[Federal Register: March 18, 2003 (Volume 68, Number 52)]
[Notices]
[Page 12906-12911]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18mr03-57]
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FEDERAL COMMUNICATIONS COMMISSION
[Report No. AUC-03-52-A (Auction No. 52); FCC 03-40]
Auction of Direct Broadcast Satellite Service Licenses Scheduled
for August 6, 2003; Comment Sought on Reserve Prices or Minimum Opening
Bids and Other Auction Procedures
AGENCY: Federal Communications Commission.
ACTION: Notice.
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SUMMARY: This document announces the auction of licenses to use the
Direct Broadcast Satellite (``DBS'') service allocation and seeks
comment on reserve prices or minimum opening bids and other auction
procedures.
DATES: Comments are due on or before March 17, 2003, and reply comments
are due on or before March 24, 2003.
ADDRESSES: Comments and reply comments must be sent by electronic mail
to the following address: auction52@fcc.gov.
FOR FURTHER INFORMATION CONTACT: Auctions and Industry Analysis
Division, WTB: For legal questions: Brian Carter at (202) 418-0660. For
general auction questions: Jeff Crooks at (202) 418-0660 or Lisa Stover
at (717) 338-2888. Satellite Division, IB: For service rule questions:
Selina Khan at (202) 418-7282 or Rockie Patterson at (202) 418-1183.
SUPPLEMENTARY INFORMATION: This is a summary of the Auction No. 52
Comment Public Notice released on March 3, 2003. The complete text of
the Auction No. 52 Comment Public Notice, including the attachment, is
available for public inspection and copying during regular business
hours at the FCC Reference Information Center, Portals II, 445 12th
Street, SW., Room CY-B402, Washington, DC 20554. The Auction No. 52
Comment Public Notice may also be purchased from the Commission's
duplicating contractor, Qualex International, Portals II, 445 12th
Street, SW., Room CY-B402, Washington, DC, 20554, telephone (202) 863-
2893, facsimile (202) 863-2898, or via e-mail qualexint@aol.com.
I. General Information
1. By the Auction No. 52 Comment Public Notice, the Commission
announces the auction of licenses to use the Direct Broadcast Satellite
(``DBS'') service allocation scheduled to commence on August 6, 2003
(Auction No. 52). This auction will include 4 licenses for unassigned
channels at orbital locations of 175[deg] W.L., 166[deg] W.L., 157[deg]
W.L., and 61.5[deg] W.L. These licenses would be subject to the
Commission's DBS service rules, including the geographic service rules
at 47 CFR 25.148(c). Specifically, DBS licensees must provide DBS
service to Alaska and Hawaii where such service is technically feasible
from the authorized location. A complete list and description of the
licenses available for Auction No. 52 is included as Attachment A of
the Auction No. 52 Comment Public Notice.
2. The Balanced Budget Act of 1997 requires the Commission to
``ensure that, in the scheduling of any competitive bidding under this
subsection, an adequate period is allowed * * * before issuance of
bidding rules, to permit notice and comment on proposed auction
procedures * * *.'' Consistent with the provisions of the Balanced
Budget Act and to ensure that potential bidders have adequate time to
familiarize themselves with the specific rules that will govern the
day-to-day conduct of an auction, the Commission seeks comment on a
variety of auction-specific procedures relating to Auction No. 52. We
note that the authority to establish specific procedures for Auction
No. 52 has already been delegated to the Wireless Telecommunications
Bureau (the ``Bureau'' or ``WTB'').
3. In addition to the enactment of the Balanced Budget Act of 1997,
there have been legal developments relevant to satellite services since
the Commission last conducted DBS auctions. Specifically, in 1996 the
Commission adopted a Report and Order, 61 FR 9946 (March 12, 1996)
(``Disco I''), that removed FCC regulatory prohibitions on the
provision of various satellite services beyond the borders of the
United States. In addition, in the year 2000 Congress enacted section
647 of the ORBIT Act, Public Law 106-180, 114 Stat. 48, which prohibits
the Commission from using competitive bidding to assign orbital
locations or spectrum used ``for the provision of international or
global satellite communications services.'' In light of these
regulatory and statutory actions, we believe it is appropriate to state
herein our conclusion that they have not altered the Commission's
authority to auction the DBS licenses included in Auction No. 52.
4. The DBS licenses that will be included in Auction No. 52 are not
subject to the auction prohibition of the ORBIT Act because they are
not authorizations to use spectrum ``for the provision of international
or global satellite communications services.'' These licenses are for
the use of DBS channels that, under the Region 2 Band Plan for Ku-band
DBS satellites initially adopted in the International Telecommunication
Union (``ITU'') 1983 Regional Administrative Radio Conference, have
coverage patterns that are designed to--and do in fact--serve the
United States almost exclusively. Thus, the technical parameters of the
ITU Region 2 Band Plan provide for coverage areas for national service
to the United States with incidental service to neighboring
territories.
5. Moreover, neither the national coverage patterns nor the
incidental international coverage patterns of the U.S. DBS satellite
assignments may be expanded without further international agreement. A
U.S.-licensed satellite operator at one of the orbital locations
assigned to the United States cannot change, without the agreement of
affected countries, any of the satellite's operations if that change
will increase the interference potential to other countries' DBS
satellite assignments above those levels permitted by international
regulation. A change in the footprint to provide increased coverage of
another country will potentially cause the modified assignment to
exceed these levels. For a licensee to operate with such modified
parameters, the United States, on behalf of the satellite operator,
must request and obtain a modification to the Region 2 Band Plan
pursuant to ITU procedures. The United States has not requested
modifications for international service purposes to the Region 2 Band
Plan for any of the orbital channel assignments
[[Page 12907]]
included in Auction No. 52. Thus, the auction will assign licenses for
DBS satellites that can provide almost exclusively national service,
with only incidental coverage outside the U.S. borders.
6. DISCO I removed FCC regulatory prohibitions on the provision of
DBS service, as well as other types of satellite service, beyond the
borders of the United States. However, DISCO I did not change the fact
that the ITU Region 2 Band Plan provides for only an incidental signal
outside U.S. borders. The technical parameters established under the
ITU Region 2 Band Plan provide for national service to the United
States, with incidental service to neighboring territories. DBS
providers who operate under licenses for the eight orbital locations
assigned to the United States under the Plan must comply with these
technical parameters.
7. The incidental provision of transborder service does not convert
an otherwise auctionable license to an unauctionable one. The
legislative history of the ORBIT Act auction exemption, which consists
of a House Commerce Committee Report on an earlier, unenacted bill
containing an auction exemption identical to that of section 647 of the
ORBIT Act, expresses concern for the effect that auctions could have on
the viability and availability of global and international satellite
services. The Committee indicated that an auctions exemption could help
such service providers avoid financial burdens they might otherwise
face if a U.S. auction regime precipitated a succession of auctions in
numerous countries in which the operators might seek to provide
service. The auctioning of U.S. DBS licenses that comply with the ITU
Region 2 Band Plan does not implicate these concerns, given the fact
that the Plan was designed to maintain the distinctly national
character of the DBS service. We seek comment on these conclusions.
8. We also note that the Commission has not adopted any blanket
eligibility restrictions on the licenses included in this auction. In
the Part 100 R&O, 67 FR 51110 (August 7, 2002), proceeding, the
Commission had the opportunity to address issues relating to ownership
restrictions and implementation of services. The Commission considered
comments filed raising such eligibility and ownership issues and
declined to adopt any specific restrictions. In this regard, we note
that, in some services, the Commission has used a standard for
determining whether an eligibility restriction is warranted. In those
cases, we have determined that an eligibility restriction may be
imposed only when there is significant likelihood of substantial harm
to competition in specific markets and when the restriction will be
effective in eliminating that harm. This approach results in reliance
on competitive market forces to guide license assignment absent a
compelling showing that regulatory intervention to exclude potential
participants is necessary. We seek comment as to the use of that
standard for this service.
9. Nonetheless, one of the four licenses scheduled for auction
authorizes the use of only two channels. The Commission has previously
noted that with so few authorized channels it may be difficult for a
DBS licensee to provide sufficient capacity to operate a viable system.
Generally, does this concern warrant any modification of our existing
open eligibility regime? We request comment on whether we should adopt
any specific eligibility criteria for licenses at the 61.5Sec. [deg]
W.L. location such as: (i) Whether the applicant should be an existing
permittee at the 61.5Sec. [deg] W.L. location; (ii) whether the
channels should be assigned to an applicant that holds no other DBS
channel resources capable of serving the continental United States; and
(iii) whether the applicant should be required to demonstrate an
ability to launch in the near future. Should the Commission consider
eligibility restrictions on particular orbital locations based on
entities' market position in the provision of terrestrial multichannel
video programming? Finally, we seek comment on any other proposed
eligibility requirements for each of the orbital locations, including
the rationale for any such requirements.
II. Auction Structure
A. Simultaneous Multiple Round (SMR) Auction Design
10. The Commission proposes to award all licenses included in
Auction No. 52 in a simultaneous multiple-round auction. As described
further, this methodology offers every license for bid at the same time
with successive bidding rounds in which bidders may place bids. We seek
comment on this proposal.
B. Upfront Payments and Initial Maximum Eligibility
11. The Bureau has delegated authority and discretion to determine
an appropriate upfront payment for each license being auctioned, taking
into account such factors as the population in each geographic license
area, and the value of similar spectrum. The upfront payment is a
refundable deposit made by each bidder to establish eligibility to bid
on licenses. Upfront payments related to the specific spectrum subject
to auction protect against frivolous or insincere bidding and provide
the Commission with a source of funds from which to collect payments
owed at the close of the auction. With these guidelines in mind for
Auction No. 52, the Commission proposes to set upfront payments on a
license-by-license basis as follows:
Upfront Payments
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Orbital Location............... 175[deg] W.L....... 166[deg] W.L...... 157[deg] W.L...... 61.5[deg] ;W.L.
Per Channel.................... $50,000............ $50,000........... $100,000.......... $400,000
No. of Channels................ 32................. 32................ 32................ 2
Upfront Payment................ $1,600,000......... $1,600,000........ $3,200,000........ $800,000
----------------------------------------------------------------------------------------------------------------
Additionally, we list all licenses and the proposed upfront payment
for each in Attachment A of the Auction No. 52 Comment Public Notice.
We seek comment on this proposal.
12. The Commission further proposes that the amount of the upfront
payment submitted by a bidder will determine the number of bidding
units on which a bidder may place bids. This limit is a bidder's
``maximum initial eligibility.'' Each license is assigned a specific
number of bidding units equal to the upfront payment listed in
Attachment A of the Auction No. 52 Comment Public Notice, on a bidding
unit per dollar basis. This number does not change as prices rise
during the auction. A bidder's upfront payment is not attributed to
specific licenses. Rather, a bidder may place bids on any combination
of licenses as long as the total number of bidding units associated
with those licenses does not exceed the bidder's eligibility.
Eligibility cannot be increased during the auction. Thus, in
calculating its upfront payment amount,
[[Page 12908]]
an applicant should determine the maximum number of bidding units it
may wish to bid on (or hold high bids on) in any single round and
submit an upfront payment covering that number of bidding units. We
seek comment on this proposal.
C. Activity Rules
13. In order to ensure that the auction closes within a reasonable
period of time, an activity rule requires bidders to bid actively on a
percentage of their current bidding eligibility during each round of
the auction rather than waiting until the end to participate. A bidder
that does not satisfy the activity rule will either use an activity
rule waiver (if any remain) or lose bidding eligibility for the next
round.
14. The Commission proposes to divide the auction into three
stages, each characterized by an increased activity requirement. The
auction will start in Stage One. We propose that the auction will
advance to the next stage (i.e., from Stage One to Stage Two, and from
Stage Two to Stage Three) after two consecutive rounds in which only
one new high bid is placed in each round. The Bureau will notify
bidders by announcement when a stage transition takes place during the
auction. We also propose that the Bureau retain discretion to change
stages unilaterally by announcement during the auction, and further
propose that the Bureau retain the discretion not to make a transition
to the next stage when the conditions described above are met. In
exercising this discretion, the Bureau will consider a variety of
measures of bidder activity, including, but not limited to, the auction
activity level, the percentage of licenses (as measured in bidding
units) on which there are new bids, the number of new bids, and the
percentage increase in revenue. We seek comment on these proposals.
15. For Auction No. 52, we propose the following activity
requirements:
Stage One: In each round of the first stage of the auction, a
bidder desiring to maintain its current eligibility is required to be
active on licenses representing at least 50 percent of its current
bidding eligibility. Failure to maintain the requisite activity level
will result in a reduction in the bidder's bidding eligibility in the
next round of bidding (unless an activity rule waiver is used). During
Stage One, reduced eligibility for the next round will be calculated by
multiplying the current round activity by two.
Stage Two: In each round of the second stage, a bidder desiring to
maintain its current eligibility is required to be active on 75 percent
of its current bidding eligibility. During Stage Two, reduced
eligibility for the next round will be calculated by multiplying the
current round activity by four-thirds (\4/3\).
Stage Three: In each round of the third stage, a bidder desiring to
maintain its current eligibility is required to be active on 100
percent of its current bidding eligibility. In this final stage,
reduced eligibility for the next round will be set at current round
activity. For example, if a bidder is not the standing high bidder and
did not place a bid in the current round its eligibility would be
reduced to zero. If it had no waivers remaining, it would be eliminated
from the auction.
16. We seek comment on these proposals. Commenters that believe
these activity rules should be modified should explain their reasoning
and comment on the desirability of an alternative approach. Commenters
are advised to support their claims with analyses and suggested
alternative activity rules.
D. Activity Rule Waivers and Reducing Eligibility
17. Use of an activity rule waiver preserves the bidder's current
bidding eligibility despite the bidder's activity in the current round
being below the required minimum level. An activity rule waiver applies
to an entire round of bidding and not to a particular license. Activity
rule waivers can be either proactive or automatic and are principally a
mechanism for auction participants to avoid the loss of auction
eligibility in the event that exigent circumstances prevent them from
placing a bid in a particular round.
Note: Once a proactive waiver is submitted during a round, that
waiver cannot be unsubmitted.
18. The Automated Auction System assumes that bidders with
insufficient activity would prefer to use an activity rule waiver (if
available) rather than lose bidding eligibility. Therefore, the system
will automatically apply a waiver (known as an ``automatic waiver'') at
the end of any bidding round in which a bidder's activity level is
below the minimum required unless: (i) the bidder has no activity rule
waivers remaining; or (ii) the bidder overrides the automatic
application of a waiver by reducing eligibility, thereby meeting the
minimum requirements. Note: If a bidder has no waivers remaining and
does not satisfy the required activity level, its current eligibility
will be permanently reduced, possibly eliminating the bidder from the
auction.
19. A bidder with insufficient activity may wish to reduce its
bidding eligibility rather than use an activity rule waiver. If so, the
bidder must affirmatively override the automatic waiver mechanism
during the bidding period by using the ``reduce eligibility'' function
in the bidding system. In this case, the bidder's eligibility is
permanently reduced to bring the bidder into compliance with the
activity rules as described above. Once eligibility has been reduced, a
bidder will not be permitted to regain its lost bidding eligibility.
20. A bidder may proactively use an activity rule waiver as a means
to keep the auction open without placing a bid. If a bidder submits a
proactive waiver (using the ``proactive waiver'' function in the
bidding system) during a bidding period in which no bids or withdrawals
are submitted, the auction will remain open and the bidder's
eligibility will be preserved. An automatic waiver invoked in a round
in which there are no new valid bids or withdrawals will not keep the
auction open.
21. The Commission proposes that each bidder in Auction No. 52 be
provided with three activity rule waivers that may be used at the
bidder's discretion during the course of the auction. We seek comment
on this proposal.
E. Information Relating to Auction Delay, Suspension, or Cancellation
22. For Auction No. 52, we propose that, by public notice or by
announcement during the auction, the Bureau may delay, suspend, or
cancel the auction in the event of natural disaster, technical
obstacle, evidence of an auction security breach, unlawful bidding
activity, administrative or weather necessity, or for any other reason
that affects the fair and efficient conduct of competitive bidding. In
such cases, the Bureau may elect to resume the auction starting from
the beginning of the current round, resume the auction starting from
some previous round, or cancel the auction in its entirety. Network
interruption may cause the Bureau to delay or suspend the auction. We
emphasize that exercise of this authority is solely within the
discretion of the Bureau and its use is not intended to be a substitute
for situations in which bidders may wish to apply their activity rule
waivers. We seek comment on this proposal.
III. Bidding Procedures
A. Round Structure
23. The Commission will conduct Auction No. 52 over the Internet.
[[Page 12909]]
Telephonic Bidding will also be available. As a contingency, the FCC
Wide Area Network will be available as well. The telephone number
through which the backup FCC Wide Area Network may be accessed will be
announced in a later public notice. Full information regarding how to
establish such a connection, and related charges, will be provided in
the public notice announcing details of auction procedures.
24. The initial bidding schedule will be announced in a public
notice listing the qualified bidders, which is released approximately
10 days before the start of the auction. The simultaneous multiple
round format will consist of sequential bidding rounds, each followed
by the release of round results. Details regarding the location and
format of round results will also be included in the qualified bidders
public notice.
25. The Bureau has discretion to change the bidding schedule in
order to foster an auction pace that reasonably balances speed with the
bidders' need to study round results and adjust their bidding
strategies. The Bureau may increase or decrease the amount of time for
the bidding rounds and review periods, or the number of rounds per day,
depending upon the bidding activity level and other factors. We seek
comment on this proposal.
B. Reserve Price or Minimum Opening Bid
26. The Balanced Budget Act calls upon the Commission to prescribe
methods for establishing a reasonable reserve price or a minimum
opening bid when FCC licenses are subject to auction, unless the
Commission determines that a reserve price or minimum opening bid is
not in the public interest. Normally, a reserve price is an absolute
minimum price below which an item will not be sold in a given auction.
Reserve prices can be either published or unpublished. A minimum
opening bid, on the other hand, is the minimum bid price set at the
beginning of the auction below which no bids are accepted. It is
generally used to accelerate the competitive bidding process. Also, the
auctioneer often has the discretion to lower the minimum opening bid
amount later in the auction. It is also possible for the minimum
opening bid and the reserve price to be the same amount.
27. In light of the Balanced Budget Act's requirements, the
Commission proposes to establish minimum opening bids for Auction No.
52. We believe that a minimum opening bid, which has been utilized in
other auctions, is an effective bidding tool.
28. Specifically, for Auction No. 52, the Commission proposes to
set minimum opening bids on a license-by-license basis as follows:
Minimum Opening Bids
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Orbital Location............... 175[deg] W.L....... 166[deg] W.L...... 157[deg] W.L...... 61.5[deg] W.L.
Per Channel.................... $100,000........... $100,000.......... $200,000.......... $800,000
No. of Channels................ 32................. 32................ 32................ 2
Minimum Opening Bid............ $3,200,000......... $3,200,000........ $6,400,000........ $1,600,000
----------------------------------------------------------------------------------------------------------------
The specific minimum opening bid for each license available in
Auction No. 52 is also set forth in Attachment A of the Auction No. 52
Comment Public Notice. Comment is sought on this proposal.
29. If commenters believe that these minimum opening bids will
result in a substantial percentage of unsold licenses, or are not
reasonable amounts, or should instead operate as reserve prices, they
should explain why this is so, and comment on the desirability of an
alternative approach. Commenters are advised to support their claims
with valuation analyses and suggested reserve prices or minimum opening
bid levels or formulas. In establishing the minimum opening bids, we
particularly seek comment on such factors as the orbital location and
the number of channels being auctioned, the size of the area being
served, issues of interference with other spectrum bands and any other
relevant factors that could reasonably have an impact on valuation of
the DBS licenses. Alternatively, comment is sought on whether,
consistent with the Balanced Budget Act, the public interest would be
served by having no minimum opening bid or reserve price.
C. Minimum Acceptable Bids and Bid Increments
30. In each round, eligible bidders will be able to place bids on a
given license in any of nine different amounts. The Automated Auction
System interface will list the nine acceptable bid amounts for each
license. Until a bid has been placed on a license, the minimum
acceptable bid for that license will be equal to its minimum opening
bid. In the rounds after an acceptable bid is placed on a license, the
minimum acceptable bid for that license will be equal to the standing
high bid plus the defined increment.
31. Once there is a standing high bid on a license, the Automated
Auction System will calculate a minimum acceptable bid for that license
for the following round. The difference between the minimum acceptable
bid and the standing high bid for each license will define the bid
increment. The nine acceptable bid amounts for each license consist of
the minimum acceptable bid (the standing high bid plus one bid
increment) and additional amounts calculated using multiple bid
increments (i.e., the second bid amount equals the standing high bid
plus two times the bid increment, the third bid amount equals the
standing high bid plus three times the bid increment, etc.).
32. For Auction No. 52, the Commission proposes to use a 10 percent
bid increment. This means that the minimum acceptable bid for a license
will be approximately 10 percent greater than the previous standing
high bid received on the license. The minimum acceptable bid amount
will be calculated by multiplying the standing high bid times one plus
the increment percentage--i.e., (standing high bid) * (1.10). We will
round the result using our standard rounding procedures for minimum
acceptable bid calculations: results above $10,000 are rounded to the
nearest $1,000; results below $10,000 but above $1,000 are rounded to
the nearest $100; and results below $1,000 are rounded to the nearest
$10.
33. Until a bid has been placed on a license, the minimum
acceptable bid for that license will be equal to its minimum opening
bid. The additional bid amounts are calculated using the difference
between the minimum opening bid times one plus the minimum percentage
increment, rounded as described above, and the minimum opening bid.
That is, I = (minimum opening bid)(1 + N){rounded{time} -(minimum
opening bid).
[[Page 12910]]
Therefore, when N equals 0.1, the first additional bid amount will be
approximately ten percent higher than the minimum opening bid; the
second, twenty percent; the third, thirty percent; etc.
34. In the case of a license for which the standing high bid has
been withdrawn, the minimum acceptable bid will equal the second
highest bid received for the license. The additional bid amounts are
calculated using the difference between the second highest bid times
one plus the minimum percentage increment, rounded, and the second
highest bid.
35. The Bureau retains the discretion to change the minimum
acceptable bids and bid increments if it determines that circumstances
so dictate. The Bureau will do so by announcement in the Automated
Auction System. We seek comment on these proposals.
D. High Bids
36. At the end of a bidding round, the high bids will be determined
based on the highest gross bid amount received for each license. A high
bid from a previous round is sometimes referred to as a ``standing high
bid.'' A ``standing high bid'' will remain the high bid until there is
a higher bid on the same license at the close of a subsequent round.
Bidders are reminded that standing high bids confer bidding activity.
37. In the event of identical high bids on a license in a given
round (i.e., tied bids), we propose to use a random number generator to
select a high bid from among the tied bids. The remaining bidders, as
well as the high bidder, will be able to submit a higher bid in a
subsequent round. If no bidder submits a higher bid in a subsequent
round, the high bid from the previous round will win the license. If
any bids are received on the license in a subsequent round, the high
bid again will be determined by the highest gross bid amount received
for the license.
E. Information Regarding Bid Withdrawal and Bid Removal
38. For Auction No. 52, the Commission proposes the following bid
removal and bid withdrawal procedures. Before the close of a bidding
period, a bidder has the option of removing any bid placed in that
round. By removing selected bids in the bidding system, a bidder may
effectively ``unsubmit'' any bid placed within that round. A bidder
removing a bid placed in the same round is not subject to a withdrawal
payment. Once a round closes, a bidder may no longer remove a bid.
39. A high bidder may withdraw its standing high bids from previous
rounds using the ``withdraw function'' in the bidding system. A high
bidder that withdraws its standing high bid from a previous round is
subject to the bid withdrawal payment provisions of the Commission
rules. We seek comment on these bid removal and bid withdrawal
procedures.
40. In the Part 1 Third Report and Order, 63 FR 770 (January 7,
1998), the Commission explained that allowing bid withdrawals
facilitates efficient aggregation of licenses and the pursuit of
efficient backup strategies as information becomes available during the
course of an auction. The Commission noted, however, that, in some
instances, bidders may seek to withdraw bids for improper reasons. The
Bureau, therefore, has discretion in managing the auction, to limit the
number of withdrawals to prevent any bidding abuses. The Commission
stated that the Bureau should assertively exercise its discretion,
consider limiting the number of rounds in which bidders may withdraw
bids, and prevent bidders from bidding on a particular market if the
Bureau finds that a bidder is abusing the Commission's bid withdrawal
procedures.
41. Applying this reasoning, the Commission proposes to limit each
bidder in Auction No. 52 to withdrawing standing high bids in no more
than one round during the course of the auction. To permit a bidder to
withdraw bids in more than one round would likely encourage insincere
bidding or the use of withdrawals for anti-competitive purposes. The
round in which withdrawals are utilized will be at the bidder's
discretion; withdrawals otherwise must be in accordance with the
Commission's rules. There is no limit on the number of standing high
bids that may be withdrawn in the round in which withdrawals are
utilized. Withdrawals will remain subject to the bid withdrawal payment
provisions specified in the Commission's rules. We seek comment on this
proposal.
F. Stopping Rule
42. The Commission has discretion ``to establish stopping rules
before or during multiple round auctions in order to terminate the
auction within a reasonable time.'' For Auction No. 52, the Commission
proposes to employ a simultaneous stopping rule approach. A
simultaneous stopping rule means that all licenses remain open until
bidding closes simultaneously on all licenses.
43. Bidding will close simultaneously on all licenses after the
first round in which no new acceptable bids, proactive waivers, or
withdrawals are received. Thus, unless circumstances dictate otherwise,
bidding will remain open on all licenses until bidding stops on every
license.
44. However, the Commission proposes that the Bureau retain
discretion to exercise any of the following options during Auction No.
52:
i. Utilize a modified version of the simultaneous stopping rule.
The modified stopping rule would close the auction for all licenses
after the first round in which no bidder submits a proactive waiver,
withdrawal, or a new bid on any license on which it is not the standing
high bidder. Thus, absent any other bidding activity, a bidder placing
a new bid on a license for which it is the standing high bidder would
not keep the auction open under this modified stopping rule. The
Commission further seeks comment on whether this modified stopping rule
should be used at any time or only in stage three of the auction.
ii. Keep the auction open even if no new acceptable bids or
proactive waivers are submitted and no previous high bids are
withdrawn. In this event, the effect will be the same as if a bidder
had submitted a proactive waiver. The activity rule, therefore, will
apply as usual, and a bidder with insufficient activity will either
lose bidding eligibility or use a remaining activity rule waiver.
iii. Declare that the auction will end after a specified number of
additional rounds (``special stopping rule''). If the Bureau invokes
this special stopping rule, it will accept bids in the specified final
round(s) only for licenses on which the high bid increased in at least
one of a specified preceding number of rounds.
45. The Commission proposes that the Bureau exercise these options
only in certain circumstances, such as, for example, where the auction
is proceeding very slowly, there is minimal overall bidding activity,
or it appears likely that the auction will not close within a
reasonable period of time. Before exercising these options, the Bureau
is likely to attempt to increase the pace of the auction by, for
example, increasing the number of bidding rounds per day, and/or
increasing the amount of the minimum bid increments for the limited
number of licenses for which there is still a high level of bidding
activity. We seek comment on these proposals.
[[Page 12911]]
IV. Conclusion
46. Comments are due on or before March 17, 2003, and reply
comments are due on or before March 24, 2003. Because of the disruption
of regular mail and other deliveries in Washington, DC, the Bureaus
require that all comments and reply comments be filed electronically.
Comments and reply comments must be sent by electronic mail to the
following address: auction52@fcc.gov. The electronic mail containing
the comments or reply comments must include a subject or caption
referring to Auction No. 52 Comments. The Commission requests that
parties format any attachments to electronic mail as Adobe[reg]
Acrobat[reg] (pdf) or Microsoft[reg] Word documents. Copies of comments
and reply comments will be available for public inspection during
regular business hours in the FCC Public Reference Room, Room CY-A257,
445 12th Street, SW., Washington, DC 20554.
47. In addition, the Commission requests that commenters fax a
courtesy copy of their comments and reply comments to the attention of
Kathryn Garland at (717) 338-2850.
48. This proceeding has been designated as a ``permit-but-
disclose'' proceeding in accordance with the Commission's ex parte
rules. Persons making oral ex parte presentations are reminded that
memoranda summarizing the presentations must contain summaries of the
substance of the presentations and not merely a listing of the subjects
discussed. More than a one or two sentence description of the views and
arguments presented is generally required. Other rules pertaining to
oral and written ex parte presentations in permit-but-disclose
proceedings are set forth in Sec. 1.1206(b) of the Commission's rules.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 03-6476 Filed 3-13-03; 3:22 am]
BILLING CODE 6712-01-P