Congress took on the results of the 700 MHz auction this week. The House Energy and Commerce Committee's Subcommittee on Telecommunications and the Internet primarily focused on the failure of the D block to hit the $1.3-billion reserve and what should be done about helping public safety gain interoperable communications, a vital need during emergencies. (See Story No. 2)
It was heartening to hear that Congress and the FCC aren't abandoning the idea of helping out public safety. The FCC wants to continue down the path of a public-private partnership, whereby a commercial operator would run the network and give priority access to public-safety users. Some members of Congress continued to support the idea too.
With some significant tweaking of the rules, I believe the FCC can make this public-private partnership stipulation work. A $1.3-billion reserve price is quite a risk for any company embarking on a business that has never been done before. Clearly, investors had seen it as a risky proposition. Frontline had planned on building this nationwide, high-speed wireless network for public safety officials, but even with the backing of L. John Doerr of Kleiner Perkins Caulfield & Byers, as well as other supporters, the company raised enough for the $128 million down payment, but not enough for the $1.3 billion reserve price on the spectrum. Subsequently, Frontline closed its doors before the auction began.
Hopefully Congress and the FCC will make some thoughtful decisions about the next round. The FCC was hamstrung before because it had to auction the 700 MHz spectrum by January 2008. There simply wasn't enough time to study the intricacies of such a complicated business proposal. --Lynnette