Verizon, T-Mobile bicker over C-band auction rules

spectrum
The FCC has promised to commence a C-band auction before the end of the year, (Pixabay)

Citing the vast amount of 2.5 GHz spectrum that T-Mobile stands to obtain from the merger with Sprint, Verizon is urging the Federal Communications Commission (FCC) to reject calls for limits on the amount of C-band spectrum a provider can obtain at auction.

The FCC is due to vote on a draft order on the C-band at its next open meeting on February 28. The FCC has promised to commence a C-band auction before the end of the year, but it has yet to set the rules.

As drafted, the current proposal before the commission argues that it is unnecessary to impose an in-band limit on the 3.7-3.98 GHz band, saying that a case-by-case review of acquisitions in the band will allow the commission to review spectrum aggregation without unnecessarily restricting entities from acquiring spectrum for 5G.

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In meetings earlier this month (PDF), T-Mobile urged the FCC to adopt a “sensible spectrum aggregation limit that ensures multiple providers have the opportunity to access the C-band,” saying the commission should impose a limit on how much C-band spectrum can be acquired in the initial tranche and overall in the auction.

Specifically, T-Mobile said the FCC should adopt a spectrum aggregation limit for the initial tranche of one-third of the spectrum that will be made available in that tranche, and an overall spectrum aggregation limit of one-third of the total amount of spectrum that will be made available in the C-band auction.

RELATED: FCC to consider C-band proposal at February meeting

T-Mobile pointed to recent spectrum auctions in other countries as examples of the success spectrum aggregation limits had in promoting auction participation and competitive bidding. Taiwan’s 3.5 GHz band auction established a spectrum aggregation limit so that no one provider could obtain more than 100 megahertz of the 270 megahertz up for auction, and it raised about $4.61 billion in revenues, well exceeding the regulator’s target of $1.47 billion.

In Italy, where a cap of 100 megahertz was imposed, an auction of spectrum in the 3.7 GHz band resulted in “intense competition,” and surpassed the regulator’s expectations by raising a total of $4.8 billion in revenues.

RELATED: Verizon, AT&T, T-Mobile support Pai’s C-band plan as backlash commences

But Verizon, in a filing this week (PDF), is having none of it, and told the FCC to stick with the wording in the draft order. “Setting aside the irony that T-Mobile would make such a proposal given the positions it has taken in support of its proposed acquisition of Sprint – and the vast swath of 2.5 GHz spectrum that T-Mobile stands to obtain if that deal is consummated – such rigid pre-auction limits would flip existing precedent on its head and are contrary to the public interest,” Verizon told the commission.

“T-Mobile has argued that recent mid-band aggregation limits used in Taiwan and Italy support similar limits in this country, but those international examples ignore the fact that established U.S. precedent strongly disfavors inflexible spectrum limits absent clear evidence of a specific competitive concern – evidence the draft order correctly finds is absent from the record,” Verizon added.

The Competitive Carriers Association (CCA), the Wireless Internet Service Providers Association (WISPA), NTCA—The Rural Broadband Association, INCOMPAS and the Computer & Communications Industry Association (CCIA) sent a letter (PDF) to the FCC this week saying a spectrum aggregation limit is a “modest step” that would provide a significant benefit for competition and for rural America.

“A requirement that no single entity can acquire more than one-third of the spectrum in a geographic area would give bidders of all sizes, including smaller providers, a reasonable opportunity to acquire scarce mid-band spectrum,” they told the commission.

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