As technology director of the Monforton School, a rural K-8 institution six miles west of Bozeman, Mont., Greg Hamley spends the better part of his days tinkering with network protocols and troubleshooting problems for teachers and students.
Perhaps that’s why he was surprised when lawyers for Sprint Nextel, one of the nation’s largest wireless providers, served him a very official-looking stack of documents that have since placed Monforton–once hardly a dot on the local roadmap–smack in the middle of a growing custody dispute over a coveted slice of real estate in the federal wireless spectrum.
Monforton, along with some 41 other K-12 schools, colleges, and community-based nonprofit organizations, have become the unsuspecting targets of an aggressive effort by America’s third-largest wireless carrier to free up space on the nation’s wireless broadband infrastructure by booting license holders who’ve failed, for one reason or another, to renew their contracts with the Federal Communications Commission (FCC) in a timely enough manner.
The dispute comes as the proliferation of wireless devices–from cell phones to personal digital assistants and Bluetooth headsets–has leading providers such as Sprint Nextel, Verizon, Cingular, and others scrambling to build out their broadband networks to accommodate rising demand.
Sprint argues that allowing schools and other nonprofit license-holders to let their licenses lapse without threat of forfeiture sets a legal precedent that could impede the right of legitimate license-holders to use the spectrum effectively, but Hamley and some other educators say the company’s aggressive tactics are insensitive and fail to take into account the difficult circumstances under which educational institutions–particularly rural schools–operate.
First established in the 1960s as the Instructional Television Fixed Service spectrum, the 2495 MHz to 2690 MHz band–which changed its name to Educational Broadband Service (EBS) in 2005–reportedly is used by thousands of schools, colleges, and other nonprofit organizations to deliver online professional development and support the increased use of wireless internet networks across campuses.
But the spectrum has another benefit, too, says Hamley. FCC rules currently allow schools and other EBS license-holders to lease any unused portion of the band to for-profit companies. Hamley says this condition enables savvy license-holders, including several schools, to turn a modest profit–which often is used to offset the impact of tight budgets, particularly in rural areas, where local funds have a tendency to dry up quickly.
Though Sprint finds no fault in the lease stipulation itself–the company currently holds lease contracts with several nonprofit groups and schools that maintain licenses on the EBS band–it does take issue with the FCC’s willingness to let schools renew their licenses past the deadline.
Though the FCC’s Wireless Telecommunications Bureau, the branch that oversees EBS, has a reputation for being a stickler when it comes to deadlines, government officials typically have been more sympathetic to the needs of schools, giving educators an unofficial grace period under which to file the appropriate paperwork.
Unlike most multimillion-dollar corporations, Hamley says, schools typically don’t have the time or the resources to keep an ever-watchful eye on federal filing deadlines. Thanks to the high level of turnover in most schools, he says, there often isn’t a single person whom administrators can contact for reliable, up-to-date information on the school’s broadcast rights.
"Some schools aren’t even aware that these licenses exist," he said. And even in those cases where schools are aware, getting the necessary paperwork done in time can be a challenge.
As far as Sprint is concerned, that’s no excuse.
"The commission’s rules are clear," wrote the company in a March 15 filing with the FCC. "Awarding spectrum outside of the competitive-bidding process under the guise of ‘reinstatement’ is impermissible and contrary to law."
The document goes on to say, "The [FCC] should uphold the rights of legitimate educational and religious institutions that have obeyed the law and served their students, rather than reward former licensees who have proven their inability to comply with [FCC] regulations."
The company followed that filing with a March 22 letter questioning the FCC’s decision to grant late renewals to Monforton School and at least 41 other educational institutions and nonprofit organizations. In that letter–which lists all 41 license-holders that Sprint takes exception to–corporate lawyers petitioned the FCC to "permit but disclose" ex parte all proceedings concerning late renewal applications. Legal experts who spoke with eSchool News said the petition is significant because, if approved by the FCC, it would enable Sprint to continue lobbying government officials without waiting for schools and other entities to counter.
Currently, FCC rules require that both parties be present and have the right to respond in the event of a dispute. If the commission rules in favor of Sprint Nextel’s ex parte petition, then Sprint’s lawyers would be free to argue their case at length, without the other party–in this case, schools–being present, as long as the company agrees to publicly disclose all information related to the case.
Even as the FCC considers Sprint’s petition, critics such as Hamley and others question the company’s tactics. They believe this approach has thrust schools into a David-versus-Goliath scenario–one that irrevocably could damage Sprint’s reputation in the school community.
Sprint, on the other hand, says its intentions have been grossly misunderstood. "This is not some corporate-versus-education storyline," said Trey Hanbury, Sprint’s director of government affairs. "It’s about determining the rights of competing educational interests."
Though the majority of EBS license-holders have been good stewards of the program, staying on top of deadlines and renewing broadband licenses in a timely fashion, he said, there are some institutions that have consistently–and, in some cases, egregiously–violated their license agreements by failing to adhere to the deadlines imposed by the FCC. In some cases, he added, schools that haven’t renewed their licenses in years now are approaching the FCC and asking that the commission recognize their place on the band.
The problem with that is, in many cases, the portion of spectrum under question already has been reallocated to other eligible licensees, according to Sprint.
Like homebuyers who must perform title checks, eligible EBS license-holders, including schools, must check to see if anyone maintains a claim on their dedicated portion of the spectrum, Hanbury says. If a license has lapsed for whatever reason, Sprint maintains that no prior claim should exist on that title.
If the FCC chooses to honor prior claims, he says, the danger is that new licensees might not be entitled to the full portion of spectrum they originally were promised. As it stands, EBS licenses currently are doled out under a geographic formula that gives each license-holder a 35-mile radius under which to operate and deploy its network without fear of interference.
"For us, it’s important that educators have the ability to take advantage of these resources," said Hanbury. If the FCC chooses to renew outdated licenses at the request of schools or other eligible entities, that might result in a geographic overlap, cutting down on the amount of territory that individual networks are entitled to cover, he said.
That chance creates an interesting dilemma for Sprint, which leases unused portions of the band from schools. If the network footprint changes, Hanbury said, it could hinder the company’s plans to build out its existing wireless network, which it hopes will extend to 100 million Americans by 2008.
"If you bought a house and you thought you bought four acres of land and then found out you are only entitled to three [acres], are you going to pay for the fourth?" asked Hanbury, who said Sprint’s ultimate goal is to help schools and consumers alike by building a more robust and reliable network.
"We want to reach out to educators and walk them through where we are coming from," said Hanbury. "The last thing we want is for licensees to be surprised."
But educators aren’t the only ones who’ve expressed concern with the company’s approach.
In a letter excerpted in the <em>EBS Advisor</em>, an industry newsletter, Todd Gray, an attorney with Dow, Lohnes, and Albertson and FCC counsel for the National ITFS Association, a nonprofit group that represents the rights of EBS license-holders, called Sprint’s opposition to the license renewals "ill-advised and legally unsound."
Said Gray: "The FCC should continue to grant appropriate leeway to educators holding EBS licenses, many or perhaps most of whom are not in the business of operating highly regulated communications facilities and which have in the past not had the resources to keep fully up to speed on such matters."
If the FCC chooses to reverse its decision and revoke the licenses of the 41 EBS license-holders named in Sprint’s petition, the geographic areas covered by those portions of the spectrum would revert to what’s known throughout the industry as "white space," which would be subject to future auction by the FCC–"the timing and outcome of which … will be very uncertain," Gray was quoted as saying in the EBS Advisor.
Even some of Sprint’s top competitors say the company’s approach is troubling.
In letter to the FCC dated April 2, Clearwire, a provider of portable broadband services to schools and consumers, spoke out against Sprint’s petition to the FCC, saying it would give the company an unfair advantage over nonprofit EBS license-holders. Like Sprint, Clearwire currently leases portions of the EBS band from several schools and other nonprofit organizations.
The company said it was opposed to Sprint’s request "because of the substantial burdens and inequities numerous individual EBS licensees would bear" if the petition were granted.
For its part, Sprint says it has no intention of using its influence to wrest away spectrum rights from legitimate EBS license-holders. Even if revoked portions of spectrum were to be put up for auction by the FCC, Hanbury said, neither Sprint, nor any other corporate provider, could legally bid on them.
"There is absolutely no scenario under which [Sprint] could directly own any portion of EBS spectrum," he said, adding, "This is not about us trying to go in and swoop up spectrum in some kind of nefarious way."
Whether Sprint’s assurances are enough to satisfy schools, or the FCC, remains to be seen.
"Sprint’s legal argument has more to do with creating licensing parity than it does starting a fight with educators," Gray wrote. "Unfortunately for Sprint, they picked a fight in the wrong neighborhood."
Federal Communications Commission
National ITFS Association
The Monforton School