On May 14, 2019, the Wireless Telecommunications Bureau (“Bureau”) and the Office of Economics and Analytics (“OEA”) released a Public Notice (“Notice”) adopting procedures to reconfigure and modify existing 39 GHz licenses in preparation for Auction 103. The incentive auction is scheduled to begin on December 10, 2019.

The Bureau/OEA previously released the Initial 39 GHz Reconfiguration Process Public Notice (“Initial Notice”), which set forth the reconfiguration procedures and implemented the first steps toward quantifying the 39 GHz holdings of incumbents by aggregating these holdings in terms of MHz-pops by PEA and consolidating the holdings of commonly controlled licensees, among other things. Today’s Notice updates the initial data on aggregate incumbent holdings, establishes the final procedures for the remaining steps of the reconfiguration process, and resolves all open issues raised in the Initial Notice. The Commission will release a future Reconfigured 39 GHz Incumbent Holdings Public Notice that will show further information regarding modified licenses and announce the timeline for Initial Commitments.

Methodology for Setting Relative Weights for Spectrum Holdings by PEA – The Notice adopts a methodology for calculating the index of PEA weights for the Auction 103 reconfiguration process using price data from Auctions 102 (24 GHz) and 1002 (600 MHz), which reflects a revision from the proposed methodology in the Initial Notice. Specifically, the weights in Appendix C to the Notice were determined by: (i) computing an average price for each PEA in Auctions 1002 and 102, (ii) calculating a relative price index value for each PEA in each auction, and (iii) taking a weighted average of index values, weighting Auction 102 data by two-thirds and Auction 1002 data by one-third to create the index for weighting the MHz-pops in each PEA.

Reconfigured Holdings for Modified Licenses – The final procedure adopted for reconfiguring the updated aggregated 39 GHz holdings are the same as those described generally in the Initial Notice. The final procedures include procedures consistent with the tentative conclusion regarding de minimis rounding and the proposal for determining the boundaries of modified licenses for partial PEAs. We encourage interested parties to review these details carefully.

Initial Commitments – The initial commitment process described in the Initial Notice is adopted, with one exception. The Bureau/OEA previously concluded that only one of the commonly controlled entities holding an existing 39 GHz license would receive the single incentive payment for an incumbent’s combined holdings relinquished in the action. In today’s Notice, the Bureau/OEA revises its approach to permit a party lacking an existing 39 GHz license that controls an incumbent’s 39 GHz licensees or that is controlled by another party that controls the incumbent’s 39 GHz licensees to receive an incentive payment. The incumbent may also divide its single payment among accounts owned by the commonly controlled party. This Notice outlines specific details on the initial commitment filing and option processes, transitions, and payments, and we strongly encourage interested parties to review this information carefully.

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