Released: June 12, 2017
WIRELESS TELECOMMUNICATIONS BUREAU REMINDS WIRELESS LICENSEES OF CONSTRUCTION OBLIGATIONS
The Wireless Telecommunications Bureau (Bureau) issues this Public Notice to remind licensees of their buildout obligations—in particular, their existing obligations to timely meet the construction and coverage deadlines set forth in the Commission’s rules (collectively, “construction obligations”). The FCC’s construction obligations serve the important purpose of ensuring that scarce spectrum resources are put to use and deployed in a manner that serves all communities. Indeed, the Commission’s construction obligations promote the Commission’s goal of making spectrum “available, so far as possible, to all the people of the United States” regardless of where they live. The Commission has taken and will continue to take steps to facilitate the rapid deployment of wireless broadband and other services.
Given these important purposes, the FCC has been clear that requests to extend construction obligations will not be routinely granted. The Commission’s rules and case law impose limits on the types of arguments and factual circumstances that would qualify a licensee for an extension. We thus take this opportunity to remind licensees that this long-standing approach to enforcing the FCC’s construction obligations will continue to apply going forward.
Construction obligations have functioned as a core part of the Commission’s wireless policy for decades. Commission rules and a wireless licensee’s FCC authorization describe construction obligations, i.e., when and how wireless licensees must construct, commence service, and, as applicable, meet coverage and substantial service benchmarks. As the Commission’s rules specify, “if a licensee fails to commence service or operations by the expiration of its construction period or to meet its coverage or substantial service obligations by the expiration of its coverage period, its authorization terminates automatically (in whole or in part as set forth in the service rules), without specific Commission action, on the date the construction or coverage period expires.”
We take this opportunity to highlight these requirements, particularly given the Commission’s recent and ongoing initiatives to ensure that wireless broadband is deployed in unserved or underserved areas, including rural and tribal areas. As the Bureau has previously made clear, it is a licensee’s responsibility to conduct its due diligence, to assure that it can construct and meet service requirements, and to confirm that the spectrum is suitable for the licensee’s business plans and needs. The Commission makes no representations or warranties about use of the spectrum, and a license is not a guarantee of business success.
As a consequence, the Commission’s rules do not contemplate extensions of construction deadlines for licensees that fail to meet construction obligations because of miscalculations or erroneous predictions about such factors as costs, demand, developments in the market, or timing and success in obtaining permissions that may be necessary for construction. Rather, we have always expected licensees to factor in these considerations from the start because construction obligations are the building blocks to making available service that puts scarce spectrum resources to use. When a licensee fails to deploy on a timely basis, the Commission holds the licensee accountable in accordance with its rules. Specifically, under Section 1.946(e) of the Commission’s rules, extensions of the time period for meeting these construction and service requirements are permitted only in two situations—either “involuntary loss of site” or “other causes beyond [a licensee’s] control.” This rule specifically cautions that the following do not qualify as grounds for an extension: “failure to obtain financing, to obtain an antenna site, or to order equipment in a timely manner,” or “because the licensee undergoes a transfer of control . . . or intends to assign the authorization,” or “to allow a transferee or assignee to complete facilities that the transferor or assignor failed to construct.”
Consistent with the specific caveats in the rule, the Commission examines carefully claims that failures to meet construction requirements were due to causes beyond the licensee’s control. For example, as precedent has made clear, circumstances beyond the licensee’s control also generally exclude the market’s failure to accommodate the licensee’s specific business plan, such as in the event of a general economic downturn or delays given the type of technology a specific licensee has chosen. The FCC has also made clear that we evaluate with care claims made concerning the unavailability of equipment. For example, a licensee’s own choice regarding which technology to support or whether any equipment is even worth deploying will generally not suffice to warrant an extension. We also have denied extension requests filed on an untimely basis and those requests reflecting a lack of substantial progress. As with other Commission rules, requests to waive the requirements of the wireless construction rules must “meet a high hurdle at the starting gate.” Specifically, we remind parties that the Commission’s rules permit the grant of a waiver request only “if it is shown that: [t]he underlying purpose of the rule(s) would not be served or would be frustrated . . . and that a grant . . . would be in the public interest; or [i]n view of unique or unusual factual circumstances, application of the rule(s) would be inequitable, unduly burdensome or contrary to the public interest, or the applicant has no reasonable alternative.” While each case must be determined in light of its specific circumstances, we emphasize that the public interest in connection with the construction rules includes the impact of a request on the Commission’s important statutory responsibilities and policy objectives. These include, but are not limited to, the efficient and productive use of spectrum, and provision of timely and innovative services, particularly in unserved areas, including rural and tribal ones. Accordingly, we will continue to scrutinize all extension or waiver requests carefully and in light of the Commission’s mandate to ensure that licensees are utilizing spectrum consistent with the public interest.
By the Acting Chief
Wireless Telecommunications Bureau