***U.S. FCC Revokes NextWave Wireless Licenses
(January 12)
According to Reuters, the Federal Communications Commission said
it has revoked dozens of wireless telephone licenses held by
bankrupt NextWave Telecom and would re-auction the valuable
rights in July. The 95 licenses, including cities like Los
Angeles, New York, and Philadelphia, are prime wireless real
estate and are likely to draw bids of billions of dollars. A U.S.
Appeals Court ruling last year gave the FCC authority to revoke
the licenses NextWave won at a 1996 auction, despite the
company's bankruptcy filing.
NextWave bid more than $4.7 billion in winning licenses to offer
wireless telephone service in 95 metropolitan areas with a
combined population of about 163 million people, but the upstart
carrier was unable to raise the money and declared bankruptcy in
1998. A New York bankruptcy court last year determined that
NextWave could keep the PCS licenses after paying just $1
billion. But in November, the U.S. Court of Appeals for the
Second Circuit reversed that ruling and gave the FCC broad
authority to revoke the licenses.
Last month, the company said it had gained new equity investments
of $1.6 billion from investors including Global Crossing and
Liberty Media Group and would begin offering service soon. Nextel
Communications, a more established carrier has been seeking to
acquire NextWave's licenses. At one point Nextel said it would
pay more than $8 billion for the licenses but withdrew the offer
once the FCC's plans became clear.
Nextel's eligibility to bid in the July auction was uncertain,
however. The FCC said that like the original 1996 auction, the
licenses would be reserved for small and start-up companies. That
decision drew praise from the Personal Communications Industry
Association, a trade group that encompasses smaller carriers.
Wave Issue 2002 1/14/00 Article 1-01