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929 and 931 Mhz Paging Service Fact Sheet

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929 and 931 Mhz Paging Service Fact Sheet 929 and 931 MHz Paging Service Fact Sheet Auction #26 929 and 931 MHz Paging Spectrum Upper Bands Auction To begin February 24, 2000 Date (See Public Notice DA99-1591) This auction offers 2,499 licenses in 51 Major Economic Areas (“MEAs”). Offered are: 612 “929 MHz licenses” Licenses (twelve in each MEA); and 1887 “931 MHz licenses”(thirty-seven in each MEA). 929 - 930 MHz Band Spectrum 931 - 932 MHz Band 929 licenses: 20 KHz per license Bandwidth 931 licenses: 20 KHz per license A bidder with average gross revenues not to exceed $15 million for the preceding three years may receive a 25 percent discount on its winning bids for the licenses. Bidding Credits A bidder with average gross revenues not to exceed $3 million for the preceding three years may receive a 35 percent discount on its winning bids for the licenses. The 929 and 931 MHz Paging spectrum auction will use simultaneous multiple round competitive bidding. Bidding will be permitted only from remote locations, either electronically (by computer) or telephonically. General information and associated licensing parameters are listed below. Number of licenses being offered The Federal Communications Commission (“FCC” or “Commission”) will hold an auction for 2,499 licenses, 612 - 929 MHz Licenses and 1,887 - 931 MHz licenses. Bidder Eligibility and Small Business Provisions A. General Eligibility Criteria As described above, this auction offers 2,499 licensees in the 929 and 931 MHz bands. Our goal in adopting small business provisions is to promote and facilitate the participation of small businesses in the 929 and 931 MHz Paging Auction and in the provision of this and other commercial mobile radio services. General eligibility to provide the 929 and 931 MHz Paging service, subject to any restrictions outlined in the Commission’s rules, is afforded to entities that are not precluded under 47 C.F.R. §§ 22.217 and 22.223. (1) Determination of Revenues For purposes of determining which entities qualify as very small businesses or small businesses, the Commission will consider the gross revenues of the applicant, its controlling interests, and the affiliates of the applicant and its controlling interests. Therefore, the gross revenues of all of the above entities must be disclosed separately and in the aggregate as Exhibit C to an applicant's FCC Form 175. The Commission does not impose specific equity requirements on controlling interests. Once principals or entities with a controlling interest are determined, only the revenues of those principals or entities will be counted in determining small business eligibility. The term "control" includes both de facto and de jure control of the applicant. Typically, ownership of at least 50.1 percent of an entity’s voting stock evidences de jure control. De facto control is determined on a case-by-case basis.1 The following are some common indicia of control: · the entity constitutes or appoints more than 50 percent of the board of directors or management committee; · the entity has authority to appoint, promote, demote, and fire senior executives that control the day-to-day activities of the licensee; or · the entity plays an integral role in management decisions. (2) Small or Very Small Business Consortia A consortium of small businesses, or very small businesses is a conglomerate organization formed as a joint venture between or among mutually independent business firms, each of which individually satisfies the definition of small or very small business in Section 22.223. Thus, each consortium member must disclose its gross revenues along with those of its affiliates, controlling interests, and controlling interests' affiliates. We note that although the gross revenues of the consortium members will not be aggregated for purposes of determining eligibility for small or very small business credits, this information must be provided to ensure that each individual consortium member qualifies for any bidding credit awarded to the consortium. 1 For further guidance on the issue of control, see the Commission's affiliation rule at 47 C.F.R. § 1.2110(b)(4). See also Ellis Thompson Corp., 76 Rad. Reg. 2d (P & F) 1125, 1127-28 (1994), in which the Commission identified the following factors used to determine control of a business: (1) use of facilities and equipment; (2) control of day-to-day operations; (3) control of policy decisions; (4) personnel responsibilities; (5) control of financial obligations; and (6) receipt of monies and profits; Intermountain Microwave, 24 Rad. Reg. (P & F) 983 (1963), and Application of Baker Creek Communications, LP, For Authority to Construct and Operate Local Multipoint Distribution Services in Multiple Basic Trading Areas, Memorandum Opinion and Order, 13 FCC Rcd 18,709 (rel. September 23, 1998). (3) Application Showing Applicants should note that they will be required to file supporting documentation as Exhibit C to their FCC Form 175 short form applications to establish that they satisfy the eligibility requirements to qualify as a small business or very small business (or consortiums of small or very small businesses) for this auction.2 Specifically, for the 929 and 931 MHz Paging Auction, applicants applying to bid as small or very small businesses (or consortiums of very small, or small businesses) will be required to file as Exhibit C to their FCC Form 175 short form applications, all information required under Sections 1.2105(a) and Section 1.2112(a). In addition, these applicants must disclose, separately and in the aggregate, the gross revenues for the preceding three years of each of the following: (1) the applicant; (2) the applicant's affiliates; (3) the applicant's controlling interests; and (4) the affiliates of the applicant's controlling interests. Certification that the average gross revenues for the preceding three years do not exceed the applicable limit is not sufficient. A statement of the total gross revenues for the preceding three years is also insufficient. The applicant must provide separately for itself, its affiliates, and its controlling interests, a schedule of gross revenues for each of the preceding three years, as well as a statement of total average gross revenues for the three-year period. If the applicant is applying as a consortium of very small or small businesses, this information must be provided for each consortium member. B. Bidding Credits Applicants that qualify under the definitions of small business, and very small business (or consortia of very small, or small businesses as are set forth in 47 C.F.R. § 22.223, are eligible for a bidding credit that represents the amount by which a bidder's winning bids are discounted.3 The size of a 929 and 931 MHz Paging bidding credit depends on the average gross revenues for the preceding three years of the bidder and its controlling interests and affiliates: · A bidder with average gross revenues of not more than $15 million for the preceding three years receives a 25 percent discount on its winning bids for 929 and 931 MHz Paging licenses (“small business”);4 · A bidder with average gross revenues of not more than $3 million for the preceding three years receives a 35 percent discount on its winning bids for the 929 and 931 MHz Paging licenses (“very small business”).5 Bidding credits are not cumulative: qualifying applicants receive either the 25 percent or the 35 percent bidding credit, but not both. 929 and 931 MHz Paging bidders should note that unjust enrichment provisions apply to winning bidders that use bidding credits and subsequently assign or transfer control of 2 See 47 C.F.R. §§ 22.217 and 1.2105. 3 See 47 C.F.R § 22.217. 4 See 47 C.F.R. § 22.223 (b) (1) (ii). 5 See 47 C.F.R. § 22.223 (b) (1) (i). their licenses to an entity not qualifying for the same level of bidding credit.6 Finally, bidders should also note that there are no installment payment plans in the 929 and 931 MHz Paging Auction. Permissible Operations The 929 and 931 MHz frequency bands are allocated for paging services. If you win a geographic license in the auction, you will be able to use the spectrum to provide: (1) one-way messaging; (2) two-way messaging; and (3) fixed wireless ervices. Provision of these services is subject to technical limitation set forth for the service in Part 22 (Part 90 for 929 MHz exclusive channels). Paging systems are traditionally one-way signaling systems. Paging services, grouped by output, include; tone, tone/voice, numeric, and alphanumeric. Present systems are of two basic types; a wide-area general-use type providing subscription service to the public, and, an in-building, private, paging system, limited to a commercial building or the general area of a manufacturing plant. Currently, neither of these paging systems can initiate an answer without calling through a landline telephone. However, in 1996, the Commission adopted the First Report and Order in the flexible spectrum use proceeding, in which several CMRS bands (including 929 and 931 MHz) were allocated to the fixed service on a co-primary basis.7 Permitting service providers to offer all types of fixed, mobile, and hybrid services will allow CMRS providers to better respond to market demand and increase competition in the provision of telecommunications services. The Commission concluded that the public interest would be served by giving licensees maximum flexibility in the use of CMRS spectrum. License Period CMRS Licenses will be issued for a ten-year term from the initial license grant date. A licensee will be required to provide coverage to one-third of the population in its areas within three years of the license grant, and to two-thirds of the population within its area within five years of the license grant.
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