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Biztel 39 GHz Substantial Service Rejection Order

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Released: December 18, 2012

Federal Communications Commission

DA 12-2032

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of Applications of
)
)

BIZTEL, INC. (C/O AT&T CORP.)
)
File Nos. 0004587562, 0004589952,
)
0004591027, 0004591084, and 0004591086
For Renewal of 39 GHz Common Carrier
)
Microwave Licenses for Stations WMT620,
)
WMT635, WPJA911, WPJC937, and WPJC939
)
)

MEMORANDUM OPINION AND ORDER

Adopted: December 18, 2012

Released: December 18, 2012

By the Deputy Chief, Broadband Division, Wireless Telecommunications Bureau:

I.

INTRODUCTION

1.
In this Memorandum Opinion and Order, we find that Biztel, Inc. (“Biztel”)1 has failed
to demonstrate substantial service for its 39 GHz Common Carrier Microwave Stations WMT620,
WMT635, WPJA911, WPJC937, and WPJC939. Based on this determination, these licenses
automatically terminated, by operation of Commission rule, as of February 1, 2011.

II.

BACKGROUND

2.
Licenses in the 38.6-40.0 GHz band (“39 GHz band”) are subject to Part 101 of the
Commission’s Rules, which generally governs terrestrial microwave operations.2 Originally, channels in
the 39 GHz service were licensed on a licensee-defined Rectangular Service Area (“RSA”) basis, but the
Commission later revised its rules to provide for Economic Area (“EA”) licenses,3 and auctioned 39 GHz
overlay licenses on an EA basis in 2000.4 Licenses in the 39 GHz band are licensed for ten-year terms
and licensees must demonstrate “substantial service” as part of their applications for license renewal.5 In
establishing this substantial service standard, the Commission intended to “ensur[e] that service is being
provided to the public,”6 but wanted to provide licensees “a significant degree of flexibility in meeting


1 Biztel is a subsidiary of AT&T Corp.
2 47 C.F.R. Part 101.
3 Amendment of the Commission's Rules Regarding the 37.0 - 38.6 GHz and 38.6 - 40 GHz Bands, Report and
Order and Second Notice of Proposed Rulemaking
, ET Docket No. 95-183, 12 FCC Rcd 18600 (1997) (39 GHz
R&O
).
4 See 39 GHz Band Auction Closes, Public Notice, 15 FCC Rcd 13648 (WTB 2000).
5 See 47 C.F.R. §§ 101.17, 101.67. See also, 39 GHz R&O, 12 FCC Rcd at 18626 ¶ 49.
6 39 GHz R&O, 12 FCC Rcd at 18624 ¶ 46.

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DA 12-2032

their performance requirement.”7 In an effort to give licensees this flexibility, the Commission rejected
defining specific build-out benchmarks as “unduly restrictive and burdensome.”8 The Commission did
provide, however, a “safe harbor” example of a substantial service showing as “four links per million
population within a service area.”9 Notably, the Commission specifically declined to exempt incumbent
39 GHz band licensees from the substantial service renewal showing.10
3.
Biztel is the licensee of 39 GHz Common Carrier Microwave Stations WMT620,
WMT635, WPJA911, WPJC937, and WPJC939 licensed on an RSA basis. Biztel was required to renew
these licenses and demonstrate substantial service for these stations by February 1, 2011, the expiration date
of those licenses.11 On January 25, 2011, Biztel filed timely renewal applications for the subject
stations.12 In accordance with Section 101.17 of the Commission’s Rules, Biztel attached its substantial
service showings to the subject renewal applications.13 Biztel states that it “employs its 39 GHz common
carrier fixed point-to-point microwave facilities as an alternative to other technologies for providing
“last-mile” access to the AT&T network,”14 and also uses its facilities “to provide redundant capacity to
its wireline facilities and to provide backhaul capacity for AT&T’s wireless services.”15 Biztel explains


7 Id. at 18623 ¶ 42.
8 Id. at 18623-18624 ¶ 43.
9 Id. at 18624-18625 ¶ 46. We note that, although the Commission did not use the specific term of “safe harbor” in
the 39 GHz band context, we believe the Commission intended for this example to serve, in fact, as a “safe harbor.”
This determination is consistent with similar examples the Commission has provided in other services. See
Amendments to Parts 1, 2, 87, and 101 of the Commission’s Rules to License Fixed Services at 24 GHz, WT Docket
No. 99-327, Report and Order, 15 FCC Rcd 16934, 16951-16952 ¶ 38 (2000); Amendment of Part 95 of the
Commission’s Rules to Provide Regulatory Flexibility in the 218-219 MHz Service, WT Docket No. 98-169, Report
and Order and Memorandum Opinion and Order
, 15 FCC Rcd 1497, 1537-1538 ¶ 70 (2000); Amendment of the
Commission’s Rules Concerning Maritime Communications, PR Docket No. 92-257, Third Report and Order and
Memorandum Opinion and Order
, 13 FCC Rcd 19853, 19870 ¶ 34 (1998); Amend Parts 1, 2, 21, and 25 of the
Commission’s Rules to Redesignate the 27.5-29.5 GHz Frequency Band, to Reallocate the 29.5 – 30.0 GHz
Frequency Band, to Establish Rules and Policies for Local Multipoint Distribution Service and for Fixed Satellite
Services, CC Docket No. 92-297, Second Report and Order, Order on Reconsideration, and Fifth Notice of
Proposed Rulemaking
, 12 FCC Rcd 12545, 12660-12661 ¶ 270 (1997); Amendment of the Commission’s Rules to
Establish Part 27, the Wireless Communications Service, GN Docket No. 96-228, Report and Order, 12 FCC Rcd
10785, 10843-10844 ¶ 113 (1997).
10 39 GHz R&O, 12 FCC Rcd at 18624 ¶ 46.
11 See 47 C.F.R. § 101.17.
12 File Nos. 0004587562, 0004589952, 0004591027, 0004591084, and 0004591086 (filed Jan. 25, 2011) (Renewal
Applications). With each Renewal Application, Biztel submitted an Exhibit 1 entitled Substantial Service Showing.
While the specific information relating to each license differed, Biztel made the same arguments for each license.
Originally, Biztel submitted the Substantial Service Showings with a request for confidential treatment. See Request
for Confidential Treatment (filed Jan. 25, 2011). On October 17, 2011, Biztel amended its Renewal Applications to
provide public versions of its substantial service showings with certain information redacted. See Exhibit 2 – Public
Version – Substantial Service Showing (filed Oct. 17, 2011) (collectively, “Substantial Service Showings”). All
citations to the Substantial Service Showings in this Memorandum Opinion and Order are to the public versions
filed on October 17, 2011.
13 See 47 C.F.R. § 101.17.
14 See Substantial Service Showings at 1.
15 See Substantial Service Showings at 2.
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DA 12-2032

that while it has constructed and operated links for all the licenses in question during the license term, the
links that are currently deployed for these licenses are not being used to provide service at this time, and
many of the links are presently disconnected.16 Nonetheless, Biztel argues that it has earned a renewal
expectancy for the subject licenses by providing “substantial service” over the course of the license
term.”17

III.

DISCUSSION

4.
We find that Biztel has not demonstrated substantial service for the subject 39 GHz
licenses. Biztel has not sought a waiver or extension of time to demonstrate substantial service for these
licenses. Without such extension or waiver, Biztel’s licenses have automatically terminated, by
operation of Sections 1.946(c) and 1.955(a)(2) of the Commission’s Rules, as of February 1, 2011.18 We
discuss these findings in detail below.
5.
To demonstrate substantial service, Biztel must show that it meets the Commission’s
definition of substantial service or that it meets one of the safe harbors applicable to 39 GHz licenses.
Biztel must demonstrate substantial service “for each channel for which they hold a license . . .”19 Biztel
has the option of showing that it has met an applicable safe harbor showing. For 39 GHz licenses, a safe
harbor of four links per million within a service area applies.20
6.
The Commission’s 39 GHz rules clearly define substantial service as service as of the
time of license renewal. Section 101.17(a) of the Commission’s Rules states, “All 38.6-40.0 GHz band
licensees must demonstrate substantial service at the time of license renewal.”21 The same rule requires
licensees to describe their “current service” in terms of geographic coverage and population served.22
Biztel, however, does not attempt to show that it is currently providing service or has met the safe harbor


16 See Substantial Service Showings at 2. Specifically, for Station WMT620, 11 links were constructed and/or
operated during the license period, three links are currently deployed but are not being used to provide service, and
eight links are disconnected. See File No. 0004587562. For Station WMT635, while 15 links were constructed
and/or operated during the license period, two links are currently deployed but are not being used to provide service,
and 13 links are disconnected. See File No. 0004589952. For Station WPJA911, two links were constructed and/or
operated during the license period, but both links are now disconnected. See File No. 0004591027. For Station
WPJC937, 13 links were constructed and/or operated during the license period, one link is currently deployed but is
not being used to provide service and 12 links are disconnected. See File No. 0004591084. For Station WJPC939,
three links were constructed and/or operated during the license period, two links are currently deployed but are not
being used to provide service, and one link is disconnected. See File No. 0004591086.
17 See Substantial Service Showings at 1.
18 47 C.F.R. §§ 1.946(c) (providing that if a licensee in the Wireless Radio Services fails to commence service or
operations by the expiration of its construction period or to meet its coverage or substantial service obligations by the
expiration of its coverage period, its authorization terminates automatically, without specific Commission action, on
the date the construction or coverage period expires) and 1.955(a)(2) (cross-referencing Section 1.946(c) and
reiterating that authorizations in the Wireless Radio Services automatically terminate without specific Commission
action, if the licensee fails to meet applicable construction or coverage requirements).
19 47 C.F.R. § 101.17(a).
20 39 GHz R&O, 12 FCC Rcd at 18624 ¶ 46.
21 47 C.F.R. § 101.17(a).
22 47 C.F.R. § 101.17(a)(1), (2).
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DA 12-2032

applicable to 39 GHz licenses. Instead, Biztel argues that it meets the Commission’s definition of
substantial service because it has constructed and operated links for its stations at some time during the
license period.23
Biztel states that “because customers frequently modify their demand for
many…services, the links used to provide them . . . also change frequently and often are used for limited
periods of time.”24
7.
We find that Biztel has not demonstrated that the subject stations have met the
substantial service standard. We decline to make a finding of substantial service where a licensee is not
currently providing service within the licensed area, and conclude that the substantial service requirement
presumes some sort of actual service at the substantial service deadline. Here, what Biztel describes as
substantial service during the license period does not involve any actual present service by any of the
subject licenses, and the safe harbor has not been met. In a case involving the Local Multipoint
Distribution Service, another Part 101 service where licensees must demonstrate substantial service at
license renewal, the Wireless Telecommunications Bureau (“Bureau”) has declined “to make a finding of
substantial service where the licensee is not currently providing service within the licensed area.”25 No
precedent supports Biztel’s argument that undertaking past activities at some point during the term of the
license, without current service, would constitute substantial service. We therefore conclude that Biztel
has not demonstrated substantial service under the Commission’s rules.
8.
Relying on a Bureau decision accepting other Biztel 39 GHz renewal applications
where, during the course of the license terms, microwave paths were established and dismantled,26 Biztel
argues that “the fact that the links are disconnected or not currently being used to provide service does
not affect AT&T’s entitlement to a renewal expectancy” with respect to its licenses.27 Biztel’s reliance
on this order is misplaced. In 2003, Biztel had constructed at least four links per million population in
each licensed area during the license term to provide a variety of services to customers, including
wireless local loop service, backhaul, and backbone service for wireless service providers.28 Although
Biztel was utilizing these links to provide service to the public, it explained that all the paths were not
operational simultaneously for the entire license period because the type of service it provided was
dynamic rather than stable.29 As a result, while all of the paths may not have been operational throughout
the entire license period, at some point during the license period, there were sufficient paths in operation
to meet the safe harbor standard,30 and the stations were constructed and operational at the time of
renewal.31 In contrast to the Biztel MO&O, where Biztel was providing a dynamic current service, Biztel
here concedes that the subject stations were either dismantled or not operational when it filed its renewal


23 Substantial Service Showings at 2.
24 Id.
25 See SPEEDUSNY.COM, Memorandum Opinion and Order and Order on Reconsideration, 22 FCC Rcd 13974,
13984 ¶ 17 (WTB 2007).
26 Biztel, Inc., Memorandum Opinion and Order, 18 FCC Rcd 3308 (WTB PS&PWD 2003) (Biztel MO&O).
27 See Substantial Service Showings at 2.
28 Biztel MO&O, 18 FCC Rcd at 3311 ¶ 7.
29 Id.
30 Id.
31 See File No. 0000309573, Substantial Service Showing Attachment at 1; File No. 0000314076, Substantial
Service Showing Attachment at 1.
4

Federal Communications Commission

DA 12-2032

applications and substantial service showings.32 The Bureau has rejected the proposition that the Biztel
MO&O
supports a finding of substantial service when no service is being provided at the substantial
service deadline.33 Accordingly, we cannot find, based on the record, that Biztel has demonstrated the
provision of substantial service for these licenses.

IV.

CONCLUSION AND ORDERING CLAUSES

9.
Biztel has failed to demonstrate substantial service for the licenses in question. It has not
sought an extension of time to meet the substantial service deadline for the subject stations or to justify a
waiver of the February 1, 2011 deadline for establishing substantial service. Accordingly, Biztel’s
licenses to operate Stations WMT620, WMT635, WPJA911, WPJC937, and WPJC939 automatically
terminated, by operation of Commission rule, as of February 1, 2011.
10.
Accordingly, IT IS ORDERED, pursuant to Sections 4(i) and 309 of the
Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i), 309, and Section 1.946 of the
Commission’s Rules, 47 C.F.R. § 1.946, that the requests for findings of substantial service made by
Biztel, Inc. on January 25, 2011, as amended (File Nos. 0004587562, 0004589952, 0004591027,
0004591084, and 0004591086) ARE DENIED.
11.
IT IS FURTHER ORDERED that, pursuant to Sections 4(i) and 303(r) of the
Communications Act, as amended, 47 U.S.C. §§ 154(i), 303(r), and Section 1.955(a)(2) of the
Commission’s Rules, 47 C.F.R. § 1.955(a)(2), that the Universal Licensing System SHALL BE
UPDATED to reflect that the licenses issued to Biztel, Inc. for Stations WMT620, WMT635, WPJA911,
WPJC937, and WPJC939 TERMINATED as of February 1, 2011.
12.
These actions are taken under delegated authority pursuant to Sections 0.131 and 0.331
of the Commission’s Rules, 47 C.F.R. §§ 0.131, 0.331.
FEDERAL COMMUNICATIONS COMMISSION
John J. Schauble
Deputy Chief, Broadband Division
Wireless Telecommunications Bureau


32 See n.16, supra.
33 See SPEEDUSNY.COM, supra, 22 FCC Rcd at 13984-13985 ¶ 17.
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