Nextel/NAB/MSTV 2 GHz Relocation Plan in Trouble?

TV broadcasters have been counting on Nextel's plan to cover their costs of moving out of the lower two channels of the existing 2 GHz broadcast auxiliary services (BAS) band. Now it looks as if the Nextel proposal, which has the support of the Association of Maximum Service Television (MSTV), the National Association
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TV broadcasters have been counting on Nextel's plan to cover their costs of moving out of the lower two channels of the existing 2 GHz broadcast auxiliary services (BAS) band. Now it looks as if the Nextel proposal, which has the support of the Association of Maximum Service Television (MSTV), the National Association of Broadcasters (NAB) and the the Society of Broadcast Engineers (SBE), is in trouble. Friday evening, on the public broadcasting program "Nightly Business Report," commentator Paul Kangas, in his "Stocks in the News" segment reported that "Friedman Billings brokerage downgraded Nextel from outperform to market perform after FCC Chairman Michael Powell withdrew his support for giving the company a coveted sector of the spectrum."

Under Nextel's plan, in exchange for covering the cost of moving broadcasters out of the two lower 2 GHz channels and receiving a portion of that spectrum, Nextel would move out of the 800 MHz band, where it has had trouble with interference to public safety communications. More details on the plan are available in the May 10, 2004 RF Report.

The opposition is coming from the Cellular Telecommunications and Internet Association (CTIA). The CTIA proposed an 800 MHz compromise in late April, which it said provides "more than a three-fold increase in funds for public safety over the `Consensus' Plan and grants Nextel 10 MHz of spectrum at 2.1 GHz." This is the same spectrum Nextel requested in its first 800 MHz transition plan. This inconsistency on Nextel's part seems to be one of the items raising concern at the FCC. The CTIA response to Nextel's plan was detailed in a May 19 letter to FCC Chairman Michael Powell, with copies to the Commissioners. Then, the May 21 issue of "CTIA Daily News" said news sources had reported that FCC Chairman Michael Powell "retracted the vote he made in March supporting Nextel's public safety swap proposal."

The CTIA letters were in response to a May 14 letter from Nextel, detailed in a press release entitled "Nextel Competitors Embrace Key Elements of Consensus Plan; Realignment of 800 MHz Band to Solve Public Safety Radio Interference". In the release, Nextel said the FCC had legal authority to assign replacement spectrum to Nextel without auction, and that CTIA and Verizon omitted material information on current 2.1 GHz licenses.

"A review of FCC licensing databases revealed that approximately 70 percent of the incumbent licensees at 2165 - 2180 MHz are cellular carriers, i.e., Verizon Wireless, Cingular Wireless, AT&T Wireless, Alltel, Sprint and US Cellular - the most vocal proponent's of assigning inferior replacement spectrum at 2.1 GHz to Nextel," the release stated. "Verizon and Cingular and AT&T Wireless alone hold licenses for approximately 40 percent of the microwave links, and this percentage holds true for each of the three potential 2.1 GHz replacement downlink blocks: 2165 - 2170 MHz, 2170 - 2175 MHz and 2175 - 2180 MHz. Nextel's competitors now are advocating assigning inferior replacement spectrum to Nextel that would give them the opportunity to directly affect the cost and timing of clearing the 2.1 GHz spectrum band. Recently obtained data once again reveals the true motive behind both CTIA and Verizon - to place Nextel at a competitive disadvantage."

The Washington Post has extensive coverage of the battle in "Nextel Lobbies for Bigger Share of Cellular Space" and "FCC Backs Off Nextel Plan For New Spectrum". It noted each side in the battle has voted to sue if the FCC decision, which was expected in early June, does not go its way. Free registration is required to view articles in The Washington Post.