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NPRM Info - EBS NPRM Published In Federal Register

As expected, at its May 10, 2018 open meeting, the FCC adopted a Notice of Proposed Rulemaking (NPRM) on Educational Broadband Service (EBS) licensing and regulation, aimed at “transforming” the 2.5 GHz band.  The NPRM was published in the Federal Register yesterday, thus establishing the schedule for comments and replies, which will be due Monday, July 9 and Monday, August 6, respectively. 

You can obtain a copy of the NPRM on the FCC’s website, here:  https://docs.fcc.gov/public/attachments/FCC-18-59A1.pdf.  We urge you to read it, including the separate statements of the Chairman and Commissioners at the end.

 

Summary

The NPRM proposes changes to the rules for existing stations, as well as new rules to govern the licensing of currently vacant EBS spectrum across the country (“white space”), as follows:

Rationalization of Existing EBS License GSAs.   The FCC proposes to expand GSAs to the borders of Census Tracts covered or intersected by the existing GSAs.  The FCC asks whether it should require some current coverage threshold to be met by a licensee’s existing GSA (such as coverage of 25% of the Census Tract) in order to permit the GSA to expand in the Census Tract, how it should resolve overlapping expansions by more than one GSA in a Census Tract, whether the expansion should be based on counties rather than Census Tracts, and what service requirements should be required in the areas of expansion.

Flexibility for Existing EBS Licensees.   The FCC proposes to permit licensees to sell their EBS licenses, including to commercial entities, to eliminate educational use requirements, and to eliminate restrictions on EBS leasing (including the current 30 year limit on leases and the requirement for review of educational needs that is supposed to take place at the 15, 20 and 25 year point of existing leases). 

White Space Licensing.   The FCC proposes to license remaining EBS white space in four steps – three filing windows limited to existing licensees, Native American Tribes, and local educational institutions, followed by an auction for any remaining spectrum, as described below.  However, the NPRM also asks whether the FCC should forego any additional licensing opportunities reserved for educators and simply auction all EBS white space to the highest bidder.

  • Filing Window 1 – Existing licensees as of the date of the NPRM (May 10) could apply to extend their GSAs to the borders of counties that they currently cover or intersect, but only where the license GSA already covers a significant portion of the county and where the licensee has a local physical presence in the expansion area.
     
  • Filing Window 2 – Rural tribal nations could apply for EBS licenses in rural areas where they have a local presence, with no limit on the number of channels they could seek.  The FCC asks whether these licenses should be awarded on a county-wide or Census Tract basis.
     
  • Filing Window 3 – Local educational entities (accredited schools or governmental entities such as school boards that are present in the proposed licensed area) that do not have any EBS licenses could apply for EBS licenses, with no limit on the number of channels they could seek.  The FCC asks whether these licenses should be awarded on a county-wide or Census Tract basis.  If there is more than one application for the same channels in the same area, the FCC proposes to use competitive bidding to award the license. 
     
  • Auction – Any remaining EBS spectrum would then be made available for commercial use using competitive bidding.  The FCC asks for comments on the appropriate geographic area for such licenses, and the size of the channel blocks to be covered by the licenses (particular channels or groups of channels, or the entire band?).    

Requirements for New EBS Licenses.  For new EBS licenses, the FCC proposes that there will be holding periods (between 3 and 7 years) before licensees could sell their licenses, and that leases on these licenses reserve 20% of the capacity of the channels for educational use.  The FCC also proposes “more robust” performance requirements for these licenses, including an interim requirement of 50% coverage of the GSA population and final coverage of 80% of GSA population.  The FCC also proposes to apply the renewal rules it adopted for other wireless licenses in the recent “renewal harmonization” proceeding.

 

Analysis

Because the FCC released of a “draft” NPRM back in April, the EBS community was already aware that the proposals were not aligned with the Consensus Plan for EBS white space licensing agreed to and provided to the FCC several years ago.  We also knew that aspects of the proposal could fundamentally alter the educational nature of the EBS service.   However, changes made to the NPRM draft prior to its adoption by the FCC make clear there is also significant misunderstanding about the nature and benefits of EBS among the FCC Commissioners, and even some outright hostility to the notion that educators should be able to obtain new EBS licensees for “free,” as opposed to having to buy them at auction.  NEBSA plans to participate in the FCC process and work actively to help shape the FCC’s ultimate decision to be something more consistent with our vision for the band.

To that end, NEBSA is planning on offering a Webinar to introduce the NPRM to EBS licensees in more detail, and offer an opportunity for questions and comments.  We are in the process of scheduling that now.  Once that’s been scheduled, we will let you know and encourage you to participate.

In addition, it is likely that NEBSA and others may seek an extension of the comment and reply comment deadlines, in order to have time to fully consider and respond to the NPRM.

Also, a “workgroup” of EBS community leaders, including NEBSA’s Regulatory Committee, has already had extensive meetings to develop a common response to the NPRM and prepare to present that response in comments, reply comments, meetings at the FCC and, perhaps, in Congress.  We are talking with other stakeholders in the band, such as members of the wireless operator community (including Sprint).   We have also started discussions with potential allies in the education, public service and public television communities, in an effort to enlist their support and assistance

This ongoing work is expected to result in a set of principles for consensus in the EBS community on how to respond to the NPRM.   These principles will form the basis of comments to be filed with the FCC.  This is still a work in progress -- some important differences in approach need to be reconciled and details filled-in -- but the basic principles will probably end up being along the lines of the following: 

  1. EBS and the 2.5 GHz band is a success story, not some sort of past FCC spectrum policy mistake.  The current rules have resulted in widespread deployment of wireless services to the public across the United States, as well as services to and financial support for education.  The only real problem with the current licensing, regulatory and leasing structure is that, for over 20 years now, there has been no mechanism for the issuance of new licenses, and thus the industry has been stuck with a coverage footprint from 1995.  EBS does not need to be “transformed” by significant changes to the existing EBS licensing, regulatory and leasing model.  What we need, and what would serve the public interest, is a process to license EBS white space across the rest of the United States.
  1. Whatever new rules may be adopted for EBS going forward, a critical priority must be to avoid disruption to existing EBS licenses and leasing arrangements.   Given the success in the band where EBS has been licensed, and reliance on existing rules by educators, wireless operators and the communities and customers they serve, the FCC must ensure that EBS licenses can be renewed under reasonable standards and the bargained-for benefits of existing leases must be protected.  
  1. The FCC should undertake a process of transitioning existing EBS licensed service areas from 35 mile radius circles to some other appropriate licensing boundaries that will support operational requirements of licensees and operators and conform to standard FCC application processing systems.  The EBS community favors a reasonable process to expand existing GSAs to county boundaries and the use of counties as the geographic basis for new EBS licensing.
  1. Following the process of transitioning existing EBS service areas as noted in #3, the FCC should license “white space” through successive filing “windows” for applicants such as Native American Tribes and local educational entities.  Different views in the EBS community about the details of this process – focusing on who will be able to apply in these windows and in what priority -- need to be worked out.  We also need to reach consensus on limits on the number of channels that can be applied for in any given window, and what happens if more than one applicant applies for the same channels.   On that latter point, the FCC clearly favors auctioning licenses where there are mutually exclusive applications, but we are hopeful it can be convinced to find some other mechanism (such as “first come first served”).
  1. The FCC should also take action on a few pending “waiver” applications now on file by educators for EBS spectrum.  These applications in a several cases seek to obtain permanent licenses for educational deployments that have already taken place under special temporary authorizations, and we believe the FCC should not shut down these operating educational systems.
  1. The FCC should adopt reasonable buildout requirements for new licenses and performance requirements for all licensees seeking license renewal, hopefully based on existing “substantial service” requirements for EBS.  To the extent that the FCC were to adopt more strict requirements, those requirements should be prospectively applied after a reasonable transition period.
  1. The FCC should maintain current eligibility requirements for holding EBS licenses, which require licensees to be nonprofit or governmental educational entities.  The FCC should also either keep the current educational reservation and minimum educational use rules in place or, if it chooses to modify those rules, adopt new reasonable standards appropriate for the digital environment.  However, if new educational reservation and use rules are adopted, they should apply only to new licenses and/or new leases for existing licenses, so as to not disrupt existing lease relationships.

With respect to principle 7, we understand that maintaining eligibility requirements means that licensees will generally not be able to sell their licenses to commercial operators such as Sprint, and we are aware that some in the EBS community prefer to have the flexibility to do so.   However, NEBSA and the working group believe that, given the skepticism about EBS reflected in the NPRM and the statements by several Commissioners (principally Commissioners O’Reilly and Carr, but also Chairman Pai), and their clearly expressed concern about unjustified economic “windfalls” flowing to EBS licensees who obtain their licenses for free and then simply monetize their value, we need to support maintaining educational reservation and use requirements if we have any hope of achieving success on the other principles noted above, and preserving EBS as a valuable educational resource for the nation.

 

Conclusion

NEBSA urges all EBS licensees to consider the issues raised in the NPRM and to participate in the proceeding.   NEBSA will provide further information as it becomes available, including information on the upcoming NEBSA webinar, updates on the deadlines for comments and reply comments, finalization of principles of consensus by the working group, and plans for submitting comments and/or reply comments to the FCC.