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Common Ground: The Spectrum Wars Trilogy

By | August 1, 2002

      by Richard DalBello

      Not to be outdone by George Lucas, the FCC is working on its own blockbuster trilogy this summer. You might call it The Spectrum Wars. Though its budget is hardly up to Hollywood standards, the FCC is out to make a big statement with its examination of three pending applications for terrestrial re-use of satellite spectrum.

      As the satellite and terrestrial wireless markets have evolved over time, the demand for spectrum has increased and the regulatory issues associated with those services have grown more complex. In a number of instances, satellite and terrestrial wireless technologies are locked in a struggle over the same spectrum resources. The conflict has tended to revolve around three critical issues–auctions, the rights of the primary licensee and interference. In 2000, Congress exempted international satellite services from the auction rules that have governed spectrum allocations. This fact has caused significant tension between the two families of wireless services. In addition, the increasingly noisy radio environment has raised fundamental new questions about the rights of licensees and the responsibilities of those causing interference.

      These complex issues have been the driving force behind the examination of three disparate spectrum-sharing conflicts:

      Episode 1–Satellite Radio–In the early ’90s, satellite Digital Audio Radio Services (DARS) began to attract the interest of Wall Street. After considerable deliberation, the FCC allocated DARS spectrum via competitive auction in 1997.

      A major technical challenge remained–how to provide service in the heart of cities where deep urban canyons would block satellite signals. The DARS industry proposed to solve this problem by constructing a network of terrestrial repeaters to rebroadcast their signal. In 2001, the FCC granted Special Temporary Authority for the two DARS companies to operate these terrestrial networks.

      The National Association of Broadcasters opposed satellite radio’s operation of terrestrial repeaters on the grounds DARS providers might offer local broadcasting via the terrestrial network and compete with terrestrial local radio stations. Terrestrial wireless services opposed it on the grounds that DARS operation would create unacceptable interference. In response, the FCC has recently proposed a compensation schedule for DARS interference in these bands. Final operating rules for the satellite radio operators are scheduled to be released sometime this summer.

      Problems notwithstanding, the DARS proposals highlight the advantages that can be gained through hybrid use of spectrum for satellite and terrestrial purposes. It is curious to note that although interference and competition issues came to the fore in this discussion, there was no significant challenge to the concept that terrestrial repeaters could be employed to rebroadcast a satellite-originated signal.

      Episode 2–Return of the Mobile Satellite Industry–When the mobile satellite industry came tumbling down in the late ’90s, investors and manufacturers began to look for new ways to profit from the remarkable technologies they had created. In response to this challenge, the industry turned to the DARS paradigm and began examining satellite-terrestrial hybrid networks. Proponents sought to combine the ability of cellular communications to serve densely populated areas with the ubiquitous coverage of satellite systems. This controversial proposal generated a good deal of excitement and opposition. Some satellite operators argued that harmful interference was inevitable. Terrestrial opponents charged that hybrid systems were merely an end-run around the expensive auction process. Spectrum that is used terrestrially, they argued, should be sold at auction with all interested parties participating. Not so, responded the mobile satellite industry–the terrestrial reuse proposed would be an integrated part of the satellite service and therefore should not be auctioned.

      Mobile satellite operators maintain, as in the DARS example, that a single entity is needed to operate both the terrestrial and satellite component of spectrum. Although, unlike DARS, the proposal for the terrestrial re-use of satellite spectrum for mobile services met an immediate and stiff challenge from potential terrestrial competitors.

      Episode 3–Terrestrial Reuse of DBS Spectrum–In a surprising reversal of roles, the satellite industry recently found its spectrum under attack by a terrestrial service that proposed to offer video and Internet services by operating terrestrially in the DBS spectrum band. This time, however, it was the DBS industry that argued auctions should be mandatory. (Unlike the mobile satellite industry, most DBS spectrum was acquired at auction.) In one of those “only in Washington” moments, the terrestrial service providers argued that it was inappropriate to auction the spectrum because–you guessed it–it was satellite spectrum. The FCC rejected that argument and the spectrum will be sold at auction on a geographic basis.

      As a result, these new services will share the 12 GHz band with the DBS and NGSO-Fixed Satellite Services on co-primary, but non-interfering, basis subject to service and technical rules.

      So what does it all mean and where is the FCC going with this terrestrial reuse concept? The FCC is not even clear about that. Recently, the FCC Chairman announced the creation of a Spectrum Policy Task Force to help the agency take a fresh look at this and other complex spectrum issues. With these new screenwriters in place, I think we can all be assured of an exciting, action-packed, big-budget conclusion to The Spectrum Wars Trilogy.

      Richard DalBello is the executive director of the Satellite Industry Association. His e-mail is

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