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FCC to Investigate D-Block Auction 54

Posted by CmdrTaco
from the messing-with-the-system dept.
eweekhickins writes "Feds and public interest groups are taking seriously accusations that someone tampered with the wireless spectrum auction process. The block of spectrum that was supposed to go to emergency responders failed to get close to the reserve price, raising suspicions that someone was trying to make money off the Sept. 11 national tragedy. But that would never happen, right?" This is a follow up to last week's allegations.
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FCC to Investigate D-Block Auction

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  • I have not been happy with almost anything this group has done in the past 7 years. This just has the same slimy feel that so many other activities of the FCC. At this point I would be surprised to find out that some was manipulated to favor someone particular group. The surprise would be that the people who did manipulate the situation did not do a better job of destroying the evidence. However the stench of corruption will still linger.
    • Re:Same old fraud (Score:5, Insightful)

      by MikeyTheK (873329) on Monday March 24, 2008 @09:40AM (#22844328)
      Then again, maybe it's because the market isn't as large as was hoped. My agency, while constantly evaluating options for radio frequency moves, is not THAT interested in moving. It's really expensive. When you think about base stations, antennas, transmitters, new radios for every piece of apparatus, and radios for every firefighter, medic, EMT, etc., you start talking about a huge chunk of change for each department. Then there are repeaters, trunk gear, etc. In order for a single department to be able to move, they need lots of neighboring departments to move as well, or they're only going to be able to talk to their mutual aid agencies via one channel on a mobile repeater, which sucks. We have that problem now, with neighboring jurisdictions in vastly different tracks of spectrum. Luckily we have some radios in their swath, because the poor blokes who are stuck hitting the repeater are frequently fighting to get a message through. That is not a good situation to have during a Mayday. So the way that this gets done is ten, fifteen, or twenty departments (an entire County, in many cases) will have to all buy new gear at once, retrofit all the towers, apparatus, stations, etc. Since none of the departments can afford to do that anyway, a big fat grant proposal has to be put together, and the funding come from government. For what? I'm not saying that you can't come up with a case justifying such investment, but given that emergency responders are able to effectively answer calls and talk to their comm center now, it's not as easy an argument to make. If you're in an urban setting it makes more sense, because your LOS to a tower is frequently impeded. However, most of the country isn't urban.
      • by jandrese (485)
        I thought the point of the D-Block was to get the emergency responders out of the communication infrastructure business. They would buy basically cell phones (and stuff like cell phones repackages to work like walkie-talkies), and use them instead of their regular radios. In the event of an emergency, they would get first access to the cell network. This would also foster interoperability because you wouldn't have waveform/frequency mismatches between departments.

        That said, it's a pretty scary requirem
        • Is there any reason it has to be a network-level mode switch rather than just issuing emergency responders "cell phones" that get a higher priority all the time?
      • Re:Same old fraud (Score:5, Interesting)

        by hey! (33014) on Monday March 24, 2008 @01:17PM (#22846820) Homepage Journal
        But it's really not that expensive. It only seems expensive to you. Enough money has been spent to equip everybody with anything they could possibly need; the reason that nothing much got done is because the money was spent in crisis mode, so nobody was looking much at substance, so much as volume of money spent and paperwork filled in.

        I've worked in companies working around the edges of various issues that have become "national emergencies". There's always people doing yeoman work in those areas who could work miracles with a marginal increase in funding. But they never get a marginal increase in funding.

        What happens is that once the politicians decide there is an emergency, there is a deluge of cash. Often, the people who've been doing the work all along never see this as people closer to the budgeting process divert the money into crash programs run by people who have no knowledge or interest in what as actually bee done. Other times, they end up with vast quantities of cash that they have to spend right away; the emergency becomes spending all the money before anybody accuses you of dragging your feet. I've seen cases where agencies have literally paid millions of dollars to have a web site with a email backed fill in form that could have been done (by several competent and independent evaluations) for around $50K. The reason was that they never had anything like two million dollars in the kitty before, and had no idea of how to spend it. If they had had a $100K windfall, they could have spent it very well indeed, but they didn't even know where to begin to spend the money they'd been given; certainly not fast enough.

        So they turned to a company that specialized in absorbing lots of cash on federal contracts quickly.

        I'll let you in on a dirty little secret about government contracting. All those rules that supposedly keep Uncle Sam from being fleeced actually make it easier for somebody with political connections to take him to the cleaner. The reason is that the only way to absorb the money generated by the federal government in a "national emergency", and comply with all the accounting rules, is to have a company or a subsidiary that specializes in absorbing federal money and filling out all the paperwork. The government doesn't buy what it needs in an emergency on the open market, but by outfits starting with Halliburton and all the way down to small time operations that eat up a few millions here and there.

        I was amazed and appalled the degree to which you could hire a lobbyist and make a quick buck on a shoeshine and a shell product, provided you were dealing with something "important".
  • So basically.... (Score:5, Insightful)

    by kaiser423 (828989) on Monday March 24, 2008 @09:07AM (#22844098)
    They didn't come anywhere close to meeting the 1.3 billion reserve. They fell something like 900 million short. They're not sure why, but they think it might be related to this company that was spreading FUD about charging an extra 50 million on top. Somehow I don't think it's that company.

    The FCC had put in some pretty strong wording about building in first responder capability. It was more than what was typically done in the past, but it didn't seem totally outrageous. I think the problem is that a lot of the wireless carriers are moving towards commodization, and thus low margins. 90% of the population in the US can get good cell service from multiple providers. With low margins, why would you take on a huge risk that could be a brick around your neck? Better to spend the little bit extra and get a chunk of spectrum whose only restrictions were pretty much that you had to use it? I think it's that that piece of the spectrum just isn't worth the hassle if you have to build in tons of first responder equipment also.

    It's just worth only 50% of what they thought it was. Oops, they messed up. But since they messed up big, they have to start an investigation.
    • by zappepcs (820751) on Monday March 24, 2008 @09:16AM (#22844160) Journal
      I think you have nailed it exactly. First responder network requirements are an absolute brick around the neck. Generator backup for every site for 8 hours is an expensive brick, 24 hours for major sites. There are probably calea requirements also that go beyond normal 'here is the subpoena, not give me the records' kind of thing.

      The requirements on existing networks to support the government(s) during emergency are nearly enough to put you out of business if you have low margins. Imagine how many lights you'd put in your house if you had to supply each with 8 hour battery backup and one outlet in every room with 24 hour battery backup plus data recorders for who used the lights and when.

      Yep, you'd be asking yourself why you want to spend 1.3 Billion Dollars for the privilege of building a network that is 3-10 times more expensive than regular networks. It probably also has to be tied into the latest NSA data dragnet system as well.

      Notoriously, emergency services teams/groups don't really have the funds to pay you extra money for that huge network you built. They like to get things cheaply too, saving your taxpayer dollars and such.
      • by Kuma-chang (1035190) on Monday March 24, 2008 @09:36AM (#22844310) Journal
        I think you have nailed it exactly. First responder network requirements are an absolute brick around the neck. Generator backup for every site for 8 hours is an expensive brick, 24 hours for major sites. There are probably calea requirements also that go beyond normal 'here is the subpoena, not give me the records' kind of thing.

        You're confusing some things here. The backup power requirement applies to ANY telecom site. Wireless or wireline, any block, any sort of CMRS. They're all subject to the same backup power requirement (at least until the D.C. Circuit rules on the appeal of that requirement). And the D-block requirements have nothing to do with CALEA. CALEA will apply exactly the same to the D-block as to the other blocks in the 700 MHz auction. What made the D-block different is that whichever commercial carrier won the spectrum rights was to work out some arrangement where, in addition to building a commercial network on that spectrum, they would also build capacity for use by public safety agencies.

        What killed the D-block was uncertainty. The FCC put out vague, put potentially onerous, obligations on the D-block. The auction winner's ability to exploit the spectrum was to be dependent on their ability to negotiate out some deal with a big mess of first responder organizations. At the time the FCC didn't seem terribly worried about this because they set everything up along the lines of a plan proposed by Frontline Wireless (a plan that first responders seemed favorably disposed towards), with Frontline's assurances that they would bid past the reserve price and ensure the block was sold. Then Frontline failed to secure the necessary capital to bid for the D-block and had to drop out. Everyone else just looked at the requirement of having to cut some sort of deal with the first responder organizations (who would all be fighting each other for bigger slices of the pie) before exploiting the spectrum and thought, you've got to be kidding me. No fucking way.
      • by mabhatter654 (561290) on Monday March 24, 2008 @09:41AM (#22844338)
        You do realize that POTS has meet all those requirements for 30+ years. They have huge battery backups at the CO so you don't lose phones when the power goes out... they call it CUSTOMER SERVICE, but it's also the rules. They also have rather nasty FBI requirements as well.. Both of which are a good deal easier to implement for a brand new all digital Cell based system that doesn't have to deal with hundreds of miles of copper wire across the country being cut by vandals and trees.

        Those "new" rules will make cell phones almost as reliable as POTS, give or take a few nines.
      • Re: (Score:3, Informative)

        by asuffield (111848)

        Yep, you'd be asking yourself why you want to spend 1.3 Billion Dollars for the privilege of building a network that is 3-10 times more expensive than regular networks. It probably also has to be tied into the latest NSA data dragnet system as well.

        I believe the expectation was that bidders would be putting together a package where the extra hardware was paid for by government grants, arranged separately. Most US communications infrastructure was paid for that way (the "investment" of the private companies

      • Re:So basically.... (Score:5, Interesting)

        by sricetx (806767) on Monday March 24, 2008 @10:15AM (#22844648)
        Umm, maybe the government should just build a dedicated emergency services network themselves. Seems like it would be better to have this done in the public sector.
        • Your argument suggests* that government build and maintain a complete wireless network for the uncommon event of emergency**. That and the government is trying to get emergency cash (these spectrum sales provide a one-time cash flow) in the face of a terrible deficit.

          It also ignores how U.S. government works. We like our public officials to be technical nitwits who need a contractor to screw in a light bulb. This makes it easier for us to build companies that overcharge the Feds for shoddy work. Have yo
    • Re:So basically.... (Score:4, Interesting)

      by elrous0 (869638) * on Monday March 24, 2008 @09:31AM (#22844268)
      Not to mention that you would be taking a huge PR and liability risk. If one of your first responder systems failed in a major disaster or incident, you can imagine the fallout in lawsuits and bad press.
    • by asuffield (111848) <asuffield@suffields.me.uk> on Monday March 24, 2008 @09:34AM (#22844292)

      They didn't come anywhere close to meeting the 1.3 billion reserve. They fell something like 900 million short. They're not sure why, but they think it might be related to this company that was spreading FUD about charging an extra 50 million on top. Somehow I don't think it's that company.


      That's not the point. The allegation is that this company tried to tack on 50 million that would go to them, and that by doing so they rocked the boat enough that people pulled out rather than bid on the block. That's fraud. It doesn't matter whether the potential bids would have been high enough - that just means it was stupid fraud, which is just as illegal.
    • It seems to me, we shouldn't be terribly unhappy that no company dropped a bomb this time around. You can recall what happened when the 3g auctions went exceedingly well in Germany and the UK. [wikipedia.org] Someone tell the FCC to calm down and be glad they didnt lose 100,000 jobs this time around.
    • Feel free to mark this off-topic, but Pen & Teller are bullshit. For those unaware, Pen & Teller had a several year running program called "Bullshit", where they went out of their way to debunk things they perceived to be bullshit. Now, most of the time, they argued on points I agree with, but it didn't take long for them to discuss two of my sacred cows, evolution and global warming.

      Okay, really, it's not that they're sacred cows. It's that both are confirmed and tested under the same system, th
  • by necro81 (917438) on Monday March 24, 2008 @09:25AM (#22844214) Journal
    The summary asks if someone is trying to make money off 9/11. The article makes no such claim - doesn't even allude to it. The only direct mention of 9/11 in the article is that members of the 9/11 Commission are asking the FCC to look into the allegations of fraud and collusion. Is the reference to 9/11 something that the submitter slipped in to try to generate additional interest in the story - like just about every form of media these days (and at least one defunct presidential candidate)?

    The only connection the D-block auction has to 9/11 is the fact that it is meant, not just for a commercial communications network, but also for emergency responders to have access to it as well. The different agencies responding on 9/11 (and in the days that followed) were hampered by the fact that they use different radio systems and had difficulty communicating with one another.
    • by asuffield (111848)

      The only connection the D-block auction has to 9/11 is the fact that it is meant, not just for a commercial communications network, but also for emergency responders to have access to it as well. The different agencies responding on 9/11 (and in the days that followed) were hampered by the fact that they use different radio systems and had difficulty communicating with one another.

      However, those problems were caused by management (government) bungling, not by technical issues. They could have had radio syst

      • Re: (Score:3, Interesting)

        by kenh (9056)
        Not for nothing, but fire departments have different requirements than police departments - the police need city-wide coverage from theie walkie-talkies, the fire department only needs coverage that encompasses the local area ( a few blocks). That means different freq. bands are better for each department, and requiring both to buy multi-band radios is very expensive - not impossible or really prohibitive, but unpopular in many locations for whatever reason.

        I agree with the earlier poster - there is no conn
    • I wonder if it was the result of confusion, with someone saying "They're trying to make money off of 911", and the submitter thinking "They're trying to make money from September 11th" rather than "They're trying to make money off of the emergency services."

      Perhaps it's time we moved the entire country to 112. It already works on GSM cellphones, and it's rapidly becoming an international standard. So far as I'm aware, no major disasters that have lingered in the public consciousness happened on either No

      • "no major disasters that have lingered in the public consciousness happened on either November 2nd"

        You whippersnappers are obviously too young to remember the tidal wave of 1570.

        You take your lives for granted.
      • Perhaps it's time we moved the entire country to 112.
        If you ask me, "occasional journalistic ambiguity" is hardly a good reason to completely replace a vital part of our emergency services infrastructure.

        - RG>
  • So based on poor or no research, they banked on greed for a product whose marginal utility is low, whose costs are excessive, and then are shocked when real businesses (who have to do this for a living) saw through it and backed away? Another example of how the government is bad at business.
  • If the FCC was using the trusty, as in "trust our machine or we'll drive our lawyers up your yinhang", Sequoia voting machine [slashdot.org] then there's no wonder the auction was a disaster.
  • by Anonymous Coward on Monday March 24, 2008 @10:50AM (#22844948)
    There are already frequency blocks set aside for emergency services in a variety of different ranges.

    Emergency Agencies can apply for and receive an assigned frequency for free. The capital costs can be expensive. But the frequency is free to use once we get past that. If our neighbor is using a frequency and we work with them, they can give us permission to use their frequency too. System works pretty well. It could be better, but it works.

    Now, the government is going to sell the emergency services spectrum in the 700Mhz range? If emergency agencies want to use 700Mhz, we will be expected to pay a monthly service fee so some private company will make a profit off of emergency services.

    I don't care if it will be a nationwide service. My fire department is in Idaho. They don't need to talk to a police department in Georgia ever.

    If you want to see an interoperable radio system that works, go talk to the National Interagency Fire Center and look at the comms packages they send out with Type I and II Incident Command Teams. They bring all the radios, repeaters, frequencies with them. Everyone of the incident gets issued a pre-programmed radio and a frequency assignment list so that they know how to get hold of each other.

    This 700Mhz plan is worthless. You want to make effective use of the frequency range and not waste local taxes, let us use the frequency for free like the other public service blocks.
  • The FCC should pay someone to build D-Block. This is another example of Bush/Cheney incompetence.
  • I've seen these "spectrum auction" stories before... and I just don't get it. Isn't this like auctioning off the ocean? or the atmosphere? Who claimed original ownership and who's getting these obscene amounts of moneys? If its the US goverment, and this auction is just for regulation, what part of gov't gets the money and what's it going to be spent on?

    Seems to me everyone owns the spectrum, and the money should go to everyone.
  • by zymano (581466) on Monday March 24, 2008 @03:00PM (#22848598)
    Open up the airwaves back to the damn public.

    Allow cheap powerful walkie talkies for the public. The free market will help build public owned towers and we will then have an alternative to government/big business colluding ripoff.
    • by evilviper (135110)

      Allow cheap powerful walkie talkies for the public.

      Umm, we already have them... Citizens Band. Family Radio Service. Multi-Use Radio Service. General Mobile Radio Service. Ham. etc.

      Not to mention the 900MHz, 2.4GHz, 5GHz (et al.) unlicensed spectrum everyone is using for cordless phones and WiFi, but not for voice service.

      What's so specially about 700MHz that voice service will magically take off, where the rest have failed to?

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