Wednesday, September 1, 2010

FCC Terminates AWS-3 Rulemaking to Auction Spectrum with Free Broadband Requirement; Breaks National Broadband Plan Commitment

/PRNewswire/ -- On Friday, August 27, 2010, the Federal Communications Commission (FCC) notified M2Z Networks, Inc. (M2Z) and its Silicon Valley investors including Kleiner Perkins, Charles River Ventures, and Redpoint Ventures, that it has terminated the AWS-3 spectrum (2155-2180 MHz) public interest rulemaking, thereby closing off the possibility of providing free nationwide broadband service in the United States for the foreseeable future. The FCC has been considering M2Z's proposal for a free nationwide broadband network using AWS-3 since 2006. This decision reverses the FCC's National Broadband Plan commitment to finalize the AWS-3 spectrum rulemaking in the fourth quarter of 2010 and for the spectrum to be auctioned by the second quarter of 2011.

The FCC's AWS-3 rulemaking, pending since 2007, consisted of three key issues:

-- A requirement that the AWS-3 licensee provide free broadband service
to at least 95% of the U.S. population in order to address the digital
-- A requirement that the AWS-3 licensee adhere to Net Neutrality
principles of open access (end-user access to all lawful content) and
open platforms (end-users to have the choice of devices);
-- An enforceable requirement on the AWS-3 licensee to build-out a
national broadband network covering 50% of the population in 4 years
and 95% in 10 years.

According to the FCC's own National Broadband Plan, 28 million Americans today cannot afford to subscribe to broadband. A free nationwide broadband service using the AWS-3 spectrum band would have addressed this persistent digital divide. While campaigning for the White House in 2008, President Obama told the U.S. Conference of Mayors, "Every American should have broadband access - no matter where you live, or how much money you have. We'll connect our schools and libraries and hospitals. And we'll take on the special interests to realize the potential of wireless spectrum for our safety and connectivity."

There continues to be considerable support from the public for a free nationwide broadband service. The FCC record shows that during the pendency of the AWS-3 rulemaking, more than 50,000 Americans signed a petition supporting the proposed rules while the FCC and members of Congress received over 20,000 letters and emails in support of the proposed rules. Government officials outside of Washington--faced with a growing digital divide and a poor economy--also saw merit in this innovative private sector solution. The FCC record shows that over 300 local, state and federal officials from all 50 states wrote to the FCC in support of the proposed AWS-3 rules.

"The FCC's decision to delay the use of this valuable spectrum forgoes the consumer welfare and economic stimulus that would result from putting new spectrum into the marketplace," said John Muleta, CEO of M2Z Networks. "A new nationwide broadband entrant that provided a free broadband service would have created tens of thousands of direct and indirect jobs throughout the country while giving all Americans an equal opportunity to participate in the digital economy. Despite the spectrum crisis facing the U.S. as documented by the FCC's National Broadband Plan, the AWS-3 spectrum will continue to lie fallow providing no economic value to American consumers."

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