Putting the D Block Back on the Block

Trying again after an auction of a wide swath of radio frequencies failed, the Federal Communications Commission has approved a new framework for the sale of the so-called D block.

The March auction of the D block -- frequencies that the buyer would share with public-safety agencies -- failed to meet its $1.3 billion reserve price, marring an otherwise successful 700 Mhz wireless auction. Verizon was the big winner in the auction, which raised nearly $20 billion for the federal government, winning a bundle of coveted C block licenses, allowing it to build a new nationwide wireless network.

The D block auction was intended to address the federal government's apparent inability, or unwillingness, to fund a nationwide, fully interoperable emergency wireless network. The auction would create a shared public-private network that first responders could use in the event of an emergency.

"Because the D Block did not meet its $1.3 billion reserve price in the 700 MHz Auction, the F.C.C. intends to re-auction this spectrum under revised rules," the commission said in a statement.

F.C.C. commissioner Michael Copps acknowledged that the commission faces a tough challenge in re-auctioning the D block, particularly amid an economic downturn.

"What we are trying to do here is conduct the most difficult F.C.C. auction ever in an extraordinarily difficult economic environment," Copps said in a statement. However, he said, "a public-private shared model represents the last, best chance we have at using the 700 MHz spectrum band to improve communications for state and local public safety users."

Controversy has swirled around the D block auction since it failed to reach its reserve price.

Just weeks before the auction began, former F.C.C. Chairman Reed Hundt's Frontline Wireless's bid for the D block fell apart.

Frontline's collapse raised questions about Cyren Call, the group that represents the Public Safety Spectrum Trust, which holds the national 12-MHz public-safety license that makes up the "public" half of the D-block.

Cyren Cell reportedly placed conditions on Frontline that precluded its ability to raise enough money to meet the reserve price, including a reported $500 million fee over ten years in exchange for a lease for the public-safety half of the spectrum.

In a statement, the Public Interest Spectrum Coalition, a group of consumer groups, praised the F.C.C.'s new approach and urged the commission to look into the ties between the public and private groups involved in the D block auction.

"The details of the business relationships between public safety and private-sector companies should have been examined much earlier, and it is appropriate that they will be now," the group said. "This is the reason the PISC asked for the F.C.C. to investigate the partnership between the public safety community and Cyren Call."

Sam Gustin