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Chairman Michael Powell has recommended to fellow
commissioners that the FCC award 10 MHz of spectrum in the 1.9 GHz band to
Nextel Communications, the Wall Street Journal reported today.
The award would be part of a deal that would require
Nextel to reband 800 MHz airwaves to solve interference problems that plague
public-safety communications. The other FCC commissioners are expected to
unanimously approve the award, the paper said.
Such an award will almost immediately be challenged in
court. Nextel rival Verizon Wireless has vowed repeatedly to file suit,
claiming that current telecommunications law prevents the FCC from awarding
spectrum outside of an auction.
The commission believes it has such authority because it
would be modifying an existing license, not granting a new one.
Verizon believes Nextel would receive an unwarranted
windfall should it receive the 1.9 GHz airwaves -- which Verizon claims are
worth a minimum of $5 billion -- and has suggested an award of 2.1 GHz
airwaves as an alternative.
Nextel, in its initial white paper on solving 800 MHz
interference, previously said it would accept an award of 2.1 GHz spectrum,
but now says its use of the airwaves today would be technologically
unfeasible and cost-prohibitive because of changes in FCC rules that govern
the use of those airwaves.
In addition, Nextel claims the spectrum it would provide
to public-safety in the deal, the cost it would incur to reband the 800 MHz
airwaves, and the value of spectrum it would clear in the 1.9 GHz band in a
deal with broadcasters -- airwaves the FCC could then auction -- would
result in a packages worth $5.4 billion, which would be in line with the
projected value of the 1.9 GHz spectrum it stands to receive, if that
spectrum were to be auctioned.
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