Appeals Court Won't Postpone August FCC Wireless Auction

WASHINGTON -(Dow Jones)- A US appeals court on Thursday refused to postpone a Federal Communications Commission wireless auction that is set for August, handing a victory to government regulators who are managing the high-profile auction that could raise an estimated $15 billion for the government.

Three groups had asked the US Third Circuit Court of Appeals to delay the auction so that small businesses would have a chance to participate. The groups, including Council Tree Communications Inc., had urged a stay while they sought to overturn new small-business bidding rules that the small firms say will dry up their financing, making it hard to participate.

"A stay is decidedly contrary to the public interest," according to an order from the court.

The decision was a blow to Council Tree, Bethel Native Corp., and the Minority Media and Telecommunications Council, which had gone to the court in an emergency bid to stay the auction while they sought to overturn the rules.

The FCC in April approved rules aimed at closing loopholes that allowed large companies to win discounts in airwave auctions by teaming up with smaller firms eligible for discounts. Among other things, the new rules require small businesses to hold their licenses for 10 years if they are to retain the full discount, typically 25% of the total bid.

The rules caused an uproar among small firms, which complained that the FCC approach would make it difficult to get financing from investors, in part because the 10-year "hold period" would deprive the firms of an exit strategy should their business plans fail.

David Fiske, an FCC spokesman, said in a statement that "we are pleased the advanced wireless auction will proceed on schedule furthering the goal of providing new and better wireless services to American consumers."

-By Siobhan Hughes, Dow Jones Newswires; 202-862-6654; Siobhan.Hughes@dowjones.com

(Peg Brickley contributed to this report.)

(END) Dow Jones Newswires"

Posted to the site on 30th June 2006