White House steps in on spectrum debate

The US government yesterday made a statement publicly opposing efforts by Northpoint Technology to acquire a high speed communications licence for free. In September Northpoint, a small start-up company with powerful political connections in Capitol Hill, successfully lobbied the Senate to approve an amendment preventing the Federal Communications Commission (FCC) from auctioning the spectrum licence. Northpoint is pushing for the country’s Orbit Act to be altered to include terrestrial wireless service providers alongside satellite companies in its list of those exempt from the spectrum auction process. The Texas-based company, which wants to use the spectrum to launch terrestrial wireless multi-video programming and high speed internet services, claims that it should receive the licence for free because a number of satellite companies, such as DirecTV, received their licences without having to tender.

Last month FCC chairman Michael Powell urged Congress to reject the application, claiming that it amounted to a ‘potential multi-million dollar government-created giveaway’. However, Northpoint has a powerful ally in Ted Stevens, chairman of the Senate Appropriations Committee, who has already clashed heads with the Senate’s commerce and budget committee chairmen over the issue. Now the White House has sided with Powell, saying: ‘This provision would pre-empt a FCC-sponsored spectrum auction that is scheduled to take place in January 2004, and provide an undeserved windfall projected by the congressional budget office to be as much as USD100 million to one company’. The FCC claims that there are a number of other bidders interested in the spectrum and that it is only fair to award the concession via auction. However, Northpoint also has a major feud with one of the potential bidders, MDS America, which it claims has infringed upon the patent for its land-based wireless technology. Last week a Florida court ruled against Northpoint’s claims, saying that two of its patents were invalid; the company plans to appeal.