# Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3AE8-23045 ## Record - **Collection:** Federal Register - **Document type:** Proposed Rule - **Published:** October 3, 2008 - **Citation:** 73 FR 57750 ## Text FEDERAL COMMUNICATIONS COMMISSION 47 CFR Parts 27 and 90 [WT Docket No. 06-150; PS Docket No. 06-229; FCC 08-230] Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band AGENCY: Federal Communications Commission. ACTION: Proposed rule. SUMMARY: In this document, the Commission seeks comment on its tentative conclusions and proposals on how the Commission might modify its rules governing the public/private partnership, the D Block licensee, and the public safety broadband licensee. This Third Further Notice of Proposed Rulemaking (Third FNPRM) seeks comment on its tentative conclusion that it should continue to mandate a public/private partnership between the D block licensee and the public safety broadband licensee on a number of proposals and tentative conclusions regarding the terms and conditions for the partnership. DATES: Written comments are due on or before November 3, 2008, and reply comments are due on or before November 12, 2008. ADDRESSES: You may submit comments, identified by WT Docket No. 06-150 and PS Docket No. 06-229, by any of the identified methods: • Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. • Federal Communications Commission's Web site: http://www.fcc.gov/cgb/ecfs/ . Follow the instructions for submitting comments. • Mail: Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (although the Commission continues to experience delays in receiving U.S. Postal Service mail). All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission. • People with Disabilities: Contact the Commission to request reasonable accommodations (accessible format documents, sign language interpreters, CART, etc.) by e-mail: FCC504@fcc.gov or phone: 202-418-0530 or TTY: 202-418-0432. For detailed instructions for submitting comments and additional information on the rulemaking process, see the SUPPLEMENTARY INFORMATION section of this document. FOR FURTHER INFORMATION CONTACT: Peter Trachtenberg at (202) 418-7369, at peter.trachtenberg@fcc.gov , Spectrum and Competition Policy Division, Wireless Telecommunications Bureau; Jeffrey S. Cohen at (202) 418-0799, jeff.cohen@fcc.gov , Public Safety and Homeland Security Bureau. SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Third FNPRM , WT Docket No. 06-150, PS Docket No. 06-229, adopted on September 25, 2008 and released September 25, 2008. The full text of the Third FNPRM is available for public inspection and copying during business hours in the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. It also may be purchased from the Commission's duplicating contractor at Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554; the contractor's Web site, http://www.bcpiweb.com ; or by calling (800) 378-3160, facsimile (202) 488-5563, or e-mail FCC@BCPIWEB.com . Copies of the public notice also may be obtained via the Commission's Electronic Comment Filing System (ECFS) by entering the docket numbers, WT Docket No. 06-150 and PS Docket No. 06-229. Additionally, the complete item is available on the Federal Communications Commission's Web site at http://www.fcc.gov . Synopsis In the Second Report and Order, 72 FR 48814, August 24, 2007, the Commission adopted rules for the establishment of a mandatory public/private partnership (the 700 MHz Public/Private Partnership) in the upper portions of the 698-806 MHz band (700 MHz Band) as the means for promoting the rapid construction and deployment of a nationwide, interoperable broadband public safety network that would serve public safety and homeland security needs. Specifically, the Commission required that the winning bidder of the commercial license in the Upper 700 MHz D Block (758-763/788-793 MHz) (D Block) enter into the 700 MHz Public/Private Partnership with the nationwide licensee of the public safety broadband spectrum (763-768/793-798 MHz) (Public Safety Broadband Licensee) to enable construction of this interoperable broadband network, which would span both the commercial D Block and public safety spectrum. In the recently concluded auction of commercial 700 MHz licenses, bidding for the D Block license did not meet the applicable reserve price of $1.33 billion and, pursuant to the Commission's rules, there was no winning bid for that license. In the Second Further Notice of Proposed Rulemaking, 22 FCC Rcd 8047 (2008) ( Second FNPRM ), the Commission revisited its decisions concerning the 700 MHz Public/Private Partnership, including revisions to this partnership as well as alternative rules the Commission should adopt in the event the D Block licensee is no longer required to enter into a mandatory public/private partnership. In the Third FNPRM, the Commission seeks comment on the tentative conclusions and proposals presented in this Third FNPRM, and on whether these proposals will lead to a successful auction and, more importantly, a successful partnership or partnerships that will fulfill the Commission's goal of making interoperable broadband wireless service available to public safety entities across the nation. The Commission tentatively concludes that it should continue to require that the D Block licensee enter into a public/private partnership with the Public Safety Broadband Licensee, and proposes to use competitive bidding to resolve two critical issues: (1) The appropriate geographic license area for the D Block, and (2) the need for a common broadband technology platform nationwide. The Commission also proposes significant clarifications and revisions of the parties' obligations regarding the construction and operation of the shared wireless broadband network as well as modifications to certain rules governing the establishment of the Network Sharing Agreement and the licensing of the D Block following bidding for D Block licenses. The Commission also addresses certain additional issues related to the auction process and the rules governing public safety users and the Public Safety Broadband Licensee, including narrowband relocation issues. This Third FNPRM is another step in the Commission's ongoing efforts to develop a regulatory framework that will address current and future public safety communications needs. Discussion I. Introduction 1. In this Third Further Notice of Proposed Rulemaking ( Third FNPRM ), the Commission takes the next step toward achieving the goal of a nationwide interoperable broadband wireless network for public safety entities. The Commission previously sought to achieve this goal through an innovative public/private partnership, which required the winning bidder of the commercial license in the Upper 700 MHz D Block (758-763/788-793 MHz) (D Block) to partner with the nationwide licensee of the public safety broadband spectrum (763-768/793-798 MHz) (Public Safety Broadband Licensee or PSBL) to enable construction of an interoperable broadband network that would serve both commercial and public safety users. 1 Because the auction of the D Block did not result in a winning bid, the Commission issued the Second FNPRM revisiting the rules governing the mandatory public/private partnership, the D Block licensee, and the Public Safety Broadband Licensee, seeking comment broadly on how the Commission might modify those rules to achieve the Commission goals, whether the Commission should continue to mandate a public/private partnership between the D Block licensee and Public Safety Broadband Licensee, and if so, under what terms and conditions. 2 The Commission further indicated that, prior to adopting final rules, the Commission would present for public comment a detailed proposal regarding specific proposed rules to address these issues. 3 In this Third FNPRM, the Commission now offers and seeks comment on the following proposals and tentative conclusions. 1 See Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, WT Docket No. 06-150, Revision of the Commission's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Systems, CC Docket No. 94-102, Section 68.4(a) of the Commission's Rules Governing Hearing Aid-Compatible Telephones, WT Docket No. 01-309, Biennial Regulatory Review—Amendment of Parts 1, 22, 24, 27, and 90 to Streamline and Harmonize Various Rules Affecting Wireless Radio Services, WT Docket 03-264, Former Nextel Communications, Inc. Upper 700 MHz Guard Band Licenses and Revisions to Part 27 of the Commission's Rules, WT Docket No. 06-169, Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, PS Docket No. 06-229, Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, WT Docket No. 96-86, Declaratory Ruling on Reporting Requirement under Commission's Part 1 Anti-Collusion Rule, WT Docket No. 07-166, Second Report and Order, 22 FCC Rcd 15289 (2007) ( Second Report and Order ) recon. pending. 2 See Service Rules for the 698-746, 747-762 and 777-792 Bands; Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, WT Docket No. 06-150, PS Docket No. 06-229, 22 FCC Rcd 8047 (2008) ( Second FNPRM ). 3 See id. at 8052 para. 7. 2. As an initial matter, the Commission tentatively concludes that it should continue to require, as a license condition, that the D Block licensee enter into a public/private partnership with the Public Safety Broadband Licensee for the purpose of constructing a wireless broadband network that will operate over both D Block spectrum and public safety broadband spectrum and provide broadband services to both commercial users and public safety entities (shared wireless broadband network). 4 The Commission finds that a public/private partnership condition on the D Block remains the best option to achieve nationwide build-out of an interoperable broadband network for public safety entities, given the current absence of legislative appropriations for this purpose and the limited funding available to the public safety sector. The Commission also proposes to retain those current rules that will support this relationship. For example, the Commission proposes to continue requiring the parties to enter into a Network Sharing Agreement (NSA), and to make the NSA a condition of the grant of the D Block license(s). The Commission also proposes, however, to clarify and revise the rules to clearly establish the obligations of the parties to the partnership with greater specificity and detail. These clarifications and revisions address whether the D Block will be licensed on a nationwide or regional basis, the obligations of the parties regarding the construction and operation of the shared wireless broadband network, the rules governing the process for establishing an NSA between the parties, certain auction issues, and issues related to public safety users and the Public Safety Broadband Licensee. The Commission anticipates that, by establishing the rules governing the public/private partnership in a more comprehensive and detailed fashion, the Commission will enhance the certainty of bidders regarding their potential obligations as D Block licensees, and facilitate the rapid and successful negotiation of NSAs as the Commission would be significantly reducing the scope of issues that need to be negotiated. 5 Equally important, the Commission seeks in its proposals to meet the needs of the public safety community in a commercially viable manner. With these goals in mind, the Commission makes the following proposals. 4 Under the Commission proposal, it is possible that there will be multiple regional D Block licenses or a single nationwide D Block license. Accordingly, references herein to “the” D Block license and licensee should be understood to incorporate reference to any of multiple D Block licenses or licensees, as appropriate. The Commission proposed rules should be interpreted in similar fashion. 5 The Commission has appended an NSA term sheet, which provides a summary of major terms that the parties must include in their agreement(s). See, supra, Appendix D. 3. First, the Commission tentatively concludes that it should resolve two critical issues through the use of competitive bidding: (1) The appropriate geographic license area for the D Block, and (2) the need for a common broadband technology platform nationwide. The Commission tentatively concludes that it can resolve these issues through competitive bidding by offering alternative sets of D Block licenses with different license areas and broadband technology conditions. With regard to the appropriate geographic area, the Commission proposes to offer the D Block both as a single nationwide license and on a regional basis, using geographic areas that the Commission will refer to as Public Safety Regions (PSRs). PSRs would be comprised of fifty-five regions that mirror the geographic boundaries of the fifty-five 700 MHz Regional Planning Committee (RPC) regions, and three additional areas (for a total of 58 PSRs) to cover the whole country and match the geographic area of the nationwide license. 6 With regard to the broadband technology platform, the Commission proposes to establish rules that will ensure that a single broadband air interface is used nationwide regardless of whether there is a single licensee or multiple regional licensees, to ensure that public safety users may communicate when they roam outside their home regions. 6 The three additional regions will cover (1) the Gulf of Mexico; (2) the Territory of Guam (Guam) and the Commonwealth of Northern Mariana Islands (Northern Mariana Islands); and (3) the Territory of American Samoa (American Samoa), and will be identical to the current Economic Area (EA) licensing areas for those same regions. See Appendix A. 4. To resolve both of these issues, the Commission therefore proposes to offer simultaneously three alternative sets of licenses that vary by geographic license area and by conditions regarding the technology platform that must be used by the licensee(s). Specifically, under this proposal, the Commission would offer (1) a single license for service nationwide with the technology platform to be determined by the licensee; (2) a nationwide set of PSR licenses conditioned on the use of Long Term Evolution (LTE) by the licensees; and (3) a nationwide set of PSR licenses conditioned on the use of Worldwide Interoperability for Microwave Access (WiMAX) by the licensees. The Commission will then award the D Block license(s) in the set that receives bids on licenses covering the greatest aggregate population, subject to the requirement that the license(s) must authorize service in areas covering at least half of the nation's population. If more than one set of licenses meeting these requirements cover the same population, the Commission will award the D Block licenses in the set that receives the highest aggregate gross bid. The Commission also proposes to establish auction procedures that will encourage bidding on licenses covering as much population as possible, including procedures to reduce minimum opening bids on unsold regional licenses during bidding under circumstances the Commission specifically describes below. The Commission also tentatively concludes that package bidding on licenses in the regional sets would serve the public interest and that it should direct the Wireless Telecommunications Bureau to propose and implement detailed package bidding procedures prior to bidding. The Commission tentatively concludes that this method of assigning D Block licenses will be most likely to result in the successful development of a nationwide interoperable broadband network for public safety use, and provides a better means of addressing these issues than by specifying a single geographic licensing area or broadband technology in advance of competitive bidding. At the same time, it will provide all interested bidders with the necessary certainty at the time they make their bids of what conditions will be applicable to them should their bids be successful. 5. The Commission proposes significant clarifications and revisions of the parties' obligations regarding the construction and operation of the shared wireless broadband network. These clarifications and revisions address (1) the use of spectrum in the shared wireless broadband network, including requirements regarding public safety priority access to commercial capacity in emergencies; (2) the technical requirements of the shared wireless broadband network; (3) the performance requirements of the D Block licensee(s); and (4) the respective operational roles of the D Block licensee(s) and the Public Safety Broadband Licensee. With regard to spectrum use, the Commission first tentatively concludes that a D Block licensee may construct and operate its shared wireless broadband network using the entire 20 megahertz of D Block spectrum and public safety broadband spectrum as a combined, blended resource. Under this proposal, public safety users will still be guaranteed unconditionally preemptive access to 10 megahertz of capacity at all times, but the shared wireless broadband network may flexibly and dynamically assign frequencies from either the D Block or public safety spectrum to provide that capacity. Second, the Commission proposes to revise the rules governing public safety priority access to D Block spectrum capacity in emergencies. The Commission proposed revisions include: (1) S pecifying in detail the circumstances that trigger public safety priority access to commercial spectrum capacity; (2) providing that, in this context, “priority access” means only that a public safety user would be assigned the next available channel within the commercial spectrum over a commercial user, and does not include a right to preempt any ongoing commercial calls being carried over commercial spectrum capacity; (3) limiting the additional capacity that must be provided to public safety users in emergencies to a specified percentage of the D Block spectrum capacity; (4) requiring that public safety priority access to D Block spectrum capacity be limited to the time and geographic scope affected by the emergency; and (5) specifying the procedures for requesting and obtaining such access. Third, the Commission tentatively concludes that the current rules for commercial access to public safety spectrum should remain the same subject to the Commission's clarification regarding blended use. Thus, the Commission proposes that commercial users will have secondary access to public safety's 10 megahertz of spectrum capacity subject to unconditional and immediate preemption when the spectrum capacity is needed by public safety users. Fourth, the Commission finds that the Commission tentative proposals regarding spectrum use are consistent with the requirements of Section 337 of the Communications Act, as amended. 6. With regard to the technical requirements of the network, in addition to the Commission's proposal regarding the broadband technology platform, it makes detailed proposals regarding (1) interoperability and public safety roaming; (2) availability, robustness, and hardening of the network; (3) capacity, throughput, and quality of service; (4) security and encryption; (5) power limits, power flux density limits, and related notification and coordination requirements; and (6) ensuring the availability of a satellite-capable handset. 7. With regard to the D Block license term and performance requirements, the Commission proposes to extend the license term to fifteen years and to adopt performance benchmarks applicable at the fourth, tenth, and fifteenth years following the license grant date. For the first two benchmarks, the Commission proposes to require D Block licensees to provide signal coverage and offer service to at least 40 percent of the population in each PSR by the end of the fourth year, and at least 75 percent by the end of the tenth year. For the final benchmark at the fifteenth year, the Commission proposes to adopt a “tiered” approach, applying one of three different population coverage requirements depending on the population density of the PSR: (1) For PSRs with an average population density of less than 100 people per square mile, the licensee would be required to provide signal coverage and offer service to at least 90 percent of the population within that PSR; (2) for PSRs with an average population density of at least 100 people per square mile and less than 500 people per square mile, the licensee would be required to provide signal coverage and offer serv ice to at least 94 percent of the population within that PSR; and (3) for PSRs with an average population density of at least 500 people per square mile, the licensee would be required to provide signal coverage and offer service to at least 98 percent of the population within that PSR. 8. The Commission also proposes modifications to certain rules governing the establishment of the Network Sharing Agreement and the licensing of the D Block following bidding for D Block licenses, in order to increase the likelihood of successful, rapid deployment of the shared wireless broadband network. First, the Commission tentatively proposes that it shall be able to offer any D Block license to a second highest bidder in the event that the original winning bidder is not assigned the license, either due to a failure to enter into an NSA or for any reason. Second, the Commission tentatively concludes that a winning bidder for a D Block license that is otherwise qualified will be liable for default payments only if it chooses not to execute a Commission-approved NSA. Thus, an otherwise-qualified winning bidder for a D Block license will not be liable for default payments if the lack of a Commission-approved NSA results from any other party's failure to execute the agreement or a Commission determination that there is no acceptable resolution to a dispute regarding terms to be included in the agreement. Finally, given the Commission decision to offer alternative D Block licenses by auction, the Commission tentatively concludes that it should adopt a D Block-specific rule regarding the amount of additional payments owed by any defaulting bidder. The Commission proposes a rule equivalent to the Commission's standard rule with respect to non-package bidding auctions, i.e. , that the Commission will provide that the additional payment will be between 3 and 20 percent of the applicable bid. 9. The Commission also addresses certain additional issues related to the auction process. In particular, in order to further facilitate applications from potentially qualified parties, the Commission tentatively concludes that it will not restrict the eligibility to bid of any party that may qualify to hold a D Block license and that no reserve price beyond the minimum opening bid(s) will apply. Furthermore, given the oversight that already applies to the D Block, the Commission will codify an existing exception to the Commission's designated entity eligibility rules with respect to the spectrum capacity of D Block licenses, so that a designated entity applicant or licensee with lease or resale (including wholesale) arrangement(s) for more than 50% of the spectrum capacity of any D Block license will not on that basis alone lose its eligibility for designated entity benefits. 7 7 Because this exception does not extend to arrangements for use of the spectrum capacity of licenses other than the D Block license, if an applicant or licensee has an impermissible material relationship with respect to the spectrum capacity of any other license(s), the normal operation of the Commission's rules will continue to render it ineligible for designated entity benefits for the D Block license. 10. The Commission also makes a number of tentative conclusions and proposals with regard to the rules governing public safety users and the Public Safety Broadband Licensee. The Commission tentatively concludes that eligible users of the public safety broadband spectrum capacity must be providers of “public safety services” as defined in the Act. 8 The Commission also proposes to reaffirm the Commission prior decision to grant the Public Safety Broadband Licensee sole discretion regarding whether to permit Federal public safety agency use of the public safety broadband spectrum capacity. Further, the Commission tentatively concludes not to require eligible public safety users to subscribe to the shared broadband network. 8 See 47 U.S.C. 337(f)(1). 11. With respect to the Public Safety Broadband Licensee, the Commission tentatively concludes that it should remain a non-profit entity, and proposes certain restrictions on its business relationships to avoid the potential for conflicts of interest. Specifically, the Commission proposes that an entity serving as an advisor, agent, or manager of the Public Safety Broadband Licensee will be ineligible to become a D Block licensee unless such entity completely severs its business relationship with the Public Safety Broadband Licensee no later than thirty days following release of an oder adopting final rules in this proceeding. Further, the Commission proposes to prohibit advisors, agents, or managers of the Public Safety Broadband Licensee from establishing business relationships with third party entities having a financial interest in the decisions of the Public Safety Broadband Licensee. 12. With respect to the mechanism of funding the Public Safety Broadband Licensee, the Commission tentatively concludes that the nationwide D Block licensee or, if the D Block is licensed on a regional basis, each regional D Block licensee, will make an annual payment to the Public Safety Broadband Licensee, which would constitute the sole allowable source of funding for the Public Safety Broadband Licensee's annual operating and administrative costs. The Commission further tentatively concludes that the Public Safety Broadband Licensee must establish an audited annual budgeting process, and must submit its proposed annual budget to the Commission for approval. The Commission also reserves the right to request an audit of the Public Safety Broadband Licensee's expenses at any time. The Commission further tentatively concludes that it should establish fixed nationwide service fees that the D Block licensee may charge to public safety users based on a discounted rate schedule. 13. The Commission proposes several changes to the Public Safety Broadband Licensee's articles of incorporation and by-laws. Specifically, the Commission proposes replacing the Public Safety Broadband Licensee board of directors position currently held by the National Emergency Management Association (NEMA) with the National Regional Planning Council (NRPC). The Commission also tentatively concludes that the positions of Chairman of the Board and Chief Executive Officer must be filled by separate individuals; that the Public Safety Spectrum Trust Corporation (PSST) may not hire a new individual to fill the CEO position until the D Block licensee(s) has made funding available to the PSST for its administrative and operational costs; and that any individual appointed as CEO cannot have served on the Public Safety Broadband Licensee executive committee during the period three years prior to his or her appointment as CEO. The Commission also tentatively concludes that the PSST board should elect a new executive committee with proposed new conditions on term limits, consecutive terms, and committee size. Further, the Commission tentatively concludes that it will require three-fourths supermajority voting on all major decisions by the board, that board meetings be open to the public (with some exceptions), that the minutes of each board meeting must be made publicly available (again with some exceptions), and several other conditions. The Commission tentatively declines to rescind the present PSST's license and reissue the license to a new licensee. 14. In relation to narrowband relocation issues, the Commission tentatively concludes that the Commission will extend the current February 17, 2009 deadline for completing such relocation twelve months from the date upon which narrowband relocation funding is made available by the D Block licensee(s). The Commission also proposes that the current $10 million cap on narrowband relocation costs should be increased to $27 million. The Commission also tentatively concludes that the existing August 30, 2007 cut-off date for narrowband deployments outside of the consolidated narrowband spectrum should not be changed, and propose conditions under which waiver relief may be granted for deployment of narrowband equipment beyond that date. 15. The Commission seeks comment on all of the tentative conclusions and proposals presented in this Third FNPRM, and on whether these proposals will lead to a successful auction and, more importantly, a successful partnership or partnerships that will fulfill the Commission's goal of making interoperable broadband wireless service available to public safety entities across the Nation. II. Background 16. In this section, the Commission reviews the history of its efforts to establish a public/private partnership to address the need for nationwide interoperable public safety communications and to promote public safety access to advanced broadband communication systems and technologies. The Commission first describes the rules it promulgated in the Second Report and Order, which established two nationwide 700 MHz licenses, the Public Safety Broadband License and the commercial D Block license, and required the licensees to enter into a public/private partnership for the purpose of constructing and operating a nationwide wireless broadband network meeting specified terms. The Commission reviews petitions for reconsideration of the Second Report and Order that raised issues related to this proceeding. The Commission briefly discusses Auction 73, the auction of commercial 700 MHz licenses concluded earlier this year in which the Commission auctioned the D Block under the public/private partnership rules but did not receive a winning bid. Finally, the Commission summarizes the Second FNPRM, which commenced the process of revisiting and reconsidering the public/private partnership rules that the Commission continues now in the present Third FNPRM. A. 700 MHz Second Report and Order 17. The commercial and public safety spectrum bands at issue in this proceeding are part of the 700 MHz Band (698-806 MHz), which is currently occupied by television broadcasters, but which must be cleared of such transmissions and made available for wireless services by February 17, 2009, as part of the digital television (DTV) transition. 9 Pursuant to Congress's direction in the Balanced Budget Act of 1997 (Balanced Budget Act), codified at section 337(a) of the Act, the Commission has allocated, in the Upper 700 MHz Band (746-806 MHz), 24 megahertz of spectrum for public safety services and 36 megahertz for commercial services. 10 9 See Deficit Reduction Act of 2005, Public Law No. 109-171, 120 Stat. 4 (2006). 10 See Balanced Budget Act of 1997, Public Law No. 105-33, 111 Stat. 251 sec. 3004 (1997) (adding new sec. 337 of the Communications Act); Reallocation of Television Channels 60-69, the 746-806 MHz Band, ET Docket No. 97-157, Report and Order, 12 FCC Rcd 22953, 22955 para. 5 (1998), recon. 13 FCC Rcd 21578 (1998) ( Upper 700 MHz Reallocation Order ). 18. In the Second Report and Order, the Commission established, among other rules regarding the 700 MHz Band, rules for the 700 MHz public safety spectrum and one block of the Upper 700 MHz commercial spectrum that would promote the creation of a nationwide, interoperable broadband public safety network. With regard to the public safety spectrum, the Commission designated the lower half of the spectrum (the 763-768 MHz and 793-798 MHz bands) for public safety broadband communications, and consolidated existing narrowband allocations, previously located in both the lower and upper ends of the public safety spectrum, in the upper half of the spectrum (the 769-775 MHz and 799-805 MHz bands) exclusively. 11 The Commission also created a single nationwide license for the public safety broadband spectrum, the Public Safety Broadband License, and the Commission specified the criteria, selection process, and responsibilities of the licensee assigned this spectrum, including a requirement that the licensee must be a non-profit organization. 12 11 See Second Report and Order, 22 FCC Rcd at 15406 para. 322. The Commission also created an internal guard band in the 768-769 MHz and 798-799 MHz bands located between the broadband and narrowband allocations. Id. 12 See Second Report and Order, 22 FCC Rcd at 15406 para. 322. 19. With regard to the commercial spectrum in the 700 MHz Band, and as described in greater detail below, the Commission created a nationwide license in the D Block (the 758-763 MHz and 788-793 MHz bands, located adjacent to the public safety broadband spectrum), and required the D Block licensee, working with the Public Safety Broadband Licensee in a public/private partnership (the 700 MHz Public/Private Partnership) and using the spectrum associated with both licenses, to construct and operate a nationwide network that would be shared by commercial and public safety users. 13 13 Id. at 15428 para. 386. 20. 700 MHz Public/Private Partnership. The Commission mandated the 700 MHz Public/Private Partnership between two nationwide licensees to promote the rapid deployment of a nationwide, interoperable, broadband public safety network that was robust, cost effective, spectrally efficient, and based on a flexible IP-based, modern architecture. 14 The Commission found that nationwide licensing would best serve these goals by centralizing the responsibilities for implementing and administering a broadband network across the entire country, creating economies of scale, and avoiding a fragmented approach to network construction. The Commission further determined that the public/private partnership, by promoting commercial investment in the build-out of a shared network infrastructure for both commercial and public safety users, would address “the most significant obstacle to constructing a public safety network—the limited availability of public funding.” 15 The Commission concluded that providing for a shared infrastructure using the D Block and the public safety broadband spectrum would help achieve significant cost efficiencies. The Commission noted that this would allow public safety agencies “to take advantage of commercial, off-the-shelf technology and otherwise benefit from commercial carriers' investments in research and development of advanced wireless technologies.” 16 The Commission stated that this approach would also benefit the public safety community by providing it with access to an additional 10 megahertz of broadband spectrum during emergencies. 17 Most importantly, the Commission anticipated that this particular public/private partnership approach would provide all of these public safety benefits on a nationwide basis. 18 The Commission noted that the 700 MHz Public/Private Partnership would also provide the D Block licensee with benefits, including the right to operate commercial services in the 10 megahertz of public safety broadband spectrum on a secondary, preemptible basis, which would both help to defray the costs of build-out and ensure that the spectrum is used efficiently. 19 14 Id. at 15420 para. 369, 15431 para. 396. See also Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, PS Docket No. 06-229, WT Docket No. 96-86, Ninth Notice of Proposed Rulemaking, 21 FCC Rcd 14837, 14842-43 (2006) ( 700 MHz Public Safety Ninth Notice ). 15 Second Report and Order, 22 FCC Rcd at 15431 para. 396. 16 Id. 17 Id. 18 Id. 19 Id. 21. To ensure that the 700 MHz Public/Private Partnership would serve the needs of the public safety community and to address concerns about its success, the Commission specified certain mandatory features. First, the Commission specified requirements regarding the shared network to be constructed and the timing for that construction. In particular, the Commission established certain technical requirements for the shared network, including requirements relating to the network technology platform, signal coverage, robustness and reliability, capacity, security, operational capabilities and control, and certain equipment specifications. 20 With regard to the spectrum shared by the common network, the Commission required that the Public Safety Broadband Licensee lease the public safety broadband spectrum for commercial use by the D Block licensee on a secondary, preemptible basis, and that the public safety entities have priority access to the D Block spectrum during emergencies. 21 To ensure timely construction and nationwide coverage, the Commission specified performance requirements, including three population-based build-out benchmarks requiring the D Block licensee to provide signal coverage and offer service to (1) at least 75 percent of the population of the nationwide D Block license area by the end of the fourth year after the DTV transition date, (2) at least 95 percent of the population of the nationwide license area by the end of the seventh year, and (3) at least 99.3 percent of the population of the nationwide license area by the end of the tenth year. 22 20 Id. at 15433-34 para. 405. 21 Id. at 15432 para. 399, 15434-43 paras. 407-31. 22 Id. at 15432 para. 399, 15433-44 paras. 403-06, 15443-46 paras. 432-43. 22. Next, while finding it appropriate to establish these mandatory terms, the Commission also concluded that many details of the 700 MHz Public/Private Partnership should be left to the parties to negotiate. 23 Accordingly, the Commission established that the terms of the 700 MHz Public/Private Partnership would be governed both by Commission rules and by a Network Sharing Agreement (NSA) between the winning bidder for the D Block license and the Public Safety Broadband Licensee. 24 The Commission further provided rules governing the process by which the parties would establish the NSA, requiring among other things that negotiations begin by a date certain and conclude within six months, and providing that the D Block license application would not be granted until the parties obtained Commission approval of the agreement, executed the approved agreement, and then filed it with the Commission. 25 The Commission further specified rules to govern in the event of a negotiation dispute. Specifically, the Commission provided that if, at the end of the six month negotiation period, or on their own motion at any time, the Chiefs of the Public Safety and Homeland Security Bureau (PSHSB) and the Wireless Telecommunications Bureau (WTB) found that negotiations had reached an impasse, they could take actions including but not limited to issuing a decision on the disputed issues and requiring the submission of a draft agreement consistent with their decision. 26 The Commission also provided that if the D Block winning bidder failed to comply with the procedures the Commission established for negotiation or dispute resolution, failed to receive final Commission approval of an NSA, or failed to execute an approved NSA, it would be deemed to have defaulted on its license and would be subject to the default payments required by Section 1.2109 of the Commission rules. 27 23 Id. at 15488 para. 447. 24 Id. at 15432 paras. 399-400, 15447-49 paras. 444-54. 25 Id. at 15448 para. 447. 26 Id. at 15465 para. 508. 27 Id. at 15466 para. 511. 23. The Commission also established a number of measures to safeguard the interests of public safety on an ongoing basis after the NSA is executed. These measures included: (1) Requirements related to the organization and structure of the 700 MHz Public/Private Partnership, intended to protect the D Block license and network assets from being drawn into a bankruptcy proceeding; (2) a prohibition on discontinuance of service provided to public safety entities; (3) special remedies in the event that the D Block licensee or Public Safety Broadband Licensee fails to comply with either the Commission's rules or the terms of the NSA; (4) a special, exclusive process for resolving any disputes related to the execution of the terms of the NSA; and (5) ongoing reporting obligations. 28 28 Id. at 15466-71 para. 513-30. 24. Reserve Price for the Auction of the D Block. In the Second Report and Order, the Commission also concluded that block-specific aggregate reserve prices should be established for each commercial license block—the A, B, C, D, and E Blocks—to be auctioned in Auction 73, and directed WTB to adopt and publicly disclose those reserve prices prior to the auction, pursuant to its existing delegated authority and consistent with the Commission directions. 29 For the D Block, the Commission concluded that WTB should consider certain factors in setting the D Block reserve price, including the 700 MHz Public/Private Partnership conditions, which might suggest a reserve price of $1.33 billion. The Commission provided that, in the event that bids for the D Block license did not meet the reserve price, the Commission would leave open the possibility of offering the license on the same terms or re-evaluating the D Block license conditions. 30 29 See id. at 15400 para. 301. 30 See id. at 15404 para. 314. 25. Narrowband Relocation . As discussed above, to promote public safety access to a nationwide, interoperable broadband network, the Commission designated the lower half of the public safety spectrum for public safety broadband communications, and consolidated existing narrowband allocations, previously located in both the lower and upper ends of the public safety spectrum, in the upper half of the spectrum. 31 The Commission also shifted the entire public safety band down one megahertz, so that it would be immediately adjacent to the D Block spectrum, to further facilitate the development of a shared wireless broadband network over both D Block and public safety broadband spectrum. 32 Both the 1-megahertz shift and the narrowband consolidation, however, left certain existing public safety narrowband operations outside of the spectrum now designated for narrowband services. 31 See id . at 15406 para. 322. The Commission also created an internal guard band in the 768-769 MHz and 798-799 MHz bands located between the broadband and narrowband allocations. Id . 32 See id . at 15333 para. 111. 26. The Commission provided in the Second Report and Order that all 700 MHz narrowband public safety operations outside of the newly consolidated narrowband spectrum must be relocated to that spectrum no later than the DTV transition date. 33 To effectuate the consolidation of the narrowband channels, the Commission required the D Block licensee to pay the costs of relocating narrowband radios and capped the disbursement amount for such relocation costs at $10 million. 34 The Commission also cautioned that any narrowband equipment deployed in the 764-770 MHz and 794-800 MHz bands (channels 63 and 68), or in the 775-776 MHz and 805-806 MHz bands (the upper one megahertz of channels 64 and 69), more than 30 days following the adoption date of the Second Report and Order would be ineligible for relocation funding. 35 In addition, the Commission prohibited authorization of any new narrowband operations in that spectrum, as of 30 days following the adoption date of the Second Report and Order . 36 Subsequent to the release of the Second Report and Order , the Commission granted limited waivers to two parties that permitted them to continue to deploy new narrowband operations outside the consolidated narrowband spectrum after August 30, 2007. 37 The Commission deferred decision on other issues raised by their requests, however, including the appropriate duration of the relief and whether the parties would be entitled to reimbursement for the costs of relocating narrowband operations deployed after August 30, 2007. 33 Id . at 15410 para. 332. 34 Id . at 15412 para. 341. 35 Id . at 15412 para. 339. 36 Id . 37 See Implementation of a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, PS Docket No. 06-229, WT Docket No. 96-86, Order , 22 FCC Rcd 20290 (2007); Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010; Request for Waiver of Pierce Transit, PS Docket No. 06-229, WT Docket No. 96-86, Order , 23 FCC Rcd 433 (PSHSB 2008). B. Petitions for Reconsideration 27. Ten parties filed petitions for reconsideration seeking review of various aspects of the Second Report and Order . 38 Three of the petitions sought reconsideration of the rules governing the 700 MHz Public/Private Partnership specifically. 39 All three of these petitioners argued that the application of the default payment rules to the D Block winner in the event of a failure to establish an NSA should be modified, for example, by imposing such payment obligations only if the D Block winner is found to have negotiated in bad faith. 40 One petitioner also argued that network requirements should be specified more precisely for potential bidders prior to auction. 41 Conversely, another of these petitioners argued that, in some respects, the technical requirements in the rules were too specific, and that the Commission should “not prematurely rule on specific technical issues, [and] should instead allow the [Public Safety Broadband Licensee] and D Block winner to develop those details as they negotiate the NSA * * * .” 42 38 AT&T Inc. Petition for Reconsideration and Clarification, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (AT&T Petition for Reconsideration); Blooston Rural Carriers Petition for Partial Reconsideration and/or Clarification, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Blooston Petition for Reconsideration); Petition for Reconsideration of the Ad Hoc Public Interest Spectrum Coalition, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (PISC Petition for Reconsideration); Cyren Call Communications Corporation Petition for Reconsideration and for Clarification, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Cyren Call Petition for Reconsideration); Frontline Wireless, LLC Petition for Reconsideration (filed Sept. 24, 2007); Pierce Transit Petition for Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Pierce Transit Petition for Reconsideration); Rural Telecommunications Group, Inc. Petition for Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (RTG Petition for Reconsideration); Commonwealth of Virginia Petition for Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 24, 2007) (Virginia Petition for Reconsideration); NTCH, Inc. Petition for Partial Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 21, 2007) (NTCH Petition for Reconsideration); MetroPCS Communications, Inc. Petition for Clarification and Reconsideration, WT Docket No. 06-150; PS Docket No. 06-229 (filed Sept. 20, 2007) (MetroPCS Petition for Reconsideration). 39 See AT&T Petition for Reconsideration; Cyren Call Petition for Reconsideration; Frontline Petition for Reconsideration. The Frontline September 20, 2007 Request also seeks changes to the rules governing the 700 MHz Public/Private Partnership. See Request to Further Safeguard Public Safety Service by Frontline Wireless, WT Docket No. 06-150 (filed Sept. 20, 2007) (Frontline September 20, 2007 Request). 40 See AT&T Petition for Reconsideration at 7-9; Cyren Call Petition for Reconsideration at 5-7; Frontline Petition for Reconsideration at 23-25. 41 See AT&T Petition for Reconsideration at 5. 42 See Frontline Petition for Reconsideration at 22. See also Cyren Call Petition for Reconsideration at 7. 28. Two of the ten petitioners sought reconsideration of the aggregate reserve prices set for the commercial license blocks, including the reserve price for the D Block. 43 These petitioners presented related arguments in the pre-auction process. 44 After considering the arguments, WTB established reserve prices consistent with the direction of the Second Report and Order , including setting a $1.33 billion reserve price for the D Block. 45 43 See, generally , Frontline Petition for Reconsideration; MetroPCS Petition for Reconsideration. 44 See Auction of 700 MHz Band Licenses Scheduled for January 24, 2008; Notice and Filing Requirements, Minimum Opening Bids, and other Procedures for Auctions 73 and 76, Public Notice , 22 FCC Rcd 18141, 18194-95 paras. 197-90 (2007) ( Auction 73/76 Procedures Public Notice ). 45 See id . at 18193-96 paras. 194-200. 29. Finally, two other parties filed petitions seeking reconsideration of some or all of the requirements regarding public safety narrowband relocation, as well as requests for waiver of some of these requirements. 46 The requests for waiver have since been granted in part. 47 The two petitions, however, together with the other petitions seeking reconsideration of the Second Report and Order , remain pending. 46 See Virginia Petition for Reconsideration; Pierce Transit Petition for Reconsideration. 47 See Implementation of a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010, PS Docket No. 06-229, WT Docket No. 96-86, Order , 22 FCC Rcd 20290 (2007); Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band; Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and Local Public Safety Communications Requirements Through the Year 2010; Request for Waiver of Pierce Transit, PS Docket No. 06-229, WT Docket No. 96-86, Order , 23 FCC Rcd 433 (PSHSB 2008). C. Auction 73 30. Results of the Auction . The auction of the D Block and other 700 MHz Band licenses, designated Auction 73, commenced on January 24, 2008, and closed on March 18, 2008. 48 While the bids for licenses associated with the other 700 MHz Band blocks offered at Auction 73 (the A, B, C, and E Blocks) exceeded the applicable aggregate reserve prices for those blocks, the nationwide D Block license received only a single bid that did not meet its reserve price of $1.33 billion and thus did not become a winning bid. 49 On March 20, 2008, the Commission determined that the Commission would not proceed immediately to re-auction the D Block license in order to provide us additional time to consider the Commission options. 50 48 See Auction 73, 700 MHz Band, at http://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=73. 49 See id.; see also Auction of 700 MHz Band Licenses Closes, Public Notice, DA 08-595 (rel. Mar. 20, 2008) (700 MHz Auction Closing Public Notice). http://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=73. Specifically, a bid of $472 million was entered by Qualcomm in Round 1 of the auction. 50 See Auction of the D Block License in the 758-763 and 788-793 Bands, AU Docket No. 07-157, Order, 23 FCC Rcd 5421, para. 5 (2008) ( D Block Post-Auction Order ). 31. Inspector General's Report . On April 25, 2008, the Office of Inspector General (OIG) issued a report on its investigation of allegations that certain statements made by an advisor to the Public Safety Broadband Licensee to potential bidders for the D Block license in Auction 73, particularly those regarding the spectrum lease payments that the Public Safety Broadband Licensee would request from the D Block licensee for use of public safety spectrum, had the effect of deterring various companies from bidding on the D Block. 51 The OIG determined that the statements in question were “not the only factor in the companies' decision not to bid on the D Block.” Rather, it concluded that “the uncertainties and risks associated with the D Block, including, but not limited to, the negotiation framework with [the Public Safety Broadband Licensee], the potential for default payment if negotiations failed, and the costs of the build-out and the operations of the network, taken together, deterred each of the companies from bidding on the D Block.” 52 51 See Office of Inspector General Report , from Kent R. Nilsson, Inspector General, to Chairman Kevin J. Martin (OIG rel. Apr. 25, 2008) (OIG Report). 52 OIG Report at 2. D. Second Further Notice of Proposed Rulemaking 32. On May 14, 2008, to begin the process of reconsidering the appropriate rules for the D Block and the Public Safety Broadband License, the Commission released the Second Further Notice of Proposed Rulemaking (Second FNPRM) . In the Second FNPRM , the Commission enumerated the following goals and principles for this rulemaking proceeding: • To facilitate public safety access to a nationwide, interoperable broadband network in a timely manner; • To identify concerns in the existing structure of the 700 MHz Public/Private Partnership to inform the Commission decision making going forward; • To promote wireless innovation and broadband network penetration while meeting the communications needs of the first responder community in a commercially viable manner; • To identify funding opportunities for the public safety community to realize the promise of a broadband communications infrastructure with a nationwide level of interoperability; and • To maximize the commercial and public safety benefits of the D Block spectrum. 53 53 See Second FNPRM , 23 FCC Rcd at 8052 para. 6. 33. With these goals and principles in mind, the Commission sought comment first on whether and how to clarify or revise the rules governing the public safety component of the 700 MHz Public/Private Partnership, including rules governing the Public Safety Broadband Licensee, the entities eligible to obtain access to the public safety broadband network, 54 and the relocation of public safety narrowband operations. 54 See id . at 8058-8062 paras. 24-32. The term “public safety broadband network,” which the Commission has used in the Second FNPRM and again in this Third FNPRM , refers to those functions and services of the shared network to which the Public Safety Broadband Licensee will administer access. 34. With regard to the Public Safety Broadband Licensee, the Commission sought comment on (1) whether to revise or clarify the structure and criteria of the Public Safety Broadband Licensee as adopted in the Second Report and Order , including whether to clarify the requirement that the Public Safety Broadband Licensee must be a non-profit organization; 55 (2) how the Public Safety Broadband Licensee should be funded; 56 (3) whether to adopt additional measures to better enable Commission or Congressional oversight of the Public Safety Broadband Licensee's activities; 57 and (4) whether, in light of these and other possible changes, the Commission should rescind the current Public Safety Broadband License and seek new applicants. 58 55 See id . at 8064 para. 40, 8067 para. 48. 56 See id . at 8065-8065 paras. 42-45 57 See id . at 8067 para. 48, 8068 para. 51. 58 See id . at 8068 para. 53. 35. Regarding access to the public safety broadband network, the Commission sought comment on (1) whether to clarify which entities are eligible to use the public safety broadband network; (2) whether to adopt measures requiring or promoting use of the public safety broadband network by eligible public safety entities; 59 (3) whether State governments should have a role in coordinating the participation of public safety entities in the public safety broadband network; 60 and (4) whether to revise the rules regarding use of the public safety broadband network by Federal public safety agencies. 61 59 See id . at 8063 para. 37. 60 See id . at 8068 para. 52. 61 See id . at 8092-93 para. 126. 36. With regard to the relocation of public safety narrowband operations, the Commission sought comment on issues including (1) whether to revise or eliminate the cap on relocation expenses; (2) whether, in light of the proposed re-auction of the D Block and associated timing issues, the Commission should continue to require relocation to be completed by the DTV transition date; (3) whether to amend the process for accomplishing the relocation; and (4) whether the Commission should extend the August 30, 2007 cut-off date for new narrowband deployments outside the consolidated narrowband spectrum. 62 62 See id . at 8111 paras. 180-182. 37. Turning to the 700 MHz Public/Private Partnership, the Commission asked, as a central matter, whether the Commission should continue to require the D Block licensee and the Public Safety Broadband Licensee to enter into a 700 MHz Public/Private Partnership. 63 The Commission further sought comment on a broad set of possible revisions to the 700 MHz Public/Private Partnership in the event the Commission continued that requirement, and on which changes would best serve the goal of making a broadband, interoperable network available on a nationwide basis to public safety entities. 64 63 See id . at 8069 para. 54. 64 See id . at 8069 para. 54, 8070 para. 58. 38. In particular, the Commission sought comment on (1) whether to establish a single nationwide D Block licensee or create multiple D Block licenses with, for example, Regional Economic Area Grouping (REAG) geographic license areas; 65 (2) whether to revise or clarify the technical requirements of the shared network that the D Block licensee must construct; 66 (3) whether the Commission should continue to require that the D Block licensee provide the Public Safety Broadband Licensee, in emergencies, with priority access to the D Block spectrum, and if so, whether the Commission should specify the circumstances that constitute an emergency for this purpose or establish other limits to such emergency priority access; 67 (4) whether to revise the D Block licensee's network build-out or performance requirements and the extent to which they could be met through non-cellular technologies such as Mobile Satellite Systems (MSS); 68 (5) whether to revise or clarify the respective operational roles of the D Block licensee and the Public Safety Broadband Licensee in the provision of network services to public safety users once the shared network is constructed; 69 and (6) whether the Commission should regulate network service fees. 70 65 See id . at 8109-8112 paras. 183-86. 66 See id . at 8071-78 paras. 61-83. 67 See id . at 8079-80 paras. 85-87. 68 See id . at 8081-86 paras. 90-105 69 See id . at 8088-89 paras. 113-16, 8090-92 paras. 121-26. 70 See id . at 8094-95 paras. 131-33. 39. The Commission further sought comment on the process by which these parties would establish a NSA that would further define the terms of the 700 MHz Public/Private Partnership. Among other issues, the Commission sought comment regarding (1) what rules should apply to the negotiation of the NSA; (2) whether to adopt dispute resolution procedures in the event the parties are unable to negotiate a voluntary agreement on NSA terms and if so, whether such procedures should include mandatory and binding adjudication of the disputes; (3) in the event that the process, with or without adjudication, is ultimately unsuccessful in establishing an NSA, whether and to what extent the D Block winner should be held liable for default payments; (4) whether, in the event of a failure to establish an NSA, the Commission should offer the D Block license to the next highest bidder or immediately re-auction it without the 700 MHz Public/Private Partnership condition; and (5) if a further re-auction is required, whether the D Block winning bidder should be prohibited from participating. 71 71 See id . at 8096-8100 paras. 138-54. 40. The Commission also sought comment on a number of other auction-related issues, including (1) whether to restrict who may participate in the new auction of the D Block license; (2) whether to establish a reserve price for such an auction and if so, at what level; 72 (3) whether to adopt an exception to the impermissible material relationship rule for the determination of designated entity eligibility with respect to arrangements for the lease or resale (including wholesale) of the spectrum capacity of the D Block license; 73 and (4) whether to modify the amount of the default payment potentially applicable to the D Block winning bidder. 74 72 See id . at 8104 paras. 163-64. 73 See id . at 8105-06 paras. 166-67. 74 See id . at 8108-09 paras. 172-75. 41. In addition to seeking comment on rules in the event that the Commission retains the 700 MHz Public/Private Partnership requirement, the Commission also sought comment on alternative rules for both the D Block and the Public Safety Broadband License in the event that the Commission does not retain the requirement. For the D Block, the Commission sought comment in particular on the appropriate geographic license area, performance requirements, license block size and license term, power and out-of-band-emission (OOBE) limits, and licensing partitioning and disaggregation rules, and whether to impose conditions such as an open-platform or wholesale requirement. 75 For the Public Safety Broadband Licensee, the Commission sought comment on how the Commission might still achieve the goal of ensuring that a nationwide, interoperable broadband network is available for use of public safety, and whether there are rules the Commission should impose on the Public Safety Broadband Licensee to achieve that goal. 76 75 See id . at 8115-16 paras. 192-205. 76 See id . at 8119-20 paras. 206-212. 42. Finally, the Commission provided in the Second FNPRM that, before adopting final rules to address the issues raised therein, the Commission would present for public comment, in a subsequent further notice of proposed rulemaking, a detailed proposal including the specific rules that the Commission intended to promulgate. 77 The Commission further indicated that the Commission would seek comment on an expedited basis. 78 77 See id . at 8052 para. 7. 78 See id . at 8052 n. 10. III. Discussion A. Whether to Retain the 700 MHz Public/Private Partnership Condition 43. Background . In the Second Report and Order , the Commission established rules mandating a public/private partnership between two nationwide licensees in the 700 MHz spectrum, the licensee of the commercial D Block and the Commission-designated licensee of the public safety broadband spectrum (Public Safety Broadband Licensee), to address the critical need of public safety users for interoperable, broadband communications. These rules required the D Block licensee to construct and operate a nationwide, interoperable broadband network across both the D Block and 700 MHz public safety broadband spectrum to provide broadband network services to both commercial and public safety entities. 44. The Commission found that promoting commercial investment in the build-out of a shared network infrastructure would address the most significant obstacle to constructing a public safety network—the limited availability of public funding. The Commission further determined that the network, by relying on a shared infrastructure to provide both commercial and public safety services, would achieve significant cost efficiencies, and benefit public safety agencies by allowing them to take advantage of off-the-shelf technology and commercial carriers' investments in research and development of advanced wireless technologies, as well as provide them with access to an additional 10 megahertz of broadband spectrum during emergencies. The Commission concluded that the public/private partnership approach thus provided the most practical means of speeding deployment of a nationwide, interoperable, broadband network for public safety service that is designed to meet their needs in times of crisis. At the same time, the Commission noted, it would provide the D Block licensee with rights to operate commercial services in the 10 megahertz of public safety broadband spectrum on a secondary, preemptible basis, which the Commission anticipated would help to defray the costs of build-out and also ensure that the spectrum is used efficiently. 45. In the Second FNPRM , the Commission sought comment on whether the public interest would best be served by the development of a nationwide, interoperable wireless broadband network for both commercial and public safety services through the 700 MHz Public/Private Partnership between the D Block licensee and the Public Safety Broadband Licensee, and whether the Commission should therefore continue to require that the D Block licensee and Public Safety Broadband Licensee enter into the 700 MHz Public/Private Partnership. 46. Comments . In response to the Second FNPRM , numerous commenters representing both public safety and commercial interests support continuing to require a public/private partnership between the D Block licensee and the Public Safety Broadband Licensee. 79 These commenters emphasize the importance of providing public safety first responders with an interoperable broadband wireless network 80 and they argue that a public/private partnership remains the best and possibly the only means of achieving these goals. 81 In particular, they argue that a public/private partnership is the only viable means of funding the construction of a nationwide network. 82 While noting that legislative appropriations could theoretically fund such a network, they assert that such funding is not going to be forthcoming, or that it is too uncertain for the Commission to rely upon. 83 79 See ACT Comments at 1; ALU Comments at 1; AASHTO Comments at 7; APCO Comments at 3; AT&T Comments at 2-4; Big Bend Comments at 1; California Comments at 7; Cellular South Comments at 1-2; Ericsson Comments at 3; IMSA et al. Comments at 1-2; MSUA Comments at 1; MSV Comments at i; NAEMT Comments at 1; NATOA et al. Comments at 7; NENA Comments at 2; NPSTC Comments at 1; NRPC Comments at 4; NTCH Comments at 1-2; PSST Comments at 4; RCA Comments at 1; RPC 6 Comments at 3; RPC 33 Comments at 2 (supporting the partnership “as long as there is regional and/or local control over the applied use of this network”); Seybold Comments at 2; SIEC Comments at 1; Sprint-Nextel Comments at 9; TeleCommUnity Comments at 3, 5-6; Televate Comments at 3; TE M/A-COM Comments at 3; U.S. Cellular Comments at 1; Coverage Co. Comments at 1; VFCA Comments at 3; WFCA Comments at 1; AASHTO Reply Comments at 1; Cyren Call Reply Comments at 2; IACPNSA Reply Comments at 1; ICMA Reply Comments at 2; ITS America Reply Comments at 2; NPSTC Reply Comments at 3; Sprint Nextel Reply Comments at 2-3; Space Data Reply Comments at 2; SouthernLINC Reply Comments at ii. 80 See AASHTO Comments at 7 (asserting that, “[w]ithout a single network using a common technology as its basis, the Commission nation's emergency response and disaster relief workers will continue to be hampered in their ability to respond to any call for assistance in the wake of a natural or man caused situation.”); Cellular South Comments at 1; Ericsson Comments at 3; Peha Comments at 2; MSUA Comments at 1; NAEMAT Comments at 2; NPSTC Comments at 6; PSST Comments at 4; Qualcomm Comments at 7; SIEC Comments at 1. 81 See, e.g. , APCO Comments at 3; Ericsson Comments at 3; IMSA et al. Comments at i; RCA Comments at 1. See also AT&T Comments at 2-3; Cellular South Comments at 1, 2; IMSA et al. Reply Comments at 3; ITS America Reply Comments at 2; NENA Comments at 2. 82 See AT&T Comments at 3; NATOA et al. Comments at iii; NAEMT Comments at 2; PSST Comments at 4-5; See also Cellular South Comments at 2; Ericsson Comments at 3-4; NPSTC Comments at 7 (describing public/private partnership as “the only reasoned course to meet this challenge given the lack of any funding to deploy the system.”); Sprint Nextel Comments at 10 (“public/private partnerships have been shown to be an effective means of galvanizing resources in the telecommunications and technology industries to meet critical needs in the public sector.”). 83 See, e.g. , NATOA et al. Comments at iii. See also id. at 7 (“Congress has made it clear that government funding * * * is not possible”); APCO Reply Comments at 3 (“the Commission cannot make policy decisions based on a ‘hope and prayer’ that Congress will act.”). 47. Commenters point to other benefits of the public/private partnership as well. Several argue, for example, that by sharing spectrum between commercial and public safety users, the public/private partnership will promote spectrum efficiency. 84 AT&T, discussing the benefits of public/private partnerships more generally, also asserts that the commercial partner in a public/private partnership can “leverage existing networks, technical assets, and spectrum resources to develop the interoperable network as quickly and efficiently as possible” and that it might rely on “previous experiences constructing wireless networks to ensure the construction of a reliable and effective public/private wireless broadband network.” 85 84 See AT&T Comments at 4; Cellular South Comments at 2; NATOA et al. Comments at 8; see also PSST Comments at 5-6. 85 AT&T Comments at 2-3. See also IMSA et al. Reply Comments at 6; PSST Comments at 6. 48. A number of commenters either oppose or express strong concerns regarding retaining the public/private partnership condition on the D Block. 86 They argue, among other things, that because of the high incremental cost of constructing a network to public safety specifications and build-out requirements, the network cannot be commercially viable without government funding. 87 They further argue that this problem is exacerbated by aspects of the 700 MHz Public/Private Partnership that make it difficult or impossible to determine revenue potential, and by the difficulty raising capital in the current economic environment. Several commenters argue that while the Commission might reduce the public safety-related requirements sufficient to permit commercial viability, this would defeat the public safety purpose of the network. 88 86 IAFF Comments at 1; King County Comments at 1-3; MetroPCS Comments at 5-6; Motorola Comments at 5-7; NYPD Comments at 3-5; RTG Comments at ii; San Francisco Comments at 2-4; Verizon Wireless Comments at 7-11; Rivada Reply Comments at 1-2, 4-5. 87 See, e.g. Motorola Comments at i, 2, 7, 9 (significant buildout and operating costs “will dramatically affect the ability of the D-Block licensee(s) to compete effectively with other commercial services on price” and that “further direction, legislative action, and funding are needed from Congress to ensure that first responders have the necessary resources to deploy a broadband video and data network”); King County Comments at 2; NYPD Comments at 3 (“there is simply no business case for a commercial wireless network operator to build a nationwide network that will meet public safety coverage and survivability standards.”); RPC 9 Comments at 3; San Francisco Comments at 7; Verizon Wireless Comments at 7-8. See also Motorola Reply Comments at 2. 88 Motorola Comments at 5; NYPD Reply Comments at 4-5; Verizon Wireless Comments at 8; Verizon Wireless Reply Comments at 1. See also MetroPCS Comments at 14. Cf. ITS America Reply Comments at 3 (“additional funding from Congress to cover the incremental costs of a Public Safety network compared to that of a commercial network is likely to be required.”). 49. Some commenters also argue that the Commission needs to address the unmet commercial needs of small and regional carriers for unencumbered spectrum suitable for advanced broadband services and that this demand can best be met by the D Block. 89 Based on this concern, for example, MetroPCS recommends that the Commission auction the D Block unencumbered and “seek congressional action to have the proceeds of such auction be used by the public safety community to build the network it needs.” 90 89 See MetroPCS Comments at 9-11; RTG Comments at 4-5. 90 MetroPCS Comments at 6, 9-11. See also RTG Comments at 4; CTIA Reply Comments at 2-3, 5. MetroPCS also argues that certain aspects of the 700 MHz Public/Private Partnership, including the requirement of commercial access to public safety spectrum on a secondary basis and of public safety access to commercial spectrum in emergencies, may violate Section 337 of the Communications Act. See MetroPCS Comments at 14-16. The Commission addresses these legal issues in the Commission discussion of spectrum use in the shared wireless broadband network. 50. Some public safety entities oppose the public/private partnership out of concern that the commercial incentives of the D Block licensee are inconsistent with its obligation to meet public safety needs. These commenters assert that, due in part to a lack of confidence in the network, and in some cases to the availability of local alternatives, local public safety entities will not use the network, and will therefore receive no benefit from the 700 MHz public safety broadband spectrum. 91 These commenters propose that, instead of using the public safety broadband spectrum in the 700 MHz Public/Private Partnership, the Commission should provide public safety entities direct access to the spectrum in order to build out their own separate networks. 92 AT&T, Verizon Wireless, and others support a public-private partnership but argue that a Request for Proposal process is a better alternative for accomplishing this goal than a reauction of the spectrum. 93 Specifically, AT&T and Verizon propose a process in which the Commission would reallocate the D Block spectrum to the PSBL, who in turn would use the RFP process to select a lessee or lessees to build a shared network. 94 Verizon Wireless also proposes an alternative RFP process in which the Commission would “auction the spectrum on an unencumbered basis and give the proceeds to public safety to support the deployment of interoperable communications solutions.” 95 The public safety licensee would, in turn, use an RFP process to establish a partnership with a commercial provider (presumably through some leasing arrangement). 96 91 NYPD Comments at 3 (asserting that public safety agencies in New York City have “little incentive * * * to pay subscriber fees to access a nationwide public/private broadband network” because a municipal public safety broadband data network will be fully deployed by the end of 2008); San Francisco Comments at 2-3; see also id. at 2 (describing results of a partnership requirement as “an uncertain auction, a vague network sharing agreement, an untested network, and the prospect that many local public safety agencies could choose not to participate”); RTG Comments at 2. 92 San Francisco Comments at 2; King County Comments at 2-3; NYPD Comments at 5-8. See also NYPD Comments at 7, 10; Philadelphia Comments, generally (arguing that local governments should have a right to “opt-out” of the nationwide network and construct an independent network in the public safety broadband spectrum”); TDC Comments at 3; Rivada Reply Comments at 1,2, 4. 93 See, e.g. , AT&T Comments at 2. 94 See AT&T Comments at 6; Verizon Wireless Comments at 21, n.33. 95 Verizon Wireless Comments at 21, n.33. 96 Id. (indicating that the public safety licensee could either use its existing allocation for the partnership, or the Commission could reallocate the D Block to public safety and license it to public safety licensee). 51. Discussion . The Commission tentatively concludes that it should continue to require, as a license condition, that the D Block licensee enter into a public/private partnership with the Public Safety Broadband Licensee for the purpose of constructing a shared wireless broadband network that will provide interoperable broadband service to public safety entities. Throughout this proceeding, the Commission has sought to promote nationwide access by public safety agencies to interoperable broadband wireless services operating over a modern, IP-based system architecture. The Commission has further sought to achieve certain ancillary goals, such as ensuring the robustness and survivability of the public safety broadband system as well as promoting cost and spectrum efficiency. 97 Achieving these public safety goals remains very much in the public interest. The Commission has noted previously the many potential benefits of broadband service to public safety, 98 and the record in this proceeding confirms the growing importance of broadband communications to public safety efforts. 99 The Commission finds that achieving a nationwide level of interoperability among and between public safety communications systems and devices so that public safety entities can communicate and coordinate their activities, particularly in response to emergencies, remains a critical imperative. 100 After considering the results of Auction 73 and the record in this proceeding, the Commission tentatively conclude that a mandatory public/private partnership between the licensee or licensees of the D Block and the licensee of the public safety broadband spectrum (which the Commission will again refer to as the “700 MHz Public/Private Partnership”) remains the best option available to us to achieve these goals. 97 See 700 MHz Ninth Public Safety Notice , 21 FCC Rcd at 14842-43 paras. 12-18; Second Report and Order , 22 FCC Rcd at 15431 paras. 396-97; Second FNPRM , 23 FCC Rcd at 8051-52 para. 6. 98 See 700 MHz Ninth Public Safety Notice , 21 FCC Rcd at 14842 para. 12 (“police officers could exchange mug shots, fingerprints, photographic identification, and enforcement records; firefighters could have access to floor and building plans and real-time medical information; forensic experts could provide high resolution photographs of crime scenes and real-time video monitoring transmitted to incident command centers.”). 99 See, e.g. , NAEMT Comments at 2 (“EMS communication's future is broadband. To save time in life-threatening situations, it will become essential to use technologies now in development to send data in addition to voice communications.”); see also Ericsson Comments at 3; NPSTC Comments at 6; PSST Comments at 4; Testimony of Robert M. Gurss, Director, Legal & Government Affairs, Association Of Public-Safety Communications Officials-International, Inc., July 30, 2008, http://www.fcc.gov/realaudio/presentations/2008/073008/gurss.pdf (“Broadband video, high speed images, Internet access, and data of an endless variety would greatly enhance the ability of police, fire, EMS and other personnel to protect the public and respond to emergencies.”). 100 See, e.g. , Cellular South Comments at 1; PSST Comments at 4; SIEC Comments at 1. See also AASHTO Comments at 7 (“Without a single network using a common technology as its basis, the Commission nation's emergency response and disaster relief workers will continue to be hampered in their ability to respond to any call for assistance in the wake of a natural or man caused situation.”). 52. The Commission continues to find that, as a regulatory approach for promoting the development of a nationwide, interoperable broadband network for public safety, the basic construct of the 700 MHz Public/Private Partnership model has a number of benefits. As the Commission stated in the Second Report and Order , the use of a shared infrastructure for both commercial and public safety services will enable a significant cost savings in the construction of the network. 101 Further, making the construction and operation of this network a license condition will help to promote development of public safety network with access on a nationwide basis, lead to economies of scale in network infrastructure and equipment, and provide a regulatory framework for ensuring construction on a timely basis. In addition, by providing the commercial partner with secondary preemptible access to the public safety spectrum and providing public safety limited priority access to the commercial spectrum in times of emergency, the 700 MHz Public/Private Partnership furthers the important public interest goal of maximizing efficient and intensive spectrum use, 102 without compromising safety or commercial feasibility, resulting in a total net benefit to public safety and commercial entities. This approach may also serve important commercial interests, such as promoting the availability of broadband services to remote areas. 101 See, e.g., Second Report and Order , 22 FCC Rcd at para. 396. 102 See, e.g. , 47 U.S.C. 151, 309(j)(3)(D). 53. Most importantly, the Commission finds that the 700 MHz Public/Private Partnership remains the only means, in the absence of legislative appropriations, of obtaining funding for the construction of a network or networks to provide public safety with nationwide, interoperable broadband service. The record in this proceeding confirms the limited availability of public funding for the construction of a public safety broadband network, and the importance of the 700 MHz Public/Private Partnership as a means to promote commercial investment for that purpose. 103 The Commission notes that several commenters have argued that the public safety community's need for such funding is best addressed by additional government appropriations instead of through commercial investment. 104 While the Commission agrees that government funding would be a solution, the Commission is not aware of any current appropriations for such networks, and certainly none sufficient to provide access on the scale addressed by the 700 MHz Public/Private Partnership proposal. Similarly, Congress has not authorized the Commission to use 700 MHz auction funds for network construction. Therefore, so long as there is a reasonable likelihood of success with the 700 MHz Public/Private Partnership approach, the Commission declines to abandon this course in favor of a speculative approach that relies on government funding that may not materialize. 103 See NAEMT Comments at 2 (“No other proposal for a national public safety broadband system has suggested how to fund it other than the FCC's public/private partnership concept”); see also ACT Comments at 1; AT&T Comments at 3; NATOA Comments at 21; PSST Comments at 4-5; Sprint Nextel Comments at 10 (“public/private partnerships have been shown to be an effective means of galvanizing resources in the telecommunications and technology industries to meet critical needs in the public sector.”). 104 See, e.g. , MetroPCS Comments at 6; Motorola Comments at 5-6; RTG Comments at 3, n.3. See also Verizon Wireless Comments at 30 n.52. Cf. Florida Region 9 Comments at 3 (“Without Federal funding the Commission believes any public/private partnership will fail the requirements of the PSST.”). 54. The Commission is also not persuaded to rely solely on local and state entities to build out their own networks in the 700 MHz public safety broadband spectrum as a substitute for construction by mandatory public/private partnerships. Although a few jurisdictions such as New York City have determined to use commercial service providers to satisfy their wireless broadband needs, none of these jurisdictions have stated that these networks provide anything more than commercial-grade service, or that they were able to achieve the economies of scale and nationwide interoperability inherent in the 700 MHz Public/Private Partnership approach. As more and more public safety agencies take advantage of the benefits of broadband applications, the Commission is concerned that in the end the Commission will again end up with balkanized networks incapable of even minimum interoperability. 105 Again, when faced with future calamities, the Nation will continue to suffer from the same dangerous shortcomings that were encountered following natural and man-made disasters of the past because there will remain no dedicated public safety spectrum with a nationwide level of interoperability. The Commission also remains concerned that, due to the funding issues discussed above, such local or regional efforts will occur only in a few jurisdictions, leaving most of the country's public safety community without wireless broadband for the foreseeable future. In contrast, the 700 MHz Public/Private Partnership rules proposed herein will provide a plan to provide broadband coverage for public safety entities on a significantly more expanded basis than individual agreements with commercial service providers or buildout by individual jurisdictions in the 700 MHz broadband spectrum could achieve. 105 The Commission notes that existing rules permit local jurisdictions to construct independent networks operating over the 700 MHz public safety broadband spectrum, with certain limitations and conditions, in the event that the shared wireless broadband network is not scheduled to cover the relevant jurisdiction by the end of the D Block license term. See 47 CFR 27.1330(b)(5). In addition, these rules provide local jurisdictions with a method, again with certain conditions, to construct a network prior to the anticipated construction date of the shared wireless broadband network in that jurisdiction, subject to later integration. See id. As discussed elsewhere, the Commission tentatively concludes that the Commission should retain these rules. 55. As noted above, some commenters have argued that, whatever benefits the 700 MHz Public/Private Partnership might possess, the model cannot be made commercially viable except by reductions in the network design and coverage requirements that would sacrifice its suitability as a public safety network. The Commission recognizes that, for the 700 MHz Public/Private Partnership to achieve the objectives of this proceeding, it must meet the essential requirements of public safety communications systems and also provide a level of commercial viability sufficient to encourage investor participation and to permit long-term commercial success in a competitive environment. The Commission also acknowledges that there is some tension between these goals. To the extent that the network is required to meet higher standards for reliability, hardening, security, and other features than are being implemented in competing commercial broadband networks, and to build out in commercially unprofitable areas, such costs will pose an additional challenge to the commercial viability of the network. The Commission also notes that the financial challenges posed by the construction and operation of the shared wireless broadband network may be exacerbated by the prevailing condition of the nation's economy overall and its impact on the availability of capital. 106 106 See Council Tree Comments at ii. 56. Based on the record before us, however, the Commission tentatively concludes that it is possible to establish requirements that are commercially viable while still meeting the essential requirements of public safety first responders. First, the Commission anticipates that a part, although likely not all, of the incremental cost of meeting public safety specifications and construction will be accounted for in the discounted price of the auctioned D Block spectrum. 107 In addition, the Commission finds that certain reductions or modifications of the requirements in the existing rules are consistent with the Commission's fundamental public safety objectives, and will significantly improve the commercial viability of the 700 MHz Public/Private Partnership, thus enhancing the likelihood that public safety users will in fact receive the benefits the Commission seeks to achieve in this proceeding. The Commission also expects that, to some extent, additional public safety-related requirements should provide some degree of market advantage, particularly to public safety users and others, such as critical infrastructure users. 108 The Commission notes that despite the Commission tentative conclusion that entities such as critical infrastructure users are not eligible for service as public safety users, they may still receive service as customers of the D Block licensee(s). 109 107 See APCO Comments at 37. But see Verizon Wireless Comments at 8 (“the D Block and public safety broadband spectrum are not worth nearly enough to offset the massive cost of building a national broadband network to the mission-critical specifications of public safety * * * even if the D Block were given away for free,” and estimating the incremental costs of hardening and build-out beyond commercial footprints at over $20 billion). See also APCO Comments at 37. 108 See, e.g. SouthernLINC Reply Comments at ii, 4 (noting that, “given its hardened network and best of class design, public safety agencies throughout SouthernLINC's territory have relied on SouthernLINC for day-to-day and emergency operations since the network became operational in 1995,” and that nearly one-quarter of its customer base is comprised of “federal, state, and local agencies”). But see Motorola Comments at 4-5 (stating that the number of first responders is “insufficient * * * to amortize the high costs associated with hardening the network and constructing infrastructure covering over 99.3 percent of the U.S. population.”). 109 The Commission note that the record provides some evidence indicating that networks have already been constructed that are both suitable for public safety use and commercially viable. SouthernLINC, for example, notes that since 1995, it has operated a commercial network “specifically designed to withstand the stressful weather conditions caused by hurricanes in the Southeast,” with features “far more robust than a traditionally-designed, commercial-grade network designed with some additional redundancy.” SouthernLINC Reply Comments at 3-4; but see id . at 4 (“[a] true public-private partnership can work, but it is not easy, and the Commission should recognize that this proceeding may not be the right vehicle to make it happen”). In addition, PGCC, after reviewing the results of a project to construct a Wi-Fi network over a 30-mile corridor in Arizona for public safety and other users, concluded that the “experience supports the FCC position proposing to use D-Block and the adjacent Public Safety spectrum for nationwide broadband connectivity with commercial ownership subject to Public Safety constraints.” PGCC Comments at 11. 57. The Commission does find that many of the specific problems noted by commenters regarding the existing rules governing 700 MHz Public/Private Partnership present legitimate concerns. The Commission tentatively concludes that these issues can be successfully addressed, however, through appropriate rule modifications. On the commercial side, the Commission agrees, for example, that for potential bidders to make an informed determination regarding the viability of the partnership, they must have reasonable certainty and clarity regarding their obligations under the rules, and thus, the likely costs of constructing and operating the shared wireless broadband network. They also need to have some ability to predict the revenue potential of the shared wireless broadband network. While the Commission may not have provided sufficient certainty on either of these factors under the existing rules, the Commission is persuaded that it is possible to provide such certainty. Conversely, regarding certain public safety objections that the commercial D Block licensee will not adequately serve their interests, the Commission finds that appropriate oversight measures, including reporting requirements, can address these concerns. Accordingly, in the sections below, the Commission addresses these issues in greater detail and reaches tentative conclusions regarding how best to implement the 700 MHz Public/Private Partnership to respond to these concerns. 58. Though the Commission tentatively concludes that it should retain the public/private partnership and assign commercial licenses for the D Block by competitive bidding, the Commission also seeks comment on whether assigning licenses through a Request for Proposal (RFP) process would increase the likelihood of successfully deploying a nationwide interoperable broadband network useable by public safety. The Commission seeks comments on both a detailed proposal for how the RFP process would be conducted, as well as why it would be superior to an auction of licenses consistent with the rules proposed herein. The Commission seeks comment as well on whether any RFP process would be consistent with the Commission's obligations under Sections 309(j) and 337(a) with respect to the allocation of spectrum and the method of assigning D Block licenses. B. Service Rules for the D Block Licensee and the 700 MHz Public/Private Partnership 1. Geographic Area for D Block License 59. Background. In the Second Report and Order, the Commission determined that the D Block license would be auctioned as a single, nationwide license. 110 In the Second FNPRM, the Commission revisited this decision, in part, because no bidder matched the reserve price the Commission set for the D Block license. 111 In addition to asking if the Commission should retain the single, nationwide license approach, the Commission proposed authorizing the D Block among multiple licensees and asked several questions related to such a proposal. The Commission asked what size the license areas should be if the D Block were split into regional licenses? For instance, should the blocks be Regional Economic Area Groups (REAGs), Economic Areas (EAs), or Cellular Market Areas (CMAs)? 112 The Commission also sought comment on whether the D Block should be split into one license (or several licenses) covering high-population density areas and a second license (or set of licenses) covering low-population density areas. 113 The Commission further sought comment on whether the Commission should modify any of the policies or rules previously adopted or proposed with respect to a D Block 700 MHz Public/Private Partnership to ensure that the primary goal of a national, interoperable, communications network for public safety agencies is not jeopardized. 114 110 Second Report and Order, 22 FCC Rcd at 15420 para. 369. 111 Second FNPRM, 23 FCC Rcd 8047, 8048-49 para. 1. 112 Second FNPRM, 23 FCC Rcd at 8111-12 para. 183. 113 Second FNPRM, 23 FCC Rcd at 8112 para. 185. 114 Second FNPRM, 23 FCC Rcd at 8112 para. 184. 60. Commenters offer divergent views on whether the Commission should maintain the single, nationwide, license approach or allocate the D Block through multiple, smaller, regional licenses. Sprint Nextel, Rural Cellular Association (RCA), Ericsson, Inc. (Ericsson), the PSST, the Association of Public Safety Communications Officials (APCO), National Public Safety Telecommunications Council (NPSTC), and most public safety organizations prefer the single, nationwide license approach because, they contend, it should present the most cost effective approach to designing a broadband network that achieves interoperability and connectivity across geographic regions on a nationwide basis. 115 Some commenters object to regional licensing on grounds that some or even many regions might go unsold at auction, resulting in checkerboard coverage. 116 NPSTC argues that integrating regional networks would present technical and logistical challenges and could take years to implement. 117 115 APCO Comments at 40; see also, International Municipal Signal Association, International Association of Fire Chiefs, Inc., Congressional Fire Services Institute, and Forestry Conservation Communications Association (IMSA et al.) Comments at 12; National Association of Telecommunications Officers and Advisors, National Association of Counties, National League of Cities, and U.S. Conference of Majors (NATOA, et al.,) Comments at 17; National Public Safety Telecommunications Council (NPSTC) Reply Comments at 9; Region 33, 700 MHz Planning Committee (Region 33) Comments at 19-21; Virginia Fire Chiefs Association (VFCA) Comments at 3; Rural Cellular Association (RCA) Comments at 2; Sprint Nextel Comments at 11; Public Safety Spectrum Trust Corporation (PSST) Reply Comments at 12; Testimony of Chief Harlin R. McEwen, Chairman, PSST FCC En Banc Hearing, New York, July 30, 2008 at 2; Ericsson Comments at 34; Council Tree Reply Comments at 13; Intelligent Transportation Society of America (ITS America) Reply Comments at 3. 116 See e.g. APCO Comments at 40. 117 NPSTC Reply Comments at 10. 61. A number of commenters, however, favor a regional approach. AT&T, Verizon Wireless, and smaller regional service providers, such as MetroPCS, United States Cellular Corporation US Cellular and Rural Telecommunications Group (RTG), prefer the multiple, regional license approach for the D Block because, among other reasons, regional licenses would permit participation by smaller providers, who may be unable to compete on a nationwide scale, but may have the resources to build regional networks that could be leveraged to rapidly deploy a nationwide system. 118 US Cellular recommends that the Commission adopt geographic areas that align with the “55 National Public Safety Planning Advisory Committee (NPSPAC) regions.” 119 US Cellular argues that these regions are of similar size to MEAs and “with over two decades of experience in meeting the wireless needs of state and local public safety authorities through [NPSPAC] regional committees operating pursuant to a national plan and FCC order, there are also distinct advantages in aligning D Block licenses with the NPSPAC.” 120 US Cellular and RTG also contend that smaller license areas could lead to more rapid deployment of public safety communications networks in rural areas. 121 118 AT&T Comments at 24-25; Verizon Wireless Comments at 29-31; Verizon Wireless Reply Comments at 11; Metro PCS Comments at 20; US Cellular Comments at i, 15-16; RTG Comments at ii, 1; NTCH Comments at 9-10; Testimony of William J. Andrle, Jr. Northrop Grumman Information Technology FCC En Banc Hearing, New York, July 30, 2008 at 2. 119 US Cellular Comments at 2. US Cellular later made an ex parte presentation in which it argued that the Commission should license the D Block through geographic areas that followed state geographical boundaries. See Letter from Warren G. Lavey, on behalf of US Cellular, to Marlene H. Dortch, Secretary, WT Docket No. 06-150, filed Aug. 29, 2008, Attachment at 3. 120 US Cellular Comments at i. See also AT&T Reply Comments at 9; City of Philadelphia Reply Comments at 6-7 & nn. 13, 16. 121 RTG Comments at ii, 4; US Cellular Comments at 2. 62. TeleCommUnity, a national association of local governments, and Charlotte, North Carolina, Houston, Texas, and Montgomery County, Maryland (TeleCommUnity), contends that there are strong arguments for allocating regional licenses, for the D Block, as well as the single, nationwide license approach. 122 The New York City Police Department (NYPD) and the City of Philadelphia (Philadelphia) contend that the Commission should adopt an approach that permits local public safety agencies to develop their networks that would then interconnect with other local public safety agencies. 123 These entities argue that a single, nationwide license could impede the development of their local public safety networks. 124 Coverage Co. and Space Data Corp. ask the Commission to adopt an approach that assigns one license for urban or more populated areas and another license for rural or less populated areas. 125 Other entities, such as Google and Qualcomm, do not appear to favor a single, nationwide license or a multiple regional license approach. They are more concerned that the Commission establishes a public safety broadband network that is interoperable as soon as practicable. 126 122 TeleCommUnity Comments at 13-14. 123 NYPD Reply Comments at 4-5; Philadelphia Reply Comments at 8. 124 NYPD Reply Comments at 7-14; Philadelphia Reply Comments at 5-8. 125 Coverage Co. Comments at 2; Space Data Corp. Comments at 2-3, 12. 126 Google Comments at 3; Qualcomm Comments at 8. 63. Discussion. The Commission tentatively concludes that the Commission should offer the D Block at auction as both a single, nationwide license and as regional licenses. The Commission proposes that the regional geographic areas would be comprised of the 55 700 MHz RPC regions, 127 and three additional regions, and to refer to these 58 regions as PSRs for D Block licensing purposes. 128 The three additional regions will cover (1) the Gulf of Mexico; (2) the Territory of Guam (Guam) and the Commonwealth of Northern Mariana Islands (Northern Mariana Islands); and (3) the Territory of American Samoa (American Samoa), and will be identical to the current Economic Area (EA) licensing areas for those same regions. 127 Although some commenters propose the use of NPSPAC regions for licensing, the Commission tentatively finds it more appropriate to use the Regional Planning Committee (RPC) regions, which are largely but not entirely identical. The Commission notes that the NPSPAC regions were established in connection with the 800 MHz public safety spectrum. The term “NPSPAC” is an acronym for the National Public Safety Planning Advisory Committee, which was established by the Commission in 1986 to advise the Commission on rules for the 821-824 MHz/866-869 MHz band. See Amendment of Parts 2 and 22 of the Commission's Rules Relative to Cellular Communications Systems Amendment of Parts 2, 15, and 90 of the Commission's Rules and Regulations to Allocate Frequencies in the 900 MHz Reserve Band for Private Land Mobile Use Amendment of Parts 2, 22 and 25 of the Commission's Rules to Allocate Spectrum for, and to Establish Other Rules and Policies Pertaining to the Use of Radio Frequencies in a Land Mobile Satellite Service for the Provision of Various Common Carrier Services, GEN Docket No. 84-1231 RM-4812, GEN Docket No. 84-1233 RM-4829, GEN Docket No. 84-1234, Report and Order, 2 FCC Rcd at 1825 para. 46 (1986). The 821-824 MHz/866-869 MHz band was eventually licensed on a regional basis with the resulting regions designated as NPSPAC regions. However, the initial rules governing the 700 MHz public safety spectrum, which included the regional approach governing a portion of that spectrum, were established in a separate proceeding. See Development of Operational, Technical and Spectrum Requirements For Meeting Federal, State and Local Public Safety Agency Communication Requirements Through the Year 2010, WT Docket No. 96-86, First Report and Order and Third Notice of Proposed Rulemaking, 14 FCC Rcd 152 (1998) ( 700 MHz Public Safety First Report and Order and Third Notice ). The Commission tentatively finds that the 700 MHz regions are the more appropriate regional basis to use in the instant proceeding. As noted above, the 700 MHz regions are almost, but not quite, identical to the 800 MHz NPSPAC regions. Although the NPSPAC regional boundaries were used as the initial basis for the 700 MHz public safety regions, see id. at 263, Appendix C (List of Regions), two of the regions have since been modified. See Public Notice, “Public Safety 700 MHz Band—General Use Channels Approval of Changes to Regional Planning Boundaries of Michigan and Connecticut,” 16 FCC Rcd 16359 (2001). The Commission proposal would thus license the D Block in accordance with these regional boundaries as modified for Connecticut and Michigan. As for terminology, because the NPSPAC was not involved in the 700 MHz proceeding, it would be a misnomer to identify these 700 MHz geographic areas as NPSPAC regions. It is more accurate to refer to the regions as RPC regions because the spectrum allocation in these areas is governed by the RPCs. See 47 CFR 90.531. 128 See Appendix A. 64. As the Commission explains further below, the Commission finds that both nationwide and PSR area licenses have advantages that could help achieve the public interest goal of establishing a commercially viable interoperable public safety broadband network on a nationwide basis. Further, while offering the D Block on a regional basis raises the risk of unsold areas, offering only a single, nationwide license may increase the risk that there are no bids on the D Block spectrum at all. Accordingly, to provide the greatest likelihood of success in offering new licenses for the D Block spectrum with a public/private partnership condition, the Commission proposes to permit entities to bid on both nationwide and regional licensing options and to allow auction results to determine on which geographic area basis the D Block will ultimately be licensed pursuant to auction rules and procedures that the Commission explains elsewhere in this Third FNPRM. 65. Nationwide Option. The Commission tentatively concludes that one of the D Block geographic license area options that parties should be able to bid upon is a single, nationwide license. The Commission proposes to offer a nationwide D Block license because the record in this proceeding reaffirms that the Commission can achieve its goals for the public safety broadband network through this type of license. 129 In particular, one of the Commission's primary goals for the authorization of the D Block is to “address a vitally important problem: promoting interoperability, on a nationwide basis, for public safety communications.” 130 The record in response to the Second FNPRM supports the Commission's previous determination that interoperability is a critical need for the public safety broadband network and that assigning the D Block to a single, nationwide licensee may help to facilitate achieving nationwide interoperability both within and between jurisdictions. The Commission notes that the majority of public safety agencies assert that a single, nationwide license is the best way to achieve an interoperable network. 131 Although the Commission tentatively finds that it is possible to achieve interoperability between regional networks, a nationwide license would likely simplify the task of ensuring interoperability and avoid problems in its implementation. For example, it would eliminate the need for technology coordination, roaming arrangements, and interconnection arrangements between different regional networks. 129 Second Report and Order, 22 FCC Rcd at 15420 para. 369. Thus, the license will cover the 50 states, the Gulf of Mexico, and the territories. 130 Second FNPRM, 23 FCC Rcd at 8051 para. 5; see also Second Report and Order, 22 FCC Rcd at 15419 para. 365. In addition, in the 700 MHz Public Safety Eighth Notice adopted in March 2006, the Commission emphasized its commitment “to ensuring that emergency first responders have access to reliable and interoperable communications.” 700 MHz Public Safety Eighth Notice, 21 FCC Rcd at 3682 para. 31; see also, Second FNPRM, 23 FCC Rcd at 8051 para. 4; Second Report and Order, 22 FCC Rcd at 15420 para. 369; 700 MHz FNPRM, 22 FCC Rcd at 8156 para. 253. 131 See, e.g. , APCO Comments at 40; IMSA et al. Comments at 12; NATOA, et al. Comments at 10. 66. Licensing the D Block on a nationwide basis could also help to achieve the other goals that the Commission has for the public safety broadband network, i.e. , that it be cost effective, spectrally efficient, flexible and employ an advanced IP-based network. 132 A single, nationwide license may provide opportunities for cost savings through elimination of redundant equipment ( e.g. , mobile base station deployments in the event of natural disasters), processes (billing, etc.) or staff ( e.g. , public safety support), and greater economies of scale for network equipment or handsets. 133 These cost savings might enhance the ability of the D Block licensee to rapidly build the public safety broadband network in rural, expensive-to-serve, less populated areas. The Commission therefore tentatively concludes that the economies of scale that a commercial entity could achieve through a single, nationwide license could promote the rapid deployment of an advanced nationwide public safety broadband network. 132 Second Report and Order, 22 FCC Rcd at 15420 para. 369. 133 See Second Report and Order, 22 FCC Rcd at 15298, 15324 paras. 20, 82 (explaining how larger geographic service areas permit service providers to establish economies of scale). 67. In addition, a single, nationwide license could facilitate coordination between the D Block licensee, the Public Safety Broadband Licensee, and the public safety agencies that use the network. As discussed elsewhere in this Third FNPRM, the public/private partnership concept requires the D Block licensee to establish an NSA with the Public Safety Broadband Licensee and, thereafter, coordinate with the Public Safety Broadband Licensee to ensure that the network effectively serves the interests of the public safety community. The coordination scheme envisioned for the D Block could be particularly efficient if there were only one licensee required to coordinate and negotiate with the Public Safety Broadband Licensee and local public safety agencies. 68. Some wireless service providers argue that the single, nationwide license will not work because, in their opinion, no single entity would find it commercially viable to develop a nationwide public safety communications network with the technical requirements and other rules that the Commission had imposed, in the Second Report and Order, on the D Block. 134 As the Commission discusses in more detail, elsewhere, the Commission has made substantial changes to the technical specifications and performance requirements that should help make the single, nationwide license more commercially viable. These policies should ease the burdens on a single, nationwide D Block licensee. 134 AT&T Comments at 7-8; Verizon Wireless Comments at 7-8, 24-31. 69. Public Safety Region Option. The Commission tentatively conclude that the Commission should revise the Commission rules to also provide the option of regional geographic area licensing of the D Block on the basis of 58 PSRs, 55 regions of which would correspond to the 55 RPC regions, and which would include three additional regions covering (1) the Gulf of Mexico; (2) Guam and the Northern Mariana Islands; and (3) American Samoa. 135 As the Commission explains further below, PSR licensees could lead to a rapid deployment of the public safety broadband network that is tailored to respond to the public safety communications needs of particular regions. 135 See Appendix A. 70. The Commission's proposal to permit licensing of the D Block on a regional basis is based on several factors. Section 309(j) of the Communications Act instructs that, in designing competitive bidding systems, the Commission should consider the dissemination of licenses among a wide variety of applicants when that consideration would serve the public interest. 136 Regional licensing could allow smaller commercial entities that do not have the resources to acquire a nationwide license and meet nationwide performance requirements to participate in bidding for D Block licenses, thereby increasing the chances of a successful public/private partnership for at least the majority of the nation. In addition, regional licensing could lead to enhanced build-out and faster deployment to less populated, rural areas. Those entities interested in a larger geographic footprint can bid on, and if successful, aggregate multiple PSR regional licenses. The record in response to the Second FNPRM demonstrates that nearly all nationwide carriers and several regional carriers, which filed comments, support licensing on a regional basis. 137 As the Commission explains elsewhere, in order to ensure that authorizing the D Block through multiple, regional licenses will achieve nationwide interoperability, the Commission has proposed roaming and certain other interoperability requirements for D Block licenses. In order to reduce the possibility that regional licensing of the D Block might result in large areas that are unserved by the public safety broadband network, the Commission tentatively concludes that an auction of the D Block spectrum must result in winning D Block license bidders with licenses covering at least 50 percent of the nationwide population or the results of the auction will be void. 138 136 47 U.S.C. 309(j)(3)(B); Service Rules for the 746-764 and 776-794 MHz Bands, and Revisions to Part 27 of the Commission's Rules, First Report and Order, 15 FCC Rcd 476, 500 para. 57 (2000). 137 AT&T, Inc., (AT&T) Comments at 24-25; Verizon Wireless Comments at 29-31; Verizon Wireless Reply Comments at 11; Metro PCS Comments at 20; U.S. Cellular Comments at i, 15-16; Rural Telecommunications Group, Inc. (RTG) Comments at ii, 1; NTCH, Inc., (NTCH) Comments at 9-10; Testimony of William J. Andrle, Jr. Northrop Grumman Information Technology FCC En Banc Hearing, New York, July 30, 2008 at 2. Among the carriers offering nationwide service plans, who filed comments in this proceeding, only Sprint Nextel supports nationwide licensing. See Sprint Nextel Comments at 11. 138 See Letter from Warren G. Lavey, on behalf of U.S. Cellular, to Marlene H. Dortch, Secretary, FCC, WT Docket No. 06-150, filed July 28, 2008, Attachment at 9 (suggesting that the Commission should set a minimum population threshold in determining if the auction results for the D Block should stand). 71. In addition, regional D Block licensees could be particularly responsive to the unique needs of state, regional, and local public safety agencies. Regional licensees could coordinate with local public safety entities and ensure that public safety communications are tailored to meet unique local needs in particular geographic areas. PSR licensees may, for example, take into account regional differences in terrain and public safety needs in determining how to set up and operate the system, which could be more cost effective in certain respects and better suited to regional needs than a one-size fits-all system. PSR licenses may also be more desirable because the assignment of a single, nationwide, D Block license may increase risks of disruption for public safety entities in the event the single nationwide operator is commercially unsuccessful. Having regional licensees, with license areas mostly following state jurisdictional boundaries, may also address certain concerns in the record that the development of the nationwide public safety broadband network should not impede the existing networks that some local agencies have spent substantial resources deploying. 139 139 See, generally, District Comments; see also Prepared Testimony of John J. Farmer, Former Attorney General, New Jersey; Senior Counsel, 9/11 Commission, at 3, FCC En Banc Hearing (July 30, 2008). 72. Assigning the D Block through PSR licenses that are geographically aligned with the 55 RPC regions could further enhance the responsiveness of the PSR licensees to the public safety communications needs of their specific geographic regions and facilitate the development of an interoperable public safety broadband network. The Commission created the RPC regions for 700 MHz public safety general use spectrum to maximize the efficiency of public safety's use of this spectrum and to foster the accommodation of a wide variety of localized public safety communications requirements in different areas of the Nation. Creating regional D Block licenses whose boundaries correspond with those of the RPC regions should facilitate interaction between the PSR licensees and the existing RPCs. The Commission anticipates that these regional entities have considerable institutional knowledge about the communications needs and concerns of public safety entities within their jurisdictions. PSR licensees could coordinate with them for their respective licensing area to learn about any public safety communications challenges or needs that might be specific to the particular region. RPCs might also help the Public Safety Broadband Licensee and PSR licensees negotiate the build-out schedule, fees, and other terms of their respective NSAs that would be tailored for a particular PSR region. RPCs could also share with PSR licensees approaches towards establishing inter-regional interoperability that have been more successful than others. 140 140 See AT&T Reply Comments at 9 (arguing that, if the Public/Private Partnership is able to take advantage of the organizational structure already in place among the RPCs, “the RPCs will facilitate interoperability and coordination between adjacent regions and public safety agencies, while ensuring that local public safety users have a voice in the design and functionality of the services offered over the network.”). 73. License Partitioning and Disaggregation. The Commission tentatively concludes that it would not serve the public interest to change the current rule governing D Block partitioning and disaggregation, and thus to continue prohibiting any partitioning and disaggregation of a D Block license. The Commission seeks comment on this conclusion. 74. Other Geographic Area Proposals. The Commission tentatively concludes that it would not serve the public interest to split the D Block into one license for a high-population density area and a second license covering low-population density, rural areas, as Coverage Co. and Space Data request. 141 Coverage Co. and Space Data's proposals do not specify the boundaries of the geographic areas that the two licenses would cover, which could present uncertainties for potential bidders and lead to disputes. In addition, there is a substantial question about the commercial viability of these two-license approaches. Coverage Co. and Space Data do not appear to argue, and the arguments they make do not demonstrate, that their two-license proposals are more commercially viable than the regional approach the Commission proposes. Also, the record does not indicate that commenters, other than Coverage Co. and Space Data, [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3AE8-23045. Public record. Not legal advice.