DD.............................   71-72-73-74-75-76-77-78-79-80
EE.............................   91-92-93-94-95-96-97-98-99-100
FF.............................  111-112-113-114-115-116-117-118-119-120
GG.............................   131-132-133-134-135-136-137-138-139-140
HH.............................   151-152-153-154-155-156-157-158-159-160
II.............................   171-172-173-174-175-176-177-178-179-180
JJ.............................   191-192-193-194-195-196-197-198-199-200
KK.............................   211-212-213-214-215-216-217-218-219-220
LL.............................   231-232-233-234-235-236-237-238-239-240
MM.............................   251-252-253-254-255-256-257-258-259-260
NN.............................   271-272-273-274-275-276-277-278-279-280
OO.............................   291-292-293-294-295-296-297-298-299-300
PP.............................   311-312-313-314-315-316-317-318-319-320
QQ.............................   331-332-333-334-335-336-337-338-339-340
RR.............................   351-352-353-354-355-356-357-358-359-360
SS.............................   371-372-373-374-375-376-377-378-379-380
TT.............................   391-392-393-394-395-396-397-398-399
----------------------------------------------------------------------------------------------------------------

* * * * *
    5. Amend Sec.  90.619 by revising paragraph (b)(1) and removing the 
undesignated text following paragraph (b)(1) (Table 1 remains 
unchanged); revise paragraph (b)(2) and redesignate Table 2 in 
paragraph (b)(2) as Table 2A, and by adding Table 2B, and a Note to 
Table 2B in paragraph (b)(2) to read as follows:


Sec.  90.619  Frequencies available for use in the U.S./Mexico and 
U.S./Canada border areas.

* * * * *
    (b) * * *
    (1) The channels listed in Table 1 are available to applicants 
eligible in the Industrial/Business Pool of subpart C of this part but 
exclude Special Mobilized Radio Systems as defined in Sec.  90.603(c). 
These frequencies are available within the Mexico border region. 
Specialized Mobile Radio (SMR) systems may be authorized on these 
frequencies after [Effective date of Report and Order]. For multi-
channel systems, channels may be grouped vertically or horizontally as 
they appear in the following table. Channels numbered above 200 may be 
used only subject to the power flux density limits stated in paragraph 
(a)(2) of this section.
* * * * *
    (2) The channels listed in Table 2A below are available for 
operations only to eligibles in the SMR category--which consists of 
Specialized Mobile Radio (SMR) stations and eligible end users. These 
frequencies are available in the Mexico border region.
* * * * *

    Note to Table 2B: The channels listed in Table 2B are available 
to Business/Industrial/Land Transportation or SMR eligibles for EA 
or MEA based licensing in the Mexico border region after [Effective 
date of Report and Order].


Table 2B.--896-901/935-940 MHz Band Channels (199 Channels) Available After [Effective Date of Report and Order]
   for Business/Industrial/Land Transportation or SMR Eligibles for EA-Based or MEA-Based Licensing in United
                                            States-Mexico Border Area
----------------------------------------------------------------------------------------------------------------
             Block                                                 Channel Nos.
----------------------------------------------------------------------------------------------------------------
AA.............................  11-12-13-14-15-16-17-18-19-20

[[Page 13150]]

 
BB.............................  31-32-33-34-35-36-37-38-39-40
CC.............................  51-52-53-54-55-56-57-58-59-60
DD.............................  71-72-73-74-75-76-77-78-79-80
EE.............................  91-92-93-94-95-96-97-98-99-100
FF.............................  111-112-113-114-115-116-117-118-119-120
GG.............................  131-132-133-134-135-136-137-138-139-140
HH.............................  151-152-153-154-155-156-157-158-159-160
II.............................  171-172-173-174-175-176-177-178-179-180
JJ.............................  191-192-193-194-195-196-197-198-199-200
KK.............................  211-212-213-214-215-216-217-218-219-220
LL.............................  231-232-233-234-235-236-237-238-239-240
MM.............................  251-252-253-254-255-256-257-258-259-260
NN.............................  271-272-273-274-275-276-277-278-279-280
OO.............................  291-292-293-294-295-296-297-298-299-300
PP.............................  311-312-313-314-315-316-317-318-319-320
QQ.............................  331-332-333-334-335-336-337-338-339-340
RR.............................  351-352-353-354-355-356-357-358-359-360
SS.............................  371-372-373-374-375-376-377-378-379-380
TT.............................  391-392-393-394-395-396-397-398-399
----------------------------------------------------------------------------------------------------------------
Channels numbered above 200 may only be used subject to the power flux density limits at or beyond the Mexico
  border as stated in paragraph (4) of this section.

* * * * *
    6. Amend Sec.  90.621 by revising paragraph (b) introductory text 
to read as follows:


Sec.  90.621  Selection and assignment of frequencies.

* * * * *
    (b) Stations authorized on frequencies listed in this subpart, 
except for those stations authorized pursuant to paragraph (g) of this 
section and geographic-area-based systems, will be assigned frequencies 
solely on the basis of fixed distance separation criteria. The 
separation between co-channel systems will be a minimum of 113 km (70 
mi) with one exception. For incumbent licensees in Channel Blocks G 
through V, that have received the consent of all affected parties or a 
certified frequency coordinator to utilize an 18 dB[mu]V/m signal 
strength interference contour (see Sec.  90.693), the separation 
between co-channel systems will be a minimum of 173 km (107 mi). The 
following exceptions to these separations shall apply:
* * * * *
    7. Amend Sec.  90.669 by revising paragraph (a) to read as follows. 
The note following paragraph (a) remains unchanged.


Sec.  90.669  Emission limits.

    (a) Out-of-band emission requirements shall apply only to the 
``outer'' channels included in an MTA, EA, or MEA licensee and to 
spectrum adjacent to interior channels used by incumbent licensees. On 
any frequency in a MTA, EA, or MEA geographic-area-based licensee's 
spectrum block that is adjacent to another licensee's frequency, the 
power of any emission shall be attenuated below the transmitter power 
(P) by at least 43 plus 10 log10(P) decibels or 80 decibels, 
whichever is the lesser attenuation.
* * * * *
    8. Revise Sec.  90.671 to read as follows:


Sec.  90.671  Field strength limits.

    The predicted or measured field strength at any location on the 
border of the service area for 896-901/935-940 MHz geographic-area-
based licensees shall not exceed 40 dB[mu]V/m unless all co-channel 
bordering geographic-area-based licensees agree to a higher field 
strength. Geographic-area-based licensees are also required to 
coordinate their frequency usage with co-channel adjacent geographic-
area-based licensees and all other affected parties. To the extent that 
a single entity obtains licenses for adjacent MTAs, EAs or MEAs on the 
same channel block, it will not be required to coordinate its 
operations in this manner. In the event that this standard conflicts 
with the geographic-area-based licensee's obligation to provide co-
channel protection to incumbent licensees under Sec.  90.621(b), the 
requirements of Sec.  90.621(b) shall prevail.
    9. Amend subpart S by adding the undesignated center heading and 
Sec. Sec.  90.678, 90.679, and 90.680 to read as follows:

Policies Governing Licensing and Use of EA-Based or MEA-Based Business/
Industrial/Land Transportation or SMR Systems in the 896-901/935-940 
MHz Band


Sec.  90.678  EA-Based or MEA-Based Business/Industrial/Land 
Transportation or SMR service areas.

    EA or MEA licenses for spectrum blocks AA, BB, through TT, in the 
896-940 MHz band listed in table 7 of Sec.  90.617(f) are available in 
175 Economic Areas (EAs) or 52 Major Economic Areas (MEAs) as defined 
in Sec.  90.7. Within these EAs or MEAs, licenses will be authorized in 
ten channel blocks as specified in table 7 of Sec.  90.617(f) through 
the competitive bidding procedures described in subpart U of this part.


Sec.  90.679  EA or MEA-based Business/Industrial/Land Transportation 
or SMR system operations.

    (a) EA or MEA-based licensees authorized in the 896-901/935-940 MHz 
band pursuant to Sec.  90.678 may construct and operate base stations 
using any frequency identified in their spectrum block anywhere within 
their authorized licensed area, provided that:
    (1) The EA or MEA licensee complies with any rules and 
international agreements that restrict use of frequencies identified in 
their spectrum block, including the provisions of Sec.  90.619 relating 
to U.S./Canadian and U.S./Mexican border areas.
    (2) The EA or MEA licensee limits its field strength at any 
location on the border of the service area in accordance

[[Page 13151]]

with Sec.  90.671 and masks its emissions in accordance with Sec.  
90.669.
    (b) In the event that the authorization for a previously authorized 
co-channel station within the geographic-area-based licensee's 
authorized spectrum block is terminated or revoked, the licensee's co-
channel obligations to such station will cease upon deletion of the 
facility from the Commission's licensing record. The EA or MEA licensee 
then will be able to construct and operate base stations using such 
frequency.


Sec.  90.680  Authorization, construction and implementation of EA or 
MEA-based licenses and Grandfathering provisions for incumbent 
licensees.

    (a) Geographic-area-based licenses in the 896-901/935-940 MHz band 
will be issued for a term not to exceed ten years.
    (b) Each geographic-area-based licensee in the 896-901/935-940 MHz 
band must demonstrate, through a showing to the Commission ten years 
from the date of license grant, that it is providing substantial 
service within its service area.
    (c) Geographic-area-based licensees who fail to make a convincing 
showing of substantial service by the end of the tenth year after grant 
of authorization will forfeit the portion of the geographic-area-based 
license that exceeds licensed facilities constructed and operating on 
the date of the license grant.
    (d) Grandfathering provisions for incumbent licensees. An incumbent 
licensee's service area shall be defined by its originally-licensed 40 
dB[mu]V/m field strength contour. Incumbent licensees are permitted to 
add new or modify transmit sites in this existing service area so long 
as the original 40 dB[mu]V/m field strength contour is not expanded.

[FR Doc. 05-5406 Filed 3-17-05; 8:45 am]
BILLING CODE 6712-01-P