[Federal Register Volume 90, Number 53 (Thursday, March 20, 2025)]
[Proposed Rules]
[Pages 13117-13131]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-04452]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 1 and 27
[AU Docket No. 25-117; DA 25-193; FR ID 285139]
Auction of Advanced Wireless Services (AWS-3) Licenses; Comment
Sought on Competitive Bidding Procedures for Auction 113
AGENCY: Federal Communications Commission.
ACTION: Proposed rule; proposed auction procedures.
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SUMMARY: In this document, the Federal Communications Commission
(Commission or FCC) announces an auction of 200 licenses in the 1695-
1710 MHz, 1755-1780 MHz, and 2155-2180 MHz bands (collectively, the
``AWS-3'' bands). The Office of Economics and Analytics (OEA), jointly
with the Wireless Telecommunications Bureau (WTB), also seeks comment
in this document on the procedures to be used for this auction, which
is designated as Auction 113.
DATES: Comments are due on or before April 10, 2025, and reply comments
are due on or before April 25, 2025.
ADDRESSES: Interested parties may file comments or reply comments,
identified by AU Docket No. 25-117, by any of the following methods:
Electronic Filers: Comments may be filed electronically using the
internet by accessing the Commission's Electronic Comment Filing System
(ECFS) at https://www.fcc.gov/ecfs/.
Paper Filers: Parties who choose to file by paper must file an
original and one copy of each filing.
Filings can be sent by hand or messenger delivery, by
commercial courier, or by the U.S. Postal Service mail. All filings
must be addressed to the Commission's Secretary, Office of the
Secretary, Federal Communications Commission.
Hand-delivered or messenger-delivered paper filings for
the Commission's Secretary are accepted between 8 a.m. and 4 p.m. by
the FCC's mailing contractor at 9050 Junction Drive, Annapolis
Junction, MD 20701. All hand deliveries must be held together with
rubber bands or fasteners. Any envelopes and boxes must be disposed of
before entering the building.
Commercial courier mail (any not sent by the U.S. Postal
Service) must be sent to 9050 Junction Drive, Annapolis Junction, MD
20701.
Filings sent by U.S. Postal Service First-Class Mail,
Express, and Priority mail must be sent to 45 L Street NE, Washington,
DC 20554.
Email: Commenters are requested to also submit a copy of their
comments and reply comments electronically to the following address:
[email protected].
Ex Parte Rules: This proceeding shall be treated as a permit-but-
disclose proceeding in accordance with the Commission's ex parte rules.
47 CFR 1.1200 et seq. Persons making ex parte presentations must file a
copy of any written presentation or a memorandum summarizing any oral
presentation within two business days after the presentation (unless a
different deadline applicable to the Sunshine Period applies). Persons
making oral ex parte presentations are reminded that memoranda
summarizing the presentations must (1) list all persons attending or
otherwise participating in the meeting at which the ex parte
presentation was made, and (2) summarize all data presented and
arguments made during the presentation. If the presentation consisted
in whole or in part of the presentation of data or arguments already
reflected in the presenter's written comments, memoranda, or other
filings in the proceeding, the presenter may provide citations to such
data or arguments in his or her prior comments, memoranda, or other
filings (specifying the relevant page and/or paragraph numbers where
such data or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to Commission staff during ex
parte presentations are deemed to be written ex parte presentations and
must be filed consistent with 47 CFR 1.1206(b). In proceedings governed
by 47 CFR 1.49(f) or for which the Commission has made available a
method of electronic filing, written ex parte presentations and
memoranda summarizing oral ex parte presentations, and all attachments
thereto, must be filed through the electronic comment filing system
available for that proceeding, and must be filed in their native format
(e.g., .doc, .xml, .ppt, searchable .pdf). Participants in this
proceeding should familiarize themselves with the Commission's ex parte
rules.
FOR FURTHER INFORMATION CONTACT:
Auction Legal Questions: Valerie M. Barrish, (202) 418-0660,
[email protected], or Yasiman E. Montgomery, (202) 418-0660,
[email protected].
General Auction Questions: Auction Hotline at (717) 338-2868.
AWS-3 Service Questions: Madelaine Maior, (202) 418-1166,
[email protected], or Jeffrey Tignor, (202) 418-0774,
[email protected].
SUPPLEMENTARY INFORMATION: This is a summary of the document, AU Docket
No. 25-117, DA 25-193, adopted on March 11, 2025, and released on March
11, 2025 (Auction 113 Comment Public Notice). The Auction 113 Comment
Public Notice includes the following attachments: Attachment A, Auction
113 Licenses; Proposed Bidding Units, Upfront Payments, and Minimum
Opening Bid Amounts. The complete text of the Auction 113 Comment
Public Notice, including its attachment, is available on the
Commission's website at http://www.fcc.gov/auction/113 or by using the
search function for AU Docket No. 25-117 on the Commission's ECFS web
page at www.fcc.gov/ecfs.
[[Page 13118]]
Alternative formats are available to persons with disabilities by
sending an email to [email protected] or by calling the Consumer and
Governmental Affairs Bureau at (202) 418-0530.
Providing Accountability Through Transparency Act. The Providing
Accountability Through Transparency Act, Public Law 118-9, requires
each agency, in providing notice of a rulemaking, to post online a
brief plain-language summary of the proposed rule. The required summary
of the Auction 113 Comment Public Notice is available at https://www.fcc.gov/proposed-rulemakings.
Paperwork Reduction Act of 1995 Analysis
The Auction 113 Comment Pubic Notice seeks comment on proposed
requirements that may result in new or modified information collection
requirements. The Commission, as part of its continuing effort to
reduce paperwork burdens, invites the general public and the Office of
Management and Budget to comment on the information collection
requirements contained in this document, as required by the Paperwork
Reduction Act of 1995. In addition, pursuant to the Small Business
Paperwork Relief Act of 2002, specific comment is sought on how the
Commission might further reduce the information collection burden for
small business concerns with fewer than 25 employees.
I. Introduction
1. In the Auction 113 Comment Public Notice, the Commission
announces an auction of 200 licenses in the 1695-1710 MHz, 1755-1780
MHz, and 2155-2180 MHz bands (collectively, the ``AWS-3'' bands), which
is designated as Auction 113.
2. The Commission is offering the licenses in Auction 113 pursuant
to the Spectrum and Secure Technology and Innovations Act of 2024
(Spectrum and Secure Technology and Innovation Act). The Spectrum and
Secure Technology and Innovation Act, Public Law 118-159, directs the
Commission to initiate a system of competitive bidding to grant
licenses of unassigned AWS-3 spectrum in the Commission's inventory as
of December 23, 2024 within 18 months of December 23, 2024. Auction
proceeds will support the Commission's Supply Chain Reimbursement
Program, which implements the Secure and Trusted Communications
Networks Act of 2019 by reimbursing eligible advanced communications
service providers for their costs to remove, replace, and dispose of
Huawei Technologies Company or ZTE Corporation equipment and services
obtained on or before June 30, 2020.
3. In this proceeding and consistent with past practice, the Office
of Economics and Analytics (OEA), jointly with the Wireless
Telecommunications Bureau (WTB), seeks comment in the Auction 113
Comment Public Notice on the competitive bidding procedures and auction
design to be used for bidding to acquire licenses in Auction 113,
including a proposal to use an ascending clock auction format--
specifically, a clock-1 format--wherein bidding in the clock phase
would be for specific licenses to assign the licenses offered in
Auction 113.
II. Licenses To Be Offered In Auction 113
4. The list of licenses to be offered in Auction 113 is available
in the Attachment A file on the Auction 113 website at www.fcc.gov/auction/113. The licenses available in Auction 113 will be granted
pursuant to the Commission's authority under the Spectrum and Secure
Technology and Innovation Act to initiate a system of competitive
bidding that will grant licenses for spectrum in the Commission's
inventory as of December 23, 2024 in the AWS-3 bands. Licenses for the
AWS-3 spectrum previously were offered in Auction 97, however not all
the licenses offered in Auction 97 were assigned following that
auction. The licenses for AWS-3 spectrum that were available in the
Commission's inventory as of December 23, 2024 and will be offered in
Auction 113 are listed in the Attachment A file. In its 2025 AWS-3
NPRM, 90 FR 11931 (March 13, 2025), the Commission seeks comment on
possibly adopting a Tribal licensing window for relevant portions of
AWS-3 spectrum in its inventory which could affect the licenses to be
offered in Auction 113. If corrections or changes to the list of
licenses available in Auction 113 are necessary for any reason, the
Commission may update the Attachment A file as appropriate.
A. Description of Licenses
5. In the 2014 AWS-3 Report and Order, 79 FR 32366 (June 4, 2014),
the Commission concluded that all licenses in the 1695-1710 MHz band,
and most licenses in the 1755-1780 MHz and 2155-2180 MHz bands, should
be awarded on an Economic Area (EA) basis in all areas, and that all
licenses in the 1755-1760 MHz and 2155-2160 MHz bands should be awarded
on a Cellular Market Area (CMA) basis in all areas.
6. The AWS-3 spectrum available in Auction 113 will be licensed on
a geographic area basis. Of the 200 licenses offered in Auction 113, 48
will be EA licenses and 152 will be CMA licenses. The AWS-3 frequencies
will be licensed in five and ten megahertz blocks, with each license
having a total bandwidth of five, ten, or twenty megahertz.
7. The 1695-1710 MHz band will be licensed in an unpaired
configuration for low-power mobile transmit (i.e., uplink) operations.
The 1755-1780 MHz band will be licensed paired with the 2155-2180 MHz
band, with the 1755-1780 MHz band authorized for low-power mobile
transmit (i.e., uplink) operations and the 2155-2180 MHz band
authorized for base station and fixed (i.e., downlink) operations.
Higher-power fixed and base station operations are also prohibited in
the 1755-1780 MHz band.
8. Figure 1 in the Auction 113 Comment Public Notice shows the band
plan for the 1695-1710 MHz band. Figure 2 in the Auction 113 Comment
Public Notice shows the band plans for the 1755-1780 MHz and 2155-2180
MHz bands. Table 1 contains summary information regarding the AWS-3
licenses available in Auction 113:
Table 1--AWS-3 License Summary
[Auction 113]
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Frequencies Geographic area Number of
Block (MHz) Total bandwidth Pairing type licenses
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A1.......................... 1695-1700 MHz.. 5 MHz.......... unpaired....... EA............. 1
B1.......................... 1700-1710 MHz.. 10 MHz......... unpaired....... EA............. 1
G........................... 1755-1760/2155- 10 MHz......... 2 x 5 MHz...... CMA............ 152
2160 MHz.
H........................... 1760-1765/2160- 10 MHz......... 2 x 5 MHz...... EA............. 14
2165 MHz.
I........................... 1765-1770/2165- 10 MHz......... 2 x 5 MHz...... EA............. 29
2170 MHz.
[[Page 13119]]
J........................... 1770-1780/2170- 20 MHz......... 2 x 10 MHz..... EA............. 3
2180 MHz.
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9. Each potential bidder is solely responsible for investigating
and evaluating all technical and marketplace factors that may have a
bearing on the potential uses of a license that it may seek in Auction
113. In addition to the typical due diligence considerations that the
Commission encourages of bidders in all auctions, OEA and WTB call
particular attention in Auction 113 to the incumbency issues in the
1695-1710 MHz, 1755-1780 MHz, and 2155-2180 MHz bands and protection of
Federal and non-Federal incumbent operations as described herein. Each
applicant should closely follow releases from the Commission concerning
these issues and consider carefully the technical and economic
implications for commercial use of the AWS-3 band. The Commission makes
no representations or warranties about the use of this spectrum for
particular services, or about the information in Commission databases
that is furnished by outside parties. Each applicant should be aware
that a Commission spectrum license auction represents an opportunity to
become a Commission licensee, subject to certain conditions and
regulations. This includes the established authority of the Commission
to alter the terms of existing licenses by rulemaking, which is equally
applicable to licenses awarded by auction. A Commission auction does
not constitute an endorsement by the Commission of any particular
service, technology, or product, nor does a Commission license
constitute a guarantee of business success.
B. Incumbency Issues
10. The AWS-3 bands are currently being used for a variety of
government and non-government services. In the 2014 AWS-3 Report and
Order, the Commission allocated the 1695-1710 MHz and 1755-1780 MHz
bands for commercial use. The Commission allocated the 1695-1710 MHz
band for non-Federal fixed and mobile (except aeronautical mobile) use
and the 1755-1780 MHz band for non-Federal fixed and mobile use.
Licenses in the 1695-1710 MHz band are being made available on a shared
basis with incumbent Federal meteorological-satellite (MetSat) data
users. The Commission adopted twenty-seven Protection Zones for the
1695-1710 MHz band in the 2014 AWS-3 Report and Order, and the forty-
seven Federal earth stations located in these Protection Zones will
operate on a co-equal, primary basis with commercial AWS-3 licensees.
All other Federal earth stations operate on a secondary basis. In order
to facilitate coordination, uplink/mobile transmit devices in the 1695-
1710 MHz band must be under the control of, or associated with, a base
station as a means to facilitate shared use of the band and prevent
interference to Federal operations. Licenses in the 1755-1780 MHz band
are being made available on a shared basis with a limited number of
Federal incumbents indefinitely, and some Federal systems that have or
will over time relocate out of the band. The Federal systems located in
the Protection Zones adopted by the Commission for the 1755-1780 MHz
band in the 2014 AWS-3 Report and Order will operate on a co-equal,
primary basis with commercial AWS licensees. The Federal systems that
will relocate from the band pursuant to an approved transition plan
will operate on a primary basis until they are reaccommodated. In order
to facilitate coordination, uplink/mobile transmit devices in the 1755-
1780 MHz band must be under the control of, or associated with, a base
station as a means to facilitate shared use of the band and prevent
interference to Federal operations. NTIA issues annual reports on the
status of the transitions of spectrum in the 1695-1710 MHz and 1755-
1780 MHz bands. Licenses to operate in the 1695-1710 MHz and 1755-1780
MHz bands are subject to the condition that the licensee must not cause
harmful interference to an incumbent Federal entity relocating from
these bands under an approved Transition Plan. This condition remains
in effect until NTIA terminates the applicable authorization of the
incumbent Federal entity. Although this license condition does not
apply to the permanent sharing scenario, the Commission's rules require
successful coordination to avoid causing harmful interference to these
Federal incumbents. In addition, AWS-3 licensees in the 1755-1780 MHz
band must agree to accept interference from incumbent Federal users
while they remain authorized to operate in the band. The 2155-2180 MHz
band is already allocated for exclusive non-Federal, commercial use.
Although no Federal users are currently licensed or operating in the
2155-2180 MHz band, AWS-3 licensees may have to protect or relocate
and/or share in the cost of relocating non-Federal incumbent Fixed
Microwave and Broadband Radio Service licensees in the band.
11. AWS-3 licensees in the 1695-1710 MHz and 1755-1780 MHz bands
are required to successfully coordinate with Federal incumbent users in
these bands prior to operating in designated protection zones. The 2014
AWS-3 Report and Order established that 1695-1710 MHz licensees
operating at certain power levels would be required to coordinate with
Federal incumbents in those protection zones, and higher-powered
operations would generally require nationwide coordination. Similarly,
operations in the 1755-1780 MHz band are subject to successful
coordination with Federal incumbents in the protection zones adopted
for that band, with the default coordination zone being nationwide.
Prior to commencing operations in the 1755-1780 MHz band, an AWS-3
licensee must reach a coordination arrangement on an operator-to-
operator basis with each Federal agency that has an assignment with
United States and Possessions authority. The FCC/NTIA Coordination
Procedures Public Notice, 79 FR 54710 (September 12, 2014), contains
various refinements to the previously-defined protection zones for each
of these bands. The FCC/NTIA Coordination Procedures Public Notice also
provides information and guidance on the overall coordination process
for these bands, as contemplated by the 2014 AWS-3 Report and Order,
including informal pre-coordination discussion and the formal process
of submitting coordination requests to, and receiving responses to
coordination requests from, relevant Federal agencies. OEA and WTB
encourage each potential applicant to carefully review these
coordination requirements and the policies and procedures adopted by
the Commission to implement them, and to
[[Page 13120]]
consider the impact of those requirements and policies on the potential
applicant's business plans.
III. Implementation of Part 1 Competitive Bidding Rules and
Requirements
12. The Commission's part 1 competitive bidding rules require each
applicant seeking to bid to acquire licenses in a spectrum auction to
provide certain information in a short-form application (FCC Form 175),
including ownership details and numerous certifications. Pursuant to
the Commission's competitive bidding rules under 47 CFR 1.2105, each
applicant must make a series of certifications under penalty of perjury
on its FCC Form 175 related to the information provided in its
application and its participation in the auction, and it must confirm
that it is legally, technically, financially, and otherwise qualified
to hold a Commission license. As with other required certifications, an
auction applicant's failure to make the required certification in its
short-form application by the applicable filing deadline would render
its application unacceptable for filing, its application would be
dismissed with prejudice, and it would be ineligible to participate
further in the auction. The competitive bidding rules in 47 CFR part 1,
subpart Q also contain a framework for the implementation of a
competitive bidding design, application and certification procedures,
payment procedures, reporting requirements, and the prohibition of
certain communications.
A. Certification of Notice of Auction 113 Requirements and Procedures
13. In addition to certifications already required under 47 CFR
1.2105, OEA and WTB propose to require any applicant seeking to
participate in Auction 113 to certify in its short-form application,
under penalty of perjury, that it has read the public notice(s)
adopting procedures for Auction 113, as appropriate, and that it has
familiarized itself both with the auctions procedures and with the
requirements for obtaining a license and operating facilities in the
AWS-3 band. OEA and WTB believe that this certification would help
ensure that the applicant has reviewed the procedures for participation
in the auction process and has investigated and evaluated those
technical and marketplace factors that may have a bearing on its
potential use of any license won at auction. Consequently, this
requirement will promote an applicant's successful participation in the
auction and reduce its risk of defaulting on its auction obligations.
As with other required certifications, an auction applicant's failure
to make the required certifications in its short-form application by
the applicable filing deadline would render its application
unacceptable for filing, and its application would be dismissed with
prejudice. OEA and WTB seek comment on this proposal. OEA and WTB also
seek comment on whether there are additional steps the Commission
should take with respect to the filing of short-form applications to
further ensure and promote auction integrity.
B. Acknowledgement for Auction 113 Applicants
14. In its 2014 AWS-3 Report and Order, the Commission adopted
rules to address commercial operations in these bands in light of the
temporary and indefinite sharing of the bands by Federal incumbent
users and commercial licensees, including a requirement that commercial
licensees operate on a co-equal, primary basis with Federal systems
within specified geographic zones, and a requirement that licensees in
the 1755-1780 MHz band accept interference from Federal systems as long
as such systems remain in the band. To implement these rules, each
Auction 97 applicant seeking to bid in the 1755-1780 MHz band had been
required to submit with its short-form application a signed statement
acknowledging that the applicant's operations in the 1755-1780 MHz band
may be subject to interference from Federal systems in certain
geographic zones, that the applicant must accept interference from such
Federal systems in those zones, and that the applicant has considered
these risks before submitting any bids for applicable licenses. As
discussed herein, there continue to be Federal incumbent users in the
1755-1780 MHz band. Accordingly, as was required for Auction 97
applicants, OEA and WTB propose to require an Auction 113 applicant to
submit a signed statement as an attachment to its short-form
application acknowledging that the applicant's operations in the 1755-
1780 MHz band may be subject to interference from Federal systems in
certain geographic zones, that the applicant must accept interference
from such Federal systems in those zones, and that the applicant has
considered these risks before submitting any bids for applicable
licenses in Auction 113. OEA and WTB seek comment on this proposal.
C. Bidding Credit Caps
15. In general, the Commission's bidding credit program promotes
small business and rural service provider participation in auctions and
in the provision of spectrum-based services. Consistent with the
framework established by the Commission in the Updating Part 1 Report
and Order, 80 FR 56764 (September 18, 2015), OEA and WTB seek comment
on establishing a reasonable monetary limit or cap on the total amount
of bidding credits that an eligible small business or rural service
provider may be awarded for Auction 113.
16. Eligibility for the small business bidding credit is determined
according to a tiered schedule of small business size definitions that
are based on an applicant's average annual gross revenues for the
relevant preceding period, and which determine the size of the bidding
credit discount. In its 2014 AWS-3 Report and Order, the Commission
decided it would conduct any auction for licenses in the AWS-3 bands
pursuant to its competitive bidding rules in 47 CFR part 1, subpart Q
and would provide small business bidding credits to eligible entities.
Under the rules in effect at the time Auction 97 was conducted, an
entity with average annual gross revenues for the preceding three years
not exceeding $40 million was designated as a ``small business''
eligible for a 15% bidding credit, and an entity with average annual
gross revenues for the preceding three years not exceeding $15 million
was designated as a ``very small business'' eligible for a 25% bidding
credit. Shortly after Auction 97 ended, the Commission increased the
gross revenue thresholds that define eligibility for the existing 15%,
25%, and 35% tiers of the small business bidding credit program to 55
million, $20 million, and $4 million, respectively, and adopted a rural
service provider bidding credit. Additionally, in 2018, Congress
amended the Small Business Act to require an agency that prescribes a
size standard for categorizing a business concern providing services as
a ``small business concern'' to do so based on annual average gross
revenues over a period of not less than five-years.
17. Because the service rules for the AWS-3 bands had not been
updated to reflect these changes, in its 2025 AWS-3 NPRM, the
Commission proposed to harmonize the designated entity rules for the
AWS-3 bands with both the updated competitive bidding rules for
designated entities in 47 CFR part 1, subpart Q and the Small Business
Act's
[[Page 13121]]
revised five-year average gross receipts benchmark. The Commission
defines the small business size standards on a service-by-service
basis, after evaluating the associated characteristics and capital
requirements of each service, and proposed in the 2025 AWS-3 NPRM to
adopt for the AWS-3 service rules the small business definitions for
the two higher gross revenues thresholds of $55 million and $20 million
that are in the standardized schedule for small business bidding
credits in 47 CFR part 1, subpart Q. The Commission determines
eligibility for the rural service provider bidding credit on a service-
by-service basis, and proposed in the 2025 AWS-3 NPRM that in any
future auction of licenses in the AWS-3 bands, it would offer a 15%
rural service provider bidding credit to any eligible rural service
provider, as defined in 47 CFR 1.2110(f)(4)(i), that is not also
claiming a small business bidding credit. Under 47 CFR 1.2110(f)(4)(i),
entities providing commercial communications services to a customer
base of fewer than 250,000 combined wireless, wireline, broadband, and
cable subscribers in primarily rural areas will be eligible for the 15%
rural service provider bidding credit. The Commission defined ``rural
area'' as a county with a population density of 100 persons or fewer
per square mile.
18. To protect the integrity of the bidding credit program and to
mitigate the incentives for abuse, the Commission, in the Updating Part
1 Report and Order, established a process to implement a reasonable cap
on the total bidding credit amount that an eligible small business or
rural service provider may be awarded in any auction where such credits
are available. This process is based on an evaluation of the expected
capital requirements presented by the particular service and inventory
of licenses being auctioned. The Commission determined that bidding
credit caps would be implemented on an auction-by-auction basis, but
resolved that, for any particular auction, the total amount of the
bidding credit cap for small businesses would not be less than $25
million, and the bidding credit cap for rural service providers would
not be less than $10 million. For Auctions 101, 102, 103, 105, 107,
108, and 110, the Commission adopted a $25 million cap on the total
bidding credit amount that may be awarded to an eligible small business
in each auction and a $10 million cap on rural service provider bidding
credits in each auction.
19. OEA and WTB propose to adopt the same $25 million small
business bidding credit cap for Auction 113 as was adopted for nearly
all spectrum auctions conducted after Auction 97 was completed and
following the adoption of the Updating Part 1 Report and Order's
bidding cap framework. Auction data suggest that a $25 million cap on
small business bidding credits will allow the substantial majority of
eligible small businesses in the auction to take advantage of the
bidding credit program. No bidder seeking a small business bidding
credit exceeded the $25 million cap in Auction 101, Auction 102,
Auction 103, Auction 105, Auction 110, or Auction 108, and only one
bidder seeking a small business bidding credit exceeded the $25 million
cap in Auction 107. OEA and WTB therefore believe that this proposed
cap will not conflict with the statutory goals of providing meaningful
opportunities for bona fide small businesses to compete in auctions and
in the provision of spectrum-based services, while preventing unjust
enrichment and ensuring efficient and intensive use of spectrum.
20. Similarly, if the Commission adopts the rural service provider
bidding credit proposed in the 2025 AWS-3 NPRM for any future auction
of licenses in the AWS-3 bands, OEA and WTB propose to adopt a $10
million cap on the total amount of bidding credit amounts that may be
awarded to an eligible rural service provider in Auction 113. An entity
is not eligible for a rural service provider bidding credit if it has
already claimed a small business bidding credit. Based on their
experience with other spectrum auctions, OEA and WTB anticipate that a
$10 million cap on rural service provider bidding credits will allow
any rural service provider to participate fully and fairly in Auction
113. No rural service provider exceeded the $10 million cap in the
forward portion of the Broadcast Incentive Auction (Auction 1002),
Auction 101, Auction 102, Auction 103, Auction 105, Auction 107,
Auction 108, or Auction 110. The capped rural service provider bidding
credit will be ``significant enough to assist eligible entities to have
the opportunity to compete at auction, but reasonable enough to ensure
that ineligible entities are not encouraged to undercut [the
Commission's] rules,'' and thereby serve the ``dual statutory goals of
benefitting [designated entities] and at the same time preventing
unjust enrichment.''
21. In addition, to create parity in Auction 113 among eligible
small businesses and rural service providers competing against each
other in smaller markets, if the Commission decides that a rural
service provider bidding credit will be available in Auction 113, OEA
and WTB propose a $10 million cap on the overall amount of bidding
credits that any winning designated entity bidder may apply to licenses
won in markets with a population of 500,000 or less. This proposal is
consistent with the approach adopted by the Commission in the forward
portion of the Broadcast Incentive Auction (Auction 1002), Auction 101,
Auction 102, Auction 103, Auction 105, Auction 107, Auction 108, and
Auction 110.
22. OEA and WTB seek comment on these proposed caps. Specifically,
do the expected capital requirements associated with operating in the
AWS-3 bands, the potential number and value of AWS-3 licenses, past
auction data, or any other considerations justify a higher or lower cap
for either type of bidding credit in this auction? Commenters are
encouraged to identify circumstances and characteristics of Auction 113
and/or the spectrum licenses to be made available in the auction that
should guide us in establishing bidding credit caps, and to provide
specific, data-driven arguments in support of their proposals.
23. OEA and WTB remind applicants applying for designated entity
bidding credits that they should take due account of the requirements
of the Commission's rules and implementing orders regarding de jure and
de facto control of such applicants. These rules include a prohibition,
which applies to all applicants (whether or not they are seeking
bidding credits), starting at the short-form application filing
deadline, against changes in ownership of the applicant that would
constitute an assignment or transfer of control. Under 47 CFR
1.2107(c), the winning bidder must be the entity that files the post-
auction long-form application. Pursuant to 47 CFR 1.929(a)(2), any
substantial change in ownership or control is classified as a major
amendment. Applicants should not expect to receive any opportunity to
revise their ownership structure after the filing of their short- and
long-form applications, including making revisions to their agreements
or other arrangements with interest holders, lenders, or others in
order to address potential concerns relating to compliance with the
designated entity bidding credit requirements. This policy will help to
ensure compliance with the Commission's rules applicable to the award
of bidding credits prior to the start of bidding in this auction, which
will involve competing bids from those who do and do not seek bidding
credits, and thus preserves the integrity of the
[[Page 13122]]
auctions process. In furtherance of this policy, applicants will not be
permitted to change their bidding credit type selection (i.e., from
small business to rural service provider, or vice versa) after the
short-form deadline. OEA and WTB also believe that this will meet the
Commission's objectives in awarding licenses through the competitive
bidding process, which include ``the development and rapid deployment
of new technologies, products, and services for the benefit of the
public . . . without administrative or judicial delays'' and
``promoting economic opportunity and competition and ensuring that new
and innovative technologies are readily accessible to the American
people by avoiding excessive concentration of licenses and by
disseminating licenses among a wide variety of applicants, including
small businesses.''
D. Prohibition of Certain Communications
24. Section 1.2105(c)(1) of the Commission's rules, 47 CFR
1.2105(c)(1), provides that, subject to specified exceptions, after the
short-form application filing deadline, all applicants are prohibited
from cooperating or collaborating with respect to, communicating with
or disclosing, to each other or any nationwide provider of
communications services that is not an applicant, or, if the applicant
is a nationwide provider, any non-nationwide provider that is not an
applicant, in any manner the substance of their own, or each other's,
or any other applicants' bids or bidding strategies (including post-
auction market structure), or discussing or negotiating settlement
agreements, until after the down payment deadline. Section
1.2105(c)(5)(i) of the Commission's rules, 47 CFR 1.2105(c)(5)(i),
defines ``applicant'' as including all officers and directors of the
entity submitting a short-form application to participate in the
auction, all controlling interests of that entity, as well as all
holders of partnership and other ownership interests and any stock
interest amounting to 10% or more of the entity, or outstanding stock,
or outstanding voting stock of the entity submitting a short-form
application.
25. The operation of the rule prohibiting certain communications
requires that the identification of each ``nationwide provider'' for
purposes of 47 CFR 1.2105(c)(1) in connection with each auction.
Because AWS-3 spectrum is licensed under the flexible-use rules in 47
CFR part 27 and may be used by licensees for any fixed or mobile
service that is consistent with the allocations for the AWS-3 bands,
the Commission's identification of three nationwide providers in its
most recent Communications Marketplace Report, FCC 24-136 (released
December 31, 2024), suggests that OEA and WTB should identify those
same entities as nationwide providers for purposes of AWS-3 licenses
and Auction 113. Identifying ``nationwide providers'' in this manner
for the purpose of implementing the Commission's competitive bidding
rules is consistent with the approach used in Auctions 101, 102, 103,
105, 110, and 108 and the forward auction portion of the Broadcast
Incentive Auction (Auction 1002). Accordingly, consistent with the
procedures adopted for prior auctions of flexible-use licenses for
advanced wireless services, OEA and WTB propose to identify AT&T, T-
Mobile, and Verizon as ``nationwide providers'' for the purpose of
implementing its competitive bidding rules in Auction 113, including 47
CFR 1.2105(c), the Commission's rule prohibiting certain
communications. OEA and WTB seek comment on this proposal. Commenters
that disagree with this proposed designation of nationwide providers
are encouraged to articulate alternative methodologies by which OEA and
WTB should identify nationwide providers for purposes of the prohibited
communications rule.
E. Information Procedures During the Auction Process
26. As an additional safeguard to prevent the sharing of
information about applicants' bids and bidding strategies and to
discourage anti-competitive strategic behavior, OEA and WTB propose to
limit information available in Auction 113 so that bidders placing
particular bids will not be identified until after the bidding has
closed. The Commission has instituted limited information procedures in
most recent spectrum auctions. While the Commission generally makes
available to the public information provided in each applicant's FCC
Form 175 following the initial review by Commission staff, OEA and WTB
propose to not make public until after bidding has closed: (1) the
licenses that an applicant has selected for bidding in its short-form
application (FCC Form 175), (2) the amount of any upfront payment made
by or on behalf of an applicant for Auction 113, (3) any applicant's
bidding eligibility, and (4) any other bidding-related information that
might reveal the identity of the bidder placing a bid.
27. As in past Commission auctions, OEA and WTB will not make
public during a bidding round any real-time information on bidding
activity. Bidders would have access both during and after a round to
information related to their own bidding and bid eligibility. For
example, bidders would be able to view their own level of eligibility
and submitted activity through the FCC auction bidding system.
28. After the close of bidding, bidders' license selections,
upfront payment amounts, bidding eligibility, bids, and other bidding-
related information would be made publicly available.
29. OEA and WTB seek comment on the above details of this proposal
for implementing limited information procedures, or anonymous bidding,
in Auction 113. Commenters opposing the use of anonymous bidding in
Auction 113 should explain their reasoning and propose alternative
information rules.
F. Upfront Payments and Bidding Eligibility
30. In keeping with the Commission's usual practice in spectrum
license auctions, OEA and WTB propose that each applicant would be
required to submit an upfront payment as a prerequisite to becoming
qualified to bid. As described herein, an upfront payment is a
refundable deposit made by an applicant to establish its eligibility to
bid on licenses. Upfront payments protect against frivolous or
insincere bidding and provide the Commission with a source of funds
from which to collect payments owed at the close of bidding. OEA and
WTB note that under 47 CFR 1.2106, any auction applicant that, pursuant
to 47 CFR 1.2105(a)(2)(xii), certifies that it is a former defaulter
must submit an upfront payment equal to 50 percent more than the amount
that otherwise would be required. With these considerations in mind,
the Commission propose upfront payments for the paired licenses based
on dollars per MHz-pop in three population tiers. Specifically, OEA and
WTB propose upfront payments of $0.005 per MHz-pop for the paired
licenses in areas with a population of less than 300,000, $0.01 per
MHz-pop for the paired licenses in areas with a population of at least
300,000 and less than 1,000,000, $0.025 per MHz-pop for the paired
licenses in areas with a population of at least 1,000,000, and $0.005
per MHz-pop for the unpaired licenses. For all licenses, upfront
payments would be subject to a minimum of $500 per license. The results
of these calculations will be rounded using the Commission's standard
rounding procedures for auctions: results above $10,000 are rounded to
the nearest $1,000; results
[[Page 13123]]
below 10,000 but above $1,000 are rounded to the nearest $100; and
results below $1,000 are rounded to the nearest $10. The proposed
upfront payments equal approximately half the proposed minimum opening
bids, which are established as described herein.
31. OEA and WTB seek comment on the upfront payment amounts, which
are specified in Attachment A file on the Auction 113 website at
www.fcc.gov/auction/113. If commenters believe that these upfront
payment amounts are not reasonable amounts, they should explain their
reasoning and suggest an alternative amount.
32. OEA and WTB further propose that the amount of the upfront
payment submitted by a bidder will determine its initial bidding
eligibility for the auction in bidding units. The upfront payment does
not limit the dollar amounts of the bids that a bidder may submit.
Bidder eligibility and bidding activity are measured in bidding units.
OEA and WTB propose to assign each license that is available to be
assigned a specific number of bidding units, equal to one bidding unit
per $100 of the upfront payment listed in the Attachment A file
available on the Auction 113 website at www.fcc.gov/auction/113. Thus,
a bidder's initial bidding eligibility in bidding units would be equal
to a bidding unit for each $100 of the bidder's upfront payment. The
number of bidding units for a given license is fixed and does not
change during the auction as prices change. If an applicant is found to
be qualified to bid on more than one license being offered in Auction
113, such bidder may place bids on multiple licenses, provided that the
total number of bidding units associated with those licenses does not
exceed its current eligibility. A bidder cannot increase its
eligibility during the auction; it can only maintain or decrease its
eligibility. Thus, in calculating its upfront payment amount and hence
its initial bidding eligibility, an applicant for Auction 113 must
determine the maximum number of bidding units on which it may wish to
bid in any single round and submit an upfront payment amount covering
that total number of bidding units. OEA and WTB seek comment on these
proposals.
G. Auction Delay, Suspension, or Cancellation
33. For Auction 113, OEA and WTB propose that at any time before or
during the bidding process, OEA, in conjunction with WTB, may delay,
suspend, or cancel bidding in the event of a natural disaster,
technical obstacle, network interruption, administrative or weather
necessity, evidence of an auction security breach or unlawful bidding
activity, or for any other reason that affects the fair and efficient
conduct of competitive bidding. In such case, OEA would notify
participants of any such delay, suspension, or cancellation by public
notice and/or through the FCC auction bidding system's announcement
function. If the bidding is delayed or suspended, OEA, in its sole
discretion, may elect to resume the auction starting from the beginning
of the current round or from some previous round, or it may cancel the
auction in its entirety. OEA and WTB emphasize that they would exercise
the authority to delay, suspend, or cancel bidding in Auction 113
solely at their discretion. OEA and WTB seek comment on this proposal.
H. Deficiency Payments and Additional Default Payment Percentage
34. Any winning bidder that defaults or is disqualified after the
close of an auction (i.e., fails to remit the required down payment by
the specified deadline, fails to submit a timely long-form application,
fails to make full and timely final payment, or is otherwise
disqualified) would be liable for a default payment under 47 CFR
1.2104(g)(2). This payment consists of a deficiency payment, equal to
the difference between the amount of the bidder's winning bid and the
amount of the winning bid the next time a license covering the same
spectrum is won in an auction, plus an additional payment equal to a
percentage of the defaulter's bid or of the subsequent winning bid,
whichever is less.
35. The Commission's rules provide that, in advance of each
auction, it will establish a percentage between 3% and 20% of the
applicable winning bid to be assessed as an additional default payment.
As the Commission has indicated, the level of this additional payment
in each auction will be based on the nature of the service and the
licenses being offered.
36. As noted in the CSEA/Part 1 Report and Order, 71 FR 6214,
February 7, 2006, defaults weaken the integrity of the auction process
and may impede the deployment of service to the public, and an
additional default payment of up to 20% will be more effective in
deterring defaults than the 3% used in some earlier auctions. For
Auction 113, OEA and WTB propose to establish an additional default
payment of 15% which is consistent with that adopted for Auction 97, as
well as more recent spectrum auctions, including Auctions 101, 102,
103, 107, 108 and 110. OEA and WTB seek comment on this proposal.
IV. Proposed Bidding Procedures
37. OEA and WTB seek comment on a proposed ``clock-1'' auction
format--a multiple-round auction format with bidding on specific-
frequency licenses. This format, if adopted, would follow the basic
structure of the ascending clock auction used in previous FCC spectrum
license clock auctions, in which bidding in the clock phase was
conducted for multiple generic spectrum blocks in a geographic area,
but as in Auction 108, bidding in the clock phase would be for specific
licenses rather than on generic blocks of spectrum. OEA and WTB refer
to this specific format as a clock auction with a supply of one item,
hence the ``clock-1'' auction format nomenclature. Auction 113 would
not include a separate assignment phase because none is needed with a
format that provides for bidding on specific licenses.
38. OEA and WTB are releasing a technical guide concurrently with
the AWS-3 Auction 113 Comment Public Notice. The technical guide
supplements the information in the AWS-3 Auction 113 Comment Public
Notice and provides the mathematical details and algorithms of the
procedures described herein.
A. Clock-1 Auction Structure
39. Under the proposed clock-1 format, each bidder would be able to
bid for specific licenses in the clock bidding rounds, in license-by-
license bidding. The auction would proceed in a series of rounds, with
bidding conducted simultaneously for all licenses available in the
auction. Consistent with prior FCC clock auctions, during each bidding
round, the bidding system would announce a clock price for each
license, and a bidder would indicate its demand for licenses at the
prices associated with the current round. OEA and WTB also propose that
a bidder be able to instruct the bidding system to make proxy bids on
its behalf. After the first round, intra-round bids would also be
allowed.
40. The clock price for a license would increase from round to
round if more than one bidder has demand for that license at its clock
price, creating excess demand for the license. The bidding rounds would
continue until, for all licenses, the number of bidders demanding each
license does not exceed one. Under the proposed procedures, a bidder
would not be able to reduce its demand if the reduction would cause
aggregate demand to fall below one for the license. Once bidding rounds
stop, the bidder with demand for a license would become the winning
bidder.
[[Page 13124]]
1. Individual Licenses in Two Geographic Area Types
41. Auction 113 will offer 200 geographic-based licenses in the
1695-1710 MHz, 1755-1780 MHz, and the 2155-2180 MHz bands. The Auction
113 inventory consists of licenses in EAs and CMAs. The 48 EA licenses
include frequency blocks designated A1, B1, H, I, and/or J; the 152 CMA
licenses are all for frequency block G. In Auction 113, only one
geographic area (EA173) has more than one frequency block available and
it includes both the H and the I blocks.
2. Bidding Rounds
42. Under the clock-1 auction format, Auction 113 would consist of
multiple, sequential bidding rounds, each followed by the release of
round results. Bidding would be conducted simultaneously for all
licenses available in the auction. In the first bidding round of
Auction 113, a bidder would indicate the licenses it demands at the
opening prices. During each subsequent bidding round, the bidding
system would announce a start-of-round price and a clock price for each
license, and qualified bidders would indicate the licenses for which
they wish to bid at the prices associated with the current round.
Bidding rounds would be open for predetermined periods of time. Bidders
would be subject to activity and eligibility rules that govern the pace
of the auction.
43. OEA and WTB propose that, as with any FCC spectrum auction, the
initial bidding schedule for a clock-1 auction would be announced in a
public notice to be released at least one week before the start of
bidding, and OEA would retain the discretion to adjust the bidding
schedule to maintain an auction pace that reasonably balances speed
with the bidders' needs to study round results and adjust their bidding
strategies. OEA and WTB seek comment on this proposal. Any adjustments
to the bidding schedule may include changes in the amount of time for
bidding rounds, the amount of time between rounds, and/or the number of
rounds per day, and would depend upon bidding activity and other
factors.
44. OEA and WTB propose to conduct Auction 113 over the internet.
Under the clock-1 format, a bidder would submit its bids either by
using the bidding system's upload function, which allows bid files in a
comma-separated values (CSV) text format to be uploaded, or through the
user interface in the bidding system. The bidding system would allow a
bidder to submit bids only for licenses the bidder selected on its FCC
Form 175 and for which the bidder has sufficient bidding eligibility.
45. During each open bidding round, a bidder would be able to
modify any existing bids already placed in the round through the user
interface or by uploading a new file of all its bids, which would
replace all bids previously submitted in the round.
46. As in other Commission auctions, OEA and WTB will facilitate
auction participation by providing qualified bidders with a toll-free
telephone number for an auction bidder line prior to the start of
bidding. OEA and WTB propose that, in addition to submitting bids
through the FCC's online bidding system, bidders would have the option
of placing bids by telephone through this dedicated auction bidder
line. OEA and WTB seek comment on this proposal.
3. Stopping Rule
47. As in previous FCC clock auctions, under the clock-1 format OEA
and WTB propose to use for Auction 113, OEA and WTB propose to use a
simultaneous stopping rule, under which all licenses would remain
available for bidding until the bidding stops simultaneously on every
license. Specifically, bidding would close for all licenses after the
first round in which no license has any excess demand. Consequently,
under this approach, it is not possible to determine in advance how
long Auction 113 would last. OEA and WTB seek comment on this proposal.
4. Availability of Bidding Information
48. OEA and WTB propose that the bidding system would disclose,
after each round of Auction 113, clock auction round results including,
for each license, the aggregate demand, the posted price of the last
completed round, and the clock price for the next round. The identities
of bidders making specific bids would not be disclosed until after the
close of bidding in the auction.
49. Each bidder would have access to additional information related
to its own bidding and bid eligibility. Specifically, after the bids of
a round have been processed, the bidding system would inform each
bidder of the licenses it currently demands (its processed demand) and
its eligibility for the next round. OEA and WTB seek comment on this
proposal with respect to the availability of bidding information.
5. Activity Rule
50. 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 late in the auction
before participating, an approach that is routinely used in multiple-
round auctions. In the proposed clock-1 auction, a bidder's activity in
a round for purposes of the activity rule would be the sum of the
bidding units associated with the bidder's demands as applied by the
auction system during bid processing (its processed demand). A bidder
would be required to be active on a specific percentage (the activity
requirement percentage) of its current bidding eligibility during each
round of the auction. Failure to maintain the requisite activity level
would result in a reduction in the bidder's eligibility, possibly
curtailing or eliminating the bidder's ability to place bids in
subsequent rounds of the auction.
51. Under this auction format, a bidder would be required to
maintain a fixed, high level of activity in each round of Auction 113
in order to maintain its bidding eligibility. Specifically, in each
round of Auction 113, a bidder would be required to be active on
between 90% and 100% of its bidding eligibility in all rounds to
maintain its bidding eligibility, with the specific percentage within
this range to be set for each round. OEA and WTB propose to set the
activity requirement percentage for Auction 113 initially at 95%. Thus,
the activity rule would be satisfied when a bidder has bidding activity
on licenses with bidding units that total 95% of its current
eligibility in the round. If the activity rule is met, then the
bidder's eligibility would not change for the next round. If the
activity rule is not met in a round, the bidder's eligibility would be
reduced such that the activity rule is satisfied. Bidding activity
would be based on the bids that are submitted and applied by the FCC
auction bidding system. That is, if a bidder bids to reduce its demand
for a license, but the FCC auction bidding system cannot apply the
request because demand for that license would fall below one, then the
bidder's activity would reflect its unreduced demand. Under the clock-1
format, the FCC auction bidding system would not apply a bid to reduce
demand for an individual license if the reduction would cause the
aggregate demand for that license to drop to zero (i.e., below the
available supply of one). OEA and WTB seek comment on this proposal.
52. Pursuant to this proposal, OEA would retain the discretion to
change
[[Page 13125]]
the activity requirement percentage during the auction to help manage
the pace of bidding to ensure that the auction closes within a
reasonable period of time. The bidding system would announce any such
changes in advance of the round in which they would take effect, giving
bidders adequate notice to adjust their bidding strategies.
53. OEA and WTB also seek comment on procedures by which, after
Round 1, a bidder may submit bids with bidding units totaling up to a
contingent bidding limit greater than or equal to the bidder's current
bidding eligibility for the round, as in the four most recent FCC clock
auctions (Auctions 105, 107, 108, and 110). In Round 1, a bidder would
be allowed to submit bids with bidding units totaling up to the
bidder's initial bidding eligibility. A bidder's contingent bidding
limit would be calculated as its current eligibility times a contingent
bidding percentage equal to or greater than 100%. The Commission has
previously referred to the contingent bidding limit as the activity
upper limit, and similarly, to the contingent bidding percentage as the
activity limit percentage. Those terms were modified before Auction 110
to remind bidders that bids submitted using the contingent bidding
limit will be applied only under certain circumstances. For Round 1,
the contingent bidding limit would be 100% of the bidder's initial
bidding eligibility. A bidder's use of the contingent bidding limit
would be optional.
54. Allowing a bidder to submit bids with associated bidding
activity greater than its current bidding eligibility would potentially
help a bidder avoid having its eligibility reduced as a result of
submitted bids that could not be applied during bid processing.
However, even under these additional procedures, the bidder's activity
as applied by the auction system during bid processing would not exceed
the bidder's current bidding eligibility. That is, if a bidder were
allowed to submit bids with associated bidding units exceeding 100% of
its current bidding eligibility, its processed activity would never
exceed its eligibility.
55. OEA and WTB seek comment on whether they should allow bidders
to submit bids with associated bidding activity greater than their
current bidding eligibility. Would the contingent bidding limit still
be useful with the limited inventory available in Auction 113? Would
the contingent bidding limit add unnecessary complexity? If adopted,
OEA and WTB would set the initial contingent bidding percentage at
120%, which would apply starting in Round 2, subject to change in
subsequent rounds within a range of 100% to 140%.
B. Acceptable Bids
1. Reserve Prices
56. OEA and WTB seek comment on any use of a reserve price for
Auction 113 and/or opening bid amounts, as is done prior to the start
of each auction, consistent with the statutory mandate of 47 U.S.C.
309(j), as amended. A reserve price is an absolute minimum price below
which a license will not be sold in a given auction. An opening bid, on
the other hand, is the minimum bid price set at the beginning of the
auction below which no bids are accepted. It is generally used to
accelerate the competitive bidding process. It is also possible for a
reserve price and an opening bid to be the same amount. OEA and WTB do
not propose to establish reserve prices other than the opening bid
amounts for the licenses to be offered in Auction 113. The Commission
adopted reserve prices for the auction of AWS-3 licenses in Auction 97,
pursuant to 47 CFR 1.2104(c) and the Commercial Spectrum Enhancement
Act (CSEA) because the CSEA required the Commission to prescribe
methods by which the total cash proceeds from any auction of licenses
authorizing the use of eligible frequencies would equal at least 110%
of the total estimated relocation costs of eligible Federal entities.
In light of the separate costs associated with the different bands, the
Commission established two reserve prices in Auction 97, one for
licenses for the 1695-1710 MHz band and a second for licenses for the
paired 1755-1780/2155-2180 MHz band. At the conclusion of Auction 97,
the reserve prices were exceeded by the applicable net winning bids,
thereby satisfying that statutory requirement. Given that the results
of Auction 97 fulfilled the purpose of the reserve prices in that
auction, that CSEA provision is not a basis to adopt a reserve here.
OEA and WTB do not believe that there is any other public interest
reason to establish reserve prices, beyond opening bid amounts, for the
licenses being offered in Auction 113. However, if commenters believe
that a reserve price would be in the public interest, OEA and WTB
invite their comments and request that they describe what specific
factors lead them to that conclusion.
2. Opening Prices
57. Opening prices would serve as initial clock prices under a
clock-1 auction format. In Round 1 of the auction, qualified bidders
would indicate the licenses they demand at the opening prices.
58. OEA and WTB will calculate opening prices on a license-by-
license basis based on $0.01 per MHz-pop for the paired licenses in
areas with a population of less than 300,000, $0.02 per MHz-pop for the
paired licenses in areas with a population of at least 300,000 and less
than 1,000,000, $0.05 per MHz-pop for the paired licenses in areas with
a population of at least 1,000,000, and $0.01 per MHz-pop for the
unpaired licenses. For all licenses, opening prices would be subject to
a minimum of $1,000 per license. The results of these calculations will
be rounded using the Commission's standard rounding procedures for
auctions: 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. OEA and WTB
seek comment on these amounts, which are specified in the Attachment A
file on the Auction 113 website at www.fcc.gov/auction/113. If
commenters believe that these opening prices would result in unsold
licenses or are not reasonable, they should explain why.
59. In establishing opening prices, OEA and WTB particularly seek
comment on factors that reasonably could have an impact on bidders'
valuation of the spectrum, including the type of service offered,
market size, population covered by the proposed facility, and any other
relevant factors. Commenters should support their claims with valuation
analyses and suggested amounts or formulas for opening prices.
60. Commenters may also wish to address the general role of opening
prices in managing the pace of the auction. For example, commenters
could compare using opening prices--e.g., by setting higher opening
prices to reduce the number of rounds it takes licenses to reach their
final prices--to other means of controlling auction pace, such as
changes to bidding schedules or activity requirements.
3. Clock Price Increments
61. Under clock-1 procedures for Auction 113, after bidding in the
first round and before each subsequent round, for each license, the FCC
auction bidding system would announce the start-of-round price and the
clock price for the upcoming round--that is, the lowest price and the
highest price at which bidders can submit bids during the round. The
start-of-round price would depend upon aggregate demand
[[Page 13126]]
for the license in the previous round. If aggregate demand for the
license at the clock price exceeded one, the start-of-round price for
the upcoming round would be equal to the clock price in the previous
round. If aggregate demand equaled one at a price (clock price or
intra-round price) in the previous round, then the start-of-round price
for the upcoming round would be equal to the lowest price at which
demand equaled one. If aggregate demand was zero in the previous round,
then the start-of-round price for the upcoming round would be the same
as the start-of-round price in the previous round.
62. The clock price for a license for a round would be set by
adding a percentage increment to the start-of-round price. OEA and WTB
propose that OEA would set the initial increment percentage at 10%, and
potentially would adjust the increment percentage within a range of 5%
to 30% inclusive as rounds continue. OEA would retain the discretion to
cap the increment if the total dollar amount of the increment (the
difference between the clock price and the start-of-round price) would
exceed a certain amount. The 5% to 30% increment range and cap would
allow us to set a percentage that manages the auction pace and takes
into account bidders' needs to evaluate their bidding strategies. OEA
and WTB seek comment on this proposal.
4. Intra-Round Bids
63. OEA and WTB propose that in this clock-1 auction, in a round
after the first round, a bidder would be permitted to make intra-round
bids by indicating a point between the start-of-round price and the
clock price at which its demand for a license changes. In placing an
intra-round bid for a license, a bidder would indicate a specific price
and the changed quantity it demands (either zero or one) if the price
for the license should increase beyond that price.
64. Intra-round bid amounts would be limited to multiples of $10
for prices below $10,000; to multiples of $100 for prices between
$10,000 and $100,000, inclusive; and to multiples of $1,000 for prices
above $100,000. Limiting intra-round bid amounts to certain multiples
may deter some types of anticompetitive bidding behavior.
65. Intra-round bids would be optional; a bidder may choose to
express its demands only at the start-of-round price or the clock
price. Using intra-round bidding would allow the auction system to use
relatively large percentage increments, thereby speeding up the auction
without running the risk that a jump in the clock price will overshoot
the market clearing price--the point at which only one bidder demands
the license--because bidders would be able to indicate the specific
amount below the clock price at which they stop demanding the license.
OEA and WTB seek comment on this proposal.
5. Proxy Instructions
66. OEA and WTB also seek comment on providing each bidder with the
option to use proxy bidding under the clock-1 format. With proxy
bidding, a bidder could submit a proxy instruction to the bidding
system to reduce its demand for a license to zero at a price higher
than the current round's clock price--i.e., at a price in a future
round. Proxy instructions to increase a bidder's demand for a license
at a given price would not be permitted.
67. Under these procedures, if a proxy instruction has been
submitted, the bidding system would automatically submit a proxy bid to
maintain the bidder's demand for the license in every subsequent round
as long as the clock price for the round is less than the proxy
instruction price. In the first round in which the clock price is
greater than or equal to the proxy instruction price, the bidding
system would submit a proxy bid on behalf of the bidder to reduce the
bidder's demand for that license to zero at the proxy instruction
price. Proxy bids would be processed by the bidding system in the same
way as bids submitted by the bidder in the round.
68. In the case that a bid to reduce demand, placed according to
proxy instructions or submitted by the bidder in the round, is not
applied during bid processing, the bidding system would automatically
generate a proxy instruction at the bid price and, in the following
rounds, submit proxy bids on behalf of the bidder according to that
proxy instruction.
69. In any round, a bidder can remove or modify any existing proxy
instructions or proxy bids for the round by resubmitting its bids
(through the user interface or file upload), including the
modifications, which would replace any bids and proxy instructions
previously submitted. The system would take the last bid submission as
that bidder's bids and proxy instructions.
70. As is the case for intra-round bid amounts, proxy instruction
prices would be limited to multiples of $10 for prices below $10,000;
to multiples of $100 for prices between $10,000 and $100,000,
inclusive; and to multiples of $1,000 for prices above $100,000. Proxy
instructions would not be publicly released either during or after the
auction.
6. Bid Types
71. Under the clock-1 auction format proposed for Auction 113, a
bidder would be able to make only ``simple'' bids. A bid would indicate
a desired quantity (in this auction, either one or zero) at a price. A
bidder that is willing to maintain its demand for a license at the new
clock price would submit a bid for the license at the clock price,
indicating that it is willing to pay up to that price, if need be, for
the license. A bidder with processed demand for a license that wishes
to reduce its demand for that license would submit a bid for a quantity
of zero indicating the price--either the clock price or an intra-round
price--at which it wishes to reduce its demand. A bidder that wishes to
start bidding for a license for which it does not have processed demand
would submit a bid to increase demand to one. A bid to increase demand
indicates that the bidder is willing to buy the license at any price up
to the clock price (regardless of the bid price). As described herein
and in the Auction 113 Technical Guide, bid prices are used to
determine the order in which bids are processed.
72. Unlike in some other FCC clock auctions, a ``switch'' bid to
reduce demand for one license in a market and increase demand for
another license in the same market would not be permitted. Because this
auction inventory contains only one market in which there are multiple
licenses that may be considered similar, a ``switch bid'' capability
would apply only in that single market. Only one geographic area
(EA173) has more than one frequency block available and it includes
both the H and the I blocks. Therefore, permitting ``switch'' bids
would add complexity for little or no benefit for most Auction 113
bidders. Under the clock-1 format OEA and WTB propose a bidder that
wishes to bid on both licenses within a market that has two licenses
would bid on those two licenses separately, with each license
constituting a separate category with a supply of one.
73. Bids to maintain demand would always be applied by the auction
bidding system during bid processing. Bids to change demand would not
necessarily be applied during bid processing. OEA and WTB seek comment
on this proposal.
7. Missing Bids
74. Under the proposed clock-1 auction format, a bidder would be
required to submit bids in every round
[[Page 13127]]
(as in other FCC spectrum license clock auctions) or have a proxy
instruction in place, even if its demands at the new round's prices are
unchanged from the previous round. If a bidder does not submit new bids
for all of the licenses for which it had processed demand from the
previous round and does not have proxy instructions in place, the
system will consider the bidder to have missing bids.
75. Missing bids would be treated by the auction bidding system as
requests to reduce the bidder's demand for the license to a quantity of
zero. If these requests are applied, then a bidder's bidding activity,
and its bidding eligibility for the next round, may be reduced. Under
the clock-1 format OEA and WTB propose for Auction 113, a bidder would
be permitted to enter proxy instructions as a safeguard against having
its eligibility inadvertently reduced. OEA and WTB seek comment on this
proposal.
C. Bid Processing
76. After each bidding round under the proposed clock-1 auction
format, bids would be processed according to the bid processing
procedures described below to determine the processed demand of each
bidder for each license and the posted price for each license. The
posted price would serve as the start-of-round price for the next
round. OEA and WTB seek comment on the full bid processing proposal
detailed herein.
1. No Excess Supply Rule for Bids To Reduce Demand
77. Bidding would be subject to a ``no excess supply'' rule,
wherein the FCC auction bidding system would not allow a bidder to
reduce its demand for a license if the reduction would cause demand to
fall below one, which would create excess supply. Therefore, if a
bidder has been bidding for a specific license and submits a bid to
reduce its demand to zero if the price should increase above the price
in its bid, the bidding system would treat the bid as a request to
reduce demand that would be applied only if the ``no excess supply''
rule would be satisfied. However, if a bid to reduce demand is not
applied, the bidder will not be asked to pay more for the license than
the highest price it agreed to pay.
2. Eligibility Rule for Bids To Increase Demand
78. The bidding system would not allow a bidder to increase its
demands for licenses if the total number of bidding units associated
with the bidder's demands exceeds the bidder's bidding eligibility for
the round. Therefore, if a bidder submits a bid to add a license for
which it did not have processed demand in the previous round, the FCC
auction bidding system would treat the bid as a request to increase
demand that would be applied only if that would not cause the bidder's
activity to exceed its eligibility.
3. Processed Demand
79. After a round ends, the bidding system would first consider and
apply all bids to maintain demand at the clock price. Bids to maintain
a bidder's processed demand at the clock price would always be applied.
Then the bidding system would process bids to change demand in order of
price point (and by pseudo-random number in the case of tied price
points), where the price point represents the percentage of the bidding
interval for the round.
80. The system would consider bids at the lowest price point across
all licenses, then look at bids at the next price point across all
licenses, and so on up to bids at the clock price. As it considers a
submitted bid during bid processing to determine whether a bidder's
request to reduce demand for a license can be applied, the bidding
system would determine whether there is excess demand for that license
at that point in the processing. To determine whether a request to
increase demand can be applied, the auction bidding system would
evaluate the activity associated with the bidder's most recently
determined demands at that point in the processing. If a bid could be
applied, the licenses that the bidder holds at that point in the
processing would be adjusted, and aggregate demand for the license
would be recalculated accordingly.
81. If a bid could not be applied at the price point indicated in
the bid, e.g., because demand would fall below one or because the
bidder's activity (as applied by the auction system) would exceed its
eligibility, the bid would be held in a queue and reconsidered, again
in price point order, if later in the processing there should be excess
demand for that license or if the bidder's activity is reduced
sufficiently after other bids are processed.
82. After considering the bids at the lowest price point, the
bidding system would then consider the bid submitted at the next lowest
price point, applying the bid or not given the most recently determined
demands of bidders. Any unfulfilled requests would again be held in the
queue, and aggregate demand would again be recalculated. Every time a
bid was applied, the bids held in the queue would be reconsidered, in
the order of the original price points of the bids (and by pseudo-
random number, in the case of tied price points). The auction bidding
system would not carry over unfulfilled bid requests to the next round,
however, except for generating proxy instructions in the case of bids
to reduce demand to zero that are not applied. The bidding system would
advise bidders of the status of their bids when round results are
released.
4. Price Determination
83. During bid processing, the bidding system also would determine,
based on aggregate demand, the posted price for each license for the
round, which would serve as the start-of-round price for the next
round. The price for a license would increase from round to round if
there was excess demand for the license in the round.
84. If, at the end of a round, aggregate demand for a license
exceeds the supply of one, the posted price for the round would equal
the clock price. If a reduction in demand was applied during the round
that caused demand to fall to one, the posted price would be the price
at which the reduction was applied. If aggregate demand is zero, or if
aggregate demand is one and no bid to reduce demand was applied for the
license, then the posted price would equal the start-of-round price for
the round. The range of acceptable bid amounts for the next round would
be set by adding the percentage increment to the posted price.
85. Under these procedures, if a bid to reduce demand is not
applied, the bidder would not face a price for the license that is
higher than its bid price. Specifically, if a bid to reduce demand is
not applied, it must be the case that there is no excess demand for the
license at the bidder's price and, therefore, the posted price would
not be higher than that price.
86. After the bids of the round have been processed, if the
stopping rule has not been met, the FCC auction bidding system would
announce clock prices to indicate a range of acceptable bids for the
next round. Each bidder would be informed of the licenses for which it
has processed demand as well as of the aggregate demand and the posted
price for each license.
5. Winning Bids
87. A bidder with processed demand for a license at the time the
stopping rule is met would become the winning bidder for the license.
The final price for a license would be the posted price for the final
round. This and other bid processing details are addressed in the
Auction 113 Technical Guide.
[[Page 13128]]
V. Tutorial and Additional Information for Applicants
88. OEA and WTB intend to provide additional information on the
bidding system and to offer demonstrations and other educational
opportunities for applicants in Auction 113 to familiarize themselves
with the FCC auction application system and the auction bidding system.
For example, OEA and WTB intend to release online tutorials that will
help applicants understand the procedures to be followed in the filing
of their auction short-form applications (FCC Form 175) and on the
bidding procedures for Auction 113, as well as a Technical Guide that
supplements the information in the AWS-3 Auction 113 Comment Public
Notice and provides the mathematical details and algorithms of the
procedures described herein.
A. Supplemental Initial Regulatory Flexibility Analysis
89. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Office of Economics and Analytics (OEA) and the
Wireless Telecommunications Bureau (WTB) have prepared this
Supplemental Initial Regulatory Flexibility Analysis (Supplemental
IRFA) of the proposed policies and rules addressed in the AWS-3 Auction
113 Comment Public Notice assessing the possible significant economic
impact on a substantial number of small entities, to supplement the
Commission's Initial and Final Regulatory Flexibility Analyses
completed in the 2014 AWS-3 Report and Order, the 2025 AWS-3 NRPM, and
other Commission orders pursuant to which Auction 113 will be
conducted. OEA and WTB request written public comments on this
Supplemental IRFA. Comments must be identified as responses to the
Supplemental IRFA and must be filed by the same deadline for comments
specified in the DATES section of this document. The Commission will
send a copy of the AWS-3 Auction 113 Comment Public Notice, including
the Supplemental IRFA, to the Chief Counsel for Advocacy of the Small
Business Administration (SBA). In addition, the AWS-3 Auction 113
Comment Public Notice and Supplemental IRFA (or summaries thereof) will
be published in the Federal Register.
90. Need for, and Objectives of, the Proposed Rules. The AWS-3
Auction 113 Comment Public Notice sets forth the proposed auction
procedures and rules for small and other entities that seek to bid in
Auction 113 and seeks comment on those proposals. The licenses in
Auction 113 are being offered pursuant to the Spectrum and Secure
Technology and Innovations Act, which directs the Commission to
initiate a system of competitive bidding to grant licenses for spectrum
in its inventory in the AWS-3 spectrum bands. Auction 113 will auction
geographic-based licenses in the 1695-1710 MHz, 1755-1780 MHz, and
2155-2180 MHz bands (collectively, the AWS-3 bands) and will offer
individual licenses in two geographic area types: Economic Area (EA)
licenses and Cellular Market Area (CMA) licenses. Licenses in the AWS-3
bands previously were offered in Auction 97, however not all of the
licenses offered in Auction 97 were assigned following that auction.
The licenses for the unassigned AWS-3 spectrum that are available in
the Commission's inventory as of December 23, 2024 will be offered in
Auction 113.
91. Licenses in the 1695-1710 MHz band are being made available on
a shared basis with incumbent Federal meteorological-satellite (MetSat)
data users. In addition, licenses in the 1755-1780 MHz band are being
made available on a shared basis with a limited number of Federal
incumbents indefinitely, and with Federal systems that have or will
over time relocate out of the band. Licenses to operate in the 1695-
1710 MHz and 1755-1780 MHz bands are subject to the condition that the
licensee must not cause harmful interference to an incumbent Federal
entity relocating from these bands under an approved Transition Plan,
and this condition remains in effect until the National
Telecommunications and Information Administration (NTIA) terminates the
applicable authorization of the incumbent Federal entity. Further, AWS-
3 licensees in the 1755-1780 MHz band must agree to accept interference
from incumbent Federal users while they remain authorized to operate in
the band. The 2155-2180 MHz band is already allocated for exclusive
non-Federal, commercial use. Although there are no Federal users
currently licensed or operating in this band, there are non-Federal
incumbent licensees in the band, and AWS-3 licensees may have to
protect or relocate and/or share in the cost of relocating non-Federal
incumbent Fixed Microwave and Broadband Radio Service licensees in the
band. Pursuant to the 2014 AWS-3 Report and Order, AWS-3 licensees in
the 1695-1710 MHz and 1755-1780 MHz bands are required to successfully
coordinate with Federal incumbent users in these bands prior to
operating in designated protection zones. The FCC/NTIA Coordination
Procedures Public Notice contains various refinements to the
previously-defined protection zones for each of these bands, and also
provides information and guidance on the overall coordination process
for these bands, as contemplated by the 2014 AWS-3 Report and Order,
including informal pre-coordination discussion and the formal process
of submitting coordination requests to, and receiving responses to
coordination requests from, relevant Federal agencies.
92. OEA and WTB will make information regarding any incumbency,
sharing, and/or cost sharing issues in the AWS-3 bands available in the
document announcing the auction procedures and final inventory for
Auction 113 in order to assist applicants in conducting due diligence
research.
93. The Auction 113 Comment Public Notice and process is intended
to provide notice of and adequate time for potential applicants to
comment on proposed auction procedures. To promote the efficient and
fair administration of the competitive bidding process for all Auction
113 participants, OEA and WTB seek comment on the following proposed
procedures:
A requirement that any applicant seeking to participate in
Auction 113 certify in its short-form application, under penalty of
perjury, that it has read the public notice adopting procedures for
Auction 113 that will be released in advance of the short-form
deadline, and that it has familiarized itself with those procedures and
the requirements for obtaining a license and operating facilities in
the AWS-3 bands;
A requirement that any applicant seeking to bid in the
1755-1780 MHz submit a signed statement with its short-form application
acknowledging that the applicant's operations the 1755-1780 MHz band
may be subject to interference from Federal systems in certain
geographic zones, that the applicant must accept interference from such
Federal systems in those zones, and that the applicant has considered
these risks before submitting any bids for applicable licenses in
Auction 113;
Designation of AT&T, T-Mobile, and Verizon as nationwide
providers for the purpose of implementing the Commission's competitive
bidding rules in Auction 113;
Use of anonymous bidding/limited information procedures
under which the OEA and WTB will not make public until after the
bidding has closed: (1) the licenses that an applicant selects for
bidding in its shot-form application (FCC Form 175); (2) the amount of
any upfront payment made by or on behalf
[[Page 13129]]
of an applicant for Auction 113; (3) an applicant's bidding
eligibility; and (4) any other bidding-related information that might
reveal the identity of the bidder placing a bid;
Establishment of bidding credit caps for eligible small
businesses in Auction 113;
Establishment of a bidding credit cap for eligible rural
service providers, if a rural service provider bidding credit is
adopted for Auction 113;
Use of a clock auction format with a supply of one (clock-
1) for Auction 113 under which each qualified bidder will indicate in
successive clock bidding rounds its demand for licenses at the prices
associated with the current round;
Use of a simultaneous stopping rule for Auction 113, under
which all licenses would remain available for bidding until the bidding
stops on all licenses;
A specific opening price for each license available in
Auction 113;
A specific upfront payment amount for each license
available in Auction 113;
Establishment of a bidder's initial bidding eligibility in
bidding units based on that bidder's upfront payment through assignment
of a specific number of bidding units for each license;
Provision of delegated authority to OEA, in conjunction
with WTB, to exercise it discretion to delay, suspend, or cancel
bidding in Auction 113 for any reason that affects the ability of the
competitive bidding process to be conducted fairly and efficiently;
Retention by OEA of discretion to adjust the bidding
schedule in order to manage the pace of Auction 113;
Use of an activity rule that would require bidders to be
active on between 90% and 100% of their bidding eligibility in all
regular clock rounds, with the initial activity requirement percentage
set at 95% and with OEA retaining discretion to change the activity
requirement percentage during the auction;
To permit a bidder, in rounds after Round 1, to optionally
submit bids with bidding units totaling up to a contingent bidding
limit greater than or equal to the bidder's current bidding eligibility
for the round, with the contingent bidding limit calculated as the
bidder's current eligibility times a contingent bidding percentage
equal to or greater than 100%, in order to potentially help a bidder
avoid having its eligibility reduced as a result of submitted bids that
could not be applied during bid processing;
Establishment of acceptable bid amounts, including clock
price increments and intra-round bids, along with a proposed
methodology for calculating such amounts;
To permit a bidder to submit a proxy instruction to reduce
its demand for a license to zero at a price higher than the current
round's clock price for Auction 113;
To permit each bidder to place bids that indicate its
desired quantity of blocks (one or zero) for a license at a price
(either the clock price or an intra-round price);
A requirement that bidders indicate their demands in every
round or submit appropriate proxy instructions, even if their demands
at the new round's prices are unchanged from the previous round, and
the treatment of bids that are not reconfirmed as request to reduce
demand to a quantity of zero for the license;
A methodology for processing bids and requests to reduce
and increase demand; and
Establishment of an additional default payment of 15% under 47 CFR
1.2104(g)(2)in the event that a winning bidder defaults or is
disqualified after the auction.
94. The proposed procedures for the conduct of Auction 113
constitute the more specific implementation of the competitive bidding
rules contemplated by 47 CFR parts 1 and 27 of the Commission's rules,
and the underlying rulemaking orders, including the 2014 AWS-3 Report
and Order, the 2025 AWS-3 NPRM, and relevant competitive bidding
orders, and are fully consistent therewith.
95. Legal Basis. The Commission's statutory obligations to small
businesses under the Communications Act of 1934, as amended, are found
in 47 U.S.C. 309(j)(3)(B) and 309(j)(4)(D). The statutory basis for the
Commission's competitive bidding rules is found in various provisions
of the Communications Act of 1934, as amended, including 47 U.S.C.
154(i), 301, 302, 303(e), 303(f), 303(r), 304, 307, and 309(j). The
Commission has established a framework of competitive bidding rules
pursuant to which it has conducted auctions since the inception of the
auction program in 1994 and would conduct Auction 113.
96. Description and Estimate of the Number of Small Entities to
Which the Proposed Rules Will Apply. 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, 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.
97. As noted above, Regulatory Flexibility Analyses were
incorporated into the 2014 AWS-3 Report and Order and the 2025 AWS-3
NPRM, and in those analyses, the Commission described in detail the
small entities that might be significantly affected. Accordingly, in
the AWS-3 Auction 113 Comment Public Notice, the Commission
incorporates by reference the descriptions and estimates of the number
of small entities from the previous Regulatory Flexibility Analyses in
the 2014 AWS-3 Report and Order and the 2025 AWS-3 NPRM.
98. Description of Economic Impact and Projected Reporting,
Recordkeeping, and Other Compliance Requirements for Small Entities.
The RFA directs agencies to describe the economic impact of its
proposed rules on small entities and the projected reporting,
recordkeeping and other compliance requirements of the proposed rule,
including an estimate of the classes of small entities which will be
subject to the requirement and the type of professional skills
necessary for preparation of the report or record.
99. The Commission designed the auction application process itself
to minimize reporting and compliance requirements for small entity and
other applicants. In the first part of the Commission's two-phased
auction application process, parties desiring to participate in an
auction file streamlined, short-form applications in which they certify
under penalty of perjury as to their qualifications to become a bidder.
Eligibility to participate in bidding is based on an applicant's short-
form application and certifications, as well as its upfront payment. In
the second phase of the process, winning bidders file a more
comprehensive long-form application. Thus, an applicant which fails to
become a winning bidder does not need to file a long-form application
and provide the additional showings and more detailed demonstrations
required of a winning bidder. This approach will particularly benefit
small entities that seek to participate in the auction because it
avoids imposing on an auction applicant/bidder that does not ultimately
become a winning bidder the
[[Page 13130]]
burden of submitting this additional information.
100. At this time, OEA and WTB do not expect the processes and
procedures proposed in the AWS-3 Auction 113 Comment Public Notice will
require small entities to hire attorneys, engineers, consultants, or
other professionals to participate in Auction 113 or to comply with the
procedures OEA and WTB ultimately adopt due to the information,
resources, and guidance the Commission makes available to potential and
actual auction participants. For example, OEA and WTB intend to release
an online tutorial that will help applicants understand the procedures
for filing of an auction short-form application (FCC Form 175). OEA and
WTB also intend to make information on the bidding system available and
also offer demonstrations and other educational opportunities for
applicants in Auction 113 to familiarize themselves with the FCC
auction application system and the auction bidding system. By providing
these resources as well as the resources discussed below, OEA and WTB
expect small entities that use the available resources to experience
lower participation and compliance costs. Nevertheless, while OEA and
WTB cannot at this time quantify the cost of compliance with the rules
and procedures proposed in the AWS-3 Auction 113 Comment Public Notice,
they do not believe that the costs of compliance will unduly burden
small entities that choose to participate in the auction because the
proposals for Auction 113 are similar in many respects to the
procedures in previous auctions conducted by the Commission. OEA and
WTB anticipate that the information they receive via comments will help
the Commission identify and evaluate relevant compliance concerns by
small entities, including compliance costs and other burdens that may
result from the inquiries OEA and WTB make in the AWS-3 Auction 113
Comment Public Notice.
101. Discussion of Significant Alternatives Considered That
Minimize the Significant Economic Impact on Small Entities. The RFA
directs agencies to describe any significant alternatives to the
proposed rules that it has considered in reaching its proposed approach
that would accomplish the stated objectives of applicable statutes, and
minimize any significant economic impact on small entities, 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 and reporting requirements under the rule for such 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
such small entities.''
102. In the AWS-3 Auction 113 Comment Public Notice, OEA and WTB
have taken steps and considered alternatives that seek to minimize any
significant economic impact of the Commission's auction procedures on
small entities. This is accomplished through, among other things, the
many free or low-cost resources it provides potential auction
participants. For example, small entities and other auction
participants may seek clarification of, or guidance on, compliance with
competitive bidding rules and procedures, reporting requirements, and
the FCC's auction bidding system. Additionally, an FCC Auctions Hotline
provides access to Commission staff for information about the auction
process and procedures. Further, the FCC Auctions Technical Support
Hotline is another resource which provides technical assistance to
applicants, including small business entities, on issues such as access
to or navigation within the electronic FCC Form 175 application and use
of the FCC's auction bidding system. As discussed herein, small
entities may also potentially save consulting costs by utilizing the
web-based, interactive online tutorial produced by Commission staff to
familiarize themselves with auction procedures, filing requirements,
bidding procedures, and other matters related to an auction.
103. Various databases and other sources of information, including
the Auctions program websites, and copies of Commission decisions, are
also made available to the public without charge, thereby providing a
low-cost mechanism for small entities to minimize their research costs
prior to and throughout the auction. Further, prior to and at the close
of Auction 113, the Commission will post public notices on the Auctions
website, which will articulate the procedures and deadlines for the
auction. The Commission makes this information easily accessible and
without charge to benefit all Auction 113 applicants, including small
entities, thereby lowering their administrative costs to comply with
the Commission's competitive bidding rules.
104. In addition, prior to the start of bidding in each auction,
OEA and WTB propose to make available to bidders various educational
materials. For example, eligible bidders will be given an opportunity
to become familiar with auction procedures and the bidding system by
participating in a mock auction. Further, OEA and WTB intend to conduct
Auction 113 electronically over the internet using the Commission's
web-based auction system that eliminates the need for bidders to be
physically present in a specific location, thereby reducing travel
costs for small entities. As in other Commission spectrum auctions, OEA
and WTB propose that qualified bidders in Auction 113 would have the
option of placing bids by telephone through a dedicated auction bidder
line. These mechanisms are made available to facilitate participation
in Auction 113 by all eligible bidders, and may result in significant
cost savings for small entities that use these alternatives. Moreover,
the adoption of bidding procedures in advance of the auction,
consistent with statutory directive, is designed to ensure that the
auction will be administered predictably and fairly for all small
entities and other participants.
105. Lastly, in the AWS-3 Auction 113 Comment Public Notice, OEA
and WTB seek to promote opportunities and reduce economic barriers to
entry for small entities wishing to grow their businesses through the
auction process. In keeping with these objectives, for Auction 113, OEA
and WTB propose a $25 million cap on the total amount of bidding
credits that may be awarded to an eligible small business and a $10
million cap on the total amount of bidding credits that may be awarded
to a rural service provider in each auction. In addition, OEA and WTB
propose a $10 million cap on the overall amount of bidding credits that
any winning designated entity bidder may apply to winning licenses in
markets with a population of 500,000 or less. Based on the technical
characteristics of AWS-3 licenses and an analysis of past auction data,
OEA and WTB anticipate that the proposed caps will allow the majority
of small businesses in each auction to take full advantage of the
bidding credit program, thereby lowering the relative costs of
participation for small businesses. OEA and WTB seek comment on, and
will consider alternatives to, the proposed cap levels in an effort to
maximize small entity participation in the auction process, while
minimizing potential abuse of the bidding credit program, thereby
protecting its integrity.
106. OEA and WTB expect to more fully consider the economic impact
and alternatives for small entities following the review of comments
filed in response to the AWS-3 Auction 113 Comment Public Notice. OEA's
and
[[Page 13131]]
WTB's evaluation of the comments will shape the final alternatives they
consider, the final conclusions they reach, and the actions they
ultimately take in this proceeding to minimize any significant economic
impact that may occur on small entities.
107. Federal Rules that May Duplicate, Overlap, or Conflict with
the Proposed Rules. None.
Federal Communications Commission.
Gary Michaels,
Deputy Chief, Auctions Division, Office of Economics and Analytics.
[FR Doc. 2025-04452 Filed 3-19-25; 8:45 am]
BILLING CODE 6712-01-P