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 STATEMENT  OF  COMMISSIONER  MICHAEL  J.  COPPS 
 RE:  Service  Rules  for  Advanced  Wireless  Services  in  the  1.7  GHz  and  2.1  GHz  Bands  (Order  on  Reconsideration). 
 I  am  committed  to  sticking  to  our  schedule  and  conducting  the  AWS  auction  as  soon  as  possible.  The  changes  that  we  make  today  to  the  band  plan  will  make  this  a 
 better  auction.  The  band  plan  balances  the  needs  of  different  types  of  wireless  companies  by  offering  both  geographically  large  and  small  auction  areas.  I  think  we  came  up  with  a 
 solution  that  gives  everyone  a  chance  to  participate  meaningfully  in  the  auction,  a  result  that  will  serve  both  rural  and  urban  consumers.  We  all  want  to  make  this  spectrum 
 available  as  quickly  as  possible,  and  we  take  a  big  step  toward  that  goal  today. 
 The  Order  also  announces  that  the  Commission  will  initiate  a  NPRM  on  the  question  of  whether  we  should  close  a  potentially  troubling  loophole  in  the  designated 
 entity  program.  The  DE  program  is  designed  to  create  opportunities  for  smaller  carriers  to  obtain  the  spectrum  resources  needed  to  bring  new  services  to  consumers.  The 
 program  is  often  particularly  useful  in  rural  areas.  In  this  auction,  carriers  that  qualify  under  the  DE  program  as  small  companies  will  receive  a  25  percent  auction  discount. 
 That  discount  can  add  up  to  millions  of  dollars. 
 I  strongly  support  the  DE  program  and  consider  it  a  powerful  tool  that  can  create  new  competition  and  entry  by  small  businesses.  But  I  also  believe  that  we  must  be 
 vigilant  and  guard  against  misuse  of  the  program.  Some  entities  cast  themselves  as  small  companies  to  qualify  for  auction  discounts,  having  already  entered  into  agreements  to 
 lease  the  spectrum  rights  they  win  to  industry  giants  that  themselves  do  not  qualify  for  the  discount.  I  am  glad  that  we  are  exploring  whether  we  should  limit  the  ability  of 
 companies  with  billions  of  dollars  in  revenues  to  effectively  receive  discounts  intended  for  small  companies  by  entering  into  such  arrangements.  The  DE  program  was  initiated 
 to  create  new  competition  and  to  give  small  entrepreneurs  a  chance  to  bring  innovations  to  consumers.  If  there  is  a  loophole  that  could  result  in  millions  of  dollars  less  in  auction 
 revenues  without  these  goals  being  served,  we  should  act  expeditiously  to  protect  the  DE  program. 


 Our  largest  auction  in  many  years  is  going  to  be  held  in  June.  We  need  to  put  this  NPRM  out  immediately,  compile  the  record,  and  develop  whatever  action  plan  may  be 
 necessary  if  it  is  determined  that  new  protections  are  needed  for  the  DE  program—  well  before  the  auction  is  held.  We  need  not  delay  this  auction,  but  at  the  same  time  we  must 
 protect  taxpayer  money.  I  see  no  reason  –  if  we  move  quickly  –  why  we  can’t  achieve  both  of  these  goals. 
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