FCC to return millions to Native partnerships

Posted: Friday, April 05, 2002

FAIRBANKS (AP) -- Alaska Native partnerships that bid on wireless telephone frequencies last year will get 85 percent of their multimillion dollar investments back while the U.S. Supreme Court considers a dispute over the auction.

The Federal Communications Commission last week decided to keep some of the down payments while the court case plays out.

Alaska Native Wireless, with major financial backing from AT&T, put down about $555 million in January 2001 to back up its $2.8 billion in successful bids on the right to use certain wireless frequencies. It will get $472 million back from the FCC.

Doyon Ltd., Sealaska Corp. and Arctic Slope Regional Corp. -- the managing partner -- put $260 million into Alaska Native Wireless.

The frequencies were previously held by NextWave and another, much smaller company, Urbancomm. Those companies couldn't pay the FCC and went bankrupt. The FCC held a second auction, but NextWave challenged its right to do so. The Supreme Court took the case last month.

The FCC refund should help Alaska Native Wireless develop phone service in the cities where it has won undisputed licenses, Conrad Bagne, chief operating officer of Arctic Slope Regional Corp., told the Fairbanks Daily News-Miner Wednesday.

Bagne said the company received those licenses Tuesday. The licenses grant the right to use frequencies in Fairbanks, Juneau and Ketchikan, along with 13 other mostly smaller communities primarily in Western states.

The disputed frequencies previously held by NextWave are in much larger markets, including New York City, Los Angeles, Denver and Tampa.

Bagne said Alaska Native Wireless and other bidders on the NextWave licenses didn't get all their down payment back because the FCC wanted to keep the validity of the auction intact.

Returning all the down payment could have been interpreted as an admission that the auction was invalid, and the FCC didn't want to acquiesce to that allegation, Bagne said.

At the same time, the FCC recognized the problem that keeping all the money presented for telecommunications companies.

Cook Inlet Region Inc., the Anchorage-based regional Native corporation, also successfully bid on the NextWave and Urbancomm wireless licenses as the controlling member of a different partnership. That partnership, a 50-50 arrangement with VoiceStream, put $100 million down. So it should receive about $85 million back from the FCC as a result of last week's decision.

''We are definitely pleased that the FCC has elected to refund the money while all this litigation is going on,'' said Scott Torrison, director of telecommunications for CIRI.

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