D Block Spectrum Auction Fraud Alleged

eweekhickins writes "A public interest group is saying that a consulting firm hired to help the government hand over the D-block spectrum may have acted improperly and discouraged potential bidders by suggesting that any winning bid would have to pay $50 million in annual fees, in addition to the auction price. Any wonder the D-block didn't meet the reserve price?"

D Block Restrictions

[Silentknyght]

The nationwide D Block licensee must provide signal coverage and offer service to (1) at least 75 percent of the population of the license area by the end of the fourth year, (2) at least 95 percent of the population by the end of the seventh year, and (3) at least 99.3 percent of the population by the end of the tenth year. These three construction benchmarks will take effect beginning on February 17, 2009. Moreover, the nationwide D Block licensee must meet the construction benchmarks based on the build-out schedule specified in the NSA. If the licensee fails to meet a construction benchmark, the Commission may cancel its license, depending on the circumstances.

From http://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=73 [fcc.gov]

75% coverage of the "license area" (for a Nationwide license) seems daunting after four years, let alone 99.3% after ten years. I'm not sure how the FCC would actually determine compliance with that provision, but that sounds like a massive undertaking to me. Other blocks have a requirement to provide something like 35%-70% coverage of their smaller, geographic area.

Same Old Song & Dance

[TheGrumpster]

For those of you not wanting to endure E-Weak's spam, a better summary can be found here: http://www.publicknowledge.org/node/707 [publicknowledge.org] This group of scam artists has been around the wireless industry for ages, and what a great way to steal. Take something the government already owns and sell it back to them. What will they think of next?

Re:D Block Restrictions

[morgan_greywolf]

Shouldn't be a problem for a big money company like Google. A lot of the equipment they would need to do that will be going at fire sale prices from television stations who will no longer need the equipment.

No, I smell a rat. Definitely.

Re:D Block Restrictions

[Mikkeles]

'75% coverage of the "license area" (for a Nationwide license) seems daunting after four years,...'

Not really, since it is actually 75% of the population in the Nation. That's about 250M. The top 5 or 6 cities has a pop. of about 20M; the urban areas are about 80M. As a rough oestimate, it would take 50-60 cities (including the urban areas) to achieve this coverage. For flexibility in development, I would use 100 cities (with less of the surrounding urban areas) for the initial placements and expand outward from there to achieve the remaining required coverage.