You will find more details on the most significant August meeting items after the break:

C-Band Auction Procedures: The draft Public Notice would establish the procedures for Auction 107, the auction of new flexible-use overlay licenses in the 3.7-3.98 GHz band. It will be the FCC’s second auction of mid-band spectrum and is scheduled to begin on December 8, 2020. Auction 107 will offer 5,684 new licenses in the C-band, and the 280 MHz of spectrum available will be licensed on an unpaired basis in three blocks divided into 20 MHz sub-blocks by partial economic area (“PEA”) in the contiguous states and in D.C. The Commission would use an ascending clock auction format for bidding for each PEA, with an initial clock phase for bidding on generic blocks in successive rounds and a subsequent assignment phase for bidding on frequency-specific license assignments. The draft Notice details the FCC’s procedures, terms, conditions, dates, and deadlines for Auction 107, as well as the post-auction application and payment processes. Notably, the FCC would open the application filing window for auction participation on September 9, 2020 and close the window on September 22, 2020.

Inmate Calling Services Reform: The draft Report and Order on Remand and Fourth Further Notice of Proposed Rulemaking (“FNPRM”) would respond to remands from the U.S. Court of Appeals for the D.C. Circuit on inmate calling services reform and propose further rate reforms. The Order would find that ancillary service charges, or separate fees that are not included in per-minute rates assessed for individual inmate calling services calls, cannot be segregated between interstate and intrastate jurisdictions, except in a limited number of cases. This determination would prohibit inmate calling service providers from imposing any charges for ancillary services, other than those charges permitted by the FCC’s rules, and would prohibit providers from imposing such charges that exceed the FCC’s ancillary service fee caps. The FNPRM would seek comment on further rate reforms of inmate calling services, proposing to lower the interstate rate caps to $0.14 per minute for calls from prisons and $.16 for calls from jails, and proposing to cap rates for international inmate calling services, which are currently uncapped. Comments on the FNPRM would be due 30 days after publication in the Federal Register, with reply comments due 60 days following publication.

While the NPRM formally does not act on Ligado’s petition (filed by its pre-bankruptcy predecessor LightSquared), the FCC is incorporating the record from the Ligado proceeding into the new docket. That record includes strong opposition from the National Oceanic and Atmospheric Administration (“NOAA”) and several other federal and non-federal users of the band. NOAA is the primary user of the 1675-1680 MHz band, using it for its weather tracking and monitoring capabilities. Numerous unlicensed receive earth station operators and other stakeholders make operational use of the weather data downlinked from NOAA satellites on a direct read out.

NOAA and other incumbents use the band under the current allocations: Meteorological Aids (“MetAids”) and Meteorological-Satellite (“MetSat”) services. MetAids service (i.e., radiosondes) is already transitioning from the band to other frequencies. But the MetSat service is here to stay, as NOAA’s GOES-N and the recently-launched GOES-R satellites operate at the top of and near the 1675-1680 MHz band. Indeed, GOES-R is expected to operate through at least 2036. Because the federal government’s MetSat earth stations are fixed, and relatively limited in number, the FCC contemplates that large geographic areas should be available for commercial wireless users. These tentative conclusions do not take into account the uncertain number of non-federal earth stations that utilize the direct read out. However, the NPRM invites comment on other ways, apart from direct read out, that non-federal entities that rely on the GOES data can gain access to that data, including a non-radio-based content delivery network. Products generated from GOES data support multiple operational activities including dynamic weather forecasting, anticipation of hurricane movements, water level and flood management, warnings for tornadoes and severe weather, wildfire growth tracking, and condition reports for firefighters.

Comments will be due thirty days after Federal Register publication of the NPRM (which has not occurred as of this writing), with replies due 60 days after publication. The FCC seeks comment on numerous issues, with a strong repeated request for cost/benefit information and data, as well as alternative approaches, including:

• Coordination with Federal Systems – How can current federal earth stations in and adjacent to the band be protected from harmful interference? How can future federal earth stations be accommodated by new commercial users in the 1675-1680 MHz band with minimal disruption to their services?
• Non-Federal Users – Which non-federal entities operate receive earth stations in the band? Which entities rely on this direct read out data? What other options exist for non-federal users to access the data from NOAA satellites? Is a content delivery system operated over the Internet an acceptable alternative? Would such a system increase the total number of users with reliable access to NOAA satellite data?
• Band Plan and Licensing – The Commission proposes to license the full five megahertz on an unpaired, geographic area basis. Should the Commission auction licenses by Partial Economic Area (“PEA”)? Should the spectrum be made available solely for downlinks from base stations to user terminals?
• License Term and Performance Requirements – Should the Commission grant 15-year licenses? Should licensees be required to demonstrate reliable signal coverage to 45% of the population within six years and 80% within twelve years, or should other performance measures be utilized? Should there be different performance requirements for Internet of Things (“IoT”) type services, since they may not provide service based on residential population coverage?

Apart from Ligado’s reactions to the Commission’s “non-action” on its petition through the NPRM, NOAA continues to do studies using Spectrum Relocation Fund monies into the compatibility of existing meteorological operations in and adjacent to 1675-1680 MHz band with new entrants. One gets the sense that, while the NPRM clearly opens a new chapter in this long story, much of the chapter remains to be outlined, let alone written.

Text Messaging Classification: The draft Declaratory Ruling would classify the two most popular forms of text messaging – Short Message Service (“SMS”) and Multimedia Messaging Service (“MMS”) – as information services subject to light-touch regulation, and not commercial mobile services required to comply with legacy common carrier rules. In doing so, the FCC would note that text messaging services possess the capacity to store and retrieve information normally found in information services, such as email. FCC rules significantly curtail the ability of common carriers to block the transmission of communications. The FCC is concerned that applying the common carrier classification to text messaging would prevent service providers from utilizing anti-spoofing, anti-spam, and anti-robotext technologies. By officially declaring text messaging an information service, the FCC is hoping to spur further adoption of these blocking technologies and keep text-massaging relatively spam-free.

Reassigned Numbers Database: The draft Report and Order would establish procedures to create a single database that will enable robocallers and others to verify whether a particular number has been permanently disconnected, meaning the number may have been reassigned to a new consumer. With limited exceptions, federal law prohibits robocalls to wireline and wireless phones without the called party’s prior consent. As a result, a business could be subject to liability for making a call to what it thought was a consenting customer when the number actually was reassigned to a new consumer that never provided consent to receive such traffic. The FCC expects the database to reduce these incidents after its implementation, which could occur as early as next year. But just as important as what the draft item would do is what it would not do. The FCC would not establish a safe harbor for callers that rely on the database but still reach a number assigned to a non-consenting consumer. In fact, the FCC explicitly would decline to address outstanding issues regarding the definition of an automatic telephone dialing system and potential liability for calls to reassigned numbers stemming from the D.C. Circuit’s ACA International v. FCC decision earlier this year, stating that it will take up these issues in a separate proceeding.

Spectrum Frontiers Auctions: The draft Report and Order would adopt rule changes to facilitate a consolidated auction of high-frequency spectrum in the Upper 37 GHz Band (37.6-38.6 GHz), 39 GHz Band (38.6-40.0 GHz), and 47 GHz Band (47.2-48.2 GHz). The draft item would modify the band plans for these frequencies to move from 200 megahertz channels to 100 megahertz channels to facilitate incumbent repacking, ensure consistency with international allocations, encourage equipment standardization across spectrum bands, and promote secondary market transactions. The new licenses would be auctioned on a Partial Economic Area (“PEA”) basis. The draft item also would lay the groundwork for the FCC’s second incentive auction. The 39 GHz Band is home to incumbents holding licenses in non-contiguous spectrum blocks that overlap multiple PEAs. In order to resolve these encumbrances, incumbents would be afforded the options of either modifying their licenses or relinquishing their licenses in exchange for “vouchers” of “equivalent value” to use in bidding for new licenses at the auction or cash incentive payments. The FCC expects to complete the auction by the end of 2019.

Rural Broadband Funding: The draft Report and Order, Notice of Proposed Rulemaking, and Order on Reconsideration would offer additional funding to certain carriers, predominately located in rural areas, that currently receive so-called “model” (versus legacy rate-of-return) support under the Connect America Fund. In exchange for additional funding of up to $200 per location, the carrier would need to expand the availability of broadband service meeting the FCC’s current high-speed benchmark of 25 Mbps download/3 Mbps upload in current service locations and provide broadband service of at least 10 Mbps download/1 Mbps upload speeds in new service locations. The item would provide opportunities for legacy rate-of-return carriers to receive additional funding and transition to model-based support if they can meet the high-speed benchmark. The item also would seek comment on whether the FCC should award support in areas “overlapped” by unsubsidized competition through an auction. The FCC would ask how it should determine whether an area is sufficiently overlapped, the appropriate size of the areas to be auctioned, and the auction bid weighting methodology. Finally, the draft item would deny reconsideration of the FCC’s decision earlier this year to increase model-based support.

Communications Marketplace Report: The draft Report would provide an overview of competition in mobile wireless, fixed broadband, audio, video, and satellite communications markets. The Report would assess the state of communications deployment and barriers to market entry. It also would compile a list of geographic areas not served by any provider of advance telecommunications. The FCC is required to issue the Report this month under the RAY BAUM’S Act passed earlier this year. The Report consolidates and replaces a number of separate reports covering different areas of the communications industry, such as the annual mobile wireless competition report required by Section 332 of the Communications Act and the report on cable industry prices required by Section 623 of the Communications Act. However, the broadband deployment report required by Section 706 of the Communications Act would remain separate, along with other FCC reports not covered by the RAY BAUM’S ACT. The next Report is due by the end of 2020.

Of particular interest, the recently released draft item would lay the groundwork for the FCC’s second incentive auction (after the “inaugural” broadcast incentive auction completed in March 2017). A 39 GHz incentive auction would be structured quite differently than the 600 MHz broadcast incentive auction and attempt to reduce encumbrances in the 39 GHz Band by offering existing licensees the option to relinquish their licenses in exchange for payment. The FCC leadership appears bullish that the three auctions will draw significant interest from major service providers looking to support next-generation applications, including 5G wireless connectivity and the Internet of Things. Naturally, the first-in-time 24 and 28 GHz auctions may give some sense in advance of that interest. Through November 26, 2018, after 18 rounds, the 28 GHz Band auction had generated under $200 million in bids, albeit that spectrum is encumbered in many of the largest markets and in slightly more than 50% of all counties nationwide, including the most populous. The 24 GHz Band auction may prove a much better test of the appetite for participants to pay high prices for so-called “high band” spectrum.

The FCC’s draft item would modify the band plans for the Upper 37 GHz Band, 39 GHz Band, and 47 GHz Band to move from 200 megahertz channels to 100 megahertz channels to facilitate repacking of incumbents, ensure consistency with international allocations, encourage equipment standardization across spectrum bands, and promote secondary market transactions. The new licenses would be auctioned on a Partial Economic Area (“PEA”) basis. Auction participants would be allowed to bid on licenses that overlap the contiguous Upper 37 GHz Band and 39 GHz Band.

However, in order for the modified band plan to work as hoped, the FCC wants to clear out as much encumbered spectrum in the 39 GHz Band as possible. The 28 GHz Band, for example, as we mentioned earlier, is heavily encumbered. In the 39 GHz Band, like the 28 GHz Band, incumbents prior to the designation of the spectrum for flexible mobile and fixed use in 2016 were grandfathered by the Commission and generally hold licenses in non-contiguous spectrum blocks that often overlap multiple PEAs. As a result, to serve its purposes, the draft order would offer incumbents three options:

• First, incumbents could choose to have their licenses modified by the FCC to conform to the new license areas while preserving the licenses’ value. The draft item states that the FCC will provide each incumbent with a proposed modification plan well before the auction starts to help them with their decision;
• Second, incumbents could propose alternative license modifications that preserve their licenses’ value, which would be subject to FCC approval. The draft item states that the FCC will announce in advance of the auction procedures for incumbents to submit such proposed modifications and the review criteria by which it would evaluate such proposals; or
• Third, incumbents could elect to relinquish all of their existing licenses in exchange for either (1) “vouchers” of “equivalent value” to use in bidding for new licenses at the auction or (2) cash incentive payments based on the value of their licenses as determined through the auction.

As with the details of the incumbent license modification process, the final auction bidding and assignment procedures would be announced by the FCC later ̶ likely by early next year. In the meantime, incumbent licensees in the 39 GHz Band and service providers seeking to participate in the auction should take a close look at the FCC’s draft item to ensure that the auction plan would adequately safeguard existing spectrum rights while creating opportunities for increased commercial flexible use of the spectrum. Ex parte discussion with the Commissioners and staff will be possible through December 5, the expected sunshine notice date for the December 12 Open Meeting.

The three-tiered 3.5 GHz band framework which is still in the process of being launched is designed to allow sharing –by multiple-user types: by primary radar and satellite users which would retain the highest priority and level of interference protection, by second-priority PALs licensed by auction, and by third-tier licensed-by-rule General Authorized Access (“GAA”) users. Advanced frequency coordinators, known as the Spectrum Access System (“SAS”) administrators supported by Environmental Sensing Capability (“ESC”) Operators, will mediate and control access rights between the three tiers of users.

Possible PAL Rule Modifications

The NPRM does not propose to alter the basic structure, but instead seeks comment on potentially modifying the licensing rules for PALs in the following ways:

• Longer License Terms. The NPRM proposes extending PAL license terms, from three years to ten years with the expectation that this will increase the value of the licenses for prospective PAL applicants and provide incentives for them to seek licenses.
• Renewal Expectancy. The FCC proposes to eliminate the current requirement that PALs automatically terminate at the end of the license term. Rather, the NPRM tentatively concludes that PALs should enjoy a renewal expectancy, in the hopes of promoting investment in deployment and minimizing the risk of stranded investment.
• Expanded Geographic License Areas. The current PAL licensing rules provide for licenses issued in each census tract, anticipating their use for small cells. The NPRM solicits comment on larger PAL license areas such as Partial Economic Areas (“PEAs”) or counties. The NPRM reflects a prediction that larger license areas would “stimulate additional investment, promote innovation, and encourage efficient use of spectrum resources,” while asking for input on impacts to smaller entities, rural deployments, and investments relying on the current rules. The NPRM reflects an openness to a variety of approaches, such as a hybrid where some of the 10 megahertz-wide PALs would be issued within PEAs whereas others would be issued on a smaller scale, or a combination of PEAs in urban areas and census tracts in rural areas, offering PALs of different sizes, among other alternatives.
• Spectrum Caps. While the Commission has not proposed to increase the amount of spectrum in the 3.5 GHz band available to PALs in excess of the current 70 megahertz – rejecting T-Mobile’s proposal in its petition and ensuring at least 80 GHz will always be available in a given area for GAA licensees – the FCC does seek comment on lifting or revising the current single-licensee cap of 40 megahertz in a given area.
• Secondary Market Transaction Reforms. Consistent with its proposal to expand the geographic size of PAL licenses, the Commission proposes to allow partitioning and disaggregation of PALS in secondary market transactions to promote the efficient use of the spectrum where a licensee does not plan to utilize the entire license authority. However, the Commission also seeks comment on whether to allow partitioning and disaggregation irrespective of whether the agency opts to expand PAL license areas.
• Auction Rule Modifications. The FCC proposes to eliminate prior restrictions on the number of PALs per license area that are made available at auction depending on the number of PAL applicants for a given license area. Currently, except in rural areas, if there is only one PAL applicant, no licenses will be issued. The NPRM asks for comment on whether the proposed changes in the term, renewability, and geographic license area of PALs would make PALs “more useful to a wider range of potential licensees and, if so, whether that would reduce the benefit of limiting the number of PALs available in a given license area or not assigning PALs in any area for which there is only one applicant.” The Commission now proposes to assign PALs even when there is only one applicant in a given license area, assuming the applicant is otherwise qualified. The NPRM also asks whether there should nonetheless be an auction – bids of a minimum amount per license issued – where there are no more than applications for seven 10 megahertz in a given area, i.e., no traditional mutual exclusivity. Finally, the Commission seeks comment on allowing PAL applicants to bid on specific spectrum blocks within any given PAL license area.

The NPRM proposes to amend the current CBRS rules which require SAS administrators to make Citizens Broadband Service Device (“CBSD”) registration information available while “obfuscating” CBRS licensees’ identities. The Commission proposes, rather, to prohibit SAS administrators from disclosing publicly CBSD registration information that may compromise the security of critical network deployments or be considered competitively sensitive. The Commission recognizes that several carriers opposed disclosure on the grounds that it could jeopardize network security and confidential business information. However, the Commission also acknowledges arguments by parties such as Google and the Wireless Internet Service Providers Association (“WISPA”) that registration information is valuable to potential co-channel operators in investigating the feasibility of deploying service in the 3.5 GHz band before incurring the cost of attempting to reserve or participate in an auction for spectrum. Accordingly, the FCC proposes to amend the rules “to prohibit public disclosure of registration information that may compromise network security or that is competitively sensitive,” while asking whether, consistent with such a prohibition, there is certain information that SAS administrators can release to would-be operators to promote increased spectrum use in the complex multi-tier priority framework.

Potential Revisions to 3.5 GHz Emissions and Interference Limits

The Commission seeks to relax the CBRS out-of-channel and out-of-band emission limits applicable in the 3.5 GHz band, principally to facilitate wider bandwidth channels. Previously, the FCC adopted the following limits:

• -13 dBm/MHz from 0 to 10 megahertz from the assigned channel edge;
• -25 dBm/MHz beyond 10 megahertz from the assigned channel edge down to 3530 MHz and up to 3720 MHz;
• -40 dBm/MHz below 3530 MHz and above 3720 MHz.

Accompanying Order Terminating Petitions

A brief Order accompanies the NPRM and consolidates several dockets pertinent to 3.5 GHz. As noted above, T-Mobile and CTIA each filed petitions for rulemaking earlier in the year seeking revisions to the 3.5 GHz band rules. In general, the Order grants both petitions but rejects proposals by T-Mobile to revisit in-band base station power limits and make the entire 150 megahertz of the band available for PALs, as discussed earlier.

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If adopted, the PAL licensing reforms proposed in the NPRM could have serious ramifications for how the 3.5 GHz band is utilized. Such rule revisions could alter both the extent and the nature of investment in the 3.5 GHz band, impacting the variety of providers and operators that seek access to the band. While expanding the scope and duration of PALs could make them more attractive to large carriers for 5G deployment, these same measures, depending on the details, may act as a disincentive to participation in PALs by small businesses and rural carriers. Parties interested in the 3.5 GHz band would do well to monitor this proceeding (and even participate in the rulemaking) and look for new developments, as we will continue to do.