A small carriers organization, though, is fighting to try to sway other commissioners to reject the deal

In an unusually cooperative spirit, telecommunications companies AT&T, Inc. (T) and Sirius XM Radio Inc. (SIRI) found a way to iron out interference concerns regarding an AT&T spectrum repurposing plan. This has enabled the U.S. Federal Communications Commission to move towards a quick and easy approval.

I. A Quick Fix

Unlike some mobile spectrum plans, à la bankrupt satellite LTE firm LightSquared's disastrous plan, AT&T's plan involved applying spectrum that was designed for wireless operation.  Namely, AT&T wanted to repurpose 20 MHz of spectrum in the 2.3 GHz Wireless Communications Services (WCS) band to boost its LTE (4G) offerings.

The issue was that despite being purpose-built for wireless communications, the high power of LTE communications meant that the neigboring band -- occupied by Sirius XM's satellite radio service -- would be interfered with whenever someone nearby was placing a call.  In that way the plan shared a somewhat analogous roadblock to the LightSquared plan's concerns.

AT&T glass
AT&T hopes to boost its LTE network next year with WCS spectrum.
[Image Source: Reuters/Shannon Stapleton]

But since the the spectrum was wireless-geared, AT&T was able to figure out a solution, which the two companies tested and verfied to work.  AT&T's plan is actually remarkably simple -- it will divide the 20 MHz into four blocks ("A","B","C", and "D"), each with 5 MHz.  The C and D blocks neighbor Sirius XM's offerings, so AT&T promised to not use them, essentially providing a buffer to prevent interference.

The pair found that the A and B blocks could then be used safely without significant intereference concerns.

The solution leaves AT&T with half its original spectrum in the band, but considering the deployment was stalled for 15 years, it's easy to see why that's a concession AT&T would be willing to make.  After all, some spectrum is better than no spectrum.

II. FCC Commissioner Loves the Deal, but Small Carriers Complain

FCC chairman Julius Genachowski has plugged the compromise, with his office telling GigaOm:

Today’s action is part of Chairman Julius Genachowski’s continued efforts to remove regulatory barriers that limit the flexible use of spectrum, which is one way he has led the Commission towards helping address the continued ‘spectrum crunch.’ By unleashing 20 megahertz of spectrum now – and up to 30 megahertz in the future – the Chairman continues to leave no stone unturned when it comes to maximizing opportunities to refill the mobile spectrum pipeline that had begun to run dry over the last decade. In addition to removing regulatory barriers, the Commission continues to push ahead on innovative spectrum solutions in addition to traditional auctions, including incentive auctions, government-commercial sharing, technology-based opportunities like small cells, and freeing up unlicensed spectrum for innovations like Wi-Fi.

His office is suggesting approval, hence the repurposing will likely get the blessing of the U.S. regulatory agency.  

Julius Genachowski
FCC Commish Genachowski gave the repurposing compromise his thumbs up.
[Image Source: JD Lasica/]

The only thing standing in the way is the Competitive Carrier Association (formerly the Rural Carrier Association), an advocacy representing smaller U.S. carriers.  Its CEO and President Steve Barry alleges that after AT&T's prospective purchase of Deutsche Telekom AG (ETR:DTE) subsidiary T-Mobile USA failed, AT&T turned to snatching up dozens of WCS, AWS (advanced wireless services), and 700 MHz band spectrum licenses from smaller players.

Mr. Barry says approving AT&T's use of these licenses will create an anticompetitive market and limit consumer selection.  He writes in a press release, "Allowing the largest carriers to obtain unlimited amounts of spectrum on the secondary market raises serious competitive concerns.  The only way for the FCC to truly see the devastating consequences of further spectrum aggregation is by consolidating the proposed applications.  On their own, AT&T’s proposed license acquisitions may not seem significant, but when added together, it totals to a significant amount of spectrum."

But for his attempt to sink the approval to be a success, he'll likely have to convince the remaining four commissioners, given Chairman Genachowski's support for the AT&T/Sirius XM compromise.

Sources: GigaOm, Competitive Carrier Assoc.

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