FCC Proposes Ways to Spur Deals Between Wireless Licensees and Tribes

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The FCC Commissioners on Thursday proposed enhanced competition incentives that would encourage wireless licensees to engage in secondary market transactions with tribes in small rural areas, in an effort to expand and improve wireless service in their communities. 

“It is really past time for this type of action,” said FCC Commissioner Geoffrey Starks during the 4-0 vote. He spoke about the Duck Valley Indian Reservation, home to the Shoshone Paiute Tribal Nation. It’s in an isolated portion of northern Nevada, about 90 miles from the nearest interstate. “The reservation is served by a single cell tower, and residents have described needing to drive out of town simply to update their phones,” he said. 

A 2019 survey by the American Indian Policy Institute found that, even though most tribal respondents relied on their smartphones to access the internet, more than a third had issues connecting, according to Starks. A recent study conducted by the Federal Reserve Bank of Minneapolis found mobile wireless download speeds are 45 percent slower in tribal areas nationwide than in non-tribal areas, he said.

Starks explained: “Three years ago, the General Accountability Office (GAO) published a report recounting complaints by tribes about unsuccessful attempts to enter the secondary market transactions with wireless licensees. Those tribes and industry associations told GAO that these transactions often failed simply because the potential financial benefits were outweighed by the potential costs.”

FCC Chair Jessica Rosenworcel said some wireless providers have access to spectrum that others might be better positioned to deploy, but Commission rules don’t always make it easy to get spectrum resources to those who want to build in the places that need it most. “This new program will help fix that by building better incentives — specifically, an existing wireless provider that uses its license to create new spectrum opportunities for smaller carriers, tribal nations, or others serving rural areas. They will see gain and not just loss for doing so, because we will reward them with longer license terms, more flexible construction requirements, and more options for complying with our rules.”

The Enhanced Competition Incentive Program would encourage licensees to offer opportunities for small carriers and tribal nations to obtain spectrum via lease, partition, or disaggregation. The program contained in a Further Notice of Proposed Rulemaking would also be available to entities interested in providing wireless service in rural areas.

Transactions that qualify for the program would be those that encourage spectrum use by entities unaffiliated with the licensee where the licensee designates at least half of the licensed spectrum to an assignee or a lessee. That could be through either a small carrier or tribal nation deal or through a rural-focused transaction. The proposed program offers three primary benefits to participants, according to the agency:

  • A five-year extension of the license terms for all parties to a qualifying transaction;
  • A one-year extension of construction deadlines for all parties to a qualifying transaction in a partition and/or disaggregation, and to the lessor in a qualifying lease; and
  • Alternate construction requirements for partition and disaggregation in rural-focused transactions. 

The FCC will seek comment on other measures in addition to this program, including alternative construction benchmarks for all wireless licensees to promote innovative spectrum use, voluntary mechanisms and incentives to promote spectrum sharing, and flexibility to reaggregate licenses. 

By Leslie Stimson, Inside Towers Washington Bureau Chief

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