Improving Public Safety Communications in the 800 MHz Band, 29636-29650 [E9-14757]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 74, Number 119 (Tuesday, June 23, 2009)]
[Proposed Rules]
[Pages 29636-29650]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-14757]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 74 and 78

[WT Docket No. 02-55, ET Docket Nos. 00-258 and 95-18; FCC 09-49]


Improving Public Safety Communications in the 800 MHz Band

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document the Commission proposes to modify our cost 
sharing requirements for the 2 GHz BAS band because the circumstances 
surrounding the BAS transition are very different than what was 
expected when the cost sharing requirements were adopted. The 
Commission believes that the best course of action is to propose new 
requirements that will address the ambiguity of applying the literal 
language of the current requirements to the changed circumstances, as 
well as balance the responsibilities for and benefits of relocating 
incumbent BAS operations among all new entrants in the band based on 
the Commission's relocation policies set forth in the Emerging 
Technologies proceeding.

[[Page 29637]]


DATES: Comments must be filed on or before July 14, 2009, and reply 
comments must be filed on or before July 24, 2009.

ADDRESSES: You may submit comments, identified by ET Docket No. WT 02-
55, ET Docket No. 00-258 and ET Docket No. 95-18, by any of the 
following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web Site: https://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
     E-mail: [Optional: Include the E-mail address only if you 
plan to accept comments from the public]. Include the docket number(s) 
in the subject line of the message.
     Mail: [Optional: Include the mailing address for paper, 
disk, or CD-ROM submissions needed/requested by your Bureau or Office. 
Do not include the Office of the Secretary's mailing address here.]
     People with Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format documents, sign language 
interpreters, CART, etc.) by e-mail: FCC504@fcc.gov or phone: 202-418-
0530 or TTY: 202-418-0432.
    For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: Nicholas Oros, Office of Engineering 
and Technology, (202) 418-0636, e-mail: Nicholas.Oros@fcc.gov, TTY 
(202) 418-2989.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's 
Further NPRM of Proposed Rule Making, WT Docket No. 02-55, ET Docket 
No. 00-258 and ET Docket No. 95-18, FCC 09-49, adopted June 10, 2009, 
and released June 12, 2009. The full text of this document is available 
for public inspection and copying during regular business hours in the 
Commission's Reference Information Center, Portals II, 445 12th Street, 
SW., (Room CY-A257), Washington, DC 20554. The complete text of this 
document also may be purchased from the Commission's copy contractor, 
Best Copy and Printing, Inc., Portals II, 445 12th Street, SW., Room, 
CY-B402, Washington, DC 20554, telephone (202) 488-5300, facsimile 
(202) 488-5563 or via e-mail FCC@BCPIWEB.com. The full text may also be 
downloaded at: https://www.fcc.gov.
    Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's rules, 
47 CFR 1.415, 1.419, interested parties may file comments and reply 
comments on or before the dates indicated on the first page of this 
document. Comments may be filed using: (1) The Commission's Electronic 
Comment Filing System (ECFS), (2) the Federal Government's eRulemaking 
Portal, or (3) by filing paper copies. See Electronic Filing of 
Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: https://www.fcc.gov/cgb/ecfs/ 
or the Federal eRulemaking Portal: https://www.regulations.gov. Filers 
should follow the instructions provided on the Web site for submitting 
comments.
     For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Parties may also submit 
an electronic comment by Internet e-mail. To get filing instructions, 
filers should send an e-mail to ecfs@fcc.gov, and include the following 
words in the body of the message, ``get form.'' A sample form and 
directions will be sent in response.
     Paper Filers: Parties who choose to file by paper must 
file an original and four copies of each filing. If more than one 
docket or rulemaking number appears in the caption of this proceeding, 
filers must submit two additional copies for each additional docket or 
rulemaking number.
    Filings can be sent by hand or messenger delivery, by commercial 
overnight courier, or by first-class or overnight U.S. Postal Service 
mail (although we continue to experience delays in receiving U.S. 
Postal Service mail). All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail should be addressed to 445 12th Street, SW., Washington DC 20554.
    People With Disabilities: To request materials in accessible 
formats for people with disabilities (braille, large print, electronic 
files, audio format), send an e-mail to fcc504@fcc.gov or call the 
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (tty). Filings and comments are also available for public 
inspection and copying during regular business hours at the FCC 
Reference Information Center, Portals II, 445 12th Street, SW., room 
CY-A257, Washington, DC 20554. They may also be purchased from the 
Commission's duplicating contractor, Best Copy and Printing, Inc., 
Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, 
telephone: (202) 488-5300, fax: (202) 488-5563, or via e-mail https://www.bcpiweb.com.

Summary of Further NPRM of Proposed Rulemaking

    1. In this Further NPRM of Proposed Rulemaking (Further NPRM), the 
Commission proposes to modify our cost sharing requirements for the 2 
GHz BAS band because the circumstances surrounding the BAS transition 
are very different than what was expected when the cost sharing 
requirements were adopted. Sprint Nextel has asked us to issue a 
declaratory ruling regarding the cost sharing obligations between 
itself and the MSS and AWS-2 entrants in the band, but we decline to do 
so at this time. The Commission believes that the best course of action 
is to propose new requirements that will address the ambiguity of 
applying the literal language of the current requirements to the 
changed circumstances, as well as balance the responsibilities for and 
benefits of relocating incumbent BAS operations among all new entrants 
in the band based on the Commission's relocation policies set forth in 
the Emerging Technologies proceeding.
    2. In the Report and Order and Order, the Commission allowed MSS 
entrants to operate in markets where the BAS incumbents have not been 
relocated only if they successfully coordinate operations with the BAS 
incumbents. In this Further NPRM the Commission seeks comment on 
whether MSS can operate on an unrestricted and secondary basis in 
nonrelocated BAS markets.

[[Page 29638]]

    3. In this Further NPRM, the Commission also proposes to modify the 
current rules regarding the MSS entrants' obligation to relocate the 
BAS incumbents to take into account our decision in the Report and 
Order and Order herein to eliminate the top 30 market rule. Under the 
current rules, after the top 30 markets are relocated, the MSS entrants 
are required to complete relocation of the BAS incumbents in markets 31 
and above within either three or five years of beginning operations, 
depending on the size of the BAS market. The Commission proposes to 
maintain this independent obligation on MSS entrants to relocate BAS 
incumbents in all markets. The Further NPRM also addresses the 
independent obligation of AWS entrants to relocate BAS incumbents in 
the band.
    4. Finally, the Commission also seeks comment on whether it should 
further modify the BAS relocation rules to allow new entrants to begin 
unencumbered operations in the band before all BAS operations are 
relocated. The BAS transition is taking longer than initially 
anticipated and delaying the introduction of new services in the band. 
The Commission seeks comment on incentives to encourage BAS licensees 
to complete the relocation process promptly and without unnecessary 
delay.

A. Cost Sharing

    5. In 2003, when fifteen megahertz of spectrum in the 1990-2000 MHz 
and 2020-2025 MHz bands was reallocated from MSS to Fixed and Mobile 
services to be used for new terrestrial services, i.e., AWS-2, the 
Commission decided that responsibility for BAS relocation would be 
shared between the MSS entrants and the other new entrants to the band. 
In 2004, Sprint Nextel was assigned five megahertz of this spectrum in 
the 1990-1995 MHz band (as well as the paired 1910-1915 MHz band) in 
exchange for giving up spectrum it held in the 800 MHz band. Sprint 
Nextel also was given the obligation to relocate the BAS incumbents 
from the entire 35 megahertz of spectrum in the 1990-2025 MHz band, as 
well as the realignment of the 800 MHz band to resolve ongoing 
interference between public safety and commercial operations in that 
band. To ensure that Sprint Nextel did not receive an undeserved 
windfall by receiving the 1.9 GHz spectrum, Sprint Nextel was required 
to make an ``anti-windfall'' payment to the U.S. Treasury if the fair 
value of the spectrum it received, as determined by the Commission 
($4.86 billion), exceeded the total of (i) the value the Commission 
attributed to the 800 MHz spectrum Sprint Nextel was vacating ($2.059 
billion); (ii) the costs paid by Sprint Nextel to realign the 800 MHz 
band; and (iii) the costs paid by Sprint Nextel to clear incumbent 
users from the BAS spectrum (as well as the paired 1910-1915 MHz band). 
The Commission required Sprint Nextel to pay any monies owed to the 
U.S. Treasury under this calculation as part of a ``true-up'' that was 
originally scheduled to be accomplished within six months of the end of 
the 36 month 800 MHz transition period. The 36 month 800 MHz transition 
deadline was later established as June 26, 2008 with the true-up to 
occur by December 26, 2008. The Commission noted that Sprint Nextel was 
to complete the relocation of the BAS incumbents by September 7, 2007, 
prior to both the 800 MHz transition date and the subsequent true-up 
date.
    6. In the 2004 800 MHz R&O, 69 FR 67823, November 22, 2005, the 
Commission provided that the earlier entrant to the band who relocated 
BAS, whether Sprint Nextel or MSS, could receive reimbursement from a 
later entrant for the band clearing costs consistent with the Emerging 
Technology relocation principles. However, the unique situation that 
led to the assignment of the 1.9 GHz spectrum to Sprint Nextel required 
the Commission to establish additional procedures for the band. 
Specifically, the Commission established in the 800 MHz R&O that Sprint 
Nextel is ``entitled to seek pro rata reimbursement * * * from MSS 
licensees that enter the band'' prior to the end of the 800 MHz 36-
month reconfiguration period, and it required Sprint Nextel to notify 
the MSS entrants of its intention to seek cost sharing. The Commission 
provided that if Sprint Nextel receives a cost sharing reimbursement 
from the MSS entrants, the amount is to be deducted from the costs it 
can claim credit for as BAS relocation expenses in the 800 MHz true-up. 
Sprint Nextel's right to receive reimbursement from MSS was limited to 
the costs of clearing the top thirty markets and all fixed BAS 
facilities, regardless of market size, based on an MSS entrant's pro 
rata share of the 1990-2025 MHz spectrum involved. The Commission notes 
that when Sprint Nextel undertook its commitment to relocate the BAS 
licensees, the Commission did not, remove the obligation of the MSS 
entrants to relocate the BAS licensees, nor did it eliminate the 
procedures that had already been put in place for doing so. Indeed, the 
Commission provided an opportunity for the MSS entrants to relocate BAS 
incumbents, particularly in the top 30 markets, so that they would not 
be delayed in satisfying their entry requirements. Sprint Nextel, in 
turn, is required to reimburse MSS entrants for a pro rata share of any 
relocation costs MSS entrants incur if they participate in the 
relocation of BAS before Sprint Nextel has completed its clearing of 
the BAS band. When the decision was made to permit Sprint Nextel to use 
the 1990-1995 MHz band, no BAS licensees had been relocated by the MSS 
entrants, and there is no evidence that the MSS entrants exercised 
their right to relocate any BAS incumbents subsequent to the 
Commission's decision.
    7. In the 800 MHz MO&O, 70 FR 76704, December 28, 2005, adopted in 
October 2005, the Commission affirmed its decision regarding the 
obligations of the MSS entrants to reimburse Sprint Nextel. The 
Commission pointed out that ``[Sprint] Nextel, as the first entrant, is 
entitled to seek pro rata reimbursement of eligible clearing costs from 
subsequent entrants, including MSS licensees.'' The Commission 
explained that ``it decided to end the reimbursement obligations of 
other entrants to [Sprint] Nextel, and any reimbursement by [Sprint] 
Nextel to other entrants, at the end of the 800 MHz band true-up period 
for administrative efficiency in the accounting process and because of 
the unique circumstances in [Sprint] Nextel's receipt of BAS 
spectrum.'' Finally, the Commission rejected a request that it move up 
the date by which MSS entrants had to ``enter the band'' in order for 
Sprint Nextel to obtain cost sharing from them, and instead decided to 
``maintain the schedule previously established, i.e., the true-up 
period.''
    8. As noted, ten megahertz of the 2 GHz BAS spectrum (1995-2000 MHz 
and 2020-2025 MHz) has been reallocated for use by future AWS-2 
licensees. In the AWS Sixth R&O, 69 FR 62615, October 27, 2004, the 
Commission established obligations for the future AWS licensees to 
reimburse Sprint Nextel for the BAS transition costs. As with the MSS 
entrants, Sprint Nextel ``is entitled to seek pro rata reimbursement of 
eligible clearing costs incurred during its 36-month 800 MHz 
reconfiguration period from AWS licensees that enter the band prior to 
the end of that period.'' Sprint Nextel ``is not entitled to 
reimbursement'' from the AWS licensees ``after receiving credit for its 
relocation cost at the 800 MHz true-up.'' The AWS-2 NPRM of Proposed 
Rulemaking (AWS-2 NPRM), 69 FR 63489, November 2, 2004, for

[[Page 29639]]

service rules for the AWS-2 licensees was issued concurrently with the 
AWS Sixth R&O. The AWS-2 NPRM states that ``we also note that if 
[Sprint] Nextel has received credit for BAS relocation costs in the 800 
MHz true-up, late-entering AWS licensees will not have any 
reimbursement obligation to Nextel for such costs.'' The AWS-2 NPRM 
sought comment on a number of issues regarding cost-sharing between the 
AWS entrants and other new entrants to the band. These issues include 
whether a timetable should be adopted for AWS entrants to relocate BAS; 
how the reimbursement rights and obligations of each AWS licensee could 
be most efficiently and equitably allocated, whether on the basis of 
the geographic area or population covered by each license, or the value 
of each license as indicated by the winning auction bid, or by some 
other means; how the relocation costs should be allocated if not all 
AWS licenses are issued; how later arriving AWS licensees should be 
treated; and how an accounting between MSS and AWS licensees should 
occur.
    9. Since the time the Commission adopted or proposed cost sharing 
procedures for Sprint Nextel, MSS, and AWS-2 in the 2 GHz BAS band, 
many of the assumptions underlying those procedures have not occurred. 
The 800 MHz transition, which was to be completed within 36 months 
(June 26, 2008) is not yet complete. The Commission has granted 
individual 800 MHz licensees waivers of the rebanding deadline, but has 
not modified the completion date itself. The original ``true-up date'' 
for calculating the anti-windfall payment, which was linked to the 
completion of 800 MHz rebanding and set to occur by December 26, 2008, 
was modified by the Commission in December 2008. The true-up is 
currently scheduled to occur by July 1, 2009, but it may be delayed 
further and could occur before 800 MHz rebanding is completed. Sprint 
Nextel has not completed the BAS relocation, and the BAS transition 
deadline has been modified several times, most recently to June 10, 
2009.
    10. In a letter filed June 25, 2008, Sprint Nextel asks the 
Commission to make a number of adjustments in deadlines and procedures 
that are tied to the June 26, 2008 end date of the 36-month 800 MHz 
reconfiguration period. Sprint Nextel posits that these deadlines 
should be adjusted due to the extension of the BAS relocation deadline 
and the grant of a large number of waivers of the 800 MHz rebanding 
deadline to public safety licensees. In particular, Sprint Nextel notes 
that the 800 MHz R&O contains references relating the June 26, 2008 
rebanding date to the MSS reimbursement obligation to Sprint Nextel for 
BAS relocation costs, and it requests that these references be 
harmonized with the postponed true-up date. On the same date, Sprint 
Nextel filed a lawsuit against ICO and TerreStar in the Eastern 
District of Virginia seeking pro rata reimbursement of its BAS 
relocation costs. On August 29, 2008, the court referred the case to 
the Commission and stayed all proceedings pending further decision by 
the Commission.
    11. TerreStar responded to Sprint Nextel's June 25, 2008 letter on 
September 8, 2008, and ICO responded on September 9, 2008. TerreStar 
and ICO both argue that the MSS entrants' reimbursement obligation to 
Sprint Nextel terminated on June 26, 2008. TerreStar and ICO also argue 
that the Commission limited Sprint Nextel's ability to recover costs 
from MSS as part of striking ``an appropriate balance'' between Sprint 
Nextel and the MSS entrants' interests. ICO states that the Commission 
expected Sprint Nextel to complete the BAS relocation and MSS to begin 
operations long before reimbursement to Sprint Nextel was due on June 
26, 2008. With the long delay in BAS relocation, ICO claims that MSS 
has no ability to earn revenue prior to the reimbursement due date or 
the certainty needed to plan to do so. TerreStar argues that, when the 
800 MHz R&O was adopted, Sprint Nextel could not have had a reasonable 
expectation of recouping expenses from TerreStar and TerreStar had a 
justifiable expectation that it would not have to pay these expenses 
because TerreStar's satellite operational milestone was after June 26, 
2008; thus, it did not ``enter the band'' before the cost sharing 
obligation terminated. TerreStar claims that establishing a new date to 
terminate the cost sharing obligation would upset its settled 
expectations, reward Sprint Nextel for not completing the 800 MHz 
reconfiguration on time, and jeopardize TerreStar's initiation of 
service. ICO claims that because Sprint Nextel has delayed in 
completing the BAS relocation by the original date, the requirement 
that BAS in the top 30 markets be relocated before MSS can begin 
operations has not been satisfied, and thus ICO can not ``enter the 
band'' and incur a cost sharing obligation even though its satellite 
was successfully launched and found operational in May 2008.
    12. On October 8, 2008, Sprint Nextel filed a letter asking for a 
declaratory ruling affirming that TerreStar and ICO must reimburse 
Sprint Nextel for a pro rata share of the eligible BAS relocation 
costs. Sprint Nextel argues that the reimbursement obligation did not 
end or ``sunset'' on June 26, 2008, as TerreStar and ICO claim, but 
extends at least through the end of the BAS and 800 MHz relocation 
projects. Sprint Nextel claims that the cost sharing obligation was 
connected to the end of the 800 MHz reconfiguration to avoid a windfall 
to Sprint Nextel and facilitate the accounting in the true-up, which 
has been extended, and the relevance of the June 26, 2008 date has been 
superseded by the extended BAS and 800 MHz deadlines. Sprint Nextel 
points out that TerreStar and ICO have been on NPRM of their 
obligations for years and cannot have reasonably expected that they 
would be able to circumvent the Commission's long-standing cost sharing 
principles. Even if one assumed that the reimbursement obligation 
sunset on June 26, 2008, Sprint Nextel claims that both ICO and 
TerreStar have entered the band by that date: ICO by transmissions from 
its satellite and TerreStar through its licensing activities, system 
build out, testing, satellite construction, and ATC operations. Sprint 
Nextel also requests that if it does not owe any payment to the U.S. 
treasury for the spectrum it is receiving, the Commission should 
establish 2015 as the BAS relocation reimbursement sunset date.
    13. The requirements that the Commission adopted for cost sharing 
among Sprint Nextel, MSS and AWS-2 entrants were based on a number of 
assumptions regarding the transition of the 2 GHz and 800 MHz bands, 
MSS and AWS-2 entry, and the true-up. As reflected in the current 
requirements, the BAS relocation was contemplated to be complete within 
thirty months, and thus the Commission expected the BAS relocation to 
be finished by September 7, 2007, well before the end of the 800 MHz 
36-month reconfiguration period, which was ultimately slated to end on 
June 26, 2008. Because ICO's satellite operational milestone was July 
2007 and TerreStar's was November 2008 when the requirements were 
adopted, the Commission also expected that one and possibly both MSS 
operators would participate in the BAS relocation process, especially 
in clearing the top 30 markets, so that they would be able to commence 
service quickly once their satellites were successfully launched, 
possibly before the end of the 800 MHz reconfiguration period. Indeed, 
the Commission's requirements provided an opportunity for the MSS 
entrants to relocate BAS incumbents even while ordering Sprint Nextel 
to undertake the same task, and required that Sprint

[[Page 29640]]

Nextel reimburse the MSS entrants for any relocation expenses they 
incurred. For its band clearing efforts, Sprint Nextel would have been 
able to seek reimbursement for a portion of the relocation costs from 
the MSS and AWS-2 entrants who entered the band prior to the end of the 
800 MHz thirty-six month reconfiguration period on June 26, 2008. The 
Commission also expected that the total cost of the BAS relocation, 
1910-1915 MHz band clearing, and 800 MHz transition would be such that 
Sprint Nextel would have to make an anti-windfall payment to the United 
States Treasury even after receiving credit for all of its band 
clearing and transition costs. Consequently, even if the MSS entrants 
and AWS-2 licensees did not have to reimburse Sprint Nextel for BAS 
clearing costs because of delayed entry into the band, the Commission 
would have anticipated that Sprint Nextel would suffer no adverse 
financial consequence because the amount of the anti-windfall payment 
that Sprint Nextel would have to make would be reduced by the amount of 
any BAS relocation cost not reimbursed by the MSS entrants.
    14. The circumstances now surrounding the 2 GHz band BAS transition 
are very different than what the Commission expected when the cost 
sharing requirements were adopted and explained in the 800 MHz R&O. 
Neither the 800 MHz transition nor the BAS relocation has yet been 
completed. While the 800 MHz thirty-six month reconfiguration date of 
June 26, 2008 has never officially been extended, Sprint Nextel and 
numerous 800 MHz licensees have received waivers of that date. 
Moreover, the 800 MHz true-up date, which was set to occur within six 
months after the 800 MHz reconfiguration date, has been extended to 
July 1, 2009 and may be delayed further. The expected relocation costs 
for the 800 MHz transition is so large that Sprint Nextel does not now 
expect to make an anti-windfall payment.
    15. In this context, the underlying assumptions of the approach 
taken by the Commission in the 800 MHz R&O did not occur, such that a 
narrow, literal interpretation of certain language in the Commission's 
decision would not correspond to the stated purposes and structure of 
the cost sharing principles set forth in the 800 MHz R&O and other 
decisions regarding the shared responsibilities of new entrants for BAS 
relocation. Certain specific language cannot be reasonably applied to 
the current circumstances.
    16. On the one hand, a narrow literal interpretation of certain 
language in the 800 MHz R&O could be argued as suggesting that Sprint 
Nextel may only be entitled to seek pro rata reimbursement to the 
extent that the MSS and AWS-2 licensees entered the 2 GHz band before 
the then-contemplated 36-month 800 MHz rebanding period ended, a date 
later established to be June 26, 2008. Moreover, because the Commission 
has never defined what ``entered the band'' means, applying this 
interpretation is problematic.
    17. On the other hand, such an interpretation of the deadline would 
arguably undermine the stated purposes of the BAS cost-sharing regime 
set up by the Commission in the 800 MHz R&O, where it discussed its 
decision as generally consistent with the cost-sharing principle that 
the licensees that ultimately benefit from the spectrum cleared by the 
first entrant shall bear the cost of reimbursing the first entrant for 
that benefit, though modified to fit the particular concerns raised in 
the 800 Rebanding proceeding. Specifically, as stated in the 2005 800 
MHz MO&O, the Commission modified the traditional Emerging Technologies 
cost-sharing policy that new entrants who ultimately benefit from 
having the spectrum cleared should pay their share of band-clearing 
costs only to the extent necessary to provide ``administrative 
efficiency in the accounting process'' and to take into account ``the 
unique circumstances in Nextel's receipt of the BAS spectrum.'' In 
other words, the Commission limited the time that Sprint Nextel could 
receive reimbursements from MSS entrants so that Sprint Nextel could 
not get a double benefit, i.e., receive reimbursements from MSS after 
it had received credit for these expenses in the true up. The 
Commission clearly allowed for the possibility that the MSS entrants 
would incur a cost-sharing obligation, and Sprint Nextel was explicitly 
allowed to pursue cost sharing from the MSS entrants by giving them 
NPRM within one year of adoption of the 800 MHz R&O.
    18. Nothing in the text of the relevant orders suggests that the 
Commission limited the time in which Sprint Nextel could seek 
reimbursements from MSS entrants to provide an independent benefit to 
MSS entrants, e.g., to subsidize them or provide them certainty about 
their business costs. Thus, the Commission finds that the MSS entrants' 
cost sharing obligations must be interpreted in light of the 
unanticipated changed circumstances, and these obligations should not 
be tied to a deadline that is no longer relevant. In short, MSS 
entrants should pay a pro rata share of the BAS relocation costs unless 
doing so would allow Sprint Nextel to be reimbursed twice (by both the 
Treasury and the MSS and AWS-2 licensees). Accordingly, the most 
logical and appropriate interpretation of the language in the 800 MHz 
orders is that the MSS entrants must pay their pro rata share of BAS 
relocation costs to the extent that they enter the band before the 800 
MHz rebanding or true up is complete. The difficulty with applying this 
interpretation is that there is no future date certain for completing 
either the 800 MHz rebanding or the true up.
    19. The Commission thus declines to resolve the conflict between 
Sprint Nextel and the MSS entrants by issuing a declaratory ruling. It 
concludes that, given the changed circumstances surrounding the 2 GHz 
BAS relocation and the ambiguity between certain language in the 800 
MHz R&O and the overall purposes and structure of the BAS cost-sharing 
regime caused by the changed circumstances, the best course of action 
is to propose clearly delineated cost sharing requirements reflecting 
these changed circumstances to balance the responsibilities for and 
benefits of relocating incumbent BAS operations among Sprint Nextel, 
MSS, and AWS-2 based on the Commission's relocation policies set forth 
in the Emerging Technologies proceeding.
    20. This Further NPRM provides an opportunity for us to address 
issues that are ambiguous or not specifically addressed by the current 
requirements. In particular, we reach the following tentative 
conclusions:
     Sprint Nextel may either obtain cost sharing for an 
eligible expense from MSS or AWS-2 entrants when those licensees 
``enter the band'' or take credit for that expense against the anti-
windfall payment to the Treasury (true-up) for the 5 megahertz of BAS 
spectrum (1990-1995 MHz) it obtained as part of the 800 MHz band 
realignment.
     The attachment of the cost sharing obligation between 
Sprint Nextel and MSS and AWS-2 would follow traditional Emerging 
Technologies policies, i.e., the obligation to share costs among new 
entrants would continue to the BAS sunset date (December 9, 2013); any 
entity that ``enters the band'' prior to that date would be obligated 
to reimburse the earlier entrant that incurred the relocation expense a 
proportional share of cost based on the amount of spectrum assigned to 
it.
     As in the current requirements, the MSS cost sharing 
obligation to Sprint Nextel would be limited to the top 30 markets by 
population and all fixed BAS links.

[[Page 29641]]

     An MSS entrant would be deemed to have ``entered the 
band'' for incurring a cost sharing obligation when its satellite is 
found operational under its authorization milestone.
     For cost sharing purposes, Sprint Nextel would be required 
to share with other new entrants information on the relocation costs it 
has incurred as documented in its annual external audit of 2 GHz band 
clearing expenses and as provided to the 800 MHz Transition 
Administrator, as required by the 800 MHz R&O.
    21. The overall approach proposed seeks to balance the BAS 
relocation costs among all new entrants based on the benefit each 
receives of the total of 35 megahertz of cleared spectrum, consistent 
with our Emerging Technologies policies. Following BAS relocation, MSS 
will have access to 20 megahertz in the 2000-2020 MHz band (\4/7\), 
AWS-2 will have 10 megahertz in the 1995-2000 and 2020-2025 MHz bands 
(\2/7\), and Sprint Nextel will have 5 megahertz in the 1990-1995 MHz 
band (\1/7\). These basic proportions inform our proposals. As the 
Commission decided in the 800 MHz R&O, this approach will follow the 
traditional relocation principle that the licensees that ultimately 
benefit from the spectrum cleared by the first entrant shall bear the 
cost of reimbursing the first entrant for the accrual of that benefit.
    22. As is the case with our current requirements, the Commission 
tentatively concludes that Sprint Nextel may not both receive 
reimbursement from another new entrant and take credit for the same BAS 
relocation cost at the 800 MHz true-up. If another new entrant enters 
the band before the true-up and Sprint Nextel obtains reimbursement for 
relocation costs from the new entrant, Sprint Nextel may not obtain 
credit against the anti-windfall payment for the reimbursed costs. 
Further, the Commission tentatively concludes that any new entrant to 
the band who incurs relocation cost will be able to obtain pro rata 
reimbursement from other new entrants who enter the band prior to the 
BAS band sunset date of December 9, 2013. In other words, the cost-
sharing obligation will no longer be linked to the 800 MHz thirty-six 
month reconfiguration period or the 800 MHz true-up date. Extending the 
relocation obligation to the BAS sunset date provides certainty to all 
new entrants, rather than linking the obligation to the 800 MHz thirty-
six month reconfiguration period or the 800 MHz true-up date, since the 
timing of both of these events is less certain. Thus, the Commission 
tentatively concludes that the attachment of the cost sharing 
obligation between Sprint Nextel and MSS and AWS-2 should follow the 
traditional Emerging Technologies policies in obligating new entrants 
to share the costs of relocating the BAS incumbents. A later entrant's 
cost-sharing obligation to the earlier entrant who cleared the spectrum 
shall be in proportion to the spectrum assigned to the later entrant. 
For example, if a future AWS licensee is assigned 5 megahertz of 
spectrum in the band on a nationwide basis, the licensee will be 
responsible for \1/7\ of the total spectrum clearing costs if it enters 
the band before the sunset date.
    23. In the 800 MHz R&O, the MSS entrants' cost sharing obligation 
to Sprint Nextel was limited to the cost of clearing the thirty largest 
markets (by population) and all fixed BAS links. This was done because 
the MSS entrants were required to clear the thirty largest markets and 
all fixed BAS links before they could begin operations, but were not 
required to relocate BAS in the other markets until later. Because this 
exception to the general cost-sharing principle was clearly established 
in the 800 MHz R&O in 2004, we propose to continue to limit the MSS 
entrants' cost-sharing obligation in this way even though we are now 
eliminating the top 30 market rule.
    24. Consequently, the Commission tentatively concludes that Sprint 
Nextel's right to seek reimbursement from any MSS entrant entering 
before the sunset date will be limited to the costs Sprint Nextel 
incurred for clearing the top thirty markets and for relocating all 
fixed BAS facilities, regardless of market size, and to an MSS 
entrant's pro rata share of the 1990-2025 MHz spectrum. Sprint Nextel 
claims that under this approach MSS would only be responsible for 
approximately 27 percent of the total BAS relocation expenses, which is 
substantially less than the 57 percent of the cleared BAS spectrum 
assigned to the two MSS entrants. The Commission also seeks comment on 
whether it should require MSS entrants to pay a pro rata share of all 
BAS relocation costs, regardless of market size.
    25. In addition, regarding MSS-to-MSS cost sharing, under the 
original requirements for MSS entrants to relocate the BAS incumbents, 
all MSS entrants share in the relocation costs on a pro rata basis 
depending on the amount of spectrum each is assigned. Later entering 
MSS operators are required to reimburse the earlier MSS entrants who 
clear the spectrum a pro rata share of the earlier MSS entrants' band 
clearing costs. After the BAS transition is completed, all of the MSS 
entrants are to ``true-up'' their costs to ensure that each MSS entrant 
pays a pro rata share of the relocation costs based on the amount of 
spectrum assigned. The Commission proposes to retain these MSS-to-MSS 
cost sharing requirements. The Commission notes that these inter-
service and intra-service cost sharing requirements can work in tandem. 
For example, if Sprint Nextel was reimbursed from only one MSS entrant, 
that entrant could in turn seek reimbursement of what it owed Sprint 
Nextel from another MSS entrant. It appears that Sprint Nextel has 
asked both ICO and TerreStar to pay equal amounts of relocation costs 
based on their equal amount of assigned spectrum (i.e., ten megahertz 
each), consistent with current requirements. The Commisssion seeks 
comment on whether Sprint Nextel should be allowed to request 
relocation costs for BAS operations in all of the 20 megahertz of 
spectrum allocated for MSS from a single MSS entrant that may, in turn, 
seek reimbursement from another MSS entrant.
    26. The Commission also tentatively concludes that AWS-2 licensees 
will be responsible for reimbursing earlier entrants for relocating BAS 
operations in their assigned geographic areas, but determining how to 
apportion a licensee's pro rata share will depend on future Commission 
action to adopt service rules for the AWS licensees in the 1995-2000 
MHz and 2020-2025 MHz band. These licenses may be issued either on a 
nationwide basis or for geographic areas, and could include all or only 
a portion of the allocated bandwidth. If licenses are issued for 
geographic areas, the geographic areas are not likely to coincide with 
the BAS market boundaries and licenses for geographic areas may be 
issued at different times. Another factor that our service rules will 
have to address is apportioning the reimbursement costs fairly among 
AWS licensees. For example, some licensees' service areas cover cleared 
spectrum for which Sprint Nextel may claim a credit at the true-up, 
thus preventing Sprint from seeking cost sharing from those AWS 
licensees. Other AWS licensees' service areas may cover cleared 
spectrum not claimed by Sprint for a true up credit and thus subject to 
cost sharing. These factors will complicate the calculation of cost 
sharing for the AWS entrants to the band. In the 2004 AWS-2 NPRM on 
service rules for the AWS entrants to the band, the Commission sought 
comment on a number of issues regarding the licensing scheme for the 
AWS entrants

[[Page 29642]]

and the cost-sharing obligations between the AWS entrants and other new 
entrants to the band. Because the licensing scheme for the AWS entrants 
to the band has not yet been determined, we are not making proposals 
here for apportioning an AWS licensee's pro rata share for cost-sharing 
with other new service entrants or between AWS-2 entrants beyond those 
made in the 2004 AWS-2 NPRM. The Commission intends to adopt specific 
cost-sharing procedures for the AWS entrants when service rules are 
adopted for the 1995-2000 MHz and 2020-2025 MHz bands.
    27. The cost sharing scheme that the Commission adopted in 2004 
required that MSS and AWS entrants reimburse Sprint Nextel for the BAS 
relocation costs after they ``enter the band,'' but did not define the 
term. For clearing other bands under our Emerging Technologies 
policies, the Commission's rules usually make a distinction between 
determining when a new entrant must relocate an incumbent operation 
before it can operate and when a new entrant incurs a cost sharing 
obligation to an earlier entrant who relocated an incumbent. Generally, 
Commission rules rely on an interference analysis to determine when a 
new entrant must relocate an incumbent. On the other hand, a later 
entrant is generally required to share in the cost that an earlier 
entrant has incurred in relocating an incumbent if the subsequent 
entrant would have been in a position to have caused interference to 
the incumbent. Because the incumbent has already been relocated, the 
cost sharing determination is not usually based on a rigorous 
interference analysis but often on a simplified proximity test for ease 
in administration. The rules may vary from these general principles 
depending on the technical characteristics of the specific services 
involved in the relocation.
    28. Because the Commission has already determined that MSS and AWS-
2 entry in the 2 GHz band requires that all BAS operations in the band 
be relocated to avoid interference between the new and incumbent 
services, we only need to determine here when a new entrant ``enters 
the band'' for purposes of the attachment of the cost sharing 
obligation. In this regard, we are mindful that in other bands a new 
entrant incurs a cost sharing obligation at the time the subsequent 
entrant would be in a position to have caused interference to the now 
relocated incumbent.
    29. With this principle in mind, the Commission tentatively 
concludes to adopt the following requirements for determining when the 
MSS entrants have ``entered the band.'' The Commission proposes that an 
MSS entrant will have entered the band and incurred a cost sharing 
obligation when it certifies that its satellite is operational for 
purposes of meeting its operational milestone. For the 2000-2020 MHz 
band, a satellite is considered operational based upon the occurrence 
of transmissions between the satellite and an authorized earth station 
using the 2000-2020 MHz and 2180-2200 MHz bands. The satellite systems 
which the MSS entrants are deploying are capable of providing 
nationwide coverage. The customer equipment transmitting to the 
satellites in this band are therefore capable of causing interference 
to any of the BAS incumbents in the local area in which that equipment 
is used. The MSS entrants having an operational satellite is therefore 
analogous to the Personal Communications Service (PCS) or AWS entrants 
building a base station in proximity to the incumbent fixed microwave 
links in the prior spectrum clearings. Like the PCS and AWS entrants, 
an MSS entrant with an operational satellite is in a position to cause 
interference to the incumbents and therefore should incur a cost 
sharing obligation to an earlier entrant who has relocated the 
incumbents. Simplicity of administration is especially important in the 
case of BAS because there is no clearinghouse to determine when a party 
has ``entered the band'' or to parse out the relocation costs on a BAS 
receiver site-by-site basis.
    30. The AWS entrants will operate terrestrial networks and thus the 
definition of ``enter the band'' which the Commission proposes for the 
MSS entrants would not be appropriate for AWS. Although no service 
rules have been adopted for the AWS portions of the 1990-2025 MHz band, 
the Commission expects that the AWS entrants will deploy terrestrial 
networks wherein fixed base stations communicate with mobile radios. 
Because both the AWS entrants and BAS incumbents will employ mobile 
radios, the interference scenarios will be more complicated than with 
the fixed point-to-point microwave incumbents being relocated in the 
PCS, AWS, and MSS downlink bands addressed by other relocation rules. 
Furthermore, there is no clearinghouse for the BAS relocation that will 
be able to determine when interference between the AWS entrants and 
previously relocated BAS incumbents would likely occur. These two 
facts--the complicated interference scenarios and lack of 
clearinghouse--require that the test for determining when AWS entrants 
incur a cost sharing obligation be simple and easy to apply.
    31. As one option, the Commission proposes to specify that AWS 
entrants in the 1990-2025 MHz band be found to have ``entered the 
band'' and incur a cost sharing obligation upon grant of the long form 
applications for their licenses. This would provide a clear and easy-
to-administer standard and provide certainty for all parties involved. 
While this proposed requirement does depart somewhat from other 
relocation rules, it is not entirely inconsistent. Because of the 
mobile nature of BAS, once the AWS entrant is licensed any deployment 
of its services could potentially have resulted in interference to 
mobile BAS incumbents.
    32. The Commission also seeks comment on an alternate approach for 
when AWS entrants should be found to ``enter the band.'' An AWS entrant 
in the 1990-2025 MHz band could be found to ``enter the band'' and 
incur a cost sharing obligation when it activates a base station in an 
AWS-2 license area that overlaps a cleared DMA. The Commission notes 
that this alternate approach presents a number of issues that could 
make it difficult to implement. Because there is no clearinghouse for 
the 1990-2025 MHz band, there currently is no entity that is 
responsible for tracking when the AWS-2 licensee activates a base 
station and for determining which DMA's are overlapped by the base 
station. Each DMA will potentially have a separate ``enter the band'' 
date, and it is likely that, whatever service rules we ultimately adopt 
for this band, any given AWS-2 licensee would trigger numerous ``enter 
the band'' dates. Consequently, the Commission seeks comment on 
whether, under this approach, an AWS-2 licensee that activates a first 
base station should incur a cost sharing obligation only for relocating 
BAS in that DMA or should it incur its entire cost sharing obligation 
for all DMAs that overlap its service area. Also, under this approach 
AWS-2 licensees could potentially delay the initiation of service, and 
thus seek to avoid incurring a cost sharing obligation, until after the 
BAS sunset date of December 9, 2013, making it more difficult for 
Sprint Nextel to decide whether to take credit for BAS relocation cost 
in the 800 MHz true-up because of the uncertainty as to whether AWS-2 
licensees will share in the cost of the BAS relocation. The Commission 
seeks comment on how, if we adopt this alternative approach, we could 
prevent

[[Page 29643]]

AWS-2 licensees from avoiding their cost sharing obligation through 
delay. If AWS-2 licensee's are able to avoid incurring a cost sharing 
obligation through delay, the Commission also seeks comment on how to 
make it easier for Sprint Nextel to determine whether to take credit 
for BAS relocation cost in the 800 MHz true-up despite the uncertainty 
as to whether the AWS-2 will share in the BAS relocation cost.
    33. When the Commission adopted the requirements allowing Sprint 
Nextel to pursue reimbursement of BAS relocation costs from MSS and AWS 
entrants, it did not specify when the MSS and AWS entrants would owe 
reimbursement to Sprint Nextel. Generally, in other band clearings the 
later new entrant has to pay its reimbursement costs when beginning 
operations or shortly thereafter. For example, in the relocation of 
fixed microwave links by AWS entrants in the 2110-2150 MHz band and by 
MSS entrants in the 2180-2200 MHz band (this is the paired downlink 
band for the MSS at issue in this proceeding), the AWS and MSS entrant 
must notify a clearinghouse prior to initiating operations. The 
clearinghouse determines if the AWS or MSS entrant must reimburse a 
prior new entrant for moving an incumbent licensee, and the AWS or MSS 
entrant has 30 days to pay the reimbursement costs. Similar rules are 
followed for the relocation of BRS incumbents in the 2150-2162 MHz band 
by AWS entrants.
    34. As the Commission discussed in the Further NPRM, there are 
unique circumstances in this case that require additional 
consideration. The Commission has already determined to permit MSS 
entrants to begin operations in the near term, even if this were to 
occur before they have actually satisfied the cost sharing 
reimbursement obligations that would attach under our proposals here. 
Here, we seek comment on various approaches that the Commission might 
take concerning when such reimbursements are owed.
    35. If the Commission were to apply a similar scheme as that 
followed by our relocation rules in other bands with the BAS transition 
in the 2 GHz band, once the later entrant has entered the band, it may 
not begin operations until it has reimbursed the earlier entrant that 
relocated BAS incumbents for the later entrant's pro rata share of the 
relocation costs for all BAS markets that have been transitioned as of 
the date that the later entrant entered the band (or, in the case of 
MSS, the later of these two dates: the date MSS is determined to have 
entered the band or the earliest date MSS is permitted to begin 
operations under our rules). Thereafter, as the BAS relocation 
continues and each additional BAS market is transitioned to the new 
channel plan, the new entrant would have to pay its share of the cost 
of transitioning that market within thirty days of being notified of 
the market transitioning or cease operations in that band. Under this 
approach, it may be more reasonable to expect an MSS entrant to pay 
reimbursement costs only when a BAS market is cleared and it can 
operate on a primary basis, rather than to pay these costs on a per 
station basis in nonrelocated BAS markets where it may operate only on 
a secondary basis. The entrant who is relocating the BAS incumbents 
could have the responsibility of notifying the other new entrants and 
the Commission of the transition of each BAS market. The Commission 
seeks comment generally on this approach, or variations to it.
    36. The Commission also seeks comment, given the unique 
circumstances in this case, on alternative approaches for when MSS 
entrants should be required to reimburse Sprint Nextel for their pro 
rata share of the BAS relocation costs. Because the MSS entrants have 
not yet begun to provide commercial services, they do not have an 
established revenue stream. Consequently, it may be difficult for the 
MSS entrants to reimburse Sprint Nextel immediately for their pro rata 
share of costs for all of the markets that have transitioned when the 
MSS entrant enters the band or begins service, as proposed. Rather than 
require that, when an MSS entrant is ready to begin operations, it pay 
its reimbursement share for all markets cleared when it either entered 
the band or was permitted to begin operations under the rules, should 
MSS entrants only initially have to pay reimbursement costs for those 
markets in which they choose to operate? If so, what schedule should 
they follow for reimbursing costs associated with the remaining 
markets--when they start providing service in those markets, or under a 
different timetable? The Commission also seeks comment on establishing 
a reimbursement scheme that is not specifically tied to MSS entry in 
each market. For example, should MSS entrants be allowed to delay 
payment of some portion of their pro rata share of reimbursement costs 
until the BAS relocation is complete, or some other date? Would this 
provide some needed certainty to MSS entrants that they could begin 
operating? Should the MSS entrants' payments be linked to the pace of 
the BAS transition--e.g., as additional BAS markets are transitioned, 
should MSS entrants be required to make additional payments? The 
Commission also seeks comment on how any of these approaches would 
affect the true-up, particularly if Sprint Nextel is owed monies that 
MSS entrants have not yet paid when the true-up occurs. More generally, 
the Commission also seeks comment on whether any of these approaches 
would undermine our goal of ensuring that later entrants reimburse, on 
a pro rata basis, the first entrant that paid for relocation, and on 
what actions we should take if MSS entrants fail to pay.
    37. Finally, the Commission tentatively concludes that, for cost 
sharing purposes, Sprint Nextel would be required to share with other 
new entrants information on the relocation costs it has incurred as 
documented in its annual external audit of 2 GHz band clearing expenses 
and as provided to the 800 MHz Transition Administrator, as required by 
the 800 MHz R&O. As part of the financial reconciliation process in the 
800 MHz true-up, Sprint Nextel is required to conduct an annual 
external audit of its 2 GHz band clearing expenses and to provide this 
audit to the Transition Administrator for the 800 MHz rebanding and 
true-up. Sprint Nextel also is to report to the Transition 
Administrator the amount of reimbursement it receives from other 
entrants to the band. With this information, the Transition 
Administrator will be able to ensure that Sprint Nextel receives the 
proper amount of credit against the anti-windfall payment for BAS 
relocation. However, the annual external audit provides data on total 
expenses, rather than by market, and the Transition Administrator is 
under no obligation to analyze, audit or verify the data that Sprint 
Nextel supplies on the cost of clearing the 2 GHz spectrum. 
Furthermore, if an MSS or AWS licensee enters the band after the true-
up occurs, the Transition Administrator will not be present to 
calculate the amount that Sprint Nextel claims the new entrant owes. To 
facilitate the cost sharing process, the Commission proposes to require 
that Sprint Nextel share with any other new entrant who owes it 
relocation reimbursement information about its relocation costs as 
documented in its annual external audit and as provided to the 
Transition Administrator. Similarly, if a new entrant other than Sprint 
Nextel relocates a BAS incumbent and seeks cost sharing from later 
entrants, the first entrant would be required to provide the later 
entrants with documented

[[Page 29644]]

relocation costs. The Commission seeks comment.
    38. The Commission seeks comment on all of the proposed changes to 
the cost-sharing requirements for the 1990-2025 MHz BAS relocation. It 
seeks comment on this proposal as well as alternative proposals.

B. BAS-MSS Spectrum Sharing

    39. In the accompanying Report and Order and Order, the Commission 
eliminated the top 30 market rule which prevented the MSS entrants from 
beginning operations before the BAS incumbents in the thirty largest 
markets by population and fixed BAS links in all markets had been 
relocated. The MSS entrants are now able to operate with primary status 
in those markets where the BAS incumbents have been relocated to the 
new channel plan and with secondary status in nonrelocated markets 
subject to coordination.
    40. The Commission concluded that coordination was necessary in 
nonrelocated markets because we were not persuaded by the record that 
MSS could conduct unrestricted operations in these markets without 
causing interference to the BAS incumbents. TerreStar asserts that, 
based on its probabilistic analysis, interference from MSS handsets to 
BAS operations is unlikely to occur, and thus suggests that 
coordination may not be necessary. Rather, it would cease operations if 
a BAS incumbent experiences interference. MSTV disputes these claims. 
The Commission is concerned that if interference occurs to BAS 
licensees in nonrelocated markets, that interference will harm BAS 
operations and could prove difficult to resolve because the location of 
the handset which is the source of the interference may not be easily 
determined. Such interference could have a significant impact given the 
number of major markets that will transition toward the end of Sprint 
Nextel's relocation schedule. Nonetheless, the Commission invites 
additional analysis on whether MSS can operate on an unrestricted and 
secondary basis in nonrelocated BAS markets. Commenters should include 
evidence on the likelihood of harmful interference occurring to the 
nonrelocated BAS incumbents from MSS operations.
    41. In the Report and Order and Order the Commission also 
recognizes that interference could occur to BAS incumbents in a 
nonrelocated market from MSS operations in an adjacent market where BAS 
has been relocated. Consequently, it requires that MSS may not operate 
mobile terminals within line-of-sight of BAS receive sites in markets 
where the BAS transition has not been completed, absent coordination. 
The Commission seeks comment on whether this requirement continues to 
be necessary.

C. MSS Relocation Obligations

    42. Our current rules provide that the MSS entrants may not begin 
operations until BAS in the top 30 markets and all fixed BAS links have 
been relocated. Once an MSS entrant begins operations, all of the MSS 
entrants jointly have the responsibility to relocate the BAS incumbents 
in markets 31-100 within three years and the remaining markets (i.e., 
101 and above) within five years. The rule establishes a relocation 
obligation on MSS that is independent of other new entrants' relocation 
activity in the band, and provides a market tier approach for 
completing the BAS relocation that is pegged to beginning operations 
when the top 30 markets and fixed links are relocated.
    43. The accompanying Report and Order and Order removes the 
requirement that BAS in the top 30 markets and all fixed BAS links must 
be relocated before MSS can begin operations, but maintains the 
obligation for the MSS entrants to relocate the BAS incumbents once an 
MSS entrant begins operations. Thus, this rule needs further 
modification to specify when an MSS entrant ``begins operations'' for 
purposes of completing BAS relocation and to account for the relocation 
of markets 1-30 along with markets 31-100.
    44. The Commission proposes to trigger the obligation of an 
individual MSS operator to relocate BAS incumbents within three or five 
years, depending on market size--i.e., markets 1-100 within three 
years, and the remaining markets within five years--on the later of 
these two dates: When the MSS operator certifies, prior to the BAS 
sunset date of December 9, 2013, that its satellite system is 
operational for purposes of meeting its operational milestone; or the 
date when the top 30 market rule is eliminated. The Commission believes 
that this is appropriate because once the satellite system is certified 
operational and the top 30 market rule has been eliminated, an MSS 
entrant will be in the position to make use of the spectrum. 
Furthermore, the criteria will be easy to apply because the MSS entrant 
must notify the Commission when it accomplishes its operational 
milestone and the elimination of the top 30 market rule will be 
effective thirty days after publication of the Report and Order and 
Order in the Federal Register. The Commission notes that the obligation 
to relocate the BAS incumbents within three and five years, depending 
on market size, is a joint obligation of all the MSS entrants and not 
just the entrant who has begun operations. Consequently, both MSS 
entrants will have an obligation to relocate the BAS incumbents in 
markets 1-100 within three years and the remaining markets within five 
years.
    45. The Commission also proposes to specify that once the MSS 
entrants have incurred an obligation to relocate the BAS incumbents 
within the three and five year periods, the occurrence of the December 
9, 2013 sunset date will not serve to terminate that obligation. The 
Commission views this approach as appropriate to ensure that all 
eligible BAS incumbents who are entitled to relocation are fairly 
compensated.
    46. Finally, the Commission notes that our rules currently are 
silent on what consequences the MSS entrants face for not meeting the 
three and five year relocation deadlines. The Commission seeks comment 
on what consequences, if any, should be applied for failure to meet 
these deadlines.

D. BAS Relocation Process

    47. The bimonthly status reports which Sprint Nextel has filed on 
the progress of the BAS transition show that BAS relocation activity 
slows between the time when replacement equipment is ordered for 
installation by individual licensees, and when all licensees in a 
market retune to the new channel plan. The reports have cited a number 
of different reasons for the delays in completing relocation, such as 
weather conditions, the availability and scheduling of installers, and 
so on. However, some market delays are due to a single BAS licensee in 
a market that has lagged in cooperating with the BAS transition and a 
handful of BAS licensees that have failed to execute frequency 
relocation agreements.
    48. The Commission is concerned that some BAS licensees may not be 
making a good faith effort to complete the BAS transition in a timely 
manner. Because of the integrated nature of BAS, all BAS licensees in a 
market must transition as a group. Consequently, the failure of one BAS 
licensee to cooperate in the transition can delay many other BAS 
incumbents from completing the transition. Given that the BAS 
transition has taken far longer than anyone has expected, the 
Commission seeks comment on incentives it might apply to encourage all 
BAS incumbents to diligently work toward completing the BAS transition 
so as not to delay further the introduction of new services in the 
band.

[[Page 29645]]

    49. Under our current rules, the BAS incumbents are primary until 
they are relocated, they refuse relocation, or the BAS relocation rules 
sunset on December 9, 2013. Because individual BAS licensees may delay 
the transition, the Commission seeks comment on the following proposal. 
If a BAS licensee has not completed relocation by February 9, 2010, the 
Commission could change its status for interference purposes, but 
continue to require that new entrants who incur a relocation and cost 
sharing obligation fulfill this obligation. Thus, Sprint Nextel, MSS 
and AWS-2 entrants would continue to have an obligation to relocate 
those BAS incumbents whose initial applications were filed prior to 
June 27, 2000 and who have primary status in the band.
    50. The interference status between a nonrelocated BAS licensee and 
a new entrant, whether Sprint Nextel, MSS, or AWS-2, could be modified 
in one of several different ways. First, nonrelocated BAS incumbents 
could become secondary in the 1990-2025 MHz band and Sprint Nextel, MSS 
and AWS entrants primary as of February 9, 2010. This would allow 
Sprint Nextel, MSS and AWS-2 entrants to provide unimpeded commercial 
service. The nonrelocated BAS incumbent would be able to continue 
operations in the band if the new entrants are not ready to begin using 
the band or if the BAS incumbent can operate without causing harmful 
interference to the new entrants. Second, the Commission could require 
the nonrelocated BAS incumbent to cease operations in the 1990-2025 MHz 
band as of February 9, 2010. This proposal has similarities to the BAS 
relocation rules prior to 2004. Third, the Commission could make the 
nonrelocated BAS licensee and the new entrants co-primary in the 1990-
2025 MHz band as of February 9, 2010. Because a later arriving co-
primary licensee must protect the operations of an existing co-primary 
licensee, the new entrants, whether Sprint Nextel, MSS, or AWS-2, would 
have to avoid causing interference to the existing BAS systems and 
accept interference from the BAS licensee. The Commission seeks comment 
on these approaches, or possible alternative approaches.
    51. If the Commission adopts either the first or second of the 
procedures described, it seeks comment on whether we should look 
favorably upon waiver request from individual nonrelocated BAS 
licensees to allow them to maintain their primary status and continue 
operations if enforcing the rule would cause hardship or otherwise not 
serve the public interest. The BAS licensee could, for example show 
that the BAS spectrum in its market is so heavily used that there is no 
other available channel or that circumstances beyond the incumbent's 
control have prevented the incumbent from completing the transition by 
the deadline.

Initial Regulatory Flexibility Analysis

    1. 52. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA),\1\ the Commission has prepared