Auction Notice and Filing Requirements for 900 MHz PCS [anyone have a spare penny or so djf]

[David Farber <farber () central cis upenn edu>]

Auction Note - Legal announcement from the Federal Communications Commission




  Date: Tue, 24 May 1994 17:02:38 -0400 (EDT)
  From: Bob Keller <rjk () telcomlaw com>
  Subject: Auction Notice and Filing Requirements for 900 MHz PCS


            COMMON CARRIER PUBLIC MOBILE SERVICES INFORMATION


               AUCTION NOTICE AND FILING REQUIREMENTS FOR
      TEN NATIONWIDE LICENSES FOR PERSONAL COMMUNICATIONS SERVICES
                           IN THE 900 MHZ BAND


Report No. AUC-94-01, Auction No. 1     May  23, 1994


The Federal Communications Commission ("FCC") plans to hold a
simultaneous multiple round auction for ten nationwide Personal
Communications Service (PCS) licenses in the 900 MHz band ("narrowband
PCS").  The auction will begin at 10:00 A.M. on Monday, July 25, 1994.
Bidding will begin at 9:00 A.M and end at 6:00 P.M. each day
thereafter until bidding has closed on all licenses.  The auction will
be held in the Blue Room at the Omni Shoreham Hotel at 2500 Calvert
Street, N.W. Washington D.C., Telephone number (202) 234-0700.  Those
wishing to participate in the auction must submit an FCC Form 175 in
accordance with the Commission's rules and the instructions in this
Public Notice.  The FCC Form 175 must be received on or before 5:30
P.M. EDT, Friday, July 1, 1994.  Applicants are also required to
submit a upfront payment of $350,000 per license (in U.S.  dollars)
for the maximum number of licenses on which they expect to bid in any
single round.  The upfront payment must be by wire transfer or
cashier's check payable to the Federal Communications Commission or
"FCC" and must be received on or before 3:00 P.M. EDT on Monday, July
11, 1994.  Limited space will be available at the auction for members
of the public to observe the auction.


1.  Summary of Licenses to be Auctioned


The following table lists by market number and frequency block number
the 10 nationwide narrowband PCS licenses grouped by category of
license.  All ten licenses will be auctioned simultaneously:


(1)  Five 50 kHz channels, each paired with another 50 kHz channel:


Market No. N-1, Frequency Block No. 1:
        940.00-940.05 and 901.00-901.05 MHz;
Market No. N-2, Frequency Block No. 2:
        940.05-940.10 and 901.05-901.10 MHz;
Market No. N-3, Frequency Block No. 3:
        940.10-940.15 and 901.10-901.15 MHz;
Market No. N-4, Frequency Block No. 4:
        940.15-940.20 and 901.15-901.20 MHz; and,
Market No. N-5, Frequency Block No. 5:
        940.20-940.25 and 901.20-901.25 MHz.**


(2) Three 50 kHz channels, each paired with another 12.5 kHz channel:


Market No. N-6, Frequency Block No. 6:
        930.40-930.45 and 901.7500-901.7625 MHz;
Market No. N-7, Frequency Block No. 7:
        930.45-930.50 and 901.7625-901.7750 MHz;  and,
Market No. N-8, Frequency Block No. 8:
        930.50-930.55 and 901.7750-901.7875 MHz;**


 (3) Two 50 kHz unpaired channels:


Market No. N-10, Frequency Block No. 10:
        940.80-940.85 MHz.
Market No. N-11, Frequency Block No. 11:
        940.85-940.90 MHz,**


Please note that Market No. N-9, Frequency Block No. 9: 940.75-940.80
MHz will not be offered at the auction.  The market numbers and
frequency block numbers outlined above should be used in filling out
FCC Form 175, discussed more fully below.  Businesses owned by women
and/or minorities will be eligible for a 25 percent bidding credit on
all licenses designated by an (**) above.  See Third Report and Order
at paras. 72-80.


2.  Procedures, Terms and Conditions


The auction will be conducted by Tradewinds International, Inc. and
Cantor Fitzgerald Securities, Inc.  Prospective bidders must
thoroughly familiarize themselves with the procedures, terms and
conditions (collectively, "Terms"), contained in the Second Report and
Order in PP Docket No. 93-253, FCC 94-61, released April 20, 1994, and
the Third Report and Order in PP Docket No. 93-253, FCC 94-98,
released May 10, 1994.  Copies of the Second Report and Order are
available for a fee from International Transcription Services, Inc. at
(202) 857-3800.  A copy of the Third Report and Order will be included
in the Bidder Information Package ("Bidder Package") described below.
The Terms contained in the Commission Reports and Orders and in the
Bidder Package are not negotiable.  Prospective bidders should review
these auction documents thoroughly prior to the auction to make
certain that they understand all of the provisions and are willing to
be bound by all of the Terms before making any bid.


3.  Bidder Package


The Bidder Package (as amended and supplemented from time to time) may
be obtained by prospective bidders by contacting Tradewinds
International, Inc. at General Aviation Terminal, No. 7 Thomas Avenue,
Washington National Airport, Washington, D.C., 20001, telephone number
(202) 637-3221, facsimile number (202) 637-3222.  The business hours
of Tradewinds International, Inc. are Monday through Friday 9:00 A.M.
to 6:00 P.M., EDT.


 The Bidder Package will contain the following information:


 (1)  A list of licenses to be offered simultaneously;


 (2)  The procedures, terms and conditions of the auction;


 (3) A copy of the Third Report and Order in PP Docket No. 93-253,
     FCC 94-98;


 (4) An Application Form to participate in an FCC auction ("FCC Form 175"
     and "175S" or "Short-Form") including instructions on filling out the
     form and a sample of a completed Form 175;


 (5) An FCC Remittance Advice (FCC Form 159) to be submitted by bidders
     together with their upfront payment, down payment and final payment
     (described below);


 (6)  Wire transfer instructions;


 (7) An application for a narrowband PCS license (FCC Form 401 or
     "Long-Form" application) to be submitted by winning bidders only; and


 (8)  Other general auction information.


4.  Short Form Application (FCC Form 175)


In order to be eligible to bid in the auction bidders must submit an
application for one or more narrowband PCS licenses on FCC Form 175
prior to the auction in compliance with applicable FCC Rules and
Regulations and with the requirements set forth below.  Only the
person or persons identified on FCC Form 175 as qualified to make a
bid will be permitted to bid at the auction.  The FCC Form 175 may be
submitted anytime after the release of this Public Notice but must be
received no later than 5:30 P.M.  EDT, Friday, July 1, 1994.  Certain
information necessary to complete FCC Form 175, such as market numbers
and frequency block numbers for nationwide narrowband PCS licenses as
well as the Auction No., may be found at the top of this Public
Notice.


Completion of Form 175


Applicants are required to complete all the items on the application.
The applicant must also identify all parties to the application,
including members of bidding consortia, joint ventures or any other
agreements, arrangements or understandings relating to the auction or
post- auction market structure.  In completing FCC Form 175, bidders
should note the following:


 1.  In item 6 of FCC Form 175, Auction No., applicants should enter "1".


 2.  Item 7 requires applicants to make up a ten digit FCC Account
Number, a personal identification number that the Commission will use
to identify and track applications.  Applicants have two options to
create this FCC Account Number.  Option 1- an applicant may use its
taxpayer identification number (TIN) with a prefix of "0", i.e.,
0123456789.  Option 2- an applicant may use its ten digit telephone
number (i.e., 5552345678).  Each applicant should use this same number
when submitting additional information/material regarding its
application, including any required fees submitted to the Commission
on FCC Remittance Advice, (i.e.  use the same number for the Form 175
and the FCC Account Number on FCC Form 159).  This number must be used
whenever an applicant writes, calls, or otherwise inquires about its
application.  Applicants will also need this number to register for
the auction.


 3.  Items 9 and 10 will be used to determine whether the applicant is
claiming a preference in the bidding process.  As discussed more fully
in the Third Report and Order, certain preferential measures are
available to small businesses and businesses owned by members of
minority groups and/or women.  Applicants claiming a preference should
refer to Section 1.2110 of the Commission's Rules (47 C.F.R. sec.
1.2110) for definitions and eligibility requirements applicable to
small businesses and businesses owned by women and minorities.  See
also Third Report and Order at paras.  66-90.


 4.  In Item 11, applicants should identify the market number for each
narrowband PCS license they want to bid on.  The market number for
each license is listed above. Applicants should list the market
numbers for each license they are interested in bidding on in the
first column labeled "Market No."  If applicants want to bid on more
than five markets, they should list each additional market number on
FCC Form 175-S.  For the Frequency Block No. in item 11, applicants
should indicate the frequency block numbers associated with each
license they expect to bid on at the auction.


 5.  In item 12, applicants should list the name(s) of a person(s)
authorized to represent them at the auction. Only one bidding number
per applicant will be assigned.


 6.  Applicants should read the "Certifications" listed on the FCC
Form 175 carefully before signing the application.  These
certifications help to ensure a fair and competitive auction and
require, among other things, disclosure to the Commission of certain
information on applicant ownership and agreements or arrangements
concerning the auction.  Submission of a false certification to the
Commission may result in penalties, including monetary forfeitures,
license revocation(s), being barred from future auctions, and/or
criminal prosecution.


The Commission has established a Help Line to assist applicants in
filling FCC Form 175.  That number is (202) 637-3221.  Applicants may
call the Help Line for assistance Monday through Friday from 9:00 A.M.
to 6:00 P.M.  EDT.


Microfiche copies of the FCC Form 175 or 175-S are not required.


Failure to sign the FCC Form 175 will result in dismissal of the
application and inability to participate in the auction.


Where to Send the FCC Form 175:


In order to be eligible to bid, an FCC Form 175 application must be
received by 5:30 P.M., EDT on Friday, July 1, 1994.  Late applications
will not be accepted.  Applications should be submitted either by hand
delivery, certified U.S. mail (return receipt requested) or sent by
private courier.  Whether mailed, hand delivered or sent by private
courier, applications must be addressed to:


      Tradewinds International, Inc.
      General Aviation Terminal
      No. 7 Thomas Avenue
      Washington National Airport
      Washington, D.C., 20001
      Attention: Narrowband PCS Processing


Applications will not be accepted if delivered to any other location.


5.  Application Fee:


No application fee or FCC Form 159 need accompany the FCC Form 175 for
the auction.


6.  Procedures after FCC Form 175 Applications are filed.


After the deadline for filing FCC Form 175 applications has passed,
the Commission will process all applications to determine whether they
are accepted for filing.  The Commission will issue a Public Notice
listing all applications which are accepted for filing, rejected, and
those which have minor defects that may be corrected. The Public
Notice will also announce the deadline for filing corrected
applications.  As described more fully in the Commission's general
auction rules, applicants may only make minor corrections to their FCC
Form 175 applications.  Applicants will not be permitted to make major
modifications such as changes in ownership to their applications.
Failure to sign an FCC Form 175 cannot be corrected and will cause the
application to be dismissed and the applicant to be ineligible to
participate in the auction.  See Section 1.2105 of the Commission's
Rules.  47 C.F.R. sec. 1.2105.


After the deadline for resubmitting corrected applications the
Commission will release another Public Notice announcing all
applications that have been accepted for filing, including applicants
who have corrected defective applications.


7.  Upfront Payments


In order to be eligible to bid at the auction, applicants must submit
an upfront payment together with an FCC Form 159 to the Mellon Bank.
The upfront payment is $350,000 per license for the maximum number of
license on which an applicant expects to bid in any single round of
bidding.  Payment must be made in U.S. dollars and must be received by
3:00 P.M.  EDT, Monday, July 11, 1994, in accordance with the terms
and procedures set forth below and the Commission's Rules.  The
upfront payment may be submitted by wire transfer or cashier's check
payable to the "Federal Communications Commission" or "FCC." Wire
transfer instructions and the delivery address will be provided in the
Bidder Package. Check(s) must be drawn on a bank whose deposits are
insured by the Federal Deposit Insurance Corporation (FDIC).  An
applicant intending to bid on more than one nationwide narrowband
license must submit an upfront payment of $350,000 per license for the
maximum number of licenses on which it intends to bid in any single
round of bidding.  The upfront payment submitted by each applicant
will define the maximum number of licenses on which the applicant will
be permitted to bid in any single round of bidding.


Narrowband PCS licensees will be permitted to aggregate up to three
licenses.  An applicant may apply for every license on its Form 175,
but its actual bidding in any round will be limited to the number of
licenses covered by the amount of its upfront payment.


No later than seven (7) business days before the auction the
Commission will issue a Public Notice announcing all qualified bidders
for the nationwide narrowband PCS auction.  Qualified bidders are
those whose Form 175 applications have been accepted for filing and
who have timely submitted their upfront payment.


8.  Registration


All qualified bidders or their designated representatives identified
on Form 175 will be required to register for the auction.
Registration will be held from 1:00 P.M. to 9:00 P.M. on Sunday, July
24, 1994 and from 8:00 A.M. to 9:30 A.M. on Monday July 25, 1994 at
the Omni Shoreham Hotel at 2500 Calvert Street, N.W., Washington, D.C.
A confidential bidder number will be assigned to each qualified bidder
at registration.  Further information regarding registration will be
provided in the Bidder Package.  All bidders will be required to bring
two forms of identification, one form of photo identification (e.g., a
valid drivers license or passport) and one additional form of
identification.


9.  Method of Competitive Bidding


The winning bidders for the nationwide narrowband PCS licenses will be
selected through a simultaneous multiple round auction.  Bids will be
accepted on all licenses in each round of the auction.  High bid
amounts will be posted at the end of each round of bidding.  Bidding
will remain open on all licenses until bidding closes on every
license.  Thus, bidding will stop simultaneously on all licenses.


Bid Submission and Withdrawal Procedures


All bidders or their representatives are required to be present at the
auction site in order to place their bids.  Each bidder will be
required to provide its confidential bidder number and FCC account
number in order to place or withdraw a bid.  Bids will be placed with
bid assistants on site who will input the bids into the auction
database.  All accepted bids for each license and the minimum bid
increment for the next round will be announced at the conclusion of
each bidding round.  Bidders will have no less than one hour after
accepted bids are posted to place their bids for the next round.  A
high bidder who wants to withdraw its high bid during the course of
the auction may do so subject to the bid withdrawal penalty specified
in the Third Report and Order at paras. 49-59.  A high bidder who
wants to withdraw its high bid should notify a bid assistant as soon
as possible after its bid is posted as the high bid.  If a high bid is
withdrawn, the license will be offered in the next round at the second
high bid price.


Bid Increments


The bid increment is the amount or percentage by which a bid must be
raised above the previous high bid in order to be accepted as a valid
bid in the current round.  The minimum bid in the first round of
bidding will be $.02 per pop per MHz (rounded down to the nearest
$25,000).  The bid increment in subsequent rounds will be $.01 per pop
per MHz (rounded down to the nearest $25,000) or 5% of the previous
high bid, whichever is greater.  The amount of the minimum bid
increment may be reduced in later rounds as the number of active
bidders declines.  The amount of the minimum bid increment for each
license will be announced along with the accepted bids from the
preceding round.  The following table shows the amounts of the minimum
bid increment for each category of license:


                                        Minimum Bid Increment
License Category                In the First Round    After First Round*


50/50 kHz  paired licenses      $500,000                $250,000
50/12.5 kHz  paired licenses    $300,000                $150,000
50 kHz unpaired licenses        $250,000                $125,000


*(or 5% of the previous high bid, whichever is greater)


 Activity Rule


In order to ensure that the auction closes within a reasonable period
of time, we will impose an activity rule to prevent bidders from
waiting until the end of the auction before participating.  Because of
the relatively small number of licenses being offered in this auction
we will impose a simplified version of the Milgrom-Wilson activity
rule (discussed in the Third Report and Order at paras. 37-40).
During the first stage of the auction bidders will be required to be
active on at least one license in every round of bidding.  A bidder
will be considered active on a license if it either is the high bidder
from the previous round or submits a bid which exceeds the previous
round's high bid by at least the amount of the minimum bid increment.
Bidders will be permitted five automatic waivers from the activity
rule during the course of the auction.  A bidder must notify a bid
assistant of its intent to exercise one or more of its waivers at the
time such bidder submits its next bid.  Bidders in the first stage of
the auction who fall below the required activity level and who have
used all five of the automatic waivers will have their eligibility
reduced to 0 and will not be eligible to bid in future rounds.  See
Third Report and Order at paras. 36-40.  To speed up the auction the
Commission may declare at any time after 15 rounds have passed that
the auction will move into a final stage, with an increased activity
level.  If the Commission declares such an additional stage, bidders
would be required to be active on the maximum number of licenses they
desire to be awarded.  In the final stage, bidders would have their
eligibility reduced to the number of licenses on which they are
active, unless they invoke an automatic waiver or waivers, in which
case they would retain their current eligibility.


 Stopping Rules


Bidding will remain open on all licenses until bidding stops on every
license.  The auction will close if one round passes with no new
acceptable bids on any license.  Thus, bidding will stop for all
nationwide licenses simultaneously.  The Commission, however, may
declare at any time after 20 rounds that the auction will end after
one additional round (or some other specified number of rounds).


 Bid Withdrawal, Default or Disqualification Penalty


Any high bidder who withdraws a high bid in any round, defaults by
failing to remit the required 20% down payment within the prescribed
time or is disqualified after bidding is declared closed will be
subject to a penalty described in Section 24.304 of the Commission's
Rules. 47 C.F.R. sec.  24.304


 Down Payment and Final Payment


The winning bidder for each license must submit sufficient additional
funds (a "down payment") to bring the amount of money on deposit with
the government to 20% of their winning bid amount within five (5)
business days after bidding is declared closed.  Winning bidders that
are qualified small businesses are required to submit only a 10% down
payment within five (5) business days after bidding is closed, with an
additional 10% due within five (5) business days after grant of the
license.  No interest will be paid on any funds on deposit with the
Commission.


10.   Long-Form Application (FCC Form 401)


 As detailed in the narrowband PCS and general auction rules, winning
bidders must timely submit a properly completed FCC application for a
narrowband PCS license (FCC Form 401) within ten (10) business days
after being notified that they are the winning bidder.  The Form 401
must be sent to:


          Office of the Secretary
          Federal Communications Commission
          1919 M St., N.W., Room 222
          Washington, D.C. 20554
          Attention: Auction Application Processing Section


 After submission of the FCC Form 401, the Commission will determine
whether there are any reasons why the license should not be granted;
if there are none, it will grant the license.  Winning bidders will be
required to pay the remainder of the winning bid amount within five
(5) business days after grant of the license.  Qualified small
businesses will be permitted to pay the remaining 80% of their winning
bid amount in installments over the term of the license. See Third
Report and Order at paras. 86-90.  All license grants will be
conditioned on timely payment in full of the bid price.


11.  Delay, Suspension or Cancellation of the Auction


The Commission may by Public Notice or announcement during the
auction, delay, suspend or cancel the auction in the event of natural
disaster, technical obstacle, evidence of an auction security breach,
unlawful bidding activity, administrative necessity, or for any other
reason that affects the fair and competitive conduct of competitive
bidding.  In such cases, the Commission may, in its sole discretion,
resume the auction starting from the beginning of the current or some
previous round or may cancel the auction in its entirety.


                                -FCC-


                        -------------------------
Bob Keller <KY3R>        Robert J. Keller, P.C.        Tel +1 301 229 5208
rjk () telcomlaw com    Federal Telecommunications Law    Fax +1 301 229 6875
finger me for daily FCC info + see ftp.clark.net:/pub/rjk/ for other files