This week, the Federal Communications Commission released its long-awaited Report & Order creating new rules to auction and clear 280 MHz of spectrum for 5G services. The Order marks the next step in the Commission’s 5G Fast Plan to facilitate U.S. superiority in 5G technology and close the digital divide.
The Order repurposes a portion of mid-band spectrum, in particular the 3.7-4.2 GHz band (“C-band”), for 5G use. To do so, the Commission repacks incumbent fixed satellite services (FSS) into the upper 200 MHz of the C-band (with a 20 MHz guard band), clearing the way for new flexible use licensees to operate in the lower 280 MHz of the C-band throughout the continental United States. The Order also creates various mechanisms to manage a rapid transition to flexible use services and ensure continuity of existing C-band services both during and after the transition.
The Order sets a deadline of December 5, 2025 to transition the band to flexible use services, and provides incentives to incumbents to further expedite band clearing. To achieve the Commission’s goal of rapid deployment of 5G services in the C-band, accelerated relocation payments totaling $9.7 Billion (which is allocated according to the Order) are available to eligible space station operators who meet specific clearing thresholds by December 5, 2021 and December 5, 2023, respectively. The Commission also mandates that both reasonable relocation costs of incumbents as well as the accelerated relocation payments will be paid by new flexible use licensees based on a pro-rata share of gross winning bids as discussed in the Order.
To manage the transition process, the Commission provides for the establishment of an independent Relocation Payment Clearinghouse to manage cost-related aspects of the transition in a fair and transparent manner, including overseeing the relocation funds available to incumbents. The Commission also creates a relocation coordinator to ensure that existing C-band operators relocate in a timely manner, and that existing C-band services remain uninterrupted both during and after the transition. The Commission provides oversight to both the clearinghouse and the transition coordinator to ensure a timely transition.
The Order sets the stage for a public auction for new flexible use licenses commencing on December 8, 2020, and imposes deadlines that incumbent operators will need to meet in advance of the auction, including electing accelerated relocation payments and submitting detailed transition plans describing necessary steps and estimating transition costs.
This undertaking represents one of the most complex band allocations undertaken by the Commission, and there will undoubtedly be more developments as the auction approaches and the Commission continues its efforts to reform the C-band.