Channel Exclusivity to Qualified Private Paging Systems at 929- 930 MHz

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 90

[PR Docket No. 93-35; FCC 96-53]

Channel Exclusivity to Qualified Private Paging Systems at 929-

930 MHz

AGENCY: Federal Communications Commission.

ACTION: Final Rule.

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SUMMARY: In this Memorandum Opinion and Order, the Commission reviews

six petitions for reconsideration and/or clarification of the PCP

Exclusivity Order in this docket establishing channel exclusivity for

qualified local, regional, and nationwide paging systems in the 929-930

MHz band, and grants the petitions in part and denies them in part. The

petitions requesting exclusivity to regional 929 MHz systems in regions

defined by state borders, rather than based on their actual service

areas, are denied. The petitions that seek to increase the maximum

transmitter power for local and regional systems are granted.

Additionally, the Commission partially grants certain pending waiver

requests of incumbent licensees seeking additional time to comply with

multi-frequency transmitter specifications. The intended effect of this

order is to affirm that exclusivity to regional 929 MHz systems is

granted based on the service area as set forth in the PCP Exclusivity

Order and to amend the rules to facilitate the rapid and efficient

licensing of paging in the 929-930 MHz band. These amendments to the

regional channel exclusivity scheme established in the PCP Exclusivity

Order will facilitate the development of seamless, wide-area 900 MHz

paging systems.

EFFECTIVE DATE: April 4, 1996.

FOR FURTHER INFORMATION CONTACT: Mika Savir, Commercial Wireless

Division, Wireless Telecommunications Bureau, at (202) 418-0620.

SUPPLEMENTARY INFORMATION: This Memorandum Opinion and Order in PR

Docket No. 93-35; RM Docket 7986, adopted February 8, 1996, and

released February 13, 1996, is available for inspection and copying

during normal business hours in the FCC Dockets Branch, Room 230, 1919

M Street N.W., Washington D.C. The complete text may be purchased from

the Commission's copy contractor, International Transcription Service,

Inc., 2100 M Street N.E., Suite 140, Washington D.C. 20037 (202) 857-

3800.

Synopsis of Memorandum Opinion and Order

I. Introduction

Before the Commission are six petitions for reconsideration and/or

clarification of our PCP Exclusivity Order, Amendment of the

Commission's Rules to Provide Channel Exclusivity to Qualified Private

Paging Systems at 929-930 MHz, Report and Order, PR Docket No. 93-35,

58 FR 62289 (November 26, 1993) (PCP Exclusivity Order), establishing

channel exclusivity for qualified local, regional, and nationwide

paging systems in the 929-930 MHz band. After reviewing the issues

involved, the Commission grants the petitions in part and denies them

in part. In particular, the Commission denies petitions requesting that

exclusivity be granted to regional 929 MHz systems in regions defined

by state borders, rather than based on their actual service areas. The

Commission partially grants those petitions that seek to increase the

maximum transmitter power for local and regional systems. The

Commission also partially grants certain pending waiver requests of

incumbent licensees seeking additional time to comply with the multi-

frequency transmitter specifications. The Commission otherwise affirms

the rules governing 929 MHz private paging as adopted in the PCP

Exclusivity Order.

Additionally, the Commission is adopting a Notice of Proposed Rule

Making in WT Docket No. 96-18, 61 FR 6199 (February 16, 1996) to

examine ways to promote continued growth of the paging industry. In the

Notice of Proposed Rulemaking, the Commission proposes to adopt new

rules providing that future licensing of all exclusive paging channels,

including 929 MHz channels, will be based on market-defined service

areas, with mutually exclusive applications to be resolved by

competitive bidding. Therefore, the conclusions reached in this

Memorandum Opinion and Order are subject to future modification based

on

[[Page 8479]]

the outcome of the comprehensive paging rulemaking.

II. Background

PCP Exclusivity Order. In the PCP Exclusivity Order, the Commission

implemented a system of exclusive licensing for qualified local,

regional, and nationwide 929 MHz private paging systems on 35 of 40

available channels. Prior to this action, all private paging

frequencies, including those at 929 MHz, were assigned on a non-

exclusive basis. The PCP Exclusivity Order concluded that enabling 929

MHz paging systems to operate on an exclusive basis is in the public

interest, due to the efficiencies and incentives such an approach

encourages in the marketplace. Specifically, the Commission indicated

that continued sharing of frequencies would undermine efficient use of

929 MHz paging channels as demand for paging services expands in the

future. The Commission observed that, while sharing is technically

feasible, dividing air time among multiple licensees imposes

significant constraints on the efficiency and quality of service in

crowded markets. The Commission also indicated that in a shared

environment, licensees are reluctant to invest in advanced paging

technology because of the risk that others will be assigned to the same

frequency in the future. The Commission concluded that exclusivity

would create a stable, predictable environment necessary for the

industry to attract investment in wide-area, high capacity paging

systems in the 929-930 MHz band.

The PCP Exclusivity Order established the requirements for

licensees to obtain channel exclusivity in the 929 MHz band. In

particular, the Commission established minimum standards for the

configuration of protected systems, including the number of

transmitters required for local, regional, and nationwide systems, and

the treatment of multi-frequency transmitters. The Commission also

implemented geographic separation standards for placement of co-channel

stations, to protect qualified local or regional systems, and

established effective radiated power (ERP) limits for all such systems.

The PCP Exclusivity Order also set forth other prerequisites to

obtaining exclusivity. Most notably, the Commission conditioned

exclusivity on construction of a qualified system within eight months

of licensing. For larger systems, the Commission indicated that a new

applicant may request an extension of up to three years, based on its

showing of need, a construction timetable, and its establishment of an

escrow account or securing of a performance bond to cover construction

costs. Other matters addressed in the PCP Exclusivity Order include

issues associated with application of exclusivity to existing systems

and to future licensing, and certain transitional procedures. In

particular, the Commission grandfathered all existing systems and

indicated that it would grant immediate exclusivity to existing systems

that satisfied the new exclusivity criteria.

Petitions for Reconsideration/Waivers. The Commission received

petitions for reconsideration of the PCP Exclusivity Order from the

following businesses and organizations: (1) the National Association of

Business and Educational Radio and its Association for Private Carrier

Paging Section (NABER); (2) First American National Paging (First

National); (3) Afro-American Paging, Inc. (AAP); (4) American

Mobilephone, Inc. (AMI); (5) Paging Network, Inc. (PageNet); MAP Mobile

Communications, Inc. (MAP); and (6) Metrocall, Inc. The Commission has

sought and received comment on the issues raised by these petitions.

Some parties also have filed petitions asking that various provisions

of the new exclusivity rules be waived to accommodate specific hardship

situations. These requests generally involve waiver of the construction

requirements, ERP limits, or system configuration rules. For the most

part, the Commission will decide these waiver requests in other

proceedings. The Commission partially grants the waiver requests of

certain grandfathered licensees seeking time to convert their systems

from multi-frequency transmitter to single-frequency transmitter

operations for exclusivity purposes.

III. Discussion

A. Configuration of Local Systems

Background. To qualify for channel exclusivity under the 929 MHz

paging rules, the PCP Exclusivity Order provided that a local system

must consist of at least six contiguous transmitters, except in the New

York, Los Angeles, and Chicago markets, where 18 contiguous

transmitters are required. The Commission also provided that

transmitters will be considered contiguous if (1) each transmitter is

located within 25 miles of at least one other transmitter in the

system; (2) the combined area defined by a 12.5 mile radius around each

transmitter forms a single contiguous area; and (3) no transmitter is

co-located with any other transmitter being counted as part of the

local system.

Petitions for Reconsideration/Comments. On reconsideration, AAP

challenges Section 90.495 (a)(1)(ii) of the rules, as adopted in the

PCP Exclusivity Order, which requires that a 12.5 mile radius

surrounding each transmitter form a single contiguous area. AAP argues

that there was no notice of this rule change, because the restriction

was not part of our original proposal and is not a logical outgrowth of

the PCP Exclusivity Notice, Amendment of the Commission's Rules to

Provide Channel Exclusivity to Qualified Private Paging Systems at 929-

930 MHz, Notice of Proposed Rulemaking, PR Docket No. 93-35, 58 FR

17819 (April 6, 1993) (PCP Exclusivity Notice). AAP claims that as a

result of the added 12.5 mile radius requirement, one of its systems

now is disqualified from obtaining exclusivity. AAP contends that if it

is the Commission's goal to confine systems to smaller geographic

areas, a 15 mile radius standard is more equitable. The Commission has

received no comments on AAP's reconsideration proposal.

Decision. The Commission will not eliminate or alter the

requirement for local exclusivity that requires that a 12.5 mile radius

surrounding each transmitter form a single contiguous area. The 12.5

mile rule is a necessary component of the exclusivity rules, because it

ensures that a local system will serve a contiguous geographic area.

Without such a requirement, licensees could obtain local exclusivity

based on non-contiguous placement of transmitters, undermining the

Commission's effort to establish truly local systems serving an

indigenous locale or community. Proportionately, the 12.5 mile distance

is one-half the distance of the 25 mile rule, and thereby works well to

ensure that transmitters are located to serve a single contiguous

geographic territory.

While the 12.5 mile rule was not expressly included in the PCP

Exclusivity Notice, the Commission believes that this restriction

nonetheless is a ``sufficiently minor'' difference from the rule

proposed to be a ``logical outgrowth'' of the Commission's efforts to

establish a system of local exclusivity. The PCP Exclusivity Notice

sought comment on the configuration of locally protected systems.

Specifically, the Commission proposed that each transmitter in a

qualified system would have to be within 25 miles of another

transmitter to count toward the number required for exclusivity.

Incorporation of the 12.5 mile restriction in the final rules

constitutes a minor, technical

[[Page 8480]]

change to the original proposal, which is necessary to ensure that

local exclusivity is awarded to operators that locate transmitters in

close proximity to one another within a system. The 12.5 mile rule

effectively closes a loophole in the original proposal, and comports

with the Commission's intent to create local paging systems in the 929-

930 MHz band. Only AAP has objected to the change, apparently based on

its own unique situation, that one of its transmitters is 13.2 miles

from the nearest other transmitter, which is best resolved by a request

for waiver.

B. Configuration of Regional Systems

Background. The PCP Exclusivity Order provided protection for

exclusive regional systems based on the location of stations comprising

the system. To qualify for exclusivity, a regional system must consist

of 70 or more transmitters, not necessarily contiguous, located in no

more than twelve adjacent states in the continental United States. The

rules provide regional systems with exclusivity based on a prescribed

separation distance around each of the regional licensee's stations,

ranging from 112 to 187 kilometers (70 to 116 miles) depending on the

class of the station. Also, in each of the top thirty markets,

specified in Section 90.741 of the Commission's rules, no transmitter

may be counted as part of a regional system unless it also meets the

requirements for local exclusivity in that market. Petitions for

Reconsideration/Comments. NABER and PageNet argue that the geographic

scope of exclusivity granted to 929 MHz regional systems should be

based on state borders, rather than the location of the system's

stations. According to NABER, allowing regional paging systems

statewide exclusivity in each state in which the system provides

service is needed to promote the development of regional systems. NABER

and PageNet also express concern that under the current rules,

speculators can file applications in strategic locations designed

solely to extract payment from regional systems seeking to expand their

coverage. NABER therefore recommends that the Commission grant regional

applicants (i.e., applicants proposing a system of 70 or more

transmitters) exclusivity extending to the borders of any state in

which the applicant constructs at least one transmitter, except that in

states having markets listed among the top 30, the applicant must

construct six or 18 transmitters, depending on the size of the market.

NABER also requests that the Commission permit regional licensees to

locate transmitters anywhere within any state included in the system,

as long as they maintain the required geographic separation from

facilities in adjoining regions.

AMI and ADC express concern about the application of NABER's

proposal to licensees who are entitled to regional exclusivity under

our existing rules. In general, these commenters are opposed to any

change that would result in divesting licensees of existing exclusivity

rights. ADC suggests that the Commission not apply statewide

exclusivity to licensees whose applications (including those for local

exclusivity) were received by NABER for coordination on or before March

31, 1994, at least where a portion of the involved local system was

constructed and in operation before October 14, 1993.

ARCH, API, and Airtouch, on the other hand, favor statewide

exclusivity for licensing as proposed by NABER and PageNet. According

to these commenters, permitting licensees to achieve exclusivity on a

statewide basis is essential to the development of truly regional

systems. Airtouch and ARCH believe AMI and ADC's opposition to

statewide exclusivity stems from the unique market situation of these

licensees, and contend that the appropriate remedy for AMI and ADC is a

waiver, not a decision to retain the status quo.

Decision. The Commission declines to reconsider the rules defining

regional exclusivity for 929 MHz regional systems in this proceeding.

The Commission is considering the issue of revising the paging

licensing area definitions in a separate Notice of Proposed Rule Making

on market-area licensing. Under the market-area licensing proposal,

paging systems in general, including 929 MHz systems, no longer would

be licensed on a station-by-station basis. Instead, licensees would be

licensed within Commission-defined service areas, and would be afforded

the same flexibility, to the extent feasible, as cellular and PCS

licensees to locate, design, construct, and modify system facilities

throughout those areas. Because the Commission is addressing this issue

in a broader context than 929 MHz paging alone, it is premature to

modify the rules for this single category of paging service in response

to NABER's reconsideration petition.

Moreover, the Commission is not persuaded that paging licensing

areas should be based on state borders, as NABER proposes. In all other

services where Commission-defined licensing areas have been adopted, as

opposed to station-by-station licensing, the Commission has used

licensing area definitions based on economic markets or trading areas

(e.g., MSAs/RSAs for cellular, and MTAs/BTAs for PCS and 900 MHz SMR).

By contrast, using state borders would create licensing areas with

political boundary lines which do not necessarily correspond to

economic markets or trading areas and, in some instances, which may cut

across them. The Commission therefore concludes that the status quo

should prevail while alternative licensing area definitions more

consistent with our approach in other services are considered.

C. Effective Radiated Power

Background. In the PCP Exclusivity Order, the Commission

established effective radiated power (ERP) limits of 1000 watts for

local and regional 929 MHz systems and 3500 watts for nationwide

systems. The Commission noted that the 3500 watt limit for nationwide

systems was the same as the limit for nationwide common carrier paging

systems in the 931 MHz band. The Commission declined to adopt a 3500

watt limit for non-nationwide systems, notwithstanding the fact that

the Part 22 rules then in effect allowed 931 MHz non-nationwide common

carrier licensees to operate internal system sites at 3500 watts. The

Commission reasoned that higher power limits for 931 MHz licensees were

justified because demand for 931 MHz licenses largely was confined to

expansion by existing systems. The Commission concluded that a 1000

watt maximum for 929 MHz non-nationwide systems was appropriate to

preserve opportunities for entry by new systems.

Petitions for Reconsideration/ Comments. NABER and PageNet request

that the Commission increase the maximum ERP for 929 MHz regional

systems from 1000 watts to 3500 watts, provided that adjacent co-

channel systems remain protected. NABER claims that, in the context of

the statewide regional licensing scheme it has proposed, a 3500 watt

power limit would not restrict opportunities for the entry of new

systems into the market, which was the reason the Commission rejected a

3500 watt ERP previously. According to NABER and PageNet, use of high-

power transmitters within the boundaries of a regional system will

enable licensees to offer superior service at a lower cost. Celpage,

ARCH, Airtouch, and API support NABER's proposal.

MAP seeks clarification on whether the 1000 watt ERP restriction

applies only to facilities that define the exterior of the licensee's

service area, and whether higher power facilities are

[[Page 8481]]

permitted at internal sites within existing service areas. MAP observes

that 931 MHz common carrier paging licensees are permitted to operate

at 3500 watts ERP at internal sites within their service areas. MAP

asserts that principles of regulatory parity require us to apply the

same rule to private paging systems. The Commission received no

comments on MAP's request for clarification.

Decision. Except in certain limited circumstances discussed below,

the Commission declines to raise the maximum ERP for non-nationwide 929

MHz systems at this time. NABER's proposal to raise the ERP limit is

premised on the Commission adopting its proposal to base regional

exclusivity on state borders, rather than site location. The Commission

has declined to reconsider the definition of regional exclusivity,

therefore NABER's rationale for raising the ERP limit does not apply.

The Commission's decision on this issue does not preclude future

changes to the rules if the Commission adopts some form of market-based

licensing for 929 MHz channels. The Commission seeks further comment on

height and power limits for common carrier and private carrier paging

in the Notice of Proposed Rule Making.

The Commission agrees with commenters that under certain

circumstances, allowing local and regional 929 MHz licensees to operate

at greater than 1000 watts ERP may be appropriate. Specifically, if

operation of sites at a higher power would not expand a licensee's

existing service-area contour, there is no reason to prohibit operation

at such higher power. The Commission will modify the rules to allow

non-nationwide licensees to operate sites within their existing service

area at up to 3500 watts ERP, provided that such operation does not

increase the minimum geographic separation applicable to co-channel

systems under Section 90.495(b)(2) of the Commission's rules. This will

give licensees greater flexibility to build technically and

economically efficient systems, without compromising opportunities for

co-channel entry in areas adjacent to those systems.

D. Slow Growth Eligibility

Background. In the PCP Exclusivity Order, the Commission adopted

rules allowing for so-called ``slow growth'' extensions of the eight-

month construction requirement for larger system applicants.

Specifically, for applications filed after October 14, 1993, a period

of up to three years may be authorized for construction and

commencement of operations if the proposed system is composed of more

than 30 transmitters and the applicant submits specific justification

for an extended implementation period. Applicants must provide a

detailed construction timetable and evidence of the ability to fund

construction, either in the form of a construction escrow account or a

performance bond covering construction costs.

Petitions for Reconsideration/Comments. NABER, PageNet, Metrocall,

First National Paging, and AMI challenge the Commission's decision to

make the three-year slow-growth option available only to post-October

14, 1993 paging applicants. NABER contends that the Commission did not

provide adequate notice of the rule, because the PCP Exclusivity Notice

did not expressly propose to limit the slow growth option to new

applicants. According to NABER, the restriction has a detrimental

impact on existing licensees because of the added construction demands

posed by the Commission's treatment of multi-frequency transmitters

under the exclusivity rules. AMI suggests that slow-growth eligibility

be extended to licensees who filed for exclusivity after the March 31,

1993 release date of the PCP Exclusivity Notice, rather than limited to

applicants filing after the October 14, 1993 date established in the

PCP Exclusivity Order. According to AMI, there is no link between the

October 14, 1993 date and the decision by any affected licensee to

rebuild its facilities.

Commenters generally support extending the slow growth option to

grandfathered licensees on the grounds that additional construction

time is needed for incumbents to transition to our new system of

channel exclusivity. Celpage, however, is concerned about the treatment

of licensees who relied on single-frequency, as opposed to multi-

frequency, transmitters. Celpage does not want operators that decided

to build dedicated facilities at each licensed site, rather than to

rely on inter-carrier agreements allowing them to utilize other

licensees' dual-frequency transmitters, to be penalized under an

extended transition period. Celpage therefore seeks reinstatement of

certain ``single use'' transmitter licenses, whose authorizations

expired while the exclusivity rules were under consideration. Arch and

Airtouch support a slow growth period for existing licensees, but argue

that the bond and escrow requirements for new construction should not

apply in such cases.

Decision. The Commission will not change the rules to make pre-

October 14, 1993 applicants automatically eligible for the extended

implementation construction schedule. October 14, 1993, the date of the

Sunshine Notice on the PCP Exclusivity Order, is the cutoff date for

slow growth eligibility. The Commission will deny slow growth

extensions to grandfathered licensees generally. As of our Sunshine

Notice on October 14, 1993, applicants reasonably could anticipate that

the Commission was going to adopt channel exclusivity rules for 929-930

MHz paging licensees. To deter speculative filings, therefore, the

Commission decided not to grandfather anyone that filed after October

14, 1993. The date for dividing ``old'' from ``new'' applicants also is

the appropriate date for triggering slow growth eligibility. Moreover,

the Commission never suggested that slow growth extensions would apply

to grandfathered licensees. Indeed, in an April 6, 1993 Order,

Amendment of the Commission's Rules to Provide Channel Exclusivity to

Qualified Private Paging Systems at 929-930 MHz, Order, PR Docket No.

93-35, 58 FR 21111 (April 19, 1993) (Order), the Commission indicated

that all parties in the application and coordination process were

expected to comply with existing eight-month construction requirements

while the rule making was underway. Consequently, applicants falling

into the grandfathered category cannot legitimately claim that they

expected to be eligible for slow growth extensions.

E. Multi-Frequency Transmitters

Background. In the PCP Exclusivity Order, the Commission considered

the issue of whether licensees should be allowed to count multi-

frequency transmitters for exclusivity purposes on more than one

channel. The Commission concluded that licensees should not be barred

from using multi-frequency transmitters, but that each such transmitter

would be counted only once for exclusivity purposes. This requirement

was to ensure that licensees would not claim exclusivity on multiple

channels by repeatedly counting the same transmitter. The Commission

noted that a licensee using multi-frequency transmitters could qualify

for exclusivity on two frequencies by constructing twice the number of

transmitters required to obtain one channel.

Petitions for Reconsideration/Comments. Several parties urge the

Commission to relax the ``single-count'' rule to accommodate incumbent

licensees who had constructed systems based on multi-frequency

transmitters prior to the adoption of the PCP Exclusivity Order. NABER

argues that these licensees need time to construct

[[Page 8482]]

sufficient single-frequency transmitters to comply with the exclusivity

requirements on a single-count basis. PageNet suggests that existing

licensees be given two years from the time they qualify for earned

exclusivity to make this conversion. First National Paging suggests

establishing a reasonable transition period for incumbent licensees,

beyond the existing eight-month construction requirement.

In addition to reconsideration petitions on this issue, the

Commission has received waiver requests from Arch, Comtech, First

National Paging, Metrocall, Airtouch, and Message Center Beepers. At

the time the PCP Exclusivity Order became effective, each of these

petitioners was operating systems on dual channels using multi-channel

transmitters. The number of transmitters in place in each system is

sufficient to qualify for regional or nationwide exclusivity on one

channel, but under the single-count rule petitioners would be required

to construct additional sites to obtain protection for their operations

on the second channel. Because their construction plans prior to the

PCP Exclusivity Order relied on use of dual-channel transmitters,

petitioners request twenty-four months rather than eight months to

reconfigure their systems and construct additional sites to meet the

requirements of the single-count rule.

Decision. The Commission declines to modify the general rule that

no transmitter may be counted more than once for exclusivity purposes.

This rule prevents the potential hoarding of multiple frequencies, by

requiring paging licensees seeking more than one exclusive frequency to

meet a higher construction threshold. Licensees may continue to use

multi-frequency transmitters in their systems, but exclusivity will be

conferred on multiple channels only if the total number of transmitters

is sufficient to qualify for exclusivity on each channel on a single-

count basis.

The Commission will grant some additional time to those

grandfathered licensees who have filed waiver requests to bring

existing systems into compliance with the single-count rule. Prior to

the adoption of the PCP Exclusivity Order, these licensees had embarked

on construction and operation of substantial systems relying on dual-

frequency transmitters. The adoption of the single-count rule required

these licensees to modify their plans to add additional transmitters in

order to gain full exclusivity protection for their existing systems.

The Commission believes that a reasonable time should be afforded to

petitioners to make this adjustment. The Commission notes that the risk

of allowing hoarding of frequencies is not present here, because the

systems at issue already are grandfathered on both channels,

petitioners substantially have constructed their systems and are

providing service to the public on a dual-channel basis, and the

additional construction needed will promote increased coverage and

better quality service.

The petitioners filed their initial requests for a twenty-four

month construction period in early 1994. Since that time, petitioners

have had substantial opportunity to construct additional facilities on

a single-frequency transmitter basis to bring their systems into

compliance. The Commission concludes that because of this elapsed time,

petitioners should be granted an amount of time consistent with their

original estimate of the time required to bring their systems into

compliance. The Commission grants Arch, Comtech, First National Paging,

Metrocall, Airtouch, and Message Center Beepers until six months after

the publication date of this Memorandum Opinion and Order in the

Federal Register to demonstrate that their grandfathered systems

qualify for exclusivity on a single-count basis.

F. Modification of Existing Systems

Background. In the PCP Exclusivity Order, the Commission concluded

that all existing 929 MHz licensees should be grandfathered under the

new rules whether or not they qualified for exclusivity. Thus,

incumbent systems that did not qualify for exclusivity would be allowed

to continue operating their existing facilities, and any licensee

granted exclusivity on the same channel in the same area would be

required to share the channel with the grandfathered system.

Grandfathered systems would not be allowed to add new facilities to

their systems, however, if such expansion conflicted with exclusivity

rights granted to another licensee.

Petitions for Reconsideration/ Comments. MAP contends that the

Commission should allow grandfathered licensees who do not qualify for

exclusivity to modify their existing systems in order to continue

service to subscribers. MAP argues that allowable modifications should

include changes in the number of paging receivers, type of emission,

antenna height, power, class of station, ownership or corporate

structure, and location of existing facilities. API opposes MAP's

proposal. API believes that minor and reasonable modifications to

existing facilities should be allowed, but that other changes should

not be permitted, particularly if the effect is to diminish or impair

the development of a co-channel system which already has qualified for

exclusivity in the same area. MAP replies that it is not asking to

expand the rights of grandfathered licensees, but only is seeking a

clarification of the types of ``minor'' modifications that the FCC will

allow. MAP does not want the rules interpreted in a manner that hampers

the ability of existing licensees to improve service, respond to

customer needs, and adjust to business changes.

Decision. The rules provide that grandfathered licensees who do not

qualify for exclusivity may make modifications to existing facilities

that do not impair the exclusivity rights of co-channel licensees or

otherwise violate our rules. There is no reason to change this rule,

based on MAP's petition. This issue is raised more broadly in the

Notice of Proposed Rule Making in WT Docket No. 96-18. Therefore, the

Commission will defer additional consideration of the issues raised by

MAP to that proceeding.

G. Miscellaneous

In the PCP Exclusivity Order, the Commission addressed the issue of

conditional operation of 929-930 MHz stations located above ``Line A,''

i.e., within 250 miles of the Canadian border. Noting that a 1992

agreement between the Commission and Canada's Department of

Communications had eliminated the need for international coordination

of these channels, the Commission stated that it would allow operation

of 929 MHz stations above Line A, provided all other requirements of

the rules are met. Some licensees have misconstrued this language in

the PCP Exclusivity Order to open all channels in the 929-930 MHz band

to operation by U.S. licensees above Line A. In fact, the 1992 U.S.-

Canada agreement provides that only channels between 929.5 and 930 MHz

may be used by U.S. licensees above Line A. To eliminate any possible

confusion, the Commission clarifies that operation above Line A (which

is now within 75 miles of the Canadian border) is allowed only on these

channels. In accordance with the 1992 agreement, no U.S. licensee may

operate conditionally or otherwise on channels from 929.0 MHz to 929.5

MHz.

IV. Conclusion

The Commission is amending the rules as described above to

facilitate the rapid and efficient licensing of paging in the 929-930

MHz band. The limited

[[Page 8483]]

amendments to the regional channel exclusivity scheme established in

the PCP Exclusivity Order will facilitate the development of seamless,

wide-area 900 MHz paging systems. Otherwise, the Commission affirms the

rules as adopted in the PCP Exclusivity Order.

V. Procedural Information

Regulatory Flexibility Analysis

Pursuant to the Regulatory Flexibility Act of 1980, the

Commission's final analysis is as follows:

A. Need for and Purpose of This Action

This Memorandum Opinion and Order makes amendments to Part 90 of

the Commission's rules relating to channel exclusivity for qualified

local, regional, and nationwide private paging systems on certain

channels at 929-930 MHz. The amendments will promote the efficient use

of paging channels by encouraging investment in new paging technology.

They also will foster the development of more efficient paging systems

on a local, regional, and nationwide basis.

B. Summary of Issues Raised by Public Comments in Response to the

Initial Regulatory Flexibility Analysis

Only one party, Radiofone, filed comments responding to the Initial

Regulatory Flexibility Analysis (IRFA). Radiofone argued that the

Commission has not adequately addressed the impact of the proposal on

small paging systems and that exclusive licensing will preclude small

business entry at 900 MHz. The Commission reviewed Radiofone's concerns

in the context of PCP Exclusivity Order. No additional comments have

been submitted.

C. Significant Alternatives Considered and Rejected

As the Commission determined in the PCP Exclusivity Order and

affirms in this Memorandum Opinion and Order, this action is fully

consistent with the Commission's small business policy objectives. The

Commission noted in the IRFA that this action imposes certain

conditions on the licensing of smaller 929-930 MHz paging systems, but

these requirements are not unduly burdensome. The new rules contain

significant benefits for small businesses by protecting dozens of small

existing systems in place, allowing many such systems to obtain

exclusivity, and creating opportunities for expansion and new entry by

small business licensees.

Ordering Clauses

It is ordered that pursuant to the authority of Sections 4(i),

303(g) 303(r), and 332(a) of the Communications Act of 1934, as

amended, 47 U.S.C. Secs. 154(i), 303(g), 303(r) and 332(a), 47 CFR Part

90, is amended as set forth below, effective April 4, 1996.

It is further ordered that the petitions for reconsideration filed

by National Association of Business and Educational Radio/ Association

for Private Carrier Paging Section, First National Paging Company,

Inc., Afro-American Paging, American Mobilephone, Inc., Paging Network,

Inc., MAP Mobile Communications, Inc. and Metrocall, Inc. are granted

to the extent described above and are denied in all other respects.

It is further ordered that the waiver requests filed by American

Mobilephone, Inc., Arch Communications Group, Inc., Comtech, Inc.,

First National Paging Company, Inc., Message Center Beepers, Inc.,

Metrocall, Inc. and PacTel Paging (now ``Airtouch Paging'') are granted

to the extent described above.

It is further ordered that, pursuant to the authority of Section

0.331 of the Communications Act of 1934, as amended, we delegate to the

Wireless Telecommunications Bureau the authority to address any request

for waiver of our exclusivity rules, which shall be evaluated based on

criteria set forth above.

It is further ordered that this proceeding is terminated.

List of Subjects in 47 CFR Part 90

Common carriers.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Amendments

Part 90 of Chapter I of Title 47 of the Code of Federal Regulations

is amended as follows:

PART 90--PRIVATE LAND MOBILE RADIO SERVICES

1. The authority citation for Part 90 continues to read as follows:

Authority: Sections 4, 303, 48 Stat. 1066, 1082, as amended; 47

U.S.C. 154, 303, and 332, unless otherwise noted.

2. Section 90.494 is amended by revising paragraph (g) to read as

follows:

Sec. 90.494 One-way paging operations in the 929-930 MHz band.

* * * * *

(g) Stations operating as part of regional or local systems under

Sec. 90.495(a)(1) or (a)(2) may also operate sites within their

existing service area at a maximum effective radiated power of 3500

watts, provided that such an increase in power does not expand the

licensee's service-area contour, and the requirements of

Sec. 90.495(b)(2) are met as to any co-channel system that has

preexisting exclusivity rights.

[FR Doc. 96-4723 Filed 3-4-96; 8:45 am]

BILLING CODE 6712-01-P