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Emerging Wireless Opportunities for the Rural Operator OPASTCO 44th Annual Winter Convention Orlando, FL January 16, 2007 Carri Bennet, CEO.

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Presentation on theme: "Emerging Wireless Opportunities for the Rural Operator OPASTCO 44th Annual Winter Convention Orlando, FL January 16, 2007 Carri Bennet, CEO."— Presentation transcript:

1 Emerging Wireless Opportunities for the Rural Operator OPASTCO 44th Annual Winter Convention Orlando, FL January 16, 2007 Carri Bennet, CEO

2 Spectrum Opportunities Cellular and PCS Advanced Wireless Services 700 MHz BRS/EBS 1.4 MHz - Auction Begins 2/7/2007 WCS (2.3 GHz) AWS-2 MVDDS LMDS Unlicensed Bands

3 Cellular & PCS Cellular Must have spectrum –Strategic roaming alliance with Cingular –Unserved areas are still being built out PCS T-Mobile willing to sell 10 MHz of spectrum –Reserves at least 20 MHz –Favorable roaming rates Sprint PCS already covered Distressed spectrum still available Auction Scheduled for May 16, 2007 –38 PCS licenses

4 Advanced Wireless Services (AWS-1) 1710-1755 MHz and 2110-2155 MHz bands

5 Advanced Wireless Services Spectrum auction ended September 18, 2006 –Previously allocated for federal government use; Now being transferred for commercial fixed and mobile application –Band clearing reimbursement required –Fifteen-year license term –Available Equipment

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7 AWS Auction 1,122 licenses: –36 Regional Economic Area Grouping (REAG) licenses –352 Economic Area (EA) licenses –734 Cellular Market Area (CMA) licenses 168 Qualified bidders

8 AWS Auction 104 bidders won 1,087 licenses $13.7 Billion net bids Top six bidders

9 AWS Auction The median price of a license was $0.12 MHz-POP (around $2.40/POP for a 20 MHz license)

10 AWS Auction Most expensive market –Washington DC A block $1.59 MHz-POP $31.83 POP Three most expensive RSAs (price/MHz-POP basis) –Iowa 13 – Mitchell $.89 ($17.85 per POP) –Nebraska 3 – Knox $.83 ($16.53 per POP) –Texas 9 – Runnels $.72 ($14.47 per POP) Just slightly fewer than ½ of all the licenses sold for $.10 per MHz-POP or less (about $2.00 per POP).

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17 AWS Auction What does it mean? Will it be just another 2-2.5G mobile service? –CMRS carriers pathway to WiMAX? Voice, data, music, video Multimedia Content is king How will it play with existing CMRS high-speed broadband networks?

18 AWS Auction T-Mobile –Picked up much needed spectrum –Years behind others in 3G –Will need help building out/roaming opportunities Cingular –Doesnt really need it in most areas –What does it mean for your cellular partnerships? Cricket/MetroPCS/AWS Wireless –Bankruptcy re-dux? –Cheap spectrum down the road? –Partnership buildout/roaming opportunities?

19 AWS Auction SpectrumCo –Cable JV with Sprint –Will not be a fifth CMRS competitor –Streaming video? –How does this fit with Sprints WiMAX deployment at 2.5 GHz? –Is it just a $2 billion insurance policy?

20 AWS Auction Increased data speeds Mobile high-speed access Mobile media services Multi-mode devices My phone, my internet, my games, my music, my wallet, my total connection to my life!

21 AWS Auction DEs acquired 181,252,312 covered POPs (duplicative) out of a possible 1,713,722,670...about 11%. What does this mean for future DE rules? What does this mean for 700 MHz band auction in 2008?

22 700 MHz Spectrum - Lower 700 MHz Band Plan - Upper 700 MHz Band Plan

23 Lower 700 MHz

24 Lower 700 MHz Areas (MSA/RSAs)

25 Upper 700 MHz Bandplan

26 Upper 700 MHz Areas (MEAs)

27 Upper 700 MHz Areas (EAGs)

28 Proposed Rebanding of 700 MHz Will allow rural operators to participate with smaller licensed areas (MSAs/RSAs) Major industry support

29 Balanced Consensus Plan Mix of licenses of varying sizes and geographic regions Facilitates the competitive and rapid deployment of innovative wireless services in the 700 MHz bands. Advances Section 309(j) by –promoting economic opportunity and competition –disseminating licenses across a wide variety of applicants

30 Balanced Consensus 700 MHz Band Plan Upper 700 MHz Band *Blocks have been auctioned. +Please note that this Consensus Plan is submitted without prejudice to the signatories ability to support or oppose the Cyren Call proposal that would remove the Upper 700 MHz Band from the auction.

31 Balanced Consensus 700 MHz Band Plan Lower 700 MHz Band *Blocks have been auctioned. +Please note that this Consensus Plan is submitted without prejudice to the signatories ability to support or oppose the Cyren Call proposal that would remove the Upper 700 ability to support or oppose the Cyren Call proposal that would remove the Upper 700 MHz Band from the auction.

32 Balanced Consensus Plan Signatories Alltel Corporation Aloha Partners, L.P. Blooston Rural Carriers C&W Enterprises, Inc. ConnectME Authority Corr Wireless Communications, LLC Dobson Communications Corporation Leap Wireless International, Inc. Maine Office of the Chief Information Officer MetroPCS Communications, Inc. National Telecommunications Cooperative Association Nebraska Public Service Commission North Dakota Public Service Commission Rural Cellular Association Rural Telecommunications Group, Inc. Union Telephone Company United States Cellular Corporation Vermont Department of Public Service Vermont Office of the Chief Information Officer Vermont Public Service Board Vermont Telephone Company, Inc.

33 Cyren Call Proposals Impact on 700 MHz Cyren Call filed FCC petition for reallocation of 30 MHz of spectrum in the 747-762 MHz and 777-792 MHz bands for shared commercial and public safety use FCC dismissed petition ruling that a change in Sections 337 and 309 of the Act is required. Cyren Call is lobbying congress for the change DTV Coalition is concerned –Broadcast TV transition date will be pushed past 2/2009 –equipment makers will delay deployment of new technologies while awaiting resolution of the issue

34 BRS/EBS formerly known as MMDS/ITFS BRS/EBS Transition: –Transition underway for BRS and EBS licensees. –Sprint and Clearwire changing high-power systems to low-power data systems –Spectrum increasing in value; Finally multiple equipment options. –FCC targets spectrum take-back and possible auction in 2009.

35 WCS/2.3 GHz Band

36 First licensed Wi-MAX band. Spectrum trash heap recovered by AT&T and NextWave. Ideal for initial Wi-MAX deployments. Recently granted extension of time to construct. Rural areas will need to be served

37 Secondary Market Opportunities Partitioning and Disaggregation Spectrum leasing Resale/MVNO opportunities

38 Partitioning/Disaggregation Allows breaking larger areas up and recombining areas to tailor needs Occurs after auctions Build out requirements have to be considered Requires agreement from licensee

39 Leasing Using someone elses spectrum through a lease arrangement Mainly on temporary basis while waiting on FCC approvals Bankruptcy issue Affiliated companies Not real popular among rural operators

40 MVNO Mobile Virtual Network Operator Cheap wireless entry – Available now Position for 3 G, mobile data and m-commerce Bundle with other existing service offerings Utilizes large carrier network Allows rural telcos to expand current telecom service area Positions telco to keep customer as landline migration to wireless continues Telispire ® is choice of rural operators

41 Questions Carri Bennet, CEO cbennet@bennetlaw.com 202/371-1500 www.bennetlaw.com


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