Before the
Federal Communications Commission
Washington, D.C. 20554


In the Matter of

Amendment of the Commission's Rules
Regarding Installment Payment Financing for
Personal Communications Services (PCS)
Licensees
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WT Docket No. 97-82




SIXTH REPORT AND ORDER AND ORDER ON RECONSIDERATION

   Adopted:  August 23, 2000	Released:  August 29, 2000

By the Commission:
TABLE OF CONTENTS
Heading	Paragraph #
I.	INTRODUCTION AND EXECUTIVE SUMMARY	1
II.	BACKGROUND	3
III.	DISCUSSION	11
A.	Reconfiguration of C Block Spectrum License Size	11
B.	Eligibility Restrictions Under a Tiered Approach	16
C.	Determination of Entrepreneur Eligibility	30
D.	License Grouping for Bids and Competitive Bidding Design	34
E.	Grandfather Exception	38
F.	Bidding Credits	43
G.	Transfer Requirements	46
1.	Open bidding.	46
2.	Closed bidding.	48
3.	System-wide satisfaction of construction benchmark.	52
H.	License Cap	54
I.	Spectrum Cap	56
J.	Late Filing	61
IV.	PROCEDURAL MATTERS AND ORDERING CLAUSES	63
A.	Final Regulatory Flexibility Analysis	63
B.	Paperwork Reduction Act Analysis	64
C.	Ordering Clauses	65
V.	APPENDIX A - COMMENTS AND PETITIONS IN RESPONSE TO THE FURTHER 
NOTICE	
VI.	APPENDIX B - Entrepreneur Eligibility Issues	
VII.	APPENDIX C - Spectrum Cap Issues	
VIII.	Appendix D - Revised Rules	
IX.	Appendix E - Final Regulatory Flexibility Analysis	


I. INTRODUCTION AND EXECUTIVE SUMMARY
1. In this Sixth Report and Order and Order on Reconsideration ("C/F Block Sixth Report and 
Order"), we address the tentative conclusions and proposals in our recent Further Notice of Proposed 
Rulemaking in this docket ("Further Notice").  We also resolve the petitions that precipitated the Further 
Notice.   The modifications to the Commission's rules that we adopt in this order will apply to Auction 
No. 35, a C and F block auction currently scheduled to begin on November 29, 2000.  The modifications 
also will apply to any subsequent auctions of C or F block licenses, including any spectrum made 
available or reclaimed from bankruptcy proceedings in the future. 
2. We conclude that it is in the public interest to modify our auction and service rules for C and 
F block broadband Personal Communications Services (PCS) licenses to achieve the various goals of 
Section 309(j) of the Communications Act.  Specifically, in this C/F Block Sixth Report and Order we 
retain, clarify, and revise our rules, as follows:
? Reconfiguration.  We will reconfigure each 30 MHz C block license available in Auction 
No. 35 and other future broadband PCS auctions into three 10 MHz C block licenses.
? Tiers.  We divide Basic Trading Areas (BTAs) into two tiers according to the population size 
of the BTA.  "Tier 1" will comprise BTAs with populations equal to or greater than 2.5 
million;  "Tier 2" will comprise the remaining BTAs.
? Eligibility restrictions.  We remove the entrepreneur auction eligibility restrictions - thereby 
establishing "open" bidding - for the following licenses:
? two of the three reconfigured 10 MHz C block licenses in Tier 1;
? one of the three reconfigured 10 MHz C block licenses in Tier 2;
? all 15 MHz C block licenses in Tier 1;
? all F block licenses;
? all C block licenses available but unsold in Auction No. 22. 
? License grouping.  We reject Nextel's proposal to license by bulk bidding.
? "Grandfather" exception.  We clarify an applicant's eligibility for the Section 24.709(b)(9)(i) C 
block "grandfather" exception after it has been involved in a merger, acquisition, or other business 
combination, as follows:
? When each of the combining entities is individually eligible for the "grandfather" exception, the 
exception will extend to the resulting entity.
? When one or more of the combining entities is not individually eligible for the grandfather exception, 
the resulting entity will be eligible for the exception only so long as an originally eligible entity 
retains de facto and de jure control of the resulting entity.
? Bidding credits. 
? Licenses won in open bidding: We retain the existing bidding credits for small and very small 
businesses of 15 percent and 25 percent, respectively.
? Licenses won in closed bidding: We eliminate bidding credits.
? Transfer requirements.
? Licenses won in open bidding: We will not apply the entrepreneur eligibility restrictions to the 
assignment or transfer of control of C and F block licenses won in open bidding.
? Licenses won in closed bidding: Upon satisfaction of the first construction benchmark for a license 
won in closed bidding, the control group of any eligible entrepreneur may assign or transfer control of 
C block licenses to a non-entrepreneur.  We will continue to evaluate satisfaction of construction 
requirements on a license-by-license, rather than on a system-wide, basis.
? Unjust enrichment:  A licensee that won a license in Auction No. 5 or 10 will not be subject to a 
bidding credit unjust enrichment payment upon assignment or transfer of the license, subject to the 
Commission's transfer requirements, to an entity not qualifying as a small business.  Because all 
license winners in those auctions qualified for the available 25 percent bidding credit, there is no 
purpose in requiring the payment.  Licenses won in other auctions using a bidding credit will be 
subject to a bidding credit unjust enrichment payment upon transfer or assignment in accordance with 
the Commission's transfer requirements.
? License cap.  We eliminate the provision of our rules (Section 24.710) that prohibits any applicant 
from winning more than 98 of the licenses available in the C and F blocks.
? Spectrum cap.  We will continue to apply the spectrum cap to C and F block licenses, including those 
won in Auction No. 35.
II. BACKGROUND
3. In the Omnibus Budget Reconciliation Act of 1993,  Congress authorized the Commission to 
employ systems of competitive bidding to award spectrum licenses.  This authorization, as amended, is 
codified as Section 309(j) of the Communications Act.   Section 309(j)(3) directs the Commission to 
"seek to promote" a number of objectives, including:
? the development and rapid deployment of new services for the benefit of the public, including 
those residing in rural areas;

? promoting economic opportunity and competition and ensuring that new and innovative 
technologies are readily accessible to the public by avoiding excessive concentration of 
licenses and by disseminating licenses among a wide variety of applicants, including small 
businesses, rural telephone companies, and businesses owned by members of minority groups 
and women, i.e., "designated entities;"

? recovery for the public of a portion of the value of the public spectrum resource made 
available for commercial use. 

4. Section 309(j)(4) directs the Commission, in prescribing regulations to implement the 
objectives of Section 309(j)(3), to, inter alia,  (1) establish performance requirements to ensure prompt 
delivery of service to rural areas and prevent warehousing of spectrum by licensees; (2) prescribe area 
designations and bandwidth assignments that promote an equitable geographic distribution of licenses and 
services, economic opportunity for a wide variety of applicants, including designated entities, and rapid 
deployment of services; and (3) ensure that designated entities are given the opportunity to participate in 
the provision of spectrum-based services, and, for such purposes, consider using bidding preferences and 
other procedures. 
5. The Commission outlined the original framework for C and F block auctions in the 1994 
Competitive Bidding Fifth Report and Order, establishing the C and F blocks as "set-aside" licenses for 
"entrepreneurs" in which eligibility would be restricted to entities below a specified financial threshold.  
The initial C block licenses were awarded through two auctions, Auction No. 5, which ended on May 6, 
1996, and Auction No. 10, which concluded on July 16, 1996.  Auction No. 11, the initial F block auction, 
ended on January 14, 1997, and also included D and E block licenses.  Auction No. 22, which concluded 
on April 15, 1999, made available C and F block licenses that had been returned to, or reclaimed by, the 
Commission. 
6. Since adoption of the 1994 Competitive Bidding Fifth Report and Order, the rules for auctions 
of C and F block licenses have steadily evolved in response to legislative changes, judicial decisions, the 
needs of licensees striving to succeed in a rapidly developing wireless market, and the demand of the 
public for greater access to wireless services.  For example, in the 1997 C Block Second Report and 
Order,   as modified by the 1998 C Block Reconsideration Order,  the Commission created a package of 
financial restructuring options to be offered to C block licensees experiencing financial difficulties in the 
wake of Auctions No. 5 and No. 10.  The Commission also decided in the C Block Second Report and 
Order, as modified by the 1998 C Block Fourth Report and Order, to allow, for a period of two years 
from the beginning of the first post-restructuring C block auction (Auction No. 22), participation in 
bidding for C block licenses by entities that had participated in Auctions No. 5 and 10,  even if such 
entities had since become too large to qualify as entrepreneurs under the Commission's rules. 
7. Prior to the start of Auction No. 22, three C block licensees, NextWave Personal 
Communications, Inc. ("NextWave"), GWI PCS Inc. ("GWI"), and DCR PCS, Inc. ("DCR"), filed for 
bankruptcy protection.  Bankruptcy filings and payment defaults by C and F block licensees occurred, 
both before and after the auction; and, to date, a total of 232 C and F block licenses, covering a population 
("pops") of approximately 191 million,  have been involved in bankruptcy proceedings and/or license 
payment defaults.
8. In January 2000, the Wireless Telecommunications Bureau ("Bureau"), pursuant to its 
delegated authority, announced the next C and F block auction, Auction No. 35.  Auction No. 35 is slated 
to include both 30 MHz and 15 MHz C block licenses, as well as F block licenses (all 10 MHz each) for 
operation on frequencies for which previous licenses had automatically cancelled  or had been returned to 
the Commission.   The announcement of Auction No. 35 prompted petitions from SBC Communications 
Inc. ("SBC"), Nextel Communications, Inc. ("Nextel"), and other parties asking that we waive, modify, or 
eliminate our entrepreneur eligibility requirements for participation in the auction.   In response to those 
filings, several parties also proposed that we make other modifications to our C and F block rules.   
Additionally, US WEST Wireless, LLC ("US West") and Sprint Spectrum L.P. dba Sprint PCS ("Sprint") 
filed a joint petition for reconsideration of our Order on Reconsideration of the Fourth Report and Order 
in WT Docket No. 97-82 ("C Block Fourth Report and Order Reconsideration").   The C Block Fourth 
Report and Order Reconsideration addressed certain of the rules governing auctions of C block licenses.  
Sprint and US West requested that the Commission eliminate its eligibility restrictions for participation in 
the upcoming auction as well as modify other C block rules.  In addition, Verizon Wireless ("Verizon") 
petitioned the Commission for clarification or reconsideration of our two-year C block auction eligibility 
"grandfather" rule, Section 24.709(b)(9)(i).  In response to these petitions, a number of parties argued 
that all, or at least some portion, of the C and F block spectrum should be open to all participants in order 
to satisfy the Commission's obligations under 309(j)(4);  other parties opposed these arguments. 
9. We also received petitions from Bell Atlantic Mobile, Inc. ("Bell Atlantic"), BellSouth 
Corporation ("BellSouth"), AT&T Wireless Services, Inc. ("AT&T"), and GTE Service Corporation 
("GTE") requesting that the Commission waive, forbear from applying, or declare inapplicable the 
Commercial Mobile Radio Services ("CMRS") spectrum cap with respect to the spectrum available in 
Auction No. 35. 
10. We addressed the issues raised and points made in the various petitions, comments, and other 
documents filed in this proceeding in a Further Notice of Proposed Rulemaking (the "Further Notice"), 
released on June 7, 2000, in which we set forth tentative conclusions and proposals concerning our C and 
F block rules.  Also on June 7, 2000, the Bureau announced that Auction No. 35 would begin on 
November 29, 2000, in order to allow resolution of the issues in the Further Notice and implementation of 
any rule changes prior to the auction.   In this C/F Block Sixth Report and Order, we resolve the issues 
raised in the Further Notice and in the petitions and other filings in this proceeding by retaining, 
clarifying, and modifying our rules governing C and F block auctions and licenses. 
III. DISCUSSION
A. Reconfiguration of C Block Spectrum License Size
11. Background.  In the Further Notice, we tentatively concluded that each 30 MHz C block 
license available in Auction No. 35 should be reconfigured into three 10 MHz C block licenses.   We 
asserted that the increased number of licenses available as a result of this reconfiguration, along with 
elimination of certain of the Commission's C and F block eligibility requirements, would promote wider 
auction participation and license distribution in accordance with the goals of Section 309(j) of the 
Communications Act.     We tentatively concluded that a 10 MHz C block license is a viable minimum 
size for voice and some data services, including Internet access, and that it provides an appropriate 
building block for bidders that wish to acquire a larger amount of spectrum in particular markets.  We 
sought comment on these tentative conclusions, as well as on whether a different configuration, such as 
creation of 20 MHz C block licenses where possible, would be more appropriate to provide meaningful 
opportunities for potential bidders, including new entrants into particular markets.  Additionally, in the 
Further Notice, we proposed to permit bidders to aggregate the 10 MHz C block licenses, subject only to 
the CMRS spectrum cap and the relevant remaining eligibility restrictions for these licenses. 
12. Discussion.  We adopt our tentative conclusions in the Further Notice to reconfigure each 
available 30 MHz C block license into three 10 MHz C block licenses and to permit bidders to aggregate 
the 10 MHz C block licenses, subject to the CMRS spectrum cap and the relevant remaining eligibility 
restrictions for these licenses.  Each 30 MHz C block license that is available for inclusion in the 
Commission's license inventory for Auction No. 35 or any subsequent auction, will be reconfigured into 
three 10 MHz C block licenses.   Each of the newly reconfigured 10 MHz C block licenses will consist of 
two paired 5 MHz blocks:  1895 - 1900 MHz paired with 1975 - 1980 MHz; 1900 - 1905 MHz paired with 
1980 - 1985 MHz; and 1905 MHz - 1910 MHz paired with 1985 - 1990 MHz.  Accordingly, we deny the 
Nextel Petition insofar as it requests a different reconfiguration of available 30 MHz C block licenses; and 
we grant the US West/Sprint Petition to the extent that it requests the reconfiguration we adopt today. 
13. The majority of the commenters support our proposal to divide each available 30 MHz C 
block license into three 10 MHz C block licenses.  They contend that dividing the spectrum into three 10 
MHz C block licenses will promote a wider dissemination of licenses; provide bidders with more 
flexibility to adapt their bidding strategies to meet their business plans; and make licenses more 
affordable, especially for entrepreneurs.   Some parties offer contingent support for reconfiguring the 30 
MHz C block licenses, e.g., provided that entrepreneur eligibility restrictions are maintained in their 
current form,  are modified as proposed in the Further Notice,  or are eliminated for at most only a 
single 10 MHz C block license in each market.  Other parties oppose the Commission's proposal, arguing 
that such a proposal is contrary to statutory requirements, because it will reduce small business 
opportunity in the marketplace.     Additionally, some parties contend that 10 MHz of C block spectrum is 
insufficient to provide a full range of third generation ("3G") services.  
14. We believe that 10 MHz is a viable broadband PCS license size.  Ten MHz has always been 
one of the principal license sizes used in broadband PCS.  In fact, half of the original licenses representing 
one-fourth of the total broadband PCS spectrum were 10 MHz licenses.  In Auction No. 11, we made 
available to bidders almost 1,500 D, E, and F block licenses, all of which were for 10 MHz of spectrum.  
Virtually all of those licenses were sold; and, with the exception of licenses won by entrepreneurs with 
substantial C block holdings, almost none of the them have been returned to, or reclaimed by, the 
Commission.  Moreover, we believe that 10 MHz broadband PCS block licenses provide opportunities to 
applicants, such as smaller companies and new entrants, that might not be able to acquire 20 or 30 MHz 
PCS licenses.  In our recent 700 MHz First Report and Order, where we established both 20 MHz and 10 
MHz block licenses for wireless use, we noted that 10 MHz block wireless licenses "should prove of 
interest to parties in the record who desire spectrum to deploy innovative wireless technologies, including 
high-speed Internet access, that do not require as much spectrum."   Those entities that want to obtain 
more than 10 MHz of C block spectrum where it is available in a BTA  retain the option of bidding on, or 
otherwise acquiring, as many of the available C block licenses as they are eligible for  and aggregating 
them, or aggregating one or more newly acquired licenses with existing licenses.
15. Accordingly, we conclude that, by dividing each available 30 MHz C block license into three 
10 MHz licenses, we can best address the diverse needs of the potential participants in the next C and F 
block auction.  Entrepreneurs that continue to favor smaller blocks will still be able to fulfill their business 
needs.  Parties that desire more spectrum for services will be allowed to aggregate the 10 MHz C block 
licenses, subject to the CMRS spectrum cap.  As more fully discussed below, we will continue to provide 
set-asides for some C block licenses to ensure that entrepreneurs are provided opportunities to acquire 
spectrum for their needs.  We believe that this reconfiguration, along with the other rule modifications we 
make today, will ensure the best use of spectrum through the competitive bidding process while at the 
same time promoting wider auction participation and license distribution in accordance with the goals of 
Section 309(j) of the Communications Act. 
B. Eligibility Restrictions Under a Tiered Approach
16. Background.  In the Further Notice, we proposed to remove the entrepreneur eligibility 
restrictions for some, but not all, licenses available in Auction No. 35 and in future C and F block 
auctions.  We tentatively concluded that we should divide BTAs into two tiers according to population 
size of the BTA.  "Tier 1" would comprise BTAs at and above a 2.5 million population threshold; "Tier 2" 
would comprise BTAs below that population threshold.  We also sought comment on other population 
thresholds and on establishing a third tier.  We tentatively concluded that we would allow "open" bidding 
(i.e., bidding without eligibility restrictions) for two of the three newly reconfigured 10 MHz C block 
licenses in Tier 1 and one of the three newly reconfigured 10 MHz C block licenses in Tier 2.   We also 
sought comment on whether there should be "open" bidding for all three of the 10 MHz licenses in Tier 1 
and two of the three in Tier 2.  With respect to available F block licenses,   we sought comment on 
eliminating the eligibility requirements, or, alternatively, applying a tiered approach or retaining the 
existing eligibility rules.  We tentatively concluded that we would allow "open" bidding for all available 
15 MHz C block licenses, because they had not been sold in Auction No. 22.   Finally, we sought 
comment on whether to establish a rule that lifts eligibility restrictions on any C or F block licenses that 
remain unsold after Auction No. 35 or after other future auctions.
17. Discussion.  As described below, we adopt our tentative conclusions and other proposals to 
remove the entrepreneur eligibility restrictions for some, but not all, licenses available in Auction No. 35 
and in future C and F block auctions, utilizing the tiered approach outlined in the Further Notice.  In the 
Further Notice, we discussed at some length the rationale behind those tentative conclusions and other 
proposals.  We find in general that those reasons continue to apply and that they support the actions we 
take today.  We elaborate further on our reasoning below in light of the record we received in response to 
the Further Notice.  
18. Tiers.  Consistent with our tentative conclusion, we will divide all BTAs into two categories, 
"Tier 1" BTAs and "Tier 2" BTAs.  Tier 1 will comprise BTAs with populations that, according to the 
1990 census, are equal to or greater than 2.5 million;  and Tier 2 will comprise the remaining BTAs.   
Commenters that support or oppose a tiered approach per se do so in the context of removing entrepreneur 
eligibility restrictions, and we will address their views in the section immediately below.  Certain 
commenters take issue with our tentative conclusion to demarcate the two tiers at a population of 2.5 
million.  For example, AT&T, while opposing the tiering concept as too restrictive for large companies, 
suggests that, if the concept is adopted, the upper tier should be enlarged to include BTAs with 
populations of one million or greater, i.e., approximately the top ten percent of the BTAs in the United 
States.     In contrast, Leap argues that we should constrict Tier 1 to include only BTAs with populations 
over five million. 
19. We believe that our decision to establish two tiers with a 2.5 million population demarcation 
represents the most reasonable balancing of the various competing public interest factors that bear on this 
issue.  Both sides in this debate make credible arguments about their needs for additional spectrum.  
Because we have only a limited amount of spectrum to offer, we must respond with an approach to 
eligibility that necessarily will not fully satisfy all competing demands.  Under these circumstances, we 
believe that the mid-course approach proposed in the Further Notice, which removes eligibility 
restrictions for some, but not all, of the available spectrum is the best course.  The approach, in 
conjunction with the changes in entrepreneur eligibility restrictions described below, will make relatively 
more spectrum available for "open" bidding in the most populous markets where the demand for spectrum 
by existing CMRS carriers is the greatest and the prospects of a spectrum shortage for these carriers is the 
most acute.  At the same time, the modifications we make today will keep most of this spectrum (i.e., 20 
MHz) closed in all but the very largest markets, while also retaining restricted eligibility for some 
spectrum (i.e., 10 MHz) even in those latter cases.  Thus, entrepreneurs will have an opportunity to 
acquire additional spectrum on a set-aside basis in all available C block markets.  We note that the tiering 
approach will split the C block spectrum available in Auction No. 35 almost equally, when weighted by 
population, between open and closed licenses.  For these reasons, implementing our tentative conclusion 
provides an effective method of accommodating the conflicting goals of entrepreneurs and non-
entrepreneurs and satisfies our objectives under Section 309(j). 
20. 30 MHz and 15 MHz C block licenses.  For markets with available 30 MHz licenses, other 
than licenses that were available but unsold in Auction No. 22,  we adopt our tentative conclusion and 
establish open bidding (i.e., bidding without entrepreneur eligibility restrictions) for two of the three 
newly reconfigured 10 MHz C block licenses in Tier 1 and for one of the three newly reconfigured 10 
MHz C block licenses in Tier 2.  In Tier 1, the following two 10 MHz blocks will be open: 1900 - 1905 
MHz paired with 1980 - 1985 MHz and 1905 MHz - 1910 MHz paired with 1985 - 1990 MHz.  In Tier 2, 
the following 10 MHz block will be open: 1905 MHz - 1910 MHz paired with 1985 - 1990 MHz.   For 
available 15 MHz C block licenses, other than for licenses that were available but unsold in Auction No. 
22,  we eliminate entrepreneur eligibility restrictions for licenses in Tier 1 but retain the restrictions for 
licenses in Tier 2. 
21. A number of commenters oppose any relaxation of the Commission's entrepreneur eligibility 
restrictions.  Some commenters argue that Section 309(j) compels the Commission to maintain the C and 
F block set-aside as is.   On the other hand, SBC responds that nothing in Section 309(j) or its legislative 
history necessitates a C and F block set-aside for entrepreneurs.  Some parties that favor elimination of 
entrepreneur eligibility requirements believe that our tentative conclusion is too limited.  These parties, 
which include most of the major, national carriers, would prefer that we remove entrepreneur eligibility 
restrictions from more - or all - of the available C and F block licenses.  Other commenters ask that the 
reduction be smaller.   CIRI, however, supports our tentative conclusion, provided that we also lift 
existing C and F block transfer restrictions. 
22. Section 309(j)(3) directs the Commission to seek to promote a variety of sometimes 
competing objectives, including economic opportunity, competition, and the rapid deployment of new 
technologies and services by, inter alia, disseminating licenses among a wide variety of applicants, 
including small businesses.  Section 309(j)(4) requires the Commission to ensure that small businesses 
and others "are given the opportunity to participate in the provision of spectrum based services" and 
directs the Commission to consider the use of mechanisms that will further that end.  The statute accords 
the Commission wide latitude in determining how to achieve the stated objectives.  For example, Section 
309(j) does not mandate the use of set-asides, or any other particular method, to promote the participation 
of small businesses in spectrum auctions; and the Commission has conducted numerous auctions in recent 
years in which it has not provided an entrepreneurs' block set-aside.   Similarly, Section 309(j)(3) does 
not require the Commission to promote the participation of small businesses in PCS auctions at the 
expense of other, potentially conflicting, objectives enumerated in the section, such as the promotion of 
competition and the rapid deployment of new technologies and services.  Finally, Section 309(j)(4)(D) 
does not require the Commission to ensure that licenses actually are granted to small businesses but, 
rather, requires only that these small businesses be given the opportunity to participate in the provision of 
spectrum-based services.  
23.     We believe that by implementing our tentative conclusion we give effect to, and reasonably 
balance, as many of the various and partially conflicting Section 309(j) objectives as possible.  As 
discussed in the Further Notice,  circumstances in the PCS industry have changed dramatically, and 
continue to change, since the implementation of our rules in 1994.  The introduction of wireless Internet, 
advanced data, and 3G services, and global competition within these services, has created a shortage of 
suitable available spectrum.   Many carriers claim that obtaining additional spectrum to provide such 
services or satisfy capacity needs is crucial to their business plans.  In addition, these carriers state that 
they require additional spectrum to "fill out" regional or national service areas.  Taking all of our 
statutory objectives into account, we believe that it is fair and appropriate to apportion the spectrum to 
accommodate these interests.  Apportioning the 30 MHz C block licenses in the manner described will 
enable larger carriers to obtain additional spectrum, which, we find, will promote the further development 
of CMRS competition and innovation, especially in larger markets.  At the same time, maintaining a 
significant set aside of C block spectrum for entrepreneurs will help smaller businesses in this band 
continue to achieve their business goals as well as providing meaningful opportunities for new 
entrepreneurial firms to enter the market.  Entrepreneurs will retain exclusive eligibility to bid on 10 MHz 
of available C block spectrum in Tier 1 markets and on most of the first-time reauctioned C block 
spectrum in Tier 2 markets.  Entrepreneurs also will be eligible to participate, along with non-
entrepreneurs, in all open bidding. 
24. F block licenses.  We adopt open bidding - bidding without entrepreneur eligibility 
restrictions - for F block licenses available in Auction No. 35 and in all future auctions.  No commenter 
advocates a middle ground for the F block, such as disaggregating the F block spectrum into smaller 
spectrum blocks or applying a tier structure to the F block and removing eligibility restrictions for some of 
the available licenses.  Commenters argue, instead, either for maintaining the entrepreneur restrictions for 
all F block licenses or for lifting these restrictions entirely.  Some parties that favor maintaining the set-
aside contend that entrepreneurs have made business plans in reliance on their ability to vie for additional 
F block licenses in future closed auctions.   Some argue that the Commission is constrained by Section 
309(j) from eliminating the eligibility restrictions.  Others point out that the Commission's proposals for 
modifying eligibility restrictions for C block licenses represent a substantial reduction in the set-aside and 
contend that the Commission should go no further.  Finally, parties believe that, because the F block does 
not share the C block's history of financial difficulty, there is less, if any, justification for eliminating the 
F block set-aside. 
25. Conversely, commenters supporting the lifting of F block entrepreneur eligibility restrictions 
argue that the lack of financial difficulties in the F block indicates no further need for continued protection 
in the form of a set-aside.  Other commenters assert that eliminating the F block set-aside would further 
the goals of Section 309(j) by alleviating spectrum congestion, promoting new services, and advancing 
competition.   VoiceStream maintains that opening F block bidding will expedite the build-out of F block 
markets, where progress has been slow.   SBC argues that because a 30 MHz C block license is already 
held by an entrepreneur in most markets where a 10 MHz F block license is now available, there is no 
need to maintain the set-aside for F block spectrum in the name of preserving entrepreneurial opportunity 
in these markets. 
26. We believe that it is in the public interest, and consistent with Section 309(j), to remove the 
set-aside for all available F block licenses.  As we stated in the Further Notice, and as some commenters 
underscore, the F block has evolved in a fashion largely distinct from that of the C block.   The two 
blocks have been subject to increasingly different regulatory requirements, reflecting in large part the 
different bidding and marketplace histories of the two blocks and the correspondingly different equity and 
reliance concerns applicable to bidders and licensees in each of the blocks.   Accordingly, as we have 
recognized previously, there is no longer a rationale for attempting to treat the two blocks in an identical 
fashion.  Moreover, the need for additional open spectrum that exists in the C block markets, discussed 
above, also applies in the F block markets; and allowing open eligibility for all available F block licenses 
might lead to more expeditious provision of service to consumers.  Moreover, as discussed in the Further 
Notice, almost every market with an available F block license already has a significant 30 MHz C block 
entrepreneur presence.  Thus, we can modify the F block eligibility rules while preserving the diversity of 
opportunity and service that are goals of Section 309(j).
27. Unsold set-aside licenses.  For Auction No. 35, we eliminate entrepreneur eligibility 
requirements for all C block licenses that were available but not sold in Auction No. 22.   For all auctions 
after Auction No. 35, we eliminate the entrepreneur eligibility requirements for any C or F block license 
that was available, but not sold, in Auction No. 22 or any subsequent auction.  In the Further Notice, we 
proposed removing eligibility restrictions for available 15 MHz C block licenses, reasoning that they 
remained unsold after having been offered in closed bidding in Auction No. 22.  We similarly proposed to 
remove eligibility restrictions on all C and F block licenses that are available, but not sold, in Auction No. 
35 as well as on all broadband PCS licenses that remain unsold after having been available for closed 
bidding in any auction after Auction No. 35.
28. Burst disagrees with the proposal to lift eligibility requirements for 15 MHz licenses being 
offered for the second time.  Nextel, however, supports our proposal for 15 MHz licenses, explaining that 
there is no reason to believe that these licenses, which were previously offered but not sold, will prove any 
more popular with entrepreneurs in yet another closed auction.   Furthermore, Nextel urges us to extend 
our proposal logically to include all available 30 MHz C block licenses that were available but not sold in 
Auction No. 22.   CIRI supports our proposal to lift eligibility restrictions for all C or F block licenses 
that are available, but not sold, in Auction No. 35 or that remain unsold after having been available for 
closed bidding in any future auction.  As CIRI states in its comments, "if entrepreneurs have been unable 
or unwilling to provide service in particular areas, then eligibility restrictions should be lifted to allow the 
introduction of service by any provider."  No commenter opposes adoption of this proposal.
29. The failure of certain 15 MHz C block licenses to sell in Auction No. 22 indicates that closed 
bidding for these licenses will not necessarily result in the acquisition and construction of these licenses 
and in service to the public.  By lifting the eligibility restrictions for these unsold licenses now, we hope to 
prevent additional delays in their utilization.  We find persuasive Nextel's argument that the same 
rationale that applies to 15 MHz C block licenses should apply to 30 MHz C block licenses, and we 
believe that the rationale is equally applicable to all C and F block licenses that have failed to sell in 
Auction No. 22 or any subsequent auction.  We note that no commenter opposed Nextel's suggestion to 
extend our proposal.  Accordingly, we will implement the rule change for all C or F block licenses that 
were available, but not sold, in Auction No. 22 or that remain unsold after having been available for 
closed bidding in Auction No. 35 or in any auction thereafter.  
C. Determination of Entrepreneur Eligibility
30. Background.  To qualify as an entrepreneur under current rules, a C or F block applicant 
(together with its affiliates and persons or entities that hold interests in the applicant and their affiliates) 
must have had gross revenues of less than $125 million in each of the last two years and must have total 
assets of less than $500 million at the short-form deadline.   Total assets are generally determined by the 
applicant's most recent audited financial statements.  As discussed below, the grandfather exception 
provides that, in addition to entities qualifying as entrepreneurs at the time of the short form filing 
deadline, any entity that was eligible for and participated in either of the first two C block auctions will be 
eligible to bid in any auction of C block spectrum that begins within two years of the March 23, 1999 start 
date of Auction No. 22.  Each C or F block licensee, whether its license was acquired at auction or by 
transfer or assignment, must maintain its entrepreneur eligibility during the five-year holding period, 
which begins on the date of the initial license grant, except that a licensee's increased gross revenues or 
increased total assets due to nonattributable equity investments, debt financing, revenue from operations 
or other investments, business development, or expanded service will not be considered.  With respect to 
applications for assignment or transfer of control of C or F block licenses during the five-year holding 
period, the proposed transferee or assignee must meet the entrepreneur eligibility criteria at the time the 
assignment or transfer application is filed or the proposed transferee or assignee must already hold other C 
or F block licenses and, at the time of receipt of such licenses, have met the entrepreneur eligibility 
criteria. 
31. Discussion.  In its comments, Nextel asks that the Commission review its rules on reporting 
"total assets" for entrepreneur eligibility and require applicants to report total assets as of the short form 
filing deadline.   Nextel asserts that Leap may try to qualify for Auction No. 35 based on the 
unavailability, at the short-form filing deadline, of Leap's audited financial statement for its fiscal year 
ending August 31, 2000.   In reply, Leap states that departing from a clear, bright-line test that uses 
credible audited numbers could facilitate manipulation of the eligibility calculations.   Leap states that 
there is no need for it to "slip in" under the asset cap since the current rules allow it to remain eligible to 
participate in future C and F block auctions, even if its assets exceed $500 million due to growth 
allowable under Section 24.709(a)(3).   In short, Leap claims that the natural growth exception which 
allows C or F block licensees to retain their entrepreneur eligibility during the holding period establishes 
its eligibility for the upcoming C block auction, Auction No. 35. 
32. Leap confuses the concept of maintaining entrepreneur eligibility for the purpose of meeting 
the five-year holding period  with the concept of eligibility to participate as an entrepreneur in a C or F 
block auction.   By allowing licensees to maintain their eligibility despite growth beyond the financial 
caps, the Commission intended to encourage entrepreneurs to grow and succeed during the five-year 
holding period.  Contrary to Leap's assertions, although the Commission intended to ignore natural 
growth for purposes of entrepreneur eligibility during the five-year holding period, it did not intend to 
ignore such growth in determining eligibility to participate in future C and F block auctions.  In other 
words, Leap, which is not eligible for the grandfather exception,  would have us read the natural growth 
rule, that allows a licensee to maintain eligibility for the holding period despite growth beyond the 
financial caps, as an alternative grandfathering exception.  If the Commission had intended the natural 
growth rule to be read as Leap contends, then the two-year grandfather exception for Auction No. 5 and 
10 participants would have been more narrowly drafted.  Instead, the Commission applied the grandfather 
exception to all entities that had qualified for, and participated in, the first two C block auctions. 
33. Nextel's comments raise the issue of whether eligibility for C block auctions is determined by 
an applicant's most recently available audited financial statements, even if those statements are then a 
year or more out of date, or whether eligibility should be based on the relevant financial data as of the 
most recently completed calendar/fiscal year, even if audited financial statements for the most recent year 
are not available as of the short-form filing deadline.   Under Section 24.720, an entrepreneurs' block 
applicant must evidence its gross revenues and total assets with its most recent audited financial 
statements, or, if the applicant does not otherwise use audited financial statements, a certification by the 
applicant's chief financial officer or its equivalent.  We see no need to modify these rules.  We note, 
however, that we expect an applicant to obtain financial statements within a reasonable period of time 
after the close of the applicable calendar or fiscal year and to base its claim to eligibility on those financial 
statements.  If an applicant delays, or takes action that results in delay in, the generation and/or submission 
of current audited financial statements in order to capture entrepreneur eligibility to which the applicant 
would otherwise not be entitled, it will risk being declared ineligible for auction participation or license 
grant or jeopardize its continuing eligibility to hold its licenses.
D. License Grouping for Bids and Competitive Bidding Design
34. Background.  In the Further Notice, we tentatively concluded that we would take bids 
separately on each license in Auction No. 35 on a simultaneous multiple round basis as we have done in 
the past.   We agreed with commenters that Nextel's bulk bid proposal, under which the Commission 
would reconfigure the available 30 MHz C block licenses into separate 20 MHz and 10 MHz licenses and 
offer the newly created 20 MHz C block licenses and the available 15 MHz C block licenses together on a 
"bulk bid"(i.e., winner-take-all) basis, would exclude all but a very few competitors.   We stated that 
small entities would be hard pressed to obtain the financing necessary to win and pay for the licenses and 
construct the systems included in the bulk bid proposal, while many other carriers would be constrained 
from participating by the CMRS spectrum cap.  We noted that our past auctions demonstrate that 
significant aggregations of licenses through the auction process are feasible and that bidding for each 
license separately is unlikely to preclude carriers from aggregating licenses on a nationwide or regional 
basis. 
35. At the same time, we explained that we were considering implementation of a combinatorial, 
or package, bidding design for the auction of licenses in the 700 MHz bands in order to facilitate 
aggregations of complementary licenses into larger blocks.  We invited parties to suggest ways in which 
bidders could efficiently aggregate licenses in Auction No. 35;  although, we noted that it might be 
impractical to implement a package bidding design for that auction. 
36. Discussion.  We reject Nextel's bulk bid proposal.  Instead, we leave to the Wireless 
Telecommunications Bureau ("Bureau"), under its existing delegated authority, the final selection of a 
competitive bidding design and methodology for Auction No. 35, including the decision whether or not to 
implement a combinatorial bidding design for the auction.  There is no support in the record for the 
Nextel bulk bid proposal.  We continue to be concerned that, as argued by the bulk bid opponents, 
Nextel's suggested approach would unduly favor Nextel to the possible exclusion of most other potential 
applicants. 
37. Some of the parties that commented on ways to aggregate licenses in the auction process, 
argue against the use of package bidding for Auction No. 35, on the ground that such a design would be 
complex and impractical.   Other commenters support implementation of package bidding as a way to 
enhance the ability of auction participants to acquire their targeted groups of licenses while reducing their 
exposure.   In preparing for Auction No. 35, the Bureau, under its existing delegated authority and 
pursuant to public notice and comment, will determine the competitive bidding design most appropriate 
for the auction.     Following the Bureau's determination of the auction design, we will, if necessary, 
revisit the need for any rule modifications.
E. Grandfather Exception
38. Background.  In the Further Notice, the Commission tentatively concluded that upon the 
merger of two entities, the grandfather exception contained in Section 24.709(b)(9)(i) should extend to the 
resulting entity when each of the two original entities is eligible for the exception, but not when only one 
of them is eligible for the exception.   The Commission sought comment on how to determine C and F 
block eligibility when faced with more complex transactions.   The Commission also sought comment on 
issues raised by Verizon in its petition for reconsideration or clarification of the C Block Fourth Report 
and Order Reconsideration.   Verizon asks us to reexamine the grandfather exception and limit resulting 
eligibility to those Auction No. 5 and 10 participants that won licenses in the auctions and then returned 
spectrum pursuant to the Commission's C block restructuring options.  Verizon also proposes that the 
entity claiming the grandfather exception must be the same company - having substantially the same 
ownership and control - as the one that acquired the entrepreneur status. 
39. Discussion.  We clarify an applicant's eligibility for the grandfather exception after it has 
been involved in a merger, acquisition, or other business combination, as follows.  When each of the 
combining entities is individually eligible for the "grandfather" exception, the exception will extend to the 
resulting entity.  When one or more of the entities are not individually eligible for the grandfather 
exception, the resulting entity will be eligible for the exception only so long as an originally eligible entity 
retains de facto and de jure control of the resulting entity.
40. We deny the Verizon petition to the extent that it asks that the exception be available only to 
Auction No. 5 and 10 participants that won licenses in those auctions and then returned spectrum.  Despite 
its narrowly worded caption,  the rule codifying the grandfather exception is clear on its face.  It applies 
not just to Auction No. 5 and 10 participants that returned spectrum to the Commission but also to 
participants in either of those auctions that either won no licenses or won licenses but did not disaggregate 
or return spectrum.  We dismiss the remainder of the Verizon petition as moot in light of our clarification 
of the application of the grandfather exception to an auction applicant that has been involved in a business 
combination.
41. Alpine opposes the extension of the grandfather exception to merged entities, because merged 
entities have substantially different ownership than would the two entities if qualifying and bidding 
separately.   Carolina and Dobson support the Commission's proposal;  although, Dobson also urges 
the Commission to extend the grandfather exception not only to the merger of entities that are each 
eligible for the exception, but also to the merger of entities only one of which is eligible for the 
exception.   Dobson asks the Commission to adopt a simple control analysis to extend the grandfather 
exception to a combination of entities only one of which is eligible for the exception if the transaction 
results in an entity over which the eligible entity retains control.  Telecorp and Tritel jointly assert that 
the exception should apply to the combined entity, as long as control remains in the same hands.   
Several parties support maintaining the grandfather exception in its current state,  while others urge the 
Commission to eliminate the exception altogether.  
42. We do not believe that, when entities eligible for the grandfather exception combine, the 
resulting entity should be penalized.  Accordingly, we clarify that, under such circumstances, the 
grandfather exception will extend to the resulting entity.  For situations where at least one of the entities is 
not individually eligible for the grandfather exception, we find persuasive Dobson's suggestion that we 
adopt a simple control analysis to determine whether an entity is "substantially the same" as the prior 
auction participant in Auction No. 5 or 10.  Pursuant to this reasoning, the grandfather exception should 
be available to the resulting entity, so long as at least one entity that was originally eligible for the 
grandfather exception retains de facto and de jure control over the resulting entity.  Other than to make 
these clarifications, we see no need to modify the grandfather exception, which will apply to auctions of C 
block licenses that begin on or before March 23, 2001. 
F. Bidding Credits 
43. Background.  In the Further Notice, we sought comment on whether we should make 
adjustments to the current C and F block bidding credits for future auctions based on whether such 
auctions are open to all bidders or subject to eligibility restrictions.  More specifically, we sought 
comment on whether we should retain existing small and very small business bidding credits (15 percent 
and 25 percent, respectively) for licenses subject to open bidding or increase them to 25 percent and 40 
percent, respectively.  For licenses subject to closed bidding, we sought comment on whether we should 
increase the bidding credits, retain them at the current level, or eliminate them entirely. 
44. Discussion.  For licenses subject to open bidding, we will maintain the current level of 
bidding credits for small and very small businesses, and consortia thereof, of 15 percent and 25 percent, 
respectively.  For licenses subject to closed bidding, we will eliminate all bidding credits.  While a 
number of commenters, primarily small and very small businesses, support an increase in bidding credits 
for licenses won in open bidding,  other parties contend that the existing bidding credits would enable 
small and very small businesses to compete successfully in open auctions.   We agree with the latter 
contingent that bidding credits of 15 and 25 percent will allow effective competition by small businesses 
in open C and F block bidding.  We note that in our Specialized Mobile Radio (SMR) 900 MHz auction - 
using bidding credits of 10 percent and 15 percent - 75 percent of the winning bidders were small 
businesses, winning 26 percent of the licenses.  Moreover, in Auction No. 11, the auction of D, E, and F 
block licenses, small and very small business were the high bidders for 141 of the 986 D and E block 
licenses won in that auction, even though bidding credits are not available for D and E block licenses. 
45. With respect to closed bidding, we believe that the continued use of bidding credits in 
restricted auctions would not necessarily serve its intended purpose.  As we explained in the Further 
Notice, among those eligible to participate in entrepreneurs' block auctions, some well capitalized new 
entities with small gross revenues qualify for bidding credits, while some older companies with small total 
assets and net revenues but high gross revenues do not.  According to Dobson, bidding credits in set-aside 
auctions "simply skew these auctions in favor of well-capitalized applicants that are carefully structured to 
shield deep-pocketed investors from attribution."   For this reason, Dobson urges us to eliminate the use 
of bidding credits altogether in restricted auctions.  We agree with Dobson and other commenters that 
support Dobson's position.   Furthermore, the results of Auction No. 11 suggest that if small and very 
small businesses can compete effectively in open bidding without bidding credits, they can certainly 
compete effectively in closed bidding without bidding credits.
G. Transfer Requirements
1. Open bidding.
46. Background.  In the Further Notice, we proposed to modify the transfer restrictions for C and 
F block licenses to correspond to our proposed changes in entrepreneur eligibility requirements and to 
encourage rapid construction of C and F block systems.  We tentatively concluded that C and F block 
licenses won pursuant to open bidding at Auction No. 35, or in any future open auction for such spectrum, 
would not be subject to the restrictions against transfers to non-entrepreneurs.  
47. Discussion.  Pursuant to our tentative conclusion, we will not subject C and F block spectrum 
licenses won pursuant to open bidding at Auction No. 35, or any future open auction for such spectrum, to 
a five-year holding and limited transfer rule.  Thus, such licenses may be transferred or assigned at any 
time after grant to any qualified entity, entrepreneur or not.  Several commenters support removing the 
transfer restrictions for C and F block licenses won pursuant to open bidding at Auction No. 35, or any 
future open auction for such spectrum.   OPM supports eliminating transfer restrictions on the basis that 
there is little justification for restricting the transfer of licenses to entrepreneurs when non-entrepreneurs 
are eligible to bid on the spectrum at auction.   BellSouth asserts that there is no need for a limitation on 
transfer or assignment for licenses won in an open auction because there is no unjust enrichment 
associated with such a license.   None of the commenters urge maintaining transfer restrictions on 
licenses won in open bidding.  The only purpose for restricting the transfer of C and F block licenses to 
non-entrepreneurs is to ensure the integrity of the set-aside auction process.  Because these licenses will 
now be subject to competitive bidding in open auctions, there is no longer a need to restrict their transfer 
and assignment solely to entrepreneurs.
2. Closed bidding. 
48. Background.  With respect to licenses won in closed bidding in any C or F block auction, 
past or future, we sought comment on tying the holding period to completion of build-out requirements.  
Under our proposal, a licensee would be able to assign or transfer its license to any qualified entity, 
entrepreneur or not, upon the licensee's completion of its first construction benchmark, whether or not it 
takes the full five years allowed by our rules.   In this way, we sought to minimize the trafficking of C 
and F block licenses won pursuant to closed bidding, while enhancing the likelihood of early build-out.   
49. Discussion.  We will allow a licensee to assign or transfer a license won in closed bidding to 
any qualified entity, entrepreneur or not, as soon as the licensee has satisfied its first construction 
benchmark.  The decision to transfer a restricted license to a non-entrepreneur before the end of the five-
year holding period in this manner must be made affirmatively by those in control of the entrepreneur.  
As discussed below, even under our modified rule, an early transfer or assignment may be subject to 
unjust enrichment payment requirements.
50. Most commenters that addressed this issue support the elimination of transfer restrictions 
upon completion of the first construction benchmark for licenses won in closed bidding in any C or F 
block auction, past or future.   VoiceStream supports eliminating transfer restrictions on C and F block 
licenses, but disagrees with the Commission's proposal that the elimination of transfer restrictions on 
licenses won in closed bidding should be tied to completion of build-out requirements.   Other 
commenters advocate retention of the transfer restrictions in "closed" auctions.  In our estimation, 
permitting such assignments and transfers will encourage rapid build-out and service to the public, two 
objectives of Section 309(j), while at the same time providing C and F block licensees with the ability to 
access capital.  The result should be increased competition and more efficient spectrum use. 
51. Normally, if a C or F block licensee that used a bidding credit assigns or transfers its license 
within the first five years after the initial license grant date to an entity not qualifying for a bidding credit, 
or as favorable a bidding credit, the licensee is subject to an unjust enrichment payment requirement.  In 
the case of early transfers or assignments of C block licenses won in Auctions No. 5 and 10, where 
virtually all bidders, and all license winners, qualified for a single 25 percent bidding credit, we see no 
purpose in requiring the payment.  When all bidders are given the same bidding credit, the competitive 
effect is the same as if no bidder has a credit.  Thus, bidding credits likely did not affect the outcome of 
those auctions in terms of who won or how much money was paid to the government.  Accordingly, 
allowing the early sale of a C block license by an Auction No. 5 or 10 licensee would not constitute unjust 
enrichment.   When there is an early transfer or assignment of a license won in Auctions No. 11 or 22, or 
of any other license won in closed bidding, we will continue to require any applicable unjust enrichment 
payment.  In Auctions No. 11 and 22, where two levels of bidding credits were used and a significant 
number of bidders and winners did not receive a bidding credit, the use of such credit by some bidders 
may well have influenced the results of the auction.
3. System-wide satisfaction of construction benchmark. 
52. Background.  In the Further Notice, we sought comment on whether we should, under 
certain circumstances, evaluate an incumbent licensee's compliance with construction requirements on a 
system-wide basis.   Noting that at least one carrier had argued that it needs the flexibility to sell and 
exchange licenses in order to restructure its business plans, we sought comment on whether we should 
allow a carrier to exchange and transfer licenses if the carrier can demonstrate "substantial service" 
throughout its system, rather than in a particular market.   We also sought comment on any other 
modifications to our transfer restrictions that would provide incumbent licensees with the flexibility to 
restructure their business plans without decreasing their incentive to rapidly construct systems and place 
them into operation. 
53. Discussion.  Although several commenters urge us to do so,  we do not believe that we 
should allow a carrier to exchange and transfer licenses where the carrier can demonstrate "substantial 
service" throughout its system, but not in the particular market that would be affected by the transfer.  
Although permitting such transfers might provide incumbent licensees with the flexibility to restructure 
their business plans, we believe that it would also remove an important incentive for carriers to construct 
systems rapidly and place them into operation in all markets where they are licensed.  If we adopt a 
system-wide "substantial service" standard, carriers may choose to build out selectively in more populous 
markets at the expense of less populated areas in anticipation of transferring or exchanging licenses.  Also, 
an entrepreneur could acquire a license in a closed auction and immediately sell the newly acquired - and 
wholly unconstructed - license on the open market so long as the entrepreneur satisfied the system-wide 
standard, even with the newly acquired license included in its "system."  We do not think that such a 
result is consistent with making licenses available for closed bidding by entrepreneurs.
H. License Cap
54. Background.  In the Further Notice, we tentatively concluded that we would remove from the 
Commission's rules Section 24.710, which prohibits an auction applicant from winning (but not from 
acquiring in the secondary market)  more than 98 C and F block licenses. 
55. Discussion.  We adopt our proposal to remove Section 24.710 from the Commission's rules.  
When established in 1994, this license cap was intended to facilitate a fair distribution of licenses within 
the C and F blocks by preventing an entity from winning more than approximately 10 percent of the then-
total of 986 D and F block licenses.  In the Further Notice, we explained that the Commission has 
already achieved its objective of disseminating the C and F block licenses among a variety of 
entrepreneurs.  While most commenters agree that the license cap has outlived its purpose,  a few 
believe that the cap is still necessary to prevent big applicants from acquiring large numbers of licenses.  
We believe that the license cap is no longer necessary.  Not only is there already substantial diversity 
among C and F block licensees, but our decision today to reconfigure each available 30 MHz C block 
license into three 10 MHz licenses - tripling the number of available C block licenses - and to eliminate 
the eligibility restrictions for many of the available C block licenses, and all of the available F block 
licenses, should enhance that diversity.
I. Spectrum Cap
56. Background.  In the Further Notice, we tentatively concluded that we would continue to 
apply the CMRS spectrum cap, as set forth in Section 20.6 of the Commission's rules,  to the spectrum 
awarded in the upcoming C and F block auction.  Almost a year ago, we determined in our Biennial CMRS 
Spectrum Cap Order that the CMRS spectrum cap, with some modification, continued to be an efficient 
means to promote competition and protect the public interest.   In addition, we established and clarified 
a process by which any carrier with a demonstrable need for additional spectrum to provide 3G or other 
advanced services in a particular geographic area could seek a waiver of the spectrum cap rule.  Finally, 
we stated that we would be reexamining whether to retain, modify, or eliminate the CMRS spectrum cap 
as part of our year 2000 biennial review. 
57. Discussion.  We conclude that we will continue to apply the CMRS spectrum cap to the C and 
F block licenses to be auctioned.  Those parties requesting that the cap be eliminated with respect to this 
spectrum have not provided sufficient bases in the record to revise a rule or eliminate the cap in the 
context of this particular auction of initial licenses.  
58. In the comments on this Further Notice, almost all of the commenters supported our tentative 
conclusion not to eliminate the CMRS spectrum cap with respect to these C and F block licenses.  They 
agreed with our general conclusion that the parties requesting elimination of the cap have not provided the 
Commission sufficient bases for revising the CMRS spectrum cap.   Only four commenters, including 
three of the parties that petitioned the Commission earlier this year (discussed below), opposed our 
tentative conclusion; they did not, however, supply any additional substantive arguments  to those raised 
in the petitions filed earlier this year.
59. As we indicated in the Further Notice, we did not find that those petitions requesting waiver, 
or limited forbearance from application, of the CMRS spectrum cap were persuasive.   In requesting 
waiver or forbearance, AT&T, Bell Atlantic, BellSouth, and GTE only supplied very general assertions 
that, absent lifting of the cap, they would face considerable difficulty rolling out 3G and other advanced 
broadband services.   We agree with most of the commenters to the petitions  that the petitioners failed 
to satisfy the waiver standard set forth either in the Biennial CMRS Spectrum Cap Order or in Section 1.3 
of the Commission's rules.   We also agree that Bell Atlantic failed to establish the basis for reversing 
our determination that the spectrum cap promoted the public interest, as would be necessary for granting a 
forbearance request.   Finally, we find unpersuasive GTE's argument that the CMRS spectrum cap does 
not apply to the C and F block spectrum in the upcoming auction, and therefore deny its request for a 
declaratory ruling. 
60. As a practical matter, we believe that our decision to reconfigure the 30 MHz blocks of C 
block spectrum into 10 MHz blocks will better enable all carriers to obtain additional spectrum in the vast 
majority of markets without the need to exceed the CMRS spectrum cap.  In only a few locations have 
carriers accumulated spectrum up to the CMRS spectrum cap limits, either the general 45 MHz cap or the 
55 MHz cap that applies to rural areas.  More particularly, in the upcoming C and F block auction, almost 
all carriers in every market could obtain additional spectrum in blocks of 10 MHz (or 15 MHz where 
applicable) and still comply with the spectrum cap without any need for disaggregation.  Finally, as we 
noted above, we will shortly issue a Notice of Proposed Rulemaking as part of our year 2000 biennial 
review of the spectrum cap rule.   That proceeding will provide the Commission a better opportunity to 
revisit, in a more comprehensive manner than in this context, issues pertaining to the CMRS spectrum cap, 
taking into consideration existing competitive conditions and technological developments that could affect 
the continued need for the cap.
J. Late Filing
61. Background.  The Further Notice established 7 p.m., July 12, 2000, as the time and date after 
which ex parte and other presentations regarding the Further Notice would be prohibited.   On July 7, 
2000, we extended this deadline until 7 p.m., July 17, 2000. 
62. Discussion.  The Personal Communications Industry Association ("PCIA") requests that we 
accept its supplemental comments filed on July 21, 2000, arguing that the relevant information did not 
become public until publication of a July 19, 2000 newspaper article.   Nextel opposes the PCIA request, 
pointing to the July 17, 2000 deadline.  While the Commission does not often establish an ex parte 
presentation cut-off deadline, we did so in this proceeding in order to ensure sufficient time to consider 
the voluminous record.   Upon review of PCIA's July 21, 2000 request, and in light of our deadline, we 
are not persuaded that consideration of PCIA's late-filed supplemental comments is warranted.  
Accordingly, we deny PCIA's request.
IV. PROCEDURAL MATTERS AND ORDERING CLAUSES
A. Final Regulatory Flexibility Analysis
63. Pursuant to the Regulatory Flexibility Act, the Final Regulatory Flexibility Analysis is 
attached as Appendix C. See 5 U.S.C.  604.
B. Paperwork Reduction Act Analysis
64. This Order contains neither a new nor a modified information collection.
C. Ordering Clauses
65. Accordingly, IT IS ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for a Waiver of Section 24.709 and for Expedited Action filed by SBC 
Communications Inc. on January 21, 2000 IS DISMISSED in part as moot and DENIED in all other 
respects.
66. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Expedited Rulemaking or, in the Alternative, Waiver of the Commission's 
Rules by Nextel Communications, Inc. on January 31, 2000 IS DISMISSED in part as moot and DENIED 
in all other respects.
67. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Waiver and Expedited Action filed by AT&T Wireless Services, Inc. on 
February 15, 2000 IS DISMISSED in part as moot and DENIED in all other respects.
68. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Waiver and Expedited Action filed by BellSouth Corporation on February 17, 
2000 IS DISMISSED in part as moot and DENIED in all other respects.
69. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Limited Forbearance filed by Bell Atlantic Mobile, Inc. on February 17, 2000, 
IS DENIED. 
70. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Waiver by Sprint Spectrum L.P. dba Sprint PCS on February 22, 2000, IS 
DISMISSED as moot.
71. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Rulemaking by the Cellular Telecommunications Industry Association on 
February 22, 2000, IS GRANTED in part and DENIED in all other respects. 
72. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Waiver by US WEST Wireless, LLC on March 1, 2000, IS DISMISSED as 
moot.
73. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Declaratory Ruling and/or Waiver filed by GTE Service Corporation on March 
8, 2000, IS DISMISSED in part as moot and DENIED in all other respects. 
74. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Reconsideration (Expedited Action Requested) by US WEST Wireless, LLC 
and Sprint Spectrum L.P. dba Sprint PCS on April 4, 2000, IS DISMISSED in part as moot and DENIED 
in all other respects. 
75. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Petition for Clarification or Reconsideration by Verizon Wireless on April 17, 2000, IS 
DENIED in part and DISMISSED as moot in all other respects. 
76. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Motion for Extension of Time by the Personal Communications Industry Association on 
June 19, 2000, IS DISMISSED as moot. 
77. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), the Motion to Accept Late-Filed Supplemental Comments by the Personal Communications 
Industry Association on July 21, IS DENIED.
78. IT IS FURTHER ORDERED that, pursuant to Sections 4(i), 5(b), 5(c)(1), 309(r), and 309(j) 
of the Communications Act of 1934, as amended, 47 U.S.C. Sections 154(i), 155(b), 156(c)(1), 303(r), 
and 309(j), this Sixth Report and Order and Order on Reconsideration is hereby ADOPTED, and Sections 
24.202, 24.203, 24.229, 24.709, 24.710, 24.712, 24.714, 24.717, 24.720, and 24.839 of the Commission's 
rules, 47 C.F.R. Sections 24.202, 24.203, 24.229, 24.709, 24.710, 24.712, 24.714, 24.717, 24.720, and 
24.839, are amended as set forth in Appendix E, effective 60 days after publication in the Federal 
Register.
79. IT IS FURTHER ORDERED that the Commission's Consumer Information Bureau, 
Reference Information Center, SHALL SEND a copy of this Sixth Report and Order, including the Final 
Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.
80. IT IS FURTHER ORDERED that, pursuant to 47 U.S.C.  155(c) and 47 C.F.R.  0.331, the 
Chief of the Wireless Telecommunications Bureau IS GRANTED DELEGATED AUTHORITY to 
prescribe and set forth procedures for the implementation of the provisions adopted herein.

FEDERAL COMMUNICATIONS COMMISSION


Magalie Roman Salas
Secretary



V. APPENDIX A - COMMENTS AND PETITIONS IN RESPONSE TO THE FURTHER NOTICE
Comments
1. Advanced Telecommunications Technology Inc. ("Advanced")  	
2. AirGate Wireless ("AirGate")			
3. Alaska DigiTel, LLC ("Alaska"), Poplar PCS, LLC ("Poplar"), and Eldorado Communications, 
LLC ("Eldorado") 
4. Alpine PCS, Inc. ("Alpine")							
5. America Connect, Inc. ("America Connect")						
6. Association of Communications Enterprises ("ASCENT")				
7. AT&T Wireless Services, Inc. ("AT&T")						
8. BellSouth Corporation ("BellSouth")						
9. Burst Wireless, Inc. ("Burst")							
10. Carolina PCS I Limited Partnership ("Carolina")					
11. The Cellular Telecommunications Industry Association ("CTIA") 			
12. Choice Wireless, LC ("Choice")							
13. ComScape Telecommunications ("ComScape")						
14. Cook Inlet Region, Inc. ("CIRI")							
15. Dobson Communications Corporation ("Dobson")					
16. Leap Wireless International, Inc. ("Leap")					
17. Vincent McBride ("McBride")								
18. National Telephone Cooperative Association ("NTCA")				
19. Nextel Communications, Inc. ("Nextel")						
20. NextWave Personal Communications, Inc. and NextWave Power
Partners Inc. (collectively "NextWave") 							
21. Northcoast Communications, LLC ("Northcoast")	
22. OPM Auction Co. ("OPM")				
23. Personal Communications Industry Association ("PCIA")				
24. Polycell Communications, Inc. ("Polycell")					
25. Powertel Inc. ("Powertel")							
26. Rahda Krushn Communications ("RK Communications")  				
27. Roseville, PCS ("RPCS")							
28. Rural Cellular Association ("RCA")						
29. Rural Telecommunications Group ("RTG") and Organization for the Promotion and Advancement 
of Small Telecommunications Companies ("OPASTCO")	
30. SBC Communications, Inc. ("SBC")						
31. STPCS Joint Venture, LLC ("STPCS")						
32. TeleCorp PCS, Inc and Tritel Communications, Inc. (collectively "Telecorp and Tritel")	
33. Twenty First Wireless, Inc. ("Twenty First Wireless")  					
34. U.S. AirWaves, Inc. ("U.S. AirWaves")							
35. U.S. Small Business Administration, Office of Advocacy ("Advocacy")	
36. US West Wireless, LLC ("US West")						
37. Verizon Wireless ("Verizon")							
38. VoiceStream Wireless ("VoiceStream")						


Reply Comments
1. AirGate Wireless ("AirGate")					
2. ALLTEL Corporation ("ALLTEL")
3. Alpine PCS, Inc. ("Alpine")
4. AT&T Wireless Services, Inc. ("AT&T")
5. BellSouth Corporation ("BellSouth")
6. Burst Wireless, Inc. ("Burst")
7. Carolina PCS I Limited Partnership ("Carolina")	
8. Cook Inlet Region, Inc. ("CIRI")		
9. Dobson Communications Corporation ("Dobson")			
10. Leap Wireless International, Inc. ("Leap")				
11. Nextel Communications, Inc. ("Nextel")	
12. Northcoast Communications, LLC ("Northcoast")			
13. North Coast Mobile Communications, Inc. ("North Coast")		
14. OPM Auction Co. ("OPM") 			
15. Personal Communications Industry Association ("PCIA"), Polycell Communications, Inc. 
("Polycell") and CFW Communications ("CFW")
16. Rainbow/Push Coalition ("Rainbow/Push")		
17. Roseville PCS, Inc. ("RPCS")					
18. Rural Cellular Association ("RCA")				
19. SBC Communications Inc. ("SBC")				
20. Southern LINC ("Southern")							
21. Sprint PCS ("Sprint")		
22. STPCS Joint Venture, LLC ("STPCS")
23. TeleCorp PCS, Inc. and Tritel Communications, Inc. ("Telecorp and Tritel")		
24. Twenty First Wireless, Inc. ("Twenty First Wireless")					
25. U.S. AirWaves ("U.S. AirWaves")
26. US West Wireless, LLC ("US West")
27. VoiceStream Wireless Corporation ("VoiceStream")

Ex Partes
1. ALLTEL Communications, Inc. ("ALLTEL")
2. Alpine PCS, Inc. ("Alpine")
3. AT&T Wireless Services, Inc. ("AT&T")
4. Bell Atlantic Mobile ("Bell Atlantic")
5. BellSouth Cellular Corporation ("BellSouth")
6. Burst Wireless, Inc. ("Burst")
7. Conestoga Wireless Company ("Conestoga")						
8. Dobson Communications Corporation ("Dobson")	
9. National Congress of American Indians ("NCAI")
10. Nextel Communications, Inc. ("Nextel")	
11. Northcoast Communications ("Northcoast")
12. Personal Communications Industry Association ("PCIA")		
13. Polycell Communications, Inc. ("Polycell")	
14. Qwest Wireless ("Qwest"), Sprint PCS ("Sprint"), and ALLTEL Corporation ("ALLTEL")
15. Representative Eliot L. Engel and Charles V. Pickering
16. Representative John Linder
17. Representative Johnny Isakson
18. Rural Telecommunications Group ("RTG")
19. SBC Telecommunications ("SBC")
20. Senator Christopher S. Bond
21. Senator Thad Cochran
22. STPCS Joint Venture, LLC ("STPCS")
23. TeleCorp PCS, Inc, and Tritel Communications, Inc. ("Telecorp and Tritel")	
24. Twenty First Wireless, Inc. ("Twenty First Wireless")	
25. U.S. AirWaves ("U.S. AirWaves")
26. UTStarcom ("UTStarcom")
27. Verizon Wireless ("Verizon")							
28. VoiceStream Wireless Corporation ("VoiceStream")		

Petitions

1. Personal Communications Industry Association ("PCIA") (Motion to Accept Late-Filed         
     Supplemental Comments) (filed July 21, 2000-late-filed)
2. Personal Communications Industry Association ("PCIA") (Motion for Extension of Time)     
     (filed June 19, 2000)

Opposition to Petitions
1. Nextel Communications, Inc. ("Nextel") (filed July 31, 2000) (opposing PCIA Motion to Accept Late-
Filed Supplemental Comments)


VI. APPENDIX B - ENTREPRENEUR ELIGIBILITY ISSUES
B-1.	Comments Filed in Response to Public Notice, DA 00-145, 00-191 and 00-271 (Petitions of 
SBC Communications, Inc. and Nextel Communications, Inc.)

Comments

1. Alaska Digitel, LLC (Alaska"), Poplar PCS, LLC ("Poplar"), and Eldorado 
Communications, LLC ("Eldorado")
2. Alpine PCS, Inc. ("Alpine")
3. American Wireless, LLC ("American Wireless")
4. AT&T Wireless Services, Inc. ("AT&T")
5. Bell Atlantic Mobile, Inc. ("Bell Atlantic")
6. BellSouth Cellular Corporation ("BellSouth")
7. Burst Networks, Inc. ("Burst")
8. Carolina PCS I Limited Partnership ("Carolina")
9. Cellular Telecommunications Industry Association ("CTIA")
10. Cook Inlet Region, Inc. ("CIRI")
11. Council Tree Communications, LLC ("Council Tree")
12. CT Communications, Inc. ("CT") 
13. D&E Communications, Inc. ("D&E")
14. Devon Mobile Communications, L.P. ("Devon")
15. Ericsson, Inc. ("Ericsson")
16. Georgetown Partners, LLC ("Georgetown")
17. GTE Service Corporation ("GTE")
18. Integrated Communications Group, Corp. ("ICG")
19. Leap Wireless International, Inc. ("Leap")
20. National Telephone Cooperative Association ("NTCA")
21. NextWave Personal Communications Inc. ("NextWave")
22. Northcoast Communications, LLC ("Northcoast")
23. Office of Advocacy of the United States Small Business Administration ("Advocacy")
24. Omnipoint Corporation ("Omnipoint")
25. ONYX Telecommunications, LLC ("ONYX")
26. OPM Auction Co. ("OPM")
27. Rural Cellular Association ("RCA")
28. Rural Telecommunications Group and the Organization for the Promotion and 
Advancement of Small Telephone Companies ("RTG")
29. SBC Communications, Inc. ("SBC")
30. SMR Group, LLC ("SMR")
31. Sprint Spectrum L.P. d/b/a Sprint PCS ("Sprint")
32. TeleCorp PCS, Inc. ("TeleCorp")
33. Telephone and Data Systems, Inc. ("TDS")
34. Tritel Communications, Inc. ("Tritel")
35. US West Wireless, LLC ("US West")
36. UTStarcom ("UTStarcom")
37. VoiceStream Wireless Corporation ("VoiceStream")
38. Wireless Operating Company, Inc ("WOC")


Reply Comments

1. Alaska Digitel, LLC ("Alaska"), Poplar PCS, LLC ("Poplar"), and Eldorado Communications, LLC 
("Eldorado")
2. Alpine PCS, Inc. ("Alpine")
3. American Wireless, LLC ("American Wireless")
4. AT&T Wireless Services, Inc. ("AT&T")
5. C Block Coalition ("Coalition")
6. Carolina PCS I Limited Partnership ("Carolina")
7. Chadmoore Wireless Group, Inc. ("Chadmoore")
8. CLEARTALK ("Cleartalk")
9. CT Communications, Inc. ("CT")
10. Entertainment Unlimited, Inc. ("Entertainment Unlimited")
11. Georgetown Partners, LLC ("Georgetown")
12. GTE Service Corporation ("GTE")
13. Nextel Communications, Inc. ("Nextel")
14. Northcoast Communications, LLC ("Northcoast")
15. Noverr Publishing, Inc. ("NPI")
16. Office of Advocacy of the United States Small Business Administration ("Advocacy")
17. Official Committee of Unsecured Creditors of NextWave Telecom Inc. ("OCUC of NextWave")
18. OPM Auction Co. ("OPM")
19. Personal Communications Industry Association ("PCIA")
20. Polycell Communications, Inc. ("Polycell")
21. SBC Communications, Inc. ("SBC")
22. TeleCorp PCS, Inc. ("TeleCorp")
23. Tritel Communications, Inc. ("Tritel")
24. US West Wireless, LLC ("US West")
25. VoiceStream Wireless Corporation ("VoiceStream")

B-2.	Oppositions and Other Pleadings Filed in Response to Public Notice, DA  00-760 (US 
West/Sprint Spectrum Petition)

Oppositions

1. Alaska Digitel, LLC ("Alaska"),  Poplar PCS, LLC ("Poplar"), and Eldorodo 
Communications, LLC ("Eldorado") (comment)
2. Alpine PCS, Inc. ("Alpine") (comment)						
3. American Wireless Licensing Group, LLC ("American Wireless")			
4. AT&T Wireless Services, Inc. (" AT&T") (comment)				
5. Burst Networks, Inc. ("Burst")							
6. Carolina PCS I Limited Partnership ("Carolina")						
7. Cellular Telecommunications Industry Association ("CTIA") (comment)		
8. ComScape Telecommunications, Inc. ("ComScape")				
9. Cook Inlet Region, Inc. ("CIRI")	
10. GTE Service Corporation ("GTE")	
11. Leap Wireless International, Inc. ("Leap")
12. Nextel Communications, Inc. ("Nextel") (comment)
13. NextWave Personal Communications, Inc. and NextWave Power Partners, Inc. 
("NextWave")
14. Northcoast Communications, LLC ("Northcoast")
15. OPM Auction Co. ("OPM")	
16. Personal Communications Industry Association ("PCIA")
17. TeleCorp PCS, Inc. ("TeleCorp") and Tritel Communications, Inc. ("Tritel") 
(comment)	
18. United States Small Business Administration Office of Advocacy 
("Advocacy") (comment)
19. Verizon Wireless ("Verizon") (comment)	
20. VoiceStream Wireless Corporation ("VoiceStream")	

B-3.	Petitions Filed in Response to Public Notice, DA 00-145, 00-191 and 00-271 (SBC 
Communications, Inc. and Nextel Communications, Inc. Petitions) and Public Notice, DA 
00-760 (US West/Sprint Spectrum Petition)

Petitions Filed in Response to Public Notice, DA 00-145, 00-191 and 00-271

1. AT&T Wireless Services, Inc. ("AT&T")                                                                       
(Petition for Waiver and Expedited Action)*
2. Bell Atlantic Mobile, Inc. ("Bell Atlantic")                                                                     
 (Petition for Limited Forbearance)*
3. BellSouth Corporation ("BellSouth")                                                                              
 (Petition for Waiver and Expedited Action)*
4. Cellular Telecommunications Industry Association ("CTIA")                                        
(Petition for Rule Making)
5. GTE Service Corporation ("GTE")                                                                                  
(Petition for Waiver and Declaratory Ruling)*
6. National Telephone Cooperative Association ("NTCA")                                               
(Expedited Request for Extension of Deadline)
7. Office of Advocacy of the United States Small Business Administration 
("Advocacy") (Request for Additional Time to File Comments)
8. Rural Cellular Association ("RCA")                                                                               
 (Request for Extension of Time)
9. Sprint Spectrum L.P. d/b/a Sprint PCS ("Sprint")                                                           
(Petition for Waiver)
10. US West Wireless, LLC  ("US West")                                                                            
(Petition for Waiver)

*   Petition primarily concerns spectrum cap issues.


Petition Filed in Response to Public Notice, DA 00-760

1. Verizon Wireless ("Verizon")                                                                                           
          (Petition for Clarification or Reconsideration)



B-4.	Ex Parte Communications and/or Late Filed Comments in Response to Public Notice, DA 
00-145, 00-191 and 00-271 (SBC Communications, Inc. and Nextel Communications, Inc. 
Petitions) and Public Notice, DA  00-760 (US West/Sprint Spectrum Petition)

1. 3G Network Holdings ("3G Network")
2. AirTouch Communications, Inc. ("AirTouch") 
3. Alpine PCS, Inc. ("Alpine")	
4. American Wireless, LLC ("American Wireless")
5. AT&T Wireless Services, Inc. ("AT&T")
6. Bell Atlantic Mobile, Inc. ("Bell Atlantic")
7. BellSouth Cellular Corp. ("BellSouth")
8. Burst Networks, Inc. ("Burst")
9. Carolina PCS I Limited Partnership ("Carolina")
10. Cook Inlet, Inc. ("CIRI")
11. Dobson Communications Corporation ("DOBSON")
12. GTE Wireless Inc. ("GTE")
13. Integrated Communications Group ("ITG")
14. Leap Wireless International, Inc. ("Leap")
15. Media Access Project ("MAP")
16. Michael Kurtis of Kurtis & Associates on Behalf of Edwards, Helms, Hollings, and Thurmond 
17. Nextel Communications, Inc. ("Nextel")
18. NextWave Telecom, Inc. ("NextWave")
19. Northcoast Communications, LLC ("Northcoast")
20. Paula Ford of the Minority Staff of the Senate Commerce Committee ("Ford")
21. Personal Communications Industry Association ("PCIA")
22. Representative Bart Stupak
23. Representative Bennie G. Thompson 
24. Representative Bob Clement 
25. Representative Bob Riley 
26. Representative Bobby L. Rush 
27. Representative Brian Bilbray 
28. Representative Charles Pickering 
29. Representative Ciro D. Rodriguez 
30. Representative Diane DeGette
31. Representative Jay Dickey 
32. Representative John  J. Duncan  
33. Representative John D. Dingell 
34. Representative John R. Kasich 
35. Representative Major R. Owens 
36. Representative Ron Packard 
37. Representative Ronnie Shows 
38. Representative Tammy Baldwin
39. Representative Tom Udall 
40. Representative W.J. "Billy" Tauzin 
41. Representative William L. Clay 
42. Representative Zach Wamp 
43. Representatives, James E. Clyburn, William J. Jefferson, Stephanie Tubbs Jones, Barbara Lee, 
Juanita Millender-McDonanld, Bobby L. Rush, Edolphus Towns, and Albert Russell Wynn
44. Representatives Randy Cunningham & Duncan L. Hunter 
45. Representatives Rick Boucher, Eliot L. Engel, Ralph M. Hall, Steve Largent, Charles Pickering, 
Ronnie Shows, and Bennie G. Thompson 
46. Roseville PCS, Inc. ("Roseville")
47. Rural Telecommunications Group ("RTG")
48. Senator Barbara A. Mikulski and Paul S. Sarbanes 
49. Senator Barbara Boxer 
50. Senator Carl Levin 
51. Senator Charles S. Robb  
52. Senator Christopher S. Bond 
53. Senator Daniel K. Inouye 
54. Senator Judd Gregg  
55. Senator Trent Lott
56. SBC Communications, Inc. ("SBC")	
57. Sprint Spectrum L.P. d/b/a Sprint PCS ("Sprint")
58. TeleCorp PCS, Inc. ("TeleCorp")
59. Telepak, Inc. (Telepak")
60. Thomas Gutierrez of Lukas, Nace, Gutierrez & Sachs 	
61. TLA Spectrum, LLC ("TLA")
62. Tritel Communications, Inc. ("Tritel")
63. US West Wireless, LLC ("US West")
64. Verizon Wireless ("Verizon")
65. VoiceStream Wireless Corporation ("VoiceStream")	


VII. APPENDIX C - SPECTRUM CAP ISSUES
Comments and Petitions Filed in Response to Public Notice, DA 00-318 
(Petitions of AT&T Wireless Services, Inc., BellSouth Corporation, and Bell Atlantic Mobile, Inc.)

Comments

1. Alaska Digitel, LLC ("Alaska")
2. American Wireless, LLC ("American Wireless")
3. Carolina PCS I Limited Partnership ("Carolina")
4. Cook Inlet Region, Inc. ("CIRI") 
5. CT Communications, Inc. ("CT") 
6. Cellular Telecommunications Industry Association ("CTIA") 
7. Eldorado Communications, LLC ("Eldorado") 
8. Georgetown Partners, LLC ("Georgetown") 
9. GTE Service Corporation ("GTE")
10. Leap Wireless International, Inc. ("Leap")
11. National Telephone Cooperative Association ("NTCA")
12. Nextel Communications ("Nextel")
13. NextWave Personal Communications, Inc. ("NextWave") and NextWave 
Power Partners, Inc. ("NextWave Power")
14. Personal Communications Industry Association ("PCIA") 
15. Poplar PCS, LLC ("Poplar") 
16. Rural Cellular Association ("RCA")
17. Rural Telecommunications Group ("RTG") 
18. SBC Communications, Inc. ("SBC") 
19. SMR Group, L.C. ("SMR") 
20. Sprint Spectrum L.P. d/b/a Sprint PCS ("Sprint") 
21. TeleCorp PCS, Inc. ("TeleCorp") 
22. Tritel Communications, Inc. ("Tritel") 
23. VoiceStream Wireless Corporation ("VoiceStream")

Reply Comments

1. Alaska Digitel, LLC ("Alaska")
2. Alpine PCS, Inc. ("Alpine")
3. American Wireless, LLC ("American Wireless")
4. AT&T Wireless Services, Inc. ("AT&T")
5. Bell Atlantic Mobile, Inc. ("Bell Atlantic")
6. BellSouth Corporation ("BellSouth")
7. CT Communications, Inc. ("CT")
8. Eldorado Communications, LLC ("Eldorado")
9. GTE Service Corporation ("GTE")
10. Leap Wireless International ("Leap")
11. Northcoast Communications, LLP ("Northcoast")
12. Poplar PCS, LLC ("Poplar")
13. TeleCorp PCS, Inc. ("TeleCorp")
14. Tritel Communications, Inc. ("Tritel")
Petitions

1. AT&T Wireless Services, Inc. ("AT&T") 
      (Petition for Waiver)                                                
2. Bell Atlantic Mobile, Inc. ("Bell Atlantic")
      (Petition for Limited Forbearance)  
3. BellSouth Corporation ("BellSouth")
     (Petition for Waiver)
4. GTE Service Corporation ("GTE") 
     (Petition for Waiver and Declaratory Ruling)





















VIII. APPENDIX D - REVISED RULES
PART 24 - PERSONAL COMMUNICATIONS SERVICES

	1.   The authority citation for part 24 continues to read as follows:

Authority: 47 U.S.C. 154, 301, 302, 303, 309 and 332.

2. Amend  24.202 by revising the introductory text to read as follows:
 24.202 Service areas.

Broadband PCS service areas are Major Trading Areas (MTAs) and Basic Trading Areas (BTAs) as 
defined in this section.  MTAs and BTAs are based on the Rand McNally 1992 Commercial Atlas & 
Marketing Guide, 123rd Edition, at pages 38-39 ("BTA/MTA Map").  Rand McNally organizes the 50 
states and the District of Columbia into 47 MTAs and 487 BTAs.  The BTA/MTA Map is available for 
public inspection at the Office of Engineering and Technology's Technical Information Center, 445 12th 
Street, SW, Washington, DC 20554.
* * * * * 
3. Amend  24.203 by revising paragraph (b) to read as follows:
 24.203 Construction requirements.

 * * * * *

(b) Licensees of 10 MHz blocks, including 10 MHz C block licenses reconfigured pursuant to Amendment 
of the Commission's Rules Regarding Installment Payment Financing for Personal Communications 
Services (PCS) Licensees, WT Docket No. 97-82, Sixth Report and Order, FCC 00-313, and 15 MHz 
blocks resulting from the disaggregation option as provided in the Commission's Rules Regarding 
Installment payment Financing for Personal Communications Services (PCS) Licensees, Second Report 
and Order and Further Notice of Proposed Rule Making, WT Docket 97-82, 12 FCC Rcd 16,436 (1997), 
as modified by Order on Reconsideration of the Second Report and Order, WT Docket 97-82, 13 FCC 
Rcd 8345 (1998), must serve with a signal level sufficient to provide adequate service to at least one-
quarter of the population in their licensed area within five years of being licensed, or make a showing of 
substantial service in their licensed area within five years of being licensed.  Population is defined as the 
1990 population census.  Licensees may elect to use the 2000 population census to determine the five-year 
construction requirement.  Failure by any licensee to meet these requirements will result in forfeiture of 
the license and the licensee will be ineligible to regain it.
* * * * *

4. Amend  24.229 by revising paragraph (b) to read as follows:
 24.229 Frequencies.

* * * * *

(b) The following frequency blocks are available for assignment on a BTA basis:

Block C: 1895-1910 MHz paired with 1975-1990 MHz;
Pursuant to Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal 
Communications Services (PCS) Licensees, WT Docket No. 97-82, Sixth Report and Order, FCC 00-313, 
all 30 MHz Block C licenses available for auction in Auction No. 35 or any subsequent auction will be 
reconfigured into three 10 MHz C block licenses as follows:
	    1895-1900 MHz paired with 1975-1980 MHz,
	    1900-1905 MHz paired with 1980-1985 MHz,
	    1905-1910 MHz paired with 1985-1990 MHz;
Block D: 1865-1870 MHz paired with 1945-1950 MHz;
Block E: 1885-1890 MHz paired with 1965-1970 MHz;
Block F: 1890-1895 MHz paired with 1970-1975 MHz;
5. Amend  24.709 by revising paragraphs (a), (a)(1), (a)(3), (b)(9)(i), redesignating paragraph 
(b)(9)(ii) as paragraph (b)(9)(iv), adding new paragraphs (b)(9)(ii), (b)(9)(iii), revising 
paragraph (d)(1), redesignating paragraph (e) as paragraph (g), and adding new paragraphs (e) 
and (f) to read as follows:
 24.709 Eligibility for licenses for frequency Blocks C and F.

(a) General Rule for licenses offered for closed bidding.
(1) No application is acceptable for filing and no license shall be granted to a winning bidder in closed 
bidding for frequency block C or frequency block F, unless the applicant, together with its affiliates and 
persons or entities that hold interests in the applicant and their affiliates, have had gross revenues of less 
than $125 million in each of the last two years and total assets of less than $500 million at the time the 
applicant's short-form application (Form 175) is filed.
* * * * * 
(3) Any licensee awarded a license won in closed bidding pursuant to the eligibility requirements of this 
section (or pursuant to  24.839(a)(2)) shall maintain its eligibility until at least five years from the date of 
initial license grant, except that a licensee's (or other attributable entity's) increased gross revenues or 
increased total assets due to nonattributable equity investments (i.e., from sources whose gross revenues 
and total assets are not considered under paragraph (b) of this section), debt financing, revenue from 
operations or other investments, business development, or expanded service shall not be considered.
(b) * * * 
(9) * * *
(i) In addition to entities qualifying for closed bidding under paragraph (a)(1) of this section, any entity 
that was eligible for and participated in the auction for frequency block C, which began on December 18, 
1995, or the reauction for frequency block C, which began on July 3, 1996, will be eligible to bid for C 
block licenses offered in closed bidding in any reauction of frequency block C spectrum that begins within 
two years of March 23, 1999.
(ii) In cases of merger, acquisition, or other business combination of entities, where each of the entities is 
eligible to bid for C block licenses offered in closed bidding in any reauction of C block spectrum on the 
basis of the eligibility exception set forth in paragraph (b)(9)(i) of this section, the resulting entity will 
also be eligible for the exception specified in paragraph (b)(9)(i).  
(iii) In cases of merger, acquisition, or other business combination of entities, where one or more of the 
entities are ineligible for the exception set forth in paragraph (b)(9)(i) of this section, the resulting entity 
will not be eligible pursuant to paragraph (b)(9)(i) unless an eligible entity possesses de jure and de facto 
control over the resulting entity.  
* * * * *
(d) * * *
(1) Applicants and licensees claiming eligibility for closed bidding under this section or for other 
provisions under  24.711 through 24.720 shall be subject to audits by the Commission, using in- house 
and contract resources.  Selection for audit may be random, on information, or on the basis of other 
factors.
* * * * * 
(e) Tiers. 
(1) For purposes of determining spectrum to which the eligibility requirements of this section are 
applicable, the BTA service areas (see  24.202(b)) are divided into two tiers according to their population 
as follows:
	Tier 1: BTA service areas with population equal to or greater than 2.5 million; 
	Tier 2: BTA service areas with population less than 2.5 million.
(2) For Auction No. 35, the population of individual BTA service areas will be based on the 1990 census.  
For auctions beginning after the start of Auction No. 35, the population of individual BTA service areas 
will be based on the most recent available decennial census.
(f) Application of eligibility requirements.
(1) The following categories of licenses will be subject to closed bidding pursuant to the eligibility 
requirements of this section in auctions that begin after the effective date of this paragraph.
For Tier 1 BTAs, one of the 10 MHz C block licenses (1895 - 1900 MHz paired with 1975 - 1980 
MHz);
For Tier 2 BTAs, two of the 10 MHz C block licenses (1895 - 1900 MHz paired with 1975 - 1980 
MHz; 1900 - 1905 MHz paired with 1980-1985 MHz) and all 15 MHz C block licenses.
(2) Notwithstanding the provisions of paragraph (f)(1) of this section, any C block license for operation on 
spectrum that has been offered, but not won by a bidder, in closed bidding in any auction beginning on or 
after March 23, 1999, will not be subject in a subsequent auction to closed bidding pursuant to the 
eligibility requirements of this section.
* * * * *
 24.710 [Removed and Reserved]
6. Remove and reserve  24.710.
7. Revise  24.712 to read as follows:
 24.712 Bidding credits for licenses for frequency Block C.

(a) Except with respect to licenses won in closed bidding in auctions that begin after March 23, 1999, a 
winning bidder that qualifies as a small business or a consortium of small businesses as defined in 
 24.720(b)(1) or  24.720(b)(4) may use a bidding credit of fifteen percent, as specified in 
 1.2110(e)(2)(iii) of this chapter, to lower the cost of its winning bid.
(b) Except with respect to licenses won in closed bidding in auctions that begin after March 23, 1999, a 
winning bidder that qualifies as a very small business or a consortium of very small businesses as defined 
in  24.720(b)(2) or  24.720(b)(5) may use a bidding credit of twenty-five percent as specified in  
1.2110(e)(2)(ii) of this chapter, to lower the cost of its winning bid.
(c) Unjust enrichment.  See  1.2111 of this chapter.  The unjust enrichment provisions of  1.2111(d) and 
(e)(2) shall not apply with respect to licenses acquired in either the auction for frequency block C that 
began on December 18, 1995, or the reauction of block C spectrum that began on July 3, 1996.
8. Amend  24.714 by revising paragraphs (a)(2) and (a)(3) to read as follows:
 24.714 Partitioned licenses and disaggregated spectrum.
(a) * * *
(2) Broadband PCS licensees in spectrum blocks A, B, D, and E and broadband PCS C and F block 
licenses not subject to the eligibility requirements of  24.709 may apply to partition their licensed 
geographic service area or disaggregate their licensed spectrum at any time following the grant of their 
licenses.
(3) Broadband PCS licensees that acquired C or F block licenses in closed bidding subject to the 
eligibility requirements of  24.709 may partition their licensed geographic service area or disaggregate 
their licensed spectrum at any time to an entity that meets the eligibility criteria set forth in  24.709 at the 
time the request for partial assignment of license is filed or to an entity that holds license(s) for frequency 
blocks C and F that met the eligibility criteria set forth in  24.709 at the time of receipt of such license(s). 
 Partial assignment applications seeking partitioning or disaggregation of broadband PCS licenses in 
spectrum blocks C and F must include an attachment demonstrating compliance with this section.
* * * * *
9. Amend  24.717 by revising paragraphs (a) and (b) to read as follows:
 24.717 Bidding credits for licenses for frequency Block F.

(a) Except with respect to licenses won in closed bidding in auctions that begin after March 23, 1999, a 
winning bidder that qualifies as a small business or a consortium of small businesses as defined in 
 24.720(b)(1) or  24.720(b)(4) may use a bidding credit of fifteen percent, as specified in 
 1.2110(e)(2)(iii) of this chapter, to lower the cost of its winning bid.
(b) Except with respect to licenses won in closed bidding in auctions that begin after March 23, 1999, a 
winning bidder that qualifies as a very small business or a consortium of very small businesses as defined 
in  24.720(b)(2) or  24.720(b)(5) may use a bidding credit of twenty-five percent as specified in  
1.2110(e)(2)(ii) of this chapter, to lower the cost of its winning bid.

* * * * *
10. Amend  24.720 by revising paragraph (i) to read as follows.  
 24.720 Definitions.

* * * * * 
(i) Members of Minority Groups.  Members of minority groups include individuals of African American, 
Hispanic-surnamed, American Eskimo, Aleut, American Indian, and Asian American extraction.
* * * * * 
11. Amend  24.839 by revising paragraphs (a) introductory text, (a)(2), (a)(3) and (a)(5) and by 
adding paragraph (a)(6) to read as follows:
 24.839 Transfer of control or assignment of license.

(a) Restrictions on Assignments and Transfers of Licenses for Frequency Blocks C and F won in closed 
bidding.  No assignment or transfer of control of a license for frequency Block C or frequency Block F 
won in closed bidding pursuant to the eligibility requirements of  24.709 will be granted unless:
 * * * * *
	(2) The proposed assignee or transferee meets the eligibility criteria set forth in  24.709 of this 
part at the time the application for assignment or transfer of control is filed, or the proposed assignee or 
transferee holds other license(s) for frequency blocks C and F and, at the time of receipt of such license(s), 
met the eligibility criteria set forth in  24.709 of this part; or
	(3) The application is for partial assignment of a partitioned service area to a rural telephone 
company pursuant to  24.714 of this part and the proposed assignee meets the eligibility criteria set forth 
in  24.709 of this part; or
* * * * *
	(5) The assignment or transfer of control is pro forma; or

	(6) The application for assignment or transfer of control is filed on or after the date the licensee 
has notified the Commission pursuant to  24.203(c) that its five-year construction requirement has been 
satisfied.   
 * * * * *  


IX. APPENDIX E - FINAL REGULATORY FLEXIBILITY ANALYSIS 
As required by the Regulatory Flexibility Act ("RFA"),  an Initial Regulatory Flexibility 
Analysis ("IRFA") was incorporated into the Further Notice of Proposed Rule Making in WT Docket 97-
82 ("Further Notice").   The Commission sought written public comment on the tentative conclusions, 
proposals, and alternatives in the Further Notice, including comment on the IRFA.  This Final 
Regulatory Flexibility Analysis ("FRFA") conforms to the RFA. 

A.	Need for, and objectives of, the C/F Block Sixth Report and Order in WT Docket No. 97-82:
This Sixth Report and Order and Order on Reconsideration ("C/F Block Sixth Report and 
Order") addresses the tentative conclusions and proposals in our recent Further Notice and also resolves 
the petitions that precipitated the Further Notice.   The modifications to the Commission's rules that we 
adopt in this order will apply to Auction No. 35, a C and F block auction currently scheduled to begin on 
November 29, 2000.  The modifications will also apply to any subsequent auctions of C or F block 
licenses, including any spectrum made available or reclaimed from bankruptcy proceedings in the future. 

We conclude that it is in the public interest to modify our auction and service rules for C and F 
block broadband Personal Communications Services ("PCS") licenses to achieve the various goals of 
Section 309(j) of the Communications Act.  In reaching this conclusion, we recognize that many carriers, 
including small and very small businesses, need additional spectrum to "fill out" their service areas or to 
satisfy capacity needs.  Although our modifications to the rules include the elimination of entrepreneur 
eligibility requirements (allowing open bidding) for some C and F block licenses, our revised rules 
provide entrepreneurs with a significant set-aside of C block spectrum (for closed bidding) in order to 
assist them in achieving their business goals.  Section 309(j) does not mandate the use of set-asides to 
promote the participation of small businesses in spectrum auctions.  In fact, we note that there have been 
numerous auctions in recent years in which we have not included an entrepreneurs' block set-aside.  By 
maintaining a significant set aside for entrepreneurs, small and very small businesses will be given the 
opportunity to participate in the provision of spectrum-based services.  Additionally, in open auctions, 
small and very small businesses will continue to be provided with bidding credits in order to ensure 
meaningful participation.  This C/F Block Sixth Report and Order reflects the Commission's continuing 
commitment to encouraging participation by small businesses while at the same time helping to ensure 
the best use of spectrum through the competitive bidding process. 

B.	Summary of significant issues raised by public comments in response to the IRFA:
	There were no comments filed directly in response to the IRFA.  However, a number of parties 
did submit general comments on the Commission's tentative conclusions and proposals set forth in the 
Further Notice.  The significant issues raised by small and very small businesses primarily concerned the 
removal of the entrepreneur eligibility restrictions for some licenses available in future C and F block 
auctions and the use of bidding credits.  For example, some commenters opposed the Commission's 
proposal to reconfigure the available 30 MHz C block license into three 10 MHz C block licenses, 
arguing that such a proposal is contrary to statutory requirements, because it will reduce small business 
opportunity in the marketplace.   Many of the commenters that opposed the reconfiguration, contended 
that 10 MHz of C block spectrum is insufficient to provide a full range of third generation ("3G") 
services.  In addition, a number of commenters opposed any relaxation of the Commission's entrepreneur 
eligibility restrictions.  Some commenters argued that Section 309(j) compels the Commission to 
maintain the C and F block set-aside as is.  In addition, small and very small businesses supported an 
increase in bidding credits in open bidding.  

On the other hand, a number of larger entities, including most of the major national carriers, 
favored the elimination of eligibility restrictions from more, or all, of the available C and F block 
licenses.  Many carriers claimed that obtaining additional spectrum to provide advanced 
telecommunications services and global competition within these services, or to satisfy capacity needs, 
was crucial to their business plans.   In addition, these carriers stated that they require additional 
spectrum to complete regional or national service areas.   As required by the RFA, and in light of the 
numerous comments received, the Commission considered the economic impact on small businesses of 
the rules adopted herein.    See section E, infra.

C.	Description and estimate of the number of small entities to which the rules apply:
	The RFA directs agencies to provide a description of and, where feasible, an estimate of the 
number of small entities that will be affected by the proposed rules, if adopted.  Generally, the RFA 
defines the term "small entity" as having the same meaning as the terms "small business," "small 
organization," and "small governmental jurisdiction."   The term "small business" has the same meaning 
as the term "small business concern" under the Small Business Act, unless the Commission has 
developed one or more definitions that are appropriate for its activities.  Under the Small Business Act, 
a "small business concern" is one which:  (1) is independently owned and operated; (2) is not dominant 
in its field of operation; and (3) meets any additional criteria established by the Small Business 
Administration ("SBA"). A small organization is generally "any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field."   Nationwide, as of 1992, there were 
approximately 275,801 small organizations."  "  Small governmental jurisdiction" generally means 
"governments of cities, counties, towns, townships, villages, school districts, or special districts, with a 
population of less than 50,000."  As of 1992, there were approximately 85,006 local governments in the 
United States.   This number includes 38,978 counties, cities, and towns; of these, 37,566, or 96 percent, 
have populations of fewer than 50,000.   The Census Bureau estimates that this ratio is approximately 
accurate for all governmental entities.  Thus, of the 85,006 governmental entities, we estimate that 
81,600 (91 percent) are small entities.  According to SBA reporting data, there were 4.44 million small 
business firms nationwide in 1992. 

The rule changes effected by this C/F Block Sixth Report and Order affect all small entities that 
choose to participate in the upcoming auction of C and F block spectrum and other future auctions of C 
and F block spectrum, including small businesses currently holding C and F block licenses, and other 
small businesses that may participate in, and/or acquire licenses through, the auction.  The broadband 
PCS spectrum is divided into six frequency blocks designated A through F, and the Commission has 
auctioned licenses in each block.  Frequency blocks C and F were originally designated by the 
Commission as "entrepreneurs' blocks," and participation in past auctions of C and F block licenses was 
limited to entities qualifying under the Commission's rules as entrepreneurs.  The Commission's rules 
define an entrepreneur as an entity (together with its affiliates and persons or entities that hold interests 
in the applicant and their affiliates) that had gross revenues of less than $125 million in each of the last 
two years and total assets of less than $500 million at the time the FCC Form 175 application was filed.  
For blocks C and F, the Commission has defined "small business" as a firm, together with its affiliates, 
that had average gross revenues of not more than $40 million in the three previous calendar years,  and 
"very small business" has been defined as an entity that, together with its affiliates, has average gross 
revenues of not more than $15 million for the preceding three calendar years.   These definitions have 
been approved by the SBA.   

On May 6, 1996, the Commission concluded the first broadband PCS C block auction.   On July 
16, 1996, the second C block auction closed.   On January 14, 1997, the broadband PCS D, E, and F 
block auction closed.   Ninety (90) bidders (prior to any defaults by winning bidders) won 493 C block 
licenses and 88 bidders won 491 F block licenses.  Small businesses placing high bids in these C and F 
block auctions were eligible for bidding credits and installment payment plans.  On April 15, 1999, 
Auction No. 22, which included 347 C and F block licenses, closed.  

On January 12, 2000, the Wireless Telecommunications Bureau ("Bureau") announced an auction 
of broadband PCS C and F block licenses scheduled for July 26, 2000 (Auction No. 35).  At that time, 
under the Commission's eligibility rules, in order to participate in an entrepreneur auction, a C or F block 
applicant (together with its affiliates and persons or entities that hold interests in the applicant and their 
affiliates) must have had gross revenues of less than $125 million in each of the last two years and must 
have total assets of less than $500 million.  Following the announcement of Auction No. 35, the 
Commission received several formal requests to waive, modify, or eliminate the C and F block auction 
and service rules in order to allow companies other than entrepreneurs to participate in the upcoming 
PCS auction.   The Commission addressed the issues raised in the various petitions, comments, and 
other documents filed in this proceeding in a Further Notice of Proposed Rulemaking ("Further Notice"), 
released on June 7, 2000, in which we set forth tentative conclusions and proposals to retain, clarify, and 
modify our rules related to the C and F block auctions and service.  In addition, on June 7, 2000, the 
Bureau announced that Auction No. 35 would begin on November 29, 2000, in order to allow resolution 
of the issues in the Further Notice and implementation of any rule changes prior to the auction.     In this 
C/F Block Sixth Report and Order, we resolve the issues raised in the Further Notice and in the petitions 
and other filings in this proceeding by retaining, clarifying, and modifying our rules governing C and F 
block auctions and licenses.  

Auction No. 35 is slated to include C block licenses as well as F block licenses for operation on 
frequencies for which previous licenses had automatically cancelled or had been returned to the 
Commission.  For purposes of our evaluations and conclusions in this IRFA, we assume that all of the 
original 90 C block broadband PCS licensees and 88 F block broadband PCS licensees, a total of 178 
licensees potentially affected by this C/F Block Sixth Report and Order are small entities.  In addition to 
the 178 original small business licensees that may participate in the auction of the C block licenses, a 
number of additional small business entities may seek to acquire licenses through auction; thus, these 
business entities would be affected by these rules.

D.	Description of reporting, recordkeeping, and other compliance requirements:

This C/F Block Sixth Report and Order does not impose new reporting, recordkeeping, or other 
compliance requirements upon auction participants.  As customary, auction participants will need to 
follow the standard procedural rules used for broadband PCS spectrum auctions, including application 
and payment rules. 

E.	Steps taken to minimize significant economic impact on small entities, and significant 
alternatives considered:

The RFA requires an agency to describe any significant alternatives that it has considered in 
reaching its proposed approach, which may include the following four alternatives (among others): (1) 
the establishment of differing compliance or reporting requirements or timetables that take into account 
the resources available to small entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather 
than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small 
entities.  5 U.S.C.  603.

The Commission concludes that it is in the public interest to modify our auction and service rules 
for C and F block broadband Personal Communications Services (PCS) licenses to achieve the various 
goals of Section 309(j) of the Communications Act.  Specifically, in this C/F Block Sixth Report and 
Order we retain, clarify, and revise our rules, as follows:

 Reconfiguration of C Block License Size: The Commission will reconfigure each 30 MHz C block 
license available in future broadband PCS auctions into three 10 MHz C block licenses.  By increasing 
the number of available licenses through this reconfiguration, rather than retaining the larger spectrum 
blocks (with fewer licenses), taken together with lifting certain of our eligibility requirements, providing 
set-asides, and providing small and very small business bidding credits to small entities for licenses 
offered in open bidding, the Commission will promote wider auction participation and license 
distribution in accordance with the goals of Section 309(j) of the Communications Act.   Under this 
alternative, small bidders be able to fulfill their business needs, while large bidders should enjoy greater 
flexibility in tailoring their bidding to their business plans without running afoul of the spectrum cap.

Utilization of a Tiered Approach: The Commission will remove the entrepreneur eligibility 
restrictions for some, but not all, licenses available in future C and F block auctions.  Based on the 
demand for spectrum to satisfy congestion, new technology and competitive needs, the Commission has 
considered the alternatives and determined that it would serve the public interest to make some additional 
spectrum available to all interested bidders, not just entrepreneurs.  The Commission will divide Basic 
Trading Areas ("BTAs")  into two tiers according to population size of the BTA.  "Tier 1" would 
comprise BTAs at and above a 2.5 million population threshold; "Tier 2" would comprise BTAs below 
that population threshold.  The Commission believes that by dividing BTAs into two tiers, according to 
population, the Commission has greater flexibility to eliminate the entrepreneur eligibility restrictions in 
some of the largest markets while retaining the restrictions in many mid-sized and smaller markets, where 
smaller entities have proven more successful.

Eligibility Restrictions Under a Tiered Approach: For markets with available 30 MHz licenses, 
other than licenses that were available but unsold in Auction No. 22, the Commission will allow open 
bidding for two of the three newly reconfigured 10 MHz C block licenses in Tier 1 and for one of the 
three newly reconfigured 10 MHz C block licenses in Tier 2.  Specifically, in Tier 1, the Commission 
will allow open bidding for two 10 MHz blocks, 1900 - 1905 MHz paired with 1980 - 1985 MHz and 
1905 MHz - 1910 MHz paired with 1985 - 1990 MHz.  In Tier 2, the Commission will allow open 
bidding for one 10 MHz block, 1905 MHz - 1910 MHz paired with 1985 - 1990 MHz.  The Commission 
believes this approach will split the C block spectrum available in Auction No. 35 almost equally, when 
weighted by population, between open and closed licenses.  Moreover, in light of the alternatives, this 
approach, in conjunction with the other revisions to the entrepreneur eligibility restrictions, will make 
relatively more spectrum available for open bidding in the most populous markets where the demand for 
spectrum by the large Commercial Mobile Radio Service ("CMRS") carriers is the greatest and the 
prospects of a spectrum shortage for these carriers is the most acute.  For available 15 MHz C block 
licenses, other than licenses that were available but unsold in Auction No. 22, the Commission will 
eliminate entrepreneur eligibility restrictions in Tier 1 but retain the restrictions in Tier 2.  The 
Commission believes that in this way we give effect to as many of the Section 309(j) objectives as 
possible.  Balancing all of our statutory objectives and considering alternative possibilities, we believe 
that it is fair and appropriate to apportion the spectrum to accommodate the interests of many carriers 
that need additional spectrum to "fill out" their service areas or to satisfy capacity needs.  Apportioning 
the 30 MHz C block licenses in the manner described will enable larger carriers to obtain spectrum 
crucial to their business plans.  At the same time, maintaining a significant set aside of C block spectrum 
for entrepreneurs will help smaller businesses in this band continue to achieve their business goals as 
well as providing meaningful opportunities for new entrepreneurial firms to enter the market.
	In addition, the Commission will allow open bidding for all F block licenses available in Auction 
No. 35 and in all future auctions.  The Commission believes that it is in the public interest and consistent 
with Section 309(j), to remove the set-aside for all available F block licenses.  The F block has evolved in 
a fashion largely distinct from that of the C block; thus, the two blocks have been subject to increasingly 
different regulatory requirements, reflecting the separate equity and reliance concerns applicable to each 
of the blocks.  Therefore, there is no longer a rationale for attempting to treat the two blocks in an 
identical or a substantially similar fashion.
Lastly, the Commission will establish open bidding for all broadband PCS C and F block licenses 
available but unsold in Auction No. 35 or in any other future auction and for all C block licenses, 15 
MHz or 30 MHz (reconfigured into 10 MHz), that were available but not sold in Auction No. 22.  
Bidding to date has failed to result in construction of these licenses and service to the public.  By lifting 
the eligibility restrictions for these unsold licenses now, the Commission hopes to prevent additional 
delays in their utilization.
	Entrepreneur Eligibility: The Commission will not apply the natural growth exception, which 
allows C and F block licensees to retain their entrepreneur eligibility during the five-year holding period, 
to determinations of entrepreneur eligibility for Auction No. 35.  Although the Commission intended to 
ignore natural growth for purposes of entrepreneur eligibility during the five-year holding period, it did 
not intend to ignore such growth in determining eligibility to participate in future C and F block auctions. 
 In addition, the Commission does not see a need to modify Section 24.720 which states that an 
entrepreneurs' block applicant must substantiate its gross revenues and total assets with its most recent 
audited financial statements, or, if the applicant does not otherwise use audited financial statements, a 
certification by the applicant's chief financial officer or its equivalent.  However, the Commission 
expects applicants to obtain audited financial statements within a reasonable period of time after the 
close of the applicable calendar or fiscal year and to base its claim to eligibility on those financial 
statements.
License Grouping for Bids and Competitive Design: The Commission will not license by bulk 
bidding.  As stated in the Further Notice, the Commission is concerned that small entities may be hard 
pressed to obtain the financing necessary to win and pay for licenses and construct systems included in 
the bulk bid proposal, while many other carriers may be constrained from participating by the CMRS 
spectrum cap.  Some of the parties that commented on ways to aggregate licenses in the auction process, 
argued against the use of package bidding for Auction No. 35, on the ground that such a design would be 
complex and impractical.  Other commenters support implementation of package bidding as a way to 
enhance the ability of auction participants to acquire their targeted groups of licenses while reducing 
their exposure.  The Bureau has discretion, under its existing delegated authority and pursuant to public 
notice and comment, to determine the competitive bidding design most appropriate for the auction. 
"Grandfather" Exception: The Commission will not eliminate the "grandfather" exception 
contained in Section 24.709(b)(9)(i).  Instead, the Commission will clarify an applicant's eligibility for 
the "grandfather" exception after it has been involved in a merger, acquisition, or other business 
combination, as follows.  When each of the merging entities is individually eligible for the "grandfather" 
exception, the exception will extend to the resulting entity.  When one or more of the entities is not 
individually eligible for the "grandfather" exception, the resulting entity will be eligible for the exception 
only so long as an originally eligible entity retains de facto and de jure control of the resulting entity.  
The Commission does not believe that, when entities eligible for the "grandfather" exception combine, 
the resulting entity should be penalized.  This revision to the Commission's rules will provide spectrum 
opportunities for entrepreneurs while at the same time maintaining a fair implementation of the auctions 
program.  
	Bidding Credits: The Commission will maintain the current level of bidding credits for small and 
very small businesses, and consortia thereof, of 15 percent and 25 percent, respectively, for licenses 
subject to "open" biding.  After considering the alternatives, the Commission believes that bidding 
credits of 15 and 25 percent will allow effective competition by small businesses in open C and F block 
bidding.  In our Specialized Mobile Radio (SMR) 900 MHz auction - using bidding credits of 10 percent 
and 15 percent - 75 percent of the winning bidders were small businesses, winning 26 percent of the 
licenses.  Moreover, in Auction No. 11, the auction of D, E, and F block licenses, small and very small 
business were the high bidders for 141 of the 986 D and E block licenses won in that auction, even 
though bidding credits are not available for D and E block licenses.  The current level of bidding credits 
for broadband PCS C and F blocks seems to allow significant participation of small and very small 
entities; therefore, we do not see a need to increase the current level of bidding credits.
For licenses subject to "closed" bidding, the Commission will eliminate all bidding credits.  After 
considering the alternatives, the Commission believes that the continued use of bidding credits in 
restricted auctions would not necessarily serve its intended purpose.  As explained in the Further Notice, 
some well-capitalized new entities with small gross revenues qualify for bidding credits, while some 
older companies with small total assets and net revenues but high gross revenues do not.  Eliminating 
bidding credits in a closed auction will remove this anomaly while at the same time continuing to provide 
small and very small businesses with a meaningful opportunity to compete in Auction No. 35.
Transfer Requirements for Certain Licenses: The Commission will modify its transfer 
requirements to correspond to the Commission's changes in the eligibility requirements, and to 
encourage rapid construction of C and F block systems.  Specifically, C and F block licenses won 
pursuant to "open" bidding at Auction No. 35, or any future open auction for such spectrum, will not be 
subject to a holding rule.  For C and F block licenses won pursuant to "closed" bidding, the Commission 
will permit a licensee to assign or transfer its licenses to any qualified entity, entrepreneur or not, upon 
the licensee's completion of its first construction benchmark, whether or not it takes the full five years 
allowed by our rules.  This will encourage rapid build-out and service to the public while at the same 
time providing C and F block licensees with the ability to access capital; thus, resulting in a more 
efficient use of spectrum.  The Commission will continue to evaluate satisfaction of construction 
requirements on a license-by-license, rather than on a system-wide, basis.
Additionally, a licensee that won a license in Auction No. 5 or 10 will not be subject to a bidding 
credit unjust enrichment payment upon transfer and assignment of the license to an entity not qualifying 
as a small business, subject to the Commission's transfer requirements.  Because all license winners in 
those auctions qualified for the available 25 percent bidding credit, there is no purpose in requiring the 
payment.  However, licenses won in other auctions using a bidding credit will be subject to a bidding 
credit unjust enrichment payment upon transfer or assignment in accordance with the Commission's 
transfer requirements.  
License Cap: The Commission will remove Section 24.710, which prohibits an auction applicant 
from winning more than 98 C and F block licenses, from the Commission's rules.  When this rule was 
established, the license cap was intended to facilitate a fair distribution of licenses within the C and F 
blocks.  The Commission has achieved this objective; moreover, the reconfiguration of the available 30 
MHz C block licenses will create additional C block licenses, while the elimination of the eligibility 
restrictions will increase the chances of C and F block licenses being won by a variety of entities. 
Spectrum Cap: The Commission will continue to apply the CMRS spectrum cap to PCS C and F 
block licenses to be auctioned.  In September 1999, the Commission decided that the spectrum cap, with 
some modification, continued to promote competition, efficient spectrum use, innovation, and a wide 
dissemination of licenses.  The Commission believes that implementation of the C and F block auction 
and service rule changes will ease the impact of the spectrum cap for Auction No. 35, making the 
alternative of spectrum cap relief unnecessary with respect to licenses in this auction.     Moreover, the 
Commission will soon begin its year 2000 biennial review of the spectrum cap rules, providing another 
opportunity for a comprehensive review of related issues.  
Section 309(j) of the Communications Act directs the Commission to disseminate licenses among a 
wide variety of applicants, including small businesses and other designated entities.   Section 309(j) also 
requires that the Commission ensures the development and rapid deployment of new technologies, 
products, and services for the benefit of the public, and recover for the public a portion of the value of 
the public spectrum resource made available for commercial use.   The Commission believes that these 
revisions to the C and F block auction and service rules as set forth in the C/F Block Sixth Report and 
Order promote these goals while maintaining the fair and efficient execution of the auctions program. 

Report to Congress: The Commission will send a copy of the C/F Block Sixth Report and Order, 
including this FRFA, in report to be sent to Congress pursuant to the SBREFA, see 5 U.S.C. 
 801(a)(1)(A).  In addition, the Commission will send a copy of the C/F Block Sixth Report and Order, 
including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration.  A copy 
of the C/F Block Sixth Report and Order and FRFA (or summaries thereof) will also be published in the 
Federal Register.  See 5 U.S.C.  604(b).


 	See Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal 
Communications Services (PCS) Licensees, WT Docket No, 97-82, Further Notice of Proposed Rulemaking, 15 
FCC Rcd 9773 (2000) ("Further Notice").  The Commission received 38 comments, 27 reply comments, 28 ex 
partes, and one motion in response to the Further Notice.  Appendices A-C contain a list of full and abbreviated 
names of commenting parties.  
  	See Further Notice, 15 FCC Rcd at 9774-76,  1, 3.
  	Section 309(j) of the Communications Act of 1934, as amended ("Communications Act"), 47 U.S.C.  
309(j).
  	In addition, for auctions subsequent to Auction No. 35, we remove the entrepreneur eligibility restrictions 
for all C and F block licenses available but unsold in Auction No. 35 or in any future auction.  See infra  29-31.
 	Pub. L. No. 103-66, Title VI,  6002(b), 107 Stat. 312 (1993) (Omnibus Budget Reconciliation Act of 
1993 ("OBRA-1993")). 
  	Section 309(j) of the Communications Act of 1934, as amended ("Communications Act"), 47 U.S.C. 
 309(j).  The Balanced Budget Act of 1997 revised the auction authority granted in OBRA-1993.
  	We note that Section 309(j)(7) of the Communications Act limits the Commission's consideration of 
auction revenues in making public interest determinations about spectrum allocations.  47 U.S.C.  309(j)(7).
  	47 U.S.C.  309(j)(4).
  	The Commission required that in order to be eligible to bid, an applicant, including attributable investors 
and affiliates, must have had gross revenues of less than $125 million in each of the last two years and must have 
less than $500 million in total assets.  See Implementation of Section 309(j) of the Communications Act - 
Competitive Bidding, PP Docket 93-253, Fifth Report and Order, 9 FCC Rcd 5532, 5581-82,  115 (1994) 
("Competitive Bidding Fifth Report and Order").  Originally, there was a personal net worth test, but this test was 
eliminated.  See Implementation of Section 309(j) of the Communications Act - Competitive Bidding, PP Docket 
93-253, Fifth Memorandum Opinion and Order, 10 FCC Rcd 403, 420-21  28-30 (1994) ("Competitive Bidding 
Fifth Memorandum Opinion and Order").
  	E block licenses were also included in Auction No. 22.
  	Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal 
Communications Services (PCS) Licenses, WT Docket No. 97-82, Second Report and Order and Further Notice of 
Proposed Rule Making, 12 FCC Rcd 16,436 (1997) ("C Block Second Report and Order").
  	Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal 
Communications Services (PCS) Licenses, WT Docket No. 97-82, Order on Reconsideration of the Second Report 
and Order, 13 FCC Rcd 8345 (1998) ("C Block Reconsideration Order").
  	Every participant in Auction No. 10 had participated in Auction No. 5.
  	See Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal 
Communications Services (PCS) Licenses, WT Docket No. 97-82, Fourth Report and Order, 13 FCC Rcd 15,743, 
15,749,  10, 15,751,  13, 15,752,  15 (1998) ("C Block Fourth Report and Order"); C Block Second Report and 
Order, 12 FCC Rcd 16,436, 16,448,  22.  See also Amendment of the Commission's Rules Regarding Installment 
Payment Financing for Personal Communications Services (PCS) Licenses, WT Docket No. 97-82, Order on 
Reconsideration of the Fourth Report and Order, 15 FCC Rcd 4740, 4742-43,  6-8 (2000) ("C Block Fourth 
Report and Order Reconsideration").
  	The proceedings of NextWave are jointly administered with those of NextWave Power Partners Inc., 
NextWave Partners Inc., NextWave Wireless Inc., and NextWave Telecom Inc.  The proceedings of GWI are 
jointly administered with those of General Wireless, Inc.; GWI PCS California/Florida, Inc.; GWI PCS Georgia, 
Inc.; and GWI PCS Chico, Inc. (now known as Metro PCS, Inc.; Metro PCS Wireless, Inc.; Metro PCS 
California/Florida, Inc.; Metro PCS Georgia, Inc.; and Metro PCS Chico, Inc.).  The DCR proceedings are jointly 
administered with those of DCR's parent company, Pocket Communications, Inc.
  	This population figure is based upon the 1990 census.
  	"Auction of C and F Block Broadband PCS Licenses, Notice of Auction Scheduled for July 26, 2000," 
Public Notice, 15 FCC Rcd 693 (2000).
  	See 47 C.F.R.  1.2110(f)(4)(iii)-(iv).  See also NextWave Personal Communications, Inc. v. FCC, 200 
F.3d 43 (2nd Cir. 1999), aff'd, No. 99-5063 (2nd Cir.  May 25, 2000).
  	See "C and F Block Broadband PCS Spectrum Auction Scheduled for July 26, 2000," Public Notice, 15 
FCC Rcd 4702, 4713-15, Att.  A (2000).
  	See Further Notice, 15 FCC Rcd at 9781 n.32.
  	See id., 15 FCC Rcd at 9781 n.33.
  	See id., 15 FCC Rcd at 9781 n.34.  In the public notice announcing the filing of the US West/Sprint 
Petition as part of WT Docket No. 97-82, we stated that we were incorporating into WT Docket No. 97-82 the 
comments and other documents filed in response to the Nextel Petition and the SBC Petition regarding C and F 
block rules.  "Wireless Telecommunications Bureau Sets Comment Schedule for Petitions for Reconsideration of 
the on Reconsideration of the Fourth Report and Order in WT Docket No. 97-82," Public Notice, 15 FCC Rcd 
6079, 6080 (2000).  We clarify that we also incorporate into the docket the Nextel Petition, the SBC Petition, and 
similar petitions that prompted the comments and other responsive filings.
  	Verizon Petition.
  	See Further Notice, 15 FCC Rcd at 9782 n.37.

  	See Further Notice, 15 FCC Rcd at 9782 n.38.

  	See AT&T Wireless Services, Inc., Petition for Waiver and Expedited Action (February 15, 2000) 
("AT&T Waiver Petition"); BellSouth Corporation, Petition for Waiver and Expedited Action (February 17, 2000) 
("BellSouth Waiver Petition"); Bell Atlantic Mobile, Inc., Petition for Limited Forbearance (February 17, 2000) 
("Bell Atlantic Forbearance Petition"); and, GTE Service Corporation, Petition for Declaratory Ruling and/or 
Waiver (March 8, 2000) ("GTE Declaratory Ruling Petition").  See also Further Notice, 15 FCC Rcd at 9782 
nn.39-40.
  	"Auction of Licenses for C and F Block Broadband PCS Spectrum Postponed Until November 29, 2000," 
Public Notice, 15 FCC Rcd 9771 (2000).
  	See Further Notice, 15 FCC Rcd at 9784,  16.
  	See 47 U.S.C.  309(j)(3)(B); Further Notice, 15 FCC Rcd at 9784,  16.
  	See Further Notice, 15 FCC Rcd at 9784,  16.
  	Id.
  	See id.  The CMRS spectrum cap is set forth at 47 C.F.R.  20.6.  The rule provides that for broadband 
PCS, cellular, or Specialized Mobile Radio services, a licensee is not permitted to hold more than 45 MHz of 
spectrum in a given market, except in rural areas where the cap is set at 55 MHz.
  	We will not reconfigure available 15 MHz C block licenses.
  	See Further Notice, 15 FCC Rcd at 9783-84,  15.
  	See Advanced Comments at 4-5 (supports only if entrepreneur eligibility restrictions are  maintained for all 
C and F block licenses); AirGate Comments at i, 1-2, 4 (supports provided that the Commission's entrepreneur 
eligibility proposals in the Further Notice are adopted); AirGate Reply at 1; ALLTEL Reply at 1-2; America 
Connect Comments at 3; AT&T Comments at 1, 10; AT&T Reply at 2-3; BellSouth Comments at ii, 2, 5; BellSouth 
Reply at 3; CTIA Comments at 2-3; CIRI Comments at 7-8; RK Communications Comments at 1-2; Sprint Reply at 
4-6; US West Comments at 3-4; US West Reply at 1, 4; Verizon Comments at 4-5; VoiceStream Comments at 3-4; 
VoiceStream Reply at 2.  See also Northcoast Comments at 4-5 (prefers no reconfiguration; however, the proposed 
reconfiguration is acceptable provided that 20 MHz remains set aside in each market).
  	See, e.g., ALLTEL Reply at 1-2; America Connect Comments at 3; AT&T Comments at 3-4; AT&T Reply 
at 2-4; BellSouth Comments at 2; BellSouth Reply at 3; CTIA Comments at 2-3: CIRI Comments at 7-8; RK 
Communications Comments at 2; Sprint Reply at 4; US West Comments at 3; Verizon Comments at 5; VoiceStream 
Comments at 4; VoiceStream Reply at 2. 
  	See Advanced Comments at 4-5.
  	See AirGate Comments at i, 1-2, 4; AirGate Reply at 1.
  	See Northcoast Comments at 4-5.
  	See Alpine Comments at ii-iii, 1-15, 18; Alpine Reply at 1, 6; Leap Comments at 14-16, NTCA Comments 
at 2-3; OPM Comments at i, 2,6-9; OPM Reply at i, 6-10, Declaration; PCIA Comments at 17-20; PCIA Reply at 2-
3, 9-14; Powertel Comments at 7; Rainbow/Push Reply at 7-9; Twenty First Wireless Comments at 11; Twenty First 
Wireless Reply at 1-3, 5; U.S. AirWaves Comments at 5-6; Advocacy Comments at 5-6; NORTH COAST Reply at 
i, 3-4.
  	See, e.g., Alpine Comments at ii-iii, 1-15; Alpine Reply at 1-2, 5-7.
 	See Service Rules for 746-764 MHz and 776-794 MHz Bands, and Revisions to Part 27 of the 
Commission's Rules, WT Docket No. 99-168, First Report and Order, 15 FCC Rcd 476, 478,  3 (2000) ("700 
MHz First Report and Order").  In our view, the advantages of reconfiguring 30 MHz C block licenses into three 10 
MHz licenses outweigh the "exposure risk" that so concerns Nextel.  See Nextel Reply at 15-16.
  	See 47 C.F.R.  24.202.
  	As explained infra, entities that qualify as entrepreneurs under the Commission's rules will be eligible to 
bid on all three 10 MHz C block licenses in each market; other entities will be eligible to bid on either one or two of 
such licenses depending on the population size of the market.
  	See 47 U.S.C.  309(j)(3)(B).
  	See Further Notice, 15 FCC Rcd at 9789,  27.
  	We stated that, in the absence of better data, we would rely on the 1990 census data for population 
numbers.
  	See Further Notice, 15 FCC Rcd at 9789,  29.
  	Id.
  	All F block licenses are 10 MHz licenses.
  	See Further Notice, 15 FCC Rcd at 9790,  31.
  	See id. at 9790,  32.
  	Tier 1 BTAs comprise approximately five percent of all BTAs.
  	For auctions after Auction No. 35, we will base population figures on the most recent available decennial 
census. 
  	See AT&T Comments at 7-8; AT&T Reply at 4-5; Nextel Comments at ii, 12-13, 24; Nextel Reply at 6; 
SBC Comments at i, 2, 8; SBC Reply at 4-5; US West Comments at 4-5; US West Reply at 2, 4; VoiceStream 
Comments at 4-5; VoiceStream Reply at 3-4.
  	Leap Comments at 4, 15-16; Leap Reply at 7-8.
  	As we explain infra, for 30 MHz C block licenses that were available but unsold in Auction No. 22, we will 
remove all entrepreneur eligibility restrictions for each of the three 10 MHz C block licenses.
  	In each case, the closed band or bands will be adjacent to the F block spectrum.  Because the bands will be 
contiguous, entrepreneurs that wish to aggregate newly acquired closed 10 MHz C block licenses with F block 
licenses may enjoy reduced base station facilities costs and simplified maintenance requirements.
  	As we explain infra, we will remove all entrepreneur eligibility restrictions for 15 MHz C block licenses 
that were available but unsold in Auction No. 22.
  	As a practical matter, all of the 15 MHz licenses that we expect to be available in Auction No. 35, that 
were not available but unsold in Auction No. 22, are in Tier 2 and therefore would be subject to closed bidding 
restricted to entrepreneurs.
  	See, e.g., Advanced Comments at 1-2; Advocacy Comments at 15 n.15; OPM Comments at i, 2, 4-6, 8, 16; 
RK Communications Comments at 2; Telecorp and Tritel Comments at 3, 5; US West Comments at 4; US West 
Reply at 2,4; RCA Comments at 8-9, 11-14; RCA Reply at 1-3, 7; Twenty First Wireless Reply at 5.  See also 
Advocacy Comments at 1-5, 8; Alaska/Poplar/Eldorado Comments at 2; Alpine Comments at ii, 4-15; Choice 
Comments at 1; Leap Comments at 1; NTCA Comments at 3; PCIA Comments at i, 4-5, 11-17; Polycell Comments 
at 1, 2-4; RTG/OPASTCO Comments at 5-6; Telecorp and Tritel Comments at 3, 5.  See generally U.S. AirWaves 
Comments at 4-5.
  	See, e.g., OPM Comments at 4 ("Removing DE eligibility restrictions would diminish meaningful 
participation of small businesses in the auction process.  .  .  [I]n light of the language of Section 309(j)(4) and its 
legislative history, OPM disagrees with the notion that meaningful participation of small businesses is a matter the 
Commission is free to purposely diminish without violating both the Act and the policy it is intended to implement. 
[citation omitted]"; Advanced at 2; AirGate Comments at 2-3; Alpine Comments at iii, 2, 15; Northcoast at 8; 
NTCA at 2; PCIA Comments at i, 1-5; RCA Comments at 1-2 (cover letter); RCA Comments at 7-10; and 
RTG/OPASTCO Comments at 1-2, 3-4.
  	See SBC Reply at 2-4.
  	See, e.g., AT&T Comments at 1-2, 6-8, 10; BellSouth Comments at ii, 1, 9-10, 15; BellSouth Reply at 1,3; 
SBC Comments at i, 2-3, 10-11; SBC Reply at 4-6; US West Comments at 4-5; US West Reply at 1-4; Verizon 
Comments at 5-9; VoiceStream Comments at 5; VoiceStream Reply at 1-2, 8.
  	See, e.g., Advocacy Comments at 5; ASCENT Comments at 4, 7.
  	See CIRI Comments at 7-9; CIRI Reply at 2-3.  See also infra Part III.H.  (transfer requirements).
  	In auctions of licenses in most other services, the Commission has used bidding credits, rather than a set-
aside, to encourage auction participation by small businesses.  To date, in open Commission auctions with small 
business bidding credits, a total of 79 percent of all winning bidders have been small businesses using a  bidding 
credit.  See infra Part III.G.  (bidding credits). 
  	Melcher v. FCC, 134 F.3d 1143, 1154 (D.C. Cir. 1998), citing Mobile Tel, Inc. v. FCC, 107 F.3d 888, 895 
(D.C. Cir. 1997); see Fresno Mobile Radio, 165 F.3d 965, 971 (D.C. Cir. 1999).
  	Melcher v. FCC, 134 F.3d 1143, 1154-55 (D.C. Cir. 1998).
  	Further Notice, 15 FCC Rcd at 9788,  25.
  	See Jill Carroll and Leslie Cauley, Demand for Airwaves May Create Shortage,  The Wall Street Journal, 
Aug. 2, 2000, at A2 (The explosion in wireless communications and the emergence of 3G technology have resulted 
in a shortage of spectrum to satisfy the huge demand.); Susan Schmidt and Peter S. Goodman, Spectrum Up for 
Grabs, The Washington Post, July 11, 2000, at E1 ("[T]he 21st-century battle over the spectrum is a scramble for a 
highly valuable resource in increasingly short supply."); Implementation of Section 6002(b) of the Omnibus Budget 
Reconciliation Act of 1993; Annual Report and Analysis of Competitive Market Conditions With Respect to 
Commercial Mobile Services, Fifth Report, FCC-00289, at Part II.A.1.h (rel. August 18, 2000).
 	See, e.g., SBC Petition at 3, 11, 15; Nextel Petition at 5-8; see also, e.g., the following comments and reply 
comments to the SBC and Nextel Petitions:  AT&T Comments at 2-4; Bell Atlantic Comments at 9-10; GTE at 11-
13 (re spectrum cap); Nextel Reply at 21-22; SBC Comments at 12-13.
  	See id.
  	We emphasize that entrepreneurs will remain eligible to bid for open as well as closed C and F block 
licenses.  We note, moreover, that in Auction No. 11, where D and E block, as well as F block, broadband PCS 
licenses were available, small and very small businesses successfully bid against larger applicants for D and E block 
licenses.  Even though the D and E block licenses were not set aside for entrepreneurs, and neither bidding credits 
nor installment financing was available for these licenses, small and very small businesses were the high bidders for 
more than 14 percent of the D and E block licenses won in that auction.  We note also that, in the Further Notice, 
we failed to take into account the fact that no bidding credits were available for D and E block licenses in Auction 
No. 11 or any other auction.  See Further Notice, 15 FCC Rcd 9793-94,  40.
  	See, e.g., AirGate Comments at i, 1-2, 6-7; AirGate Reply at 4-6; Alaska/Poplar/Eldorado Comments at 3-
4; ASCENT Comments at 2-9; Burst Comments at 3-5; Burst Reply at 4; Carolina Comments at 4; Carolina Reply 
at 4-5; Leap Comments at i, 4-5, 17-19; Leap Reply at 10; NTCA Comments at 6-7; Northcoast Comments at 5-9; 
Northcoast Reply at 9; PCIA at 20-21; RK Communications Comments at 2; Advocacy Comments at 7-8; ALLTEL 
Reply at 2; OPM Reply at 3-5; Telecorp and Tritel Reply at 3-10.  But see, e.g., Nextel Comments at i, iii, 14-17, 
24; Nextel Reply at 6; RPCS Comments at 6-7; RPCS Reply at 2-4; US West Comments at 4-5; Verizon Comments 
at 14-15; VoiceStream Comments at 5; VoiceStream Reply at 1-2, 8.  See also BellSouth Reply at 1-5; CIRI Reply 
at 2; SBC Reply at 7-8.
  	See, e.g., Alaska/Poplar/Eldorado Comments at 2,3-4; Burst Comments at 3-5; Burst Reply at 4.  See also 
Northcoast Comments at 7-9; Northcoast Reply at 2-5, 9.
  	As discussed above in paragraphs 23-25, we are not compelled to retain set-aside spectrum to fulfill the 
objectives of Section 309(j).
  	See, e.g., Leap Comments at 4-13, 17-18; Leap Reply at 10.
  	See, e.g., Advocacy Comments at 7-8; AirGate Comments at 6-7; AirGate Reply at 4-6.
  	See Nextel Comments at 14-16, 24; Nextel Reply at 6.  BellSouth explains that it is a fallacy to believe that 
Section 309(j) requires the entrepreneur eligibility restrictions.  See BellSouth Reply at 3-5.
  	See RPCS Comments at 6-8; RPCS Reply at 1-7; US West Comments at  4-5.
  	See VoiceStream Comments at 5; VoiceStream Reply at 1-2.
  	See SBC Reply at 8.
  	See Further Notice, 15 FCC Rcd at 9785-86,  19, 9788,  25, 9790,  31.
  	See id.  As discussed in the Further Notice, there has been a lack of historical controversy regarding F 
block licenses.  Id.  Moreover, we note that, except for licenses won by licensees with substantial C block holdings, 
very few F block licenses have been reclaimed by the Commission as a result of default or bankruptcy. 
  	See id. at 9790,  31 and n. 81.
  	See id. at 9790,  31.
  	These licenses will include both 15 MHz C block licenses and 10 MHz C block licenses that have been 
reconfigured from the 30 MHz C block licenses that were available but not sold in Auction No. 22.
  	See Burst Comments at 5; Burst Reply at 4-5.  See also Northcoast Reply at 2-5, 9.
  	See Nextel Comments at 6-7; Nextel Reply at 6.  See also Carolina Reply at 5; CIRI Reply at 2; US West 
Comments at 4-5; Verizon Comments at 5-9.
  	See Nextel Comments at 16 (citations omitted).
  	See CIRI Comments at 8.  See also AirGate Comments at 7; Nextel Comments at i-ii, 5-11, 14-17, 24; SBC 
Comments at 10-11.
  	We note that some 15 MHz C block licenses that were not available in Auction No. 22 may be included in 
our auction inventory for Auction No. 35.  For Auction No. 35, bidding for such licenses in Tier 1 will be open; and 
bidding for such licenses in Tier 2 will be closed.  See supra  22.
  	47 C.F.R.  24.709(a)(1).
  	Id.  24.720(g).
  	Id.  24.709(b)(9)(i).
  	See Competitive Bidding Fifth Report and Order, 9 FCC Rcd 5532, 5605,  167; Competitive Bidding 
Fifth Memorandum Opinion and Order, 10 FCC Rcd 403, 419-20,  27 (the Commission has a strong interest in 
seeing entrepreneurs grow and succeed in the PCS marketplace and will under certain circumstances allow licensees 
to retain their eligibility during the holding period, even if the company has grown beyond the size limitations for 
the entrepreneur's block (i.e., "natural growth")).  
  	47 C.F.R.  24.839(a)(2).
  	See Nextel Comments at iii, 20-23; Nextel Reply at 8.
  	Id.
  	See Leap Reply at 13.
  	See id .at 14.
  	In doing so, Leap also states that the assignment and transfer rule, set forth in Section 24.839, and the 
Competitive Bidding Fifth Memorandum Opinion and Order support its interpretation of the rules.  See id., citing 
Competitive Bidding Fifth Memorandum Opinion and Order, 10 FCC Rcd at 419-20,  27.
  	See 47 C.F.R.  24.709(a)(3).
  	Under the current rules, a C or F block applicant (together with its affiliates and persons or entities that 
hold interests in the applicant and their affiliates) must have had gross revenues of less than $125 million in each of 
the last two years and must have total assets of less than $500 million at the short-form deadline.  See 47 C.F.R.  
24.709(a)(3).  Total assets are generally determined by the applicant's most recent audited financial statements.  See 
47 C.F.R.  24.720(g).
  	Leap was not a participant in either Auction No. 5 or Auction No. 10 and therefore is not eligible for the 
grandfather exception.  The grandfather exception, set forth in Section 24.709(b)(9)(i), provides that, in addition to 
entities qualifying as entrepreneurs at the time of the short form deadline, any entity that was eligible for and 
participated in either of the first two C block auctions (Auction No. 5 and Auction No. 10) will be eligible to bid in 
any auction of C block spectrum that begins within two years of the start date of Auction No. 22 (March 23, 1999).  
See 47 C.F.R.  24.709(b)(9)(i).  See also In re Applications of AirGate Wireless, L.L.C., Assignor, and Cricket 
Holdings, Inc., Assignee and Application of Leap Wireless International, Inc., For Authorization to Construct and 
Operate 36 Broadband PCS C Block Licenses, Memorandum Opinion and Order, 14 FCC Rcd 11,827 (CWD, 1999) 
("Leap Order"), aff'd, FCC 00-269 (rel. July 27, 2000).  In the Leap Order, the Commercial Wireless Division, 
after exhaustive evaluation of Leap's DE qualifications, found Leap to be qualified to hold the four F block (via 
assignment) and 36 C block licenses (won in Auction No. 22).
  	See 47 C.F.R.  24.709(b)(9)(i).
  	See Nextel Comments at 20-23; Leap Reply at 12-14.
  	See Further Notice, 15 FCC Rcd at 9791,  35.
  	See Nextel Petition at 18-23.
  	See Further Notice at 15 FCC Rcd at 9791, 35.
  	Id.
  	See id. at 9785,  17.
  	See id.
  	See Amendment of Part 1 of the Commission's Rules - Competitive Bidding Proceeding, WT Docket No. 
97-82, Order, Memorandum Opinion and Order and Notice of Proposed Rule Making, 12 FCC Rcd 5686, 5697-98, 
16 (1997).
  	The comments submitted on this issue were opposed to Nextel's proposal.  See Carolina Comments at 4; 
CTIA Comments at 3; RCA Comments at 9-10; US AirWaves Comments at 9; US AirWaves Reply Comments at 9; 
US West Comments at 6; US West Reply at 4; OPM Comments at i, 2, 9-10, 16; RK Communications Comments at 
2.
  	We note that in establishing procedures for the Commission's upcoming auction of licenses in the 700 
MHz bands, the first auction for which the Bureau established procedures to use a combinatorial or package bidding 
design, the Bureau declined to offer a limited number of packages designed by the Commission and instead allowed 
bidders to create their own grouping of licenses on which to make all-or-nothing bids.  See "Auction of Licenses in 
the 747-762 and 777-792 MHz Bands Scheduled for September 6, 2000, Procedures Implementing Package 
Bidding for Auction No. 31," Public Notice, DA 00-1486 (rel. July 3, 2000) at 4-5.
  	See AT&T Comments at 4; SBC Comments at 10 n.13; VoiceStream Reply at 2-3.
  	See Nextel Comments at 17 n.31; PCIA Comments at 19; OPM Reply at 10-11.
  	For a general discussion of the benefits of and difficulties with package bidding, see "Auction of Licenses 
in the 747-767 and 777-792 MHz Bands Scheduled for September 6, 2000, Procedures Implementing Package 
Bidding for Auction No. 31," Public Notice, DA 00-1486 (rel. July 3, 2000).
  	See Further Notice, 15 FCC Rcd at 9792-93,  38; 47 C.F.R.  24.709(b)(9)(i).
  	See Further Notice, 15 FCC Rcd at 9792-93,  38.
  	Verizon Petition at 9-10.
  	Id..
  	Id. at 10.
  	The caption to the grandfather exception, 47 C.F.R.  24.709(b)(9)(i), reads, "Special rule for licensees 
disaggregating or returning certain spectrum in frequency block C."
  	See Alpine Comments at 15-16.  See also Nextel Comments at iii, 18-20 (a once-qualified "entrepreneur" 
should not be grandfathered if it has undergone ownership changes of more than 20% since its original license was 
issued).
  	See Carolina Comments at 5; Carolina PCS Reply at 7-8; Dobson Comments at 11-12.
  	See Dobson Comments at 12.
  	See id.
   	See Telecorp and Tritel Comments at 12.
  	See CTIA Comments at 3-4; RK Communications Comments at 2.
  	See BellSouth Comments at ii, 10-11 (the grandfather exception should be eliminated in an open auction); 
Nextel Comments at iv, 4, 20; Nextel Reply at 6-7; Twenty First Wireless Comments at 11-12; Twenty First 
Wireless Reply at 5-6; Verizon Comments at 15-16 (the Commission should repeal the grandfather exception or, at 
a minimum, clarify the rule because entities that participated for the first C block auction, but did not win licenses, 
are eligible for the exception even though they have grown beyond the eligibility criteria);  ALLTEL Reply at 3.
  	See Dobson Comments at 12.  See also Telecorp and Tritel Comments at 2-3, 11-12; PCIA Reply at 3 n.3
  	See Further Notice, 15 FCC Rcd at 9794,  41. 
  	See id. at 9794,  42.
  	These commenters favor an increase in the bidding credits to 25 percent and 40 percent, respectively, for 
small and very small businesses.  See AirGate Comments at i, 2, 7; ASCENT Comments at 4; Advanced Comments 
at 5; AT&T Comments at 7; Burst Comments at 5, 10; OPM Comments at 2, 5, 11-12, 16; Carolina Comments at 5-
6 and Carolina Reply at 5-7; McBride Comments at 2; Telecorp and Tritel Comments at 15-16; Telecorp and Tritel 
Reply at 20-21; Alaska/Poplar/Eldorado Comments at 2, 6.  See also Powertel Comments at 6; RK Communications 
at 3; OPM Reply at 11-12 (support an increase in bidding credits but do not suggest an amount).  See generally 
Northcoast Comments at 10 (an increase in bidding credits should never be used as a substitute for eligibility 
restrictions in the context of a C and F block reauction); PCIA Comments at 1-3 (the availability of bidding credits 
in the absence of an entrepreneurs' block would have no measurable effect on entrepreneur participation); 
RTG/OPASTCO Comments at 6 (an increase in bidding credits will not make a difference when a small company is 
bidding against a large carrier).  Other commenters support an increase of bidding credits of more than 25 percent 
and 40 percent, respectively, for small and very small businesses in "open" bidding.  See Leap Comments at 4, 19; 
U.S. AirWaves Comments at 6-7 and U.S. AirWaves Reply at 7-8.
  	See BellSouth Comments at ii, 11-12; VoiceStream Comments at 12; CTIA Comments at 4.  See generally 
Nextel Comments at 14; Dobson Comments at 16.  Three other parties offer alternative proposals.  See Burst 
Comments at 5-7, 10; Carolina Reply at 5-7; Twenty First Wireless Comments at 12.
  	See supra note 78.
  	See Dobson Comments at 13-16; Dobson Reply at 5-6.
  	See AirGate Comments at i, 2; CIRI Comments at 9-10; CIRI Reply at 5; America Connect Comments at 4-
5; Telecorp and Tritel Reply at 21.
  	See Further Notice, 15 FCC Rcd at 9795,  44.
  	Id.
  	See BellSouth Comments at 13; CIRI Comments at 2-4, 8-9; OPM Comments at 13,16; SBC Comments at 
i, 2-3, 11; SBC Reply at 8-9; VoiceStream Comments at 6-7; VoiceStream Reply at 1, 5.
  	See OPM Comments at 13.
  	See BellSouth Comments at 13.
  	See Further Notice, 15 FCC Rcd at 9795,  44.
  	Id.  See also 47 C.F.R.  24.203.
  	See Further Notice, 15 FCC Rcd at 9795,  44.
  	See Competitive Bidding Fifth Memorandum Opinion and Order, 10 FCC Rcd at 454-56,  93-96 
("[A]greements between [entrepreneurs] and strategic investors that involve terms (such as management contracts 
combined with rights of first refusal, loans, puts, etc.) that cumulatively are designed financially to force the 
[entrepreneur] into a sale (or major refinancing) will constitute a transfer of control under our rules.").  See also 
Leap Order, 14 FCC Rcd at 11,836,  20, aff'd, FCC 00-269 (rel. July 27, 2000).
  	See AT&T Comments at 2, 9-10; Advanced Comments at 5; AirGate Comments at i, 2, 9; ALLTELL 
Reply at 3; BellSouth Comments at ii, 12-13; Carolina Reply at 8-9; OPM Comments at 13, 16;  SBC Comments at 
i, 2-3.  See also CIRI Comments at 6 (eliminate transfer restrictions on incumbent licensees but impose a one-year 
holding period for licenses won in "closed" auctions to ensure that qualified entrepreneurs are acquiring licenses for 
their own participation ); STPCS Comments at 1, STPCS Reply at 1 (permit transfers to non-designated entities 
before the first construction benchmark, provided the licensee has already met the benchmark or can show 
"substantial service' throughout its system); Twenty First Comments at 9-10 (there should be no restrictions on very 
small Native American entrepreneurs); Telecorp and Tritel Reply at 22-23 (Telecorp and Tritel does not oppose 
lifting transfer restrictions but believes that any modification to existing transfer limitations must lie solely with the 
qualified entity component of the entrepreneurial licensee).
  	See VoiceStream Comments at 6; VoiceStream Reply at 5-6.
  	See Alaska/Poplar/Digital Comments at 4; Alpine Comments at 16-17 (allowing entrepreneurs to sell to 
large carriers upon construction will undermine the establishment of stable, entrepreneur-based competition); Leap 
Comments at 20 (current transfer restrictions should be maintained because maintaining a restricted aftermarket in 
entrepreneur's block spectrum remains an important tool to ensure that entrepreneurs are able to acquire additional 
spectrum and to prevent large carriers from warehousing spectrum); RK Communications Comments at 3-4 
(strongly opposes proposed changes to C and F block transfer restrictions).
  	We note, moreover, that we are nearing the end of the five-year holding period for C block licenses won in 
Auction No. 5 and 10.
 	See 47 C.F.R.  1.2111(d).
  	Accordingly, we will not require a bidding credit unjust enrichment payment upon the transfer to an 
entrepreneur that is not a small business of a license won in Auction No. 5 or 10 within the first five years after the 
date of the initial license grant, even if the transferor or assignor has not yet satisfied its initial construction 
benchmark requirement.  We are not, however, eliminating other unjust enrichment payment requirements for 
licenses won in Auction No. 5 and 10.  See id.  1.2111.
  	See Further Notice, 15 FCC Rcd at 9795,  45.
  	Id.
  	Id.
  	See AirGate Comments at 9 (recommends elimination of the transfer requirements upon completion of first 
construction benchmark on a system wide basis rather than a market-by-market basis); Carolina Comments at 8; 
Carolina Reply at 8-9; CIRI Comments at 4-5 (if the Commission requires any build-out before permitting license 
transfers, the only reasonable method for evaluating build-out is on a system-wide basis); CIRI Reply at 4-5; STPCS 
Comments at 4; STPCS Reply at 1 (urges the Commission to permit transfer and assignment of C and F block 
licenses to non-entrepreneurs prior to expiration of the first construction benchmark period, provided the licensee 
has already met the benchmark or can demonstrate "substantial service" throughout its system.); VoiceStream 
Comments at 11-12 (the Commission should allow an incumbent C or F block licensee that has not met the build-out 
benchmarks to assign or transfer licenses to any entity upon a showing of "substantial service" to 25 percent or more 
of the combined population in its system, rather than on a market-specific basis).
  	Implementation of Section 309(j) of the Communications Act - Competitive Bidding, PP Docket No. 93-
253, Fifth Report and Order, 9 FCC Rcd 5532, 5606,  171 (1994) ("Competitive Bidding Fifth Report and 
Order").
  	See Further Notice, 15 FCC Rcd at 9796-97,  47; see 47 C.F.R.  24.710.
  	Competitive Bidding Fifth Report and Order, 9 FCC Rcd at 5606,  170.
  	See AirGate Comments at i, 2, 9; BellSouth Comments at 13-14; Burst Comments at 8-9; Carolina 
Comments at 9; CTIA Comments at 5; CIRI Comments at 9; VoiceStream Comments at 12-13.
  	See Alpine Comments at 17; OPM Comments at i, 3,14-15; RK Communications Comments at 4.
  	See 47 C.F.R.  20.6.
  	See 1998 Biennial Regulatory Review - Spectrum Aggregation Limits for Wireless Telecommunications 
Carriers, WT Docket No. 98-205, Report and Order, 15 FCC Rcd 9219, 9221-22,  1-2, 9222-23,  5-6, 9229-49, 
 20-65, 9253-57,  77-85 (1999) ("Biennial CMRS Spectrum Cap Order").  Specifically, we determined that the 
45 MHz spectrum cap should remain in place except in rural areas, defined as rural service areas (RSAs), where we 
raised the cap to 55 MHz.  Id. at 9253-57,  77-85.  The Commission first instituted a CMRS spectrum cap in 
1994, and reaffirmed the spectrum cap in 1996.  See id. at 9224-25,  9, 9226-27,  11-13.
	Two parties have filed petitions for reconsideration of the Biennial CMRS Spectrum Cap Order, while a 
third has filed a petition for clarification.  We will address these petitions in a separate order.
  	Id. at 9255-56,  82. 
  	Id. at 9232,  26.
  	See Advanced Comments at 6; AirGate Comments at 9-10; Alpine Comments at 17; ASCENT Comments 
at 3-4; Carolina Comments at 9; Burst Comments at 7-8; Burst Reply at 5; Leap Comments at 8-9, 20-21; 
Northcoast Comments; OPM Comments at 15; OPM Reply at ii; VoiceStream Comments at 13; VoiceStream Reply 
at 7-8; US West Comments at 6-7; US West Reply at 2, 4; U.S. AirWaves Comments at 9-10, U.S. AirWaves Reply 
at 8-9; U.S. AirWaves Ex Parte Comments at 1; RK Communications Comments at 4; Powertel Comments at 3-4, 7; 
PCIA, Polycell, and CFW Reply at 14; Southern Reply at 1-8; Conestoga Ex Parte Comments at 3. 
  	See AT&T Comments at 4-6; AT&T Reply at 1-2; BellSouth Comments at 14-15; Verizon Comments at 4, 
20-24; CTIA Comments at 5-6.  
  	See Further Notice, 15 FCC Rcd at 9797-98,  49-50.
  	See AT&T Waiver Petition at 2-6; AT&T Reply at 3; Bell Atlantic Forbearance Petition at 8-13; BellSouth 
Waiver Petition at 2-5; GTE Declaratory Ruling Petition at 5-7; GTE Reply at 12. 
  	Three of these petitions were placed on public notice.  See "Wireless Telecommunications Bureau Seeks 
Comment on AT&T Wireless Services, Inc., BellSouth Corporation and Bell Atlantic Mobile, Inc. Petitions 
Regarding CMRS Spectrum Cap Limits," Public Notice, DA 00-318 (rel. February 18, 2000).  Petitioners and 
commenters are listed in Appendix C.  Twenty-three of the twenty-five commenters to this public notice opposed 
petitioners' requests.  See generally Alaska Digitel, Poplar, and Eldorado Comments; Alaska, Poplar, and Eldorado 
Reply; American Wireless Comments; American Wireless Reply; Carolina Comments; CIRI Comments; CT 
Comments; CT Reply; Georgetown Comments; Leap Comments; Leap Reply; NTCA Comments; Nextel 
Comments; NextWave and NextWave Power Comments; PCIA Comments; RCA Comments; RTG Comments; SBC 
Comments; SMR Comments; Sprint Comments; TeleCorp Comments; TeleCorp Reply; Tritel Comments; Tritel 
Reply; VoiceStream Comments; Alpine Reply; Northcoast Reply.  Only CTIA and GTE supported the petitions.  
See generally CTIA Comments; GTE Comments; GTE Reply.
  	47 C.F.R.  1.3.
  	Under Section 10 of the Communications Act, the Commission can forbear from applying a regulation only 
if it determines, among other things, that forbearance is "consistent with the public interest."  47 U.S.C.  160. 
  	See GTE Declaratory Ruling Petition at 2, 7-8.  Since first instituting the CMRS spectrum cap in 1994, the 
cap has been applied to the entire 180 MHz of broadband CMRS spectrum, including the 40 MHz of C and F block 
spectrum.  See Implementation of Sections 3(n) and 332 of the Communications Act, Regulatory Treatment Of 
Mobile Services, GN Docket No. 93-252, Third Report and Order, 9 FCC Rcd. 7988, 8109-10,  263-64 (1994); 
see also Biennial CMRS Spectrum Cap Order, 15 FCC Rcd at 9254-56,   78-83.    
  	For instance, in those markets in which the C block will be divided into 10 MHz blocks of spectrum, our 
analysis indicates that relatively few carriers currently have more than 35 MHz of spectrum in markets in which the 
45 MHz cap applies.
  	The Commission reviews the CMRS spectrum cap biennially, pursuant to Section 11 of the 
Communications Act, as amended.  47 U.S.C.  161.  
  	Further Notice, 15 FCC Rcd at 9773, 9800,  57.  See 47 C.F.R.  1.1200(a) and 1.1202(a).
  	"Deadline for Final Ex Parte and Other Presentations Responding to Issues Raised in Further Notice of 
Proposed Rulemaking in WT Docket No. 97-82 Extended to July 17, 2000," Public Notice, DA 00-1531, (rel. July 
7, 2000).
  	PCIA Petition (July 21, 2000).
  	Since the filing of the SBC and Nextel Petitions, we have received approximately 300 filings in this 
proceeding.  See infra Appendices A-C (in some cases, multiple ex parte presentations filed by the same party are 
represented in an appendix by a single entry).
  	See 5 U.S.C.  603.  The RFA, see 5 U.S.C.  601 et seq., has been amended by the Contract With 
America Advancement Act of 1996, Pub.L.  No. 104-121, 110 Stat. 847 (1996) ("CWAAA").  Title II of the 
CWAAA is the Small Business Regulatory Enforcement Fairness Act of 1996 ("SBREFA").
  	See Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal 
Communications Services (PCS) Licensees, WT Docket No, 97-82, Further Notice of Proposed Rulemaking, 15 
FCC Rcd 9773, 9808-14 (rel. June 7, 2000) ("Further Notice"). 
  	See 5 U.S.C.  604.
 	See Further Notice, 15 FCC Rcd at 9774-76,  1, 3.
  	See Alpine Comments at ii-iii, 1-15, 18; Alpine Reply at 1, 6; Leap Comments at 14-16, NTCA 
Comments at 2-3; OPM Comments at i, 2,6-9; OPM Reply at i, 6-10, Declaration; PCIA Comments at 17-20; 
PCIA Reply at 2-3, 9-14; Powertel Comments at 7; Rainbow/Push Reply at 7-9; Twenty First Wireless Comments 
at 11; Twenty First Wireless Reply at 1-3, 5; U.S. AirWaves Comments at 5-6; Advocacy Comments at 5-6; North 
Coast Reply at i, 3-4.
  	See, e.g., Alpine Comments at ii-iii, 1-15; Alpine Reply at 1-2, 5-7.
  	See, e.g., Advanced Comments at 1-2; Advocacy Comments at 15 n.15; OPM Comments at i, 2, 4-6, 8, 
16; RK Communications Comments at 2; Telecorp and Tritel Comments at 3, 5; US West Comments at 4; US 
West Reply at 2,4; RCA Comments at 8-9, 11-14; RCA Reply at 1-3, 7; Twenty First Wireless Reply at 5.  See 
also Advocacy Comments at 1-5, 8; Alaska/Poplar/Eldorado Comments at 2; Alpine Comments at ii, 4-15; Choice 
Comments at 1; Leap Comments at 1; NTCA Comments at 3; PCIA Comments at i, 4-5, 11-17; Polycell Comments 
at 1, 2-4; RTG/OPASTCO Comments at 5-6; Telecorp and Tritel Comments at 3, 5.  See generally U.S. AirWaves 
Comments at 4-5.
  	See, e.g., OPM Comments at 4 ("Removing DE eligibility restrictions would diminish meaningful 
participation of small businesses in the auction process.  .  .  [I]n light of the language of Section 309(j)(4) and its 
legislative history, OPM disagrees with the notion that meaningful participation of small businesses is a matter the 
Commission is free to purposely diminish without violating both the Act and the policy it is intended to implement. 
 [citation omitted]"; Advanced at 2; AirGate Comments at 2-3; Alpine Comments at iii, 2, 15; Northcoast at 8; 
NTCA at 2; PCIA Comments at i, 1-5; RCA Comments at 1-2 (cover letter); RCA Comments at 7-10; and 
RTG/OPASTCO Comments at 1-2, 3-4.
  	These commenters favor an increase in the bidding credits to 25 percent and 40 percent, respectively, for 
small and very small businesses.  See AirGate Comments at i, 2, 7; ASCENT Comments at 4; Advanced Comments 
at 5; AT&T Comments at 7; Burst Comments at 5, 10; OPM Comments at 2, 5, 11-12, 16; Carolina Comments at 
5-6 and Carolina at 5-7; McBride Comments at 2; Telecorp and Tritel Comments at 15-16; Telecorp and Tritel 
Reply at 20-21; Alaska/Poplar/Eldorado Comments at 2, 6.  See also Powertel Comments at 6; RK 
Communications at 3; OPM Reply at 11-12 (support an increase in bidding credits but do not suggest an amount).  
See generally Northcoast Comments at 10 (an increase in bidding credits should never be used as a substitute for 
eligibility restrictions in the context of a C and F block reauction); PCIA Comments at 1-3 (the availability of 
bidding credits in the absence of an entrepreneurs' block would have no measurable effect on entrepreneur 
participation); RTG/OPASTCO Comments at 6 (an increase in bidding credits will not make a difference when a 
small company is bidding against a large carrier).  Other commenters support an increase of bidding credits of 
more than 25 percent and 40 percent, respectively, for small and very small businesses in "open" bidding.  See 
Leap Comments at 4, 19; U.S. AirWaves Comments at 6-7 and U.S. AirWaves Reply at 7-8.
  	See, e.g., AT&T Comments at 1-2, 6-8, 10; BellSouth Comments at ii, 1, 9-10, 15; BellSouth Reply at 
1,3; SBC Comments at i, 2-3, 10-11; SBC Reply at 4-6; US West Comments at 4-5; US West Reply at 1-4; 
Verizon Comments at 5-9; VoiceStream Comments at 5; VoiceStream Reply at 1-2, 8.
  	See, e.g., the following comments and reply comments to the SBC and Nextel Petitions:  AT&T 
Comments at 2-4; Bell Atlantic Comments at 9-10; GTE at 11-13 (re spectrum cap); Nextel Reply at 21-22; SBC 
Comments at 12-13.
  	See id.
  	See 5 U.S.C.  601-612.  
 	Id.
  	Id.  601(6).
  	Id.  601(3) (incorporating by reference the definition of "small business concern" in 15 U.S.C.  632).  
Pursuant to 5 U.S.C.  601(3), the statutory definition of a small business applies "unless an agency after 
consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public 
comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and 
publishes such definition(s) in the Federal Register.
  	Id.  632.
  	Id.  601(4).
  	1992 Economic Census, U.S. Bureau of the Census, Table 6 (special tabulation data under contract to the 
Office of Advocacy of the U.S. Small Business Administration).
  	5 U.S.C.  601(5).
  	U.S. Dept. of Commerce, Bureau of the Census, "1992 Census of Governments."
  	Id.
  	See supra  note 16.
  	See 47 C.F.R.  24.720(b)(1).
  	See id.  24.720(b)(2).
  	See Letter to Amy J. Zoslov, Chief, Auctions & Industry Analysis Division, Wireless Telecommunications 
Bureau, from Aida Alvarez, Administrator, U.S. Small Business Administration, dated December 2, 1998.  See 
also Competitive Bidding Fifth Report and Order, 9 FCC Rcd at 5581-5584; 47 C.F.R.  24.720(b).
  	"Entrepreneurs' C Block Auction Closes," Public Notice, DA 96-716 (rel. May 8, 1996).
  	"Entrepreneurs' C Block Reauction Closes," Public Notice, DA 96-1153 (rel. July 17, 1996).
  	FCC News, Broadband PCS, D, E, and F Block Auction Closes, No. 71744 (rel. Jan. 14, 1997).
  	"C, D, E, and F Block Broadband PCS License Auction Closes," Public Notice, DA 99-757 (rel. April 20, 
1999).
  	See Further Notice, 15 FCC Rcd at 9781 n.32.
  	"Auction of Licenses for C and F Block Broadband PCS Spectrum Postponed Until November 29, 2000," 
Public Notice, DA 00-1246 (rel. June 7, 2000).
  	See generally 47 C.F.R. Part 1, Subpart Q; Part 24.
  	Section 309(j) of the Communications Act of 1934, as amended ("Communications Act"), 47 U.S.C.  
309(j).
  	See 47 U.S.C.  309(j)(3)(B).
  	See id.  24.202.
 	See Further Notice, 15 FCC Rcd at 9791,  35.
  	See AT&T Comments at 4; SBC Comments at 10 n.13, VoiceStream Reply at 2-3.
  	See Nextel Comments at 17 n.31; PCIA Comments at 19; OPM Reply at 10-11.
  	See Further Notice, 15 FCC Rcd at 9795,  45.
  	In the Commission's recent 700 MHz Band Order, issued in January 2000, the Commission determined 
not to apply a spectrum cap to the 700 MHz band spectrum in large measure because the Commission determined 
that the CMRS spectrum cap helped ensure that a competitive structure in the CMRS marketplace was being 
maintained.  See Service Rules for the 746-764 and 776-794 MHz Bands, and Revisions to Part 27 of the 
Commission's Rules, WT Docket No. 99-168, First Report and Order, 15 FCC Rcd 476, 498,  53 (2000). 
  	47 U.S.C.  309(j)(3)(B).
  	Id.  309(j)(3)(A), (C).
 
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