The C-Band Alliance’s (CBA) plans for the sale of 180 MHz of satellite spectrum over the US is creating turbulence for the two main players, Intelsat and SES. Both have seen their share prices suffer significant fluctuations this past fortnight. The reason is that investors are concerned that the Federal Communications Commission (FCC) might rule against the proposal, or impose such limiting restrictions that the financial benefits will not benefit the satellite players.
One of the main opponents to the CBA’s scheme is T-Mobile which last week suggested that owners of C-band Earth Stations (often cable operators themselves) mount a competitive action against the CBA.
The CBA, in a formal filing to the FCC on March 7th, said: “This shiny substitute is fool’s gold: The Communications Act does not permit earth station registrants to participate in an incentive auction.”
A spokesman for the CBA said: “There are fundamental problems with regards to the involvement of earth stations in an FCC-run incentive auction for each of 416 geographic zones. First, the Communication Act does not permit earth stations to participate in an incentive auction because they are not licensees with respect to the C-band downlink. And second, even if they were permitted to participate, it would be exceedingly complicated and create endless delay to have 17,000 earth stations in 416 geographic zones participate in auctions. Moreover, the idea to potentially auction different chunks of spectrum to different sets of participants in these zones would not only create insurmountable complexity and delay but also fails to consider the basic laws of physics. If a different amount of spectrum is cleared in adjacent zones, the 5G signals will not stop at the border of a zone but could interfere with co-frequency satellite operations in the neighbouring zone. This could have a daisy chain effect on ultimately all 416 zones, of course, driving the amount of available spectrum nationwide for 5G operations to the lowest common denominator. The whole concept is ill construed.”
The CBA, in its March 7th filing, added: “The New Proposal vastly underestimates the herculean challenge of getting different sets of earth station registrants to agree on a purchase price with respect to each [geographic area]. Without agreement, the spectrum clearing target continues to decrease until a Commission-mandated minimum is reached. The likelihood of non-agreement is high—if not guaranteed—and thus the 500 MHz of spectrum T-Mobile touts as an advantage of the New Proposal is illusory.”