BLOOMBERG GOVERNMENT STUDY

AT&T's Acquisition Of T-Mobile USA: Airwaves on the Line

BY AFZAL BARI
TECHNOLOGY FINANCE ANALYST

EDWARD GOODMANN
TECHNOLOGY ANALYST

MAY 16, 2011

To contact the authors, e-mail: abari1@bloomberg.net or egoodmann@bloomberg.net

Copyright 2011, Bloomberg L.P .

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TABLE OF CONTENTS
Section Page

Executive Summary ....................................................................................................... 3 Introduction ................................................................................................................... 5 Why Spectrum Matters .................................................................................................. 6 License Types ............................................................................................................... 7 Findings .......................................................................................................................... 8 49 Cellular Market Areas at Highest Risk for Divestiture .......................................... 9 Many Potential Buyers for Spectrum ......................................................................... 11 Increasing the Threshold Reduces Flagged Markets .............................................. 11 AT&T's Exclusion of AWS Spectrum Has Little Impact ........................................... 13 Potential FCC Actions ................................................................................................ 14 Methodology................................................................................................................ 17 Appendix...................................................................................................................... 24

Editors: ANTHONY GNOFFO JON MORGAN Reviewers: TED BUCKLEY, Ph.D. Chief Economist JASON ARVELO Labor Analyst
BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum 2

EXECUTIVE SUMMARY
Spectrum ownership will be a focal point in the regulatory review of AT&T's proposed $39 billion purchase of Deutsche Telekom AG's T-Mobile USA unit. The merger would create the nation's biggest wireless communications provider and the biggest holder of spectrum, the radio waves that power wireless communications. The companies say they will use the spectrum to give customers better services, such as high-speed mobile Internet access. The Federal Communications Commission, however, may find that the combined company would own too much spectrum, limiting competition. The FCC will examine any of the 734 cellular market areas, known as CMAs, where the combined company would own more than about one third of the available spectrum. The agency could require the companies to divest all or some of the spectrum that exceeds that threshold as a condition of approving the deal, an event that would provide opportunities for competitors to acquire new capacity. The threshold now ranges from 95 megahertz to 145 megahertz, depending on the market. The merged companies would meet or exceed the FCC's threshold in 202 markets, including some of the nation's biggest, according to data compiled by Bloomberg. That means more than a quarter of the markets could be the target of competitive review. That doesnt mean, however, that the companies will be automatically forced to divest spectrum in those markets. The FCC could change the thresholds, alter the definition for which spectrum is included in the calculations or even add new capacity to the total by shifting spectrum from other uses. The commission has adjusted its thresholds for major wireless mergers three times since 2004. This Bloomberg Government Study finds that even small adjustments could have a significant impact on the number of markets that might come under scrutiny in the proposed AT&T acquisition of T-Mobile. For example, raising the threshold by 10 megahertz would reduce the number of markets under review by half. An increase of 20 megahertz would reduce the number by almost 75 percent. The FCC's method for calculating how much spectrum AT&T owns will also affect the analysis. In previous mergers, the FCC excluded some types of spectrum. AT&T's filing suggests the FCC exclude some of its holdings in a category known as "Advanced Wireless Service" spectrum, or airwaves once reserved for government use that are being redeployed to power carriers' third- and fourth-generation networks. If the FCC includes these frequencies when calculating how much spectrum AT&T holds in each market, AT&T will exceed the spectrum threshold in 10 markets in addition to the 202. Looking at past mergers provides a clue to how the FCC may act. Before Verizon
BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum 3

Wireless's 2008 acquisition of Alltel Corp., the two companies divested spectrum in every market where they exceeded the threshold by 17 megahertz. The combined AT&T and T-Mobile would exceed the threshold by 20 megahertz or more in 35 metropolitan and 14 rural markets. The metropolitan markets include Atlanta, Dallas, Los Angeles, Miami, San Francisco and Seattle. Among the carriers that would be able to buy divested spectrum without themselves exceeding the FCC threshold are Clearwire, Leap Wireless, SpectrumCo LLC, U.S. Cellular, and Verizon Wireless, according to the data compiled by Bloomberg. Sprint Nextel would be able to do so in each market except Los Angeles.

BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum

INTRODUCTION
Spectrum -- the radio waves that power wireless communications technologies -- will be a focal point in the regulatory review of AT&T Inc's proposed $39 billion purchase of Deutsche Telekom AG's T-Mobile USA unit. These airwaves, assigned by the Federal Communications Commission to prevent users from interfering with each others' signals, are central to voice and data networks' growth and operation. In the past, regulators have set the concentration threshold near one-third of the available spectrum in a market area.1 The FCC's initial review of the proposed purchase will examine two factors: customer market share for competing wireless phone-service providers and the providers' shares of spectrum in each market. The analysis will focus on 734 cellular market areas (CMAs). Each is comprised of one or more counties anchored by a population center.2 Areas where the combined company's share of subscribers or spectrum holdings exceeds regulatory thresholds will be flagged by the FCC for closer scrutiny. In these areas, the commission can order the companies to divest all or part of its spectrum or other aspects of their existing operations as a condition of the deal's approval. For more information on the FCC's overall review process, see the Bloomberg Government Briefing: "AT&T's Acquisition of T-Mobile USA: The FCC Review").3 Under current FCC guidelines, the combined AT&T and T-Mobile exceed the review threshold in 202 markets. That means more than a quarter of the markets could be the target of competitive review. That the FCC would order the combined company to divest some of its spectrum licenses in those markets is far from certain. The commission could conclude that the company's spectrum holdings, in some or all of those markets, are not a threat to competition. The FCC may also decide to raise the threshold in some or all of those markets, as it has done in previous mergers of wireless service providers. This study conducts a spectrum-competition analysis using two resources: AT&T's application to the FCC and the commission's spectrum license database. By combining countylevel license information to examine the 734 market areas in the U.S., this study examines the impact of spectrum consolidation from several angles. First, it examines the holdings of a

Annual Report and Analysis of Competitive Market Conditions With Respect to Mobile Wireless, Including Commercial Mobile Services, WT Docket No. 09-66, Fourteenth Report (2010) ("FCC Wireless Competition Report"), http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-10-81A1.pdf. retrieved May 9, 2011 Federal Communications Commission Wireless Telecommunications Bureau, Auctions and Spectrum Access Division "Cellular Market Areas." http://wireless.fcc.gov/auctions/data/maps/CMA.pdf retrieved April 21. 2011
3 2

Afzal Bari and Edward Goodmann Bloomberg Government Briefing "AT&T's Acquisition of T-Mobile USA: The FCC Review" April 2011, http://www.bgov.com/media/news/ip3aqkAPvQHhSu7CDkUaiw

BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum

combined AT&T and T-Mobile USA and how much these holdings exceed the most recently applied FCC thresholds. Second, this study examines whether other carriers would exceed regulatory thresholds, should they seek to purchase any spectrum AT&T divests. Third, the study considers the potential changes should regulators adjust threshold levels. The FCC analysis may begin as early as mid-June while requests for information from the applicants should come in July. In the meantime, proponents and opponents can file comments until May 28, 2011, followed by a 15-day reply period for applicants AT&T and T-Mobile USA.

Why Spectrum Matters

Wireless carriers use radio waves to carry data and voice traffic. Licenses to use radio waves on specific parts of the spectrum in a geographic area are auctioned by the FCC.4 As a result, the amount of spectrum in any given cellular market area is a finite resource. While the commission has taken steps to add spectrum licenses to the wireless market, the commission reports increases in spectrum supply have not kept up with demand, causing a shortage that FCC Chairman Julius Genachowski often refers to as a "spectrum crunch."5 As outlined in the Bloomberg Government Briefing "Spectrum Allocation: Finding the Airwaves' Best Use," mobile data traffic is expected to grow at a compound annual rate of 92 percent through 2015 -- growing from 240 petabytes in 2010 to 6.3 exabytes in 2015 -- taxing the frequencies as deployed today.6 This looming growth has precipitated a policy fight between wireless carriers and television broadcasters. The wireless carriers want the FCC to ease the spectrum crunch by reallocating television broadcast spectrum to wireless phone and data services. AT&T has specifically cited a shortage of available spectrum as one of the key drivers for its proposed acquisition of T-Mobile. The company argues that it needs the spectrum to keep up with demand, and that it can more efficiently utilize scarce spectrum resources than could a stand-alone T-Mobile.

Edward Goodmann, Bloomberg Government Briefing: "Spectrum Allocation: Finding the Airwaves' Best Use" February 2011, "http://www.bgov.com/media/news/CiIUc-hO0dwo-yjuamUyTw" retrieved May 9, 2011

Todd Shields, Bloomberg News "Verizon, AT&T, T-Mobile May Get Airwaves at Auction of U.S. TV Spectrum" January 20, 2011, http://www.bloomberg.com/news/2011-01-20/verizon-at-t-may-get-airwaves-at-auction-of-u-s-tv-spectrum.html retrieved May 9, 2011
6

Edward Goodmann, Bloomberg Government Briefing: "Spectrum Allocation: Finding the Airwaves' Best Use" February 2011, "http://www.bgov.com/media/news/CiIUc-hO0dwo-yjuamUyTw" retrieved May 9, 2011

BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum

License Types
In its mission to eliminate interference on the airwaves, the FCC issues different types of licenses, depending on the spectrum band and the type of service. Mobile voice and data services use many types of licenses. This is a result of both the evolution of wireless technologies and the on-going auction of airwaves to wireless carriers. Since 1994, more than 36,000 spectrum licenses have been auctioned, raising billions of dollars.7 Ten types of licenses presently comprise the 547 megahertz range considered by the FCC to be suitable for voice and data services.8 Pertinent to this study are the Advanced Wireless Service (AWS) and Educational Broadband Service (EBS), two license types that have been treated differently by the commission in recent analyses. Licenses for Advanced Wireless Service spectrum, airwaves once reserved for the government but being redeployed to power carriers' third- and fourthgeneration networks, were auctioned in 2006. AT&T argues that certain of these licenses should not count toward its total holdings.9 Educational Broadband Service spectrum had been

Federal Communications Commission "Auctions Summary" http://wireless.fcc.gov/auctions/default.htm?job=auctions_all Note; this is a tabulation of all licenses auctioned, not exclusively those auctioned to wireless carriers. , retrieved April 28, 2011
8

Federal Communications Commission Staff Technical Paper "Mobile Broadband: The Benefits of Additional Spectrum" October 2010, http://download.broadband.gov/plan/fcc-staff-technical-paper-mobile-broadband-benefits-of-additional-spectrum.pdf retrieved April 29, 2011 Federal Communications Commission, Acquisition of T-Mobile USA, Inc by AT&T Inc, Description of Transaction, Public Interest Showing and Related Demonstrations, Filed with the Federal Communications Commission April 21, 2011 ("AT&T Application"), http://www.fcc.gov/transaction/att-tmobile.html retrieved April 27, 2011

BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum

reserved for schools and universities but is being transitioned to consumer use. Most licenses for this spectrum are owned by Clearwire, a company in which Sprint holds a majority interest. When considering the AT&T merger, the FCC may choose to include some or all advanced wireless service or educational spectrum. The FCC's decisions on these licenses will determine the total spectrum available in a market, as well as how much AT&T is determined to hold.

Findings
For each of the 734 cellular market areas, the FCC determines a threshold of acceptable spectrum ownership, which ranges from 95 MHz to 145 MHz based on the availability of spectrum in that market. In rare cases, counties within a cellular market area will have different spectrum thresholds. According to AT&T, 93 percent of market areas have one or more counties where the spectrum threshold is at the highest level, 145 MHz.10 AT&T's application acknowledges that the combined spectrum holdings of it and TMobile meet or exceed the FCC's current threshold in one or more counties located within 202 cellular market areas.11 If the commission follows the screening procedure it used for its review of AT&T's purchase of Centennial Communications Corp. in 2009, each of these 202 flagged markets will be scrutinized to determine whether the combined company can exert market power over competitors.

10 11

Percentage reflects each market area's highest threshold county

Federal Communications Commission, Acquisition of T-Mobile USA, Inc by AT&T Inc, Description of Transaction, Public Interest Showing and Related Demonstrations, Filed with the Federal Communications Commission April 21, 2011 ("AT&T Application"), http://www.fcc.gov/transaction/att-tmobile.html retrieved April 27, 2011

BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum

49 Cellular Market Areas at Highest Risk for Divestiture

Among the 202 markets that may be flagged for review are 49 where the combined company would have at least 20 MHz more than the FCC's threshold, representing the areas where spectrum is at highest risk for divestiture. During the FCC review of the Verizon Wireless purchase of Alltel Corp., all flagged markets that were at least 17 MHz above the threshold ended up being divested. The FCC distinguishes between rural markets, known as Rural Service Areas (RSAs), and markets based around metropolitan areas, known as Metropolitan Statistical Areas (MSAs). The 49 at highest risk for divestiture are 35 metropolitan areas, including Atlanta, Dallas, Los Angeles, Miami, San Francisco and Seattle and 14 rural markets. Because some markets contain more than one county, analysis required consolidating county-level data into market-level data. To consolidate the county-level AT&T filing into a cellular market-level analysis, this study considered a market above the threshold if the combined company's spectrum holdings exceed the threshold in at least one county. Based on this analysis, the combined holdings of the merged company are at least 20 MHz above the applicable threshold in 35 markets:
BLOOMBERG GOVERNMENT STUDY: AT&T, T-Mobile and Spectrum 9

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Many Potential Buyers for Spectrum

If the combined company decides or is ordered to divest airwaves in any of the markets reviewed by the FCC, potential buyers would also be subject to regulatory review, including a spectrum threshold screen. To test whether others would be able purchase airwaves, this study compared the screening threshold to the spectrum holdings for certain wireless carriers: Clearwire12, Leap Wireless, SpectrumCoAWS, Sprint Nextel, U.S. Cellular, and Verizon Wireless. Data compiled by Bloomberg shows that each of these carriers would be able to buy the potentially available spectrum without exceeding current FCC threshold for review, except for Sprint Nextel in the Los Angeles market.13

Increasing the Threshold Reduces Flagged Cellular Markets

The FCC may adjust the spectrum threshold for each market as it did in AT&T's purchase of Dobson Communications Corporation, Verizon's acquisition of Alltel, and Sprint's purchase of Nextel.14 In recent years, as the FCC has added spectrum to the wireless market, the acceptable threshold has increased. The current spectrum screen was cited in the FCC's 2009 AT&T-Centennial Wireless transaction order.

12 13

For analysis purposes, Clearwire holdings were consolidated with Sprint Nextel. Sprint Nextel owns 51 percent of Clearwire.

The Los Angeles cellular market area includes Los Angeles, Long Beach, Anaheim, Santa Ana, Garden Grove, Riverside, San Bernardino and Ontario, California. A combined Sprint Nextel and Clearwire currently exceeds the threshold in Riverside County,

Annual Report and Analysis of Competitive Market Conditions With Respect to Mobile Wireless, Including Commercial Mobile Services, WT Docket No. 09-66, Fourteenth Report (2010) ("FCC Wireless Competition Report"), http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-10-81A1.pdf. retrieved May 9, 2011

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The FCC sets a megahertz threshold in each market based on the license types used for mobile voice and data services. Two such license types, Broadcast Radio Service (BRS) and Advanced Wireless Service (AWS) licenses, have been used in recent reviews to determine which level to apply in each market. The more license types active in a given market, the more spectrum there is available for use. In recent years, the commission has tended to increase the threshold level where more license types are available. All other factors remaining the same, a threshold increase of 10 megahertz could almost halve the number of cellular markets identified in the initial screen. Moving the threshold up 20 megahertz would reduce the number of markets that meet or exceed the guideline to 49, or less than 25 percent of the ones that were originally flagged.

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Chart: Small Adjustments, Big Change If the FCC adjusts the spectrum ownership threshold that triggers it to consider ordering merging wireless companies to divest some of their holdings, the number of markets subject to such review for AT&T and T-Mobile would drop dramatically. 225 200 175 Number of Flagged Markets 150 125 100 75 50 25 0
+0MHz +5MHz +10MHz +15MHz +20MHz +25MHz +30MHz +35MHz +40MHz +45MHz +50MHz +55MHz +60MHz +65MHz +70MHz +75MHz +80MHz

Rural Areas Metro Areas

Increase in Spectrum Screening Threshold (MHz)

Source: Bloomberg Government research, AT&T Application to FCC, Appendix A Note: CMAs determined by FCC in 1990

AT&T's Exclusion of AWS Spectrum Has Little Impact

AT&T' asserts in its filing that certain spectrum holdings in the advanced wireless service range should not to count toward the "post-transaction attributable spectrum" total since some of the spectrum is still being transitioned from federal use. As a result, AT&T excluded it from its calculation of attributable spectrum in 253 of 3,233 counties. Many of the cellular markets where these counties are located were already flagged from other counties within the market. As a result, only 10 new cellular markets will be flagged if the FCC chooses to "add-back" the advanced wireless spectrum which AT&T has chosen to exclude.

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Impact of Including Advanced Wireless Service Spectrum: Additional Cellular Markets to Be Flagged Cellular Market Name California 8 - Tehama Santa Barbara-Santa Maria-Lompoc, California Phoenix, Arizona Eugene-Springfield, Oregon Redding, California Las Cruces, New Mexico Oregon 5 - Coos Yakima, WA Laredo, TX Texas 19 - Atascosa Market Type Rural Metropolitan Metropolitan Metropolitan Metropolitan Metropolitan Rural Metropolitan Metropolitan Rural Amount of Spectrum Over Threshold (MHz) 18 MHz 16 MHz 15 MHz 10 MHz 8 MHz 6 MHz 3 MHz 3 MHZ 1 MHz 1 MHz

Source: AT&T Application to FCC, Appendix A ;Note: CMAs determined by FCC in 1990

Potential FCC Actions

The FCC may adopt one of several approaches in its review: The 'Give-to-Get' Approach The commission may condition approval on the divestiture of spectrum licenses or other operations. AT&T may also volunteer to divest spectrum. Such transactions would also be subject to review by the FCC. In 2008, Verizon Wireless sold spectrum licenses in more than 100 markets -- mostly on a voluntary basis -- to win FCC approval of its acquisition of Alltel Corp.15 The 'Move-the-Goalposts' Approach Before 2004, the FCC applied a hard cap to carriers' spectrum holdings.16 The sharp increase in demand for mobile services has altered the review process to include a market-

Applications of Cellco Partnership d/b/a Verizon Wireless and Atlantic Holdings LL, WT Docket No. 08-95, Memorandum Opinion and Order and Declaratory Ruling 27 (2008) ("Verizon Wireless Order") Annual Report and Analysis of Competitive Market Conditions With Respect to Mobile Wireless, Including Commercial Mobile Services, WT Docket No. 09-66, Fourteenth Report (2010) ("FCC Wireless Competition Report"), http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-10-81A1.pdf. retrieved May 9, 2011
16

15

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specific threshold. The FCC's preference has been to limit any single competitor's ownership of spectrum in a market area to about one-third of the total spectrum capacity17, reinforced in the order approving Spring Corp.'s acquisition of Nextel Communications Corp.18 The one-third marker has remained relatively constant, despite increases in the nominal threshold level. The commission also considers license types, adjusting analysis to the variety of licenses available in each market.19 The 'Balancing-Test' Approach Another approach considers potential public benefits that outweigh the competitive harms of a transaction. The FCC uses a "sliding scale approach" to evaluate benefits claimed by the applicant. This study will not directly answer questions on this approach but will address it further in discussion. AT&T asserts spectrum consolidation would benefit consumers by relieving some of the growing pressure on national airwaves.20 With three major carriers providing services on the airwaves instead of four, AT&T says, the remaining companies could each offer more robust services, such as faster data-transfer rates. AT&T argues that this public interest benefit outweighs the loss of competition. The FCC hasn't awarded a public interest exemption to AT&T, Verizon, or Sprint in any of the most recent major wireless company transactions.21 AT&T is attempting an interesting balancing act by playing to the commission's and Obama administration's concern about the expansion of wireless services and the "spectrum crunch." The analysis indicates that AT&T will become a dominant holder of spectrum in the U.S., but would be able to vastly improve coverage for its customers. The weight the FCC gives these claims and the manner by which such benefits are quantified against the potential damage wrought by the deal may provide an avenue for approval. Once the FCC determines the markets where the consolidated company's spectrum

Annual Report and Analysis of Competitive Market Conditions With Respect to Mobile Wireless, Including Commercial Mobile Services, WT Docket No. 09-66, Fourteenth Report (2010) ("FCC Wireless Competition Report"), http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-10-81A1.pdf. retrieved May 9, 2011 Applications of Nextel Communications, Inc. and Sprint Corporation, WT Docket No. 05-63, Memorandum Opinion and Order (2005) ("Sprint-Nextel Order") Applications of AT&T Inc. and Dobson Communications Corporation, WT Docket No. 07-153, ("Dobson Order"), (2007) ("Dobson Order") Federal Communications Commission, Acquisition of T-Mobile USA, Inc by AT&T Inc, Description of Transaction, Public Interest Showing and Related Demonstrations, Filed with the Federal Communications Commission April 21, 2011 ("AT&T Application"), http://www.fcc.gov/transaction/att-tmobile.html retrieved April 27, 2011 Applications of Nextel Communications, Inc. and Sprint Corporation, WT Docket No. 05-63, Memorandum Opinion and Order (2005) ("Sprint-Nextel Order"); see also: Applications of AT&T Inc. and Dobson Communications Corporation, WT Docket No. 07153, ("Dobson Order"), (2007) ("Dobson Order"); Applications of Cellco Partnership d/b/a Verizon Wireless and Atlantic Holdings LL, WT Docket No. 08-95, Memorandum Opinion and Order and Declaratory Ruling 27 (2008) ("Verizon Wireless Order")
21 20 19 18

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exceeds guidelines, it then has to determine whether consumers and competitors will be harmed. It can then take several actions: Accept the application without any conditions. Accept the application conditioned upon sale of spectrum or fixed assets in specific markets. Accept the application conditioned upon the sale of operations in specific markets Accept the application conditioned upon other commitments (discussed more thoroughly in the Bloomberg Government Briefing "AT&T's Acquisition of T-Mobile USA: The FCC Review").22 Designate the application for a trial-type hearing before an administrative law judge. (According to the FCC, application denials without a hearing are possible only in very limited circumstances.)

Afzal Bari and Edward Goodmann, Bloomberg Government Briefing "AT&T's Acquisition of T-Mobile USA: The FCC Review" April 2011, http://www.bgov.com/media/news/ip3aqkAPvQHhSu7CDkUaiw

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METHODOLOGY
This analysis emulates the FCC's process for identifying markets where the combined AT&T and T-Mobile would possess spectrum licenses in excess of the commission's threshold that would trigger a closer investigation. The study drew from two sources, (1) AT&T's application to the FCC including an appendix of spectrum assets listed by county and cellular market area; and (2) the FCC Spectrum Dashboard, a public database of spectrum licenses retrievable by, among other qualities, geographic area, licensee name, and frequency band. AT&T Data The AT&T application appendix filed with the FCC lists AT&T and T-Mobile spectrum assets grouped by county and cellular market area. The holdings are broken into their respective license-types and assume the successful purchase of Qualcomm spectrum agreed to in December but awaiting commission approval. T-Mobile USA holdings are broken down using the same method. The record also reports "post-merger attributable spectrum" -- AT&T's reckoning of the spectrum total per county -- and the screening threshold based on licenses available in each county. View of AT&T's FCC Merger Application - Appendix A

Source: AT&T Filing to the FCC

The AT&T filing data were used to determine the number of markets flagged based on the most recent FCC screening practices. The data also provided the basis for identification of the most highly concentrated markets and the threshold sensitivity analysis showing the impact of adjusted thresholds. The data was also used to scrutinize AT&T's exclusion of some AWS spectrum in its "Post-Transaction Attributable Spectrum". The FCC's Spectrum Dashboard lists the licenses and details of U.S. spectrum allotments for wireless carriers and other spectrum holders (including TV and satellite providers). This study utilizes records for 9 large spectrum holders23 and several local carriers that were downloaded from the FCC site on April 27, 2011.24 Each license corresponds with at

The four nationwide carriers, AT&T, Verizon, Sprint, T-Mobile USA, as well as Qualcomm who has agreed to sell 700 MHz holdings to AT&T pending FCC approval; as well as four regional players: U.S. Cellular, Clearwire, Leap, and SpectrumCoAWS
24

23

For example: Madison, WI (TDS Telecom: 4 licenses), Southern Ohio (Cincinnati Bell: 9 licenses), Alaska (Alaska Communication Systems: 11 licenses; GCI communications 30 licenses), West Texas, New Mexico, Arizona (Plateau Wireless: 15 licenses)

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least one record listing the spectrum range, the geographic location, and other operational information.25 This study utilizes the data detailing the megahertz of spectrum held in a given market determined by the geographic area specified by the record. This data was used to analyze potential buyers of divested spectrum. By breaking the records into market-based snapshots (as in the AT&T filing), the resulting database reflects carrier, license type, Cellular Market Area, and total megahertz at the cellular market area level. Analyzing Data from the AT&T Application Bloomberg Government followed these steps: Step One Reformat Data for Processing: Convert the Adobe PDF version of AT&T's FCC Application, Appendix A into comma-separated value format, which can be read by Microsoft Excel. Step Two Perform Basic Calculations: Add basic calculations and lookups to other sources by adding the following columns:

a) Create column "Original" with the formula. b) Original = "Post-Transaction Attributable Spectrum" "Current Screen." c) Note that the current screen varies by county and by market, from 95 MHz to 145 MHz. For this Bloomberg Government study, the current screening threshold for each market was taken into account in all calculations. d) Create columns "CMA Name" and "MSA/RSA" by looking up the CMA number in the CMA Names cross-reference spreadsheet, available at http://wireless.fcc.gov/auctions/data/crossreferences/cmanames.xls. e) Create column "AT&T Sum" and "T-Mobile Sum" with the formulas: AT&T Sum = "AT&T Cellular" + "AT&T PCS" + "AT&T 700 MHz" + "AT&T AWS" T-Mobile Sum = "T-Mobile Cellular" + "T-Mobile PCS" + "T-Mobile AWS"

a) A license identifier, known as the license Call Sign; b)The legal name of the license holder; c)The "Common Name" of the legal license holder (e.g. AT&T for AT&T's subsidiary New Cingular Wireless PCS, LLC); d) A specific band of spectrum (e.g. 824 MHz-835 MHz); e) The amount of total spectrum (e.g. 6 MHz for a band of 824 MHz-835 MHz) f) The type of Radio Service (e.g. Cellular, 700 MHz, AWS, BRS, etc.) g) A specific geographic area, identified by Market Name, State, and County, using a U.S. Census standardized county code, known as the Federal Information Processing Standard (FIPS) code.

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f)

Create column "Sum of Spectrum" with the formula Sum of Spectrum = "AT&T Sum" + "T-Mobile Sum"

g) Create column "Original Flag," with a value of 1 if the "Post-Transaction Attributable Spectrum (MHz)" is greater or equal to the "Current Screen (MHz)" Step Three Calculate AWS Impact: AT&T chose to exclude certain Advanced Wireless Services (AWS) spectrum from its "Post-Transaction Attributable Spectrum" calculation. In our findings, we assume this exclusion to affect AT&T's tabulation of total spectrum held in given markets. To quantify the impact of this exclusion, several columns were added: a) Add column "AWS Difference," with the formulas: b) "AWS Difference" = "Sum of Spectrum" - " Post-Transaction Attributable Spectrum (MHz)" c) Add column "AWS Screen." to quantify the new threshold if AWS was excluded. If AWS Difference is 0, the threshold remained the same. If AWS Difference was not 0, the threshold was determined using the following test: If "BRS Available"=Yes (based on the filing) and "AWS Available"=Yes (based on the presence of AT&T or T-Mobile AWS spectrum that was previously excluded) then "AWS Screen"=145 MHz If "BRS Available"=Yes and "AWS Available"=No then "AWS Screen"=115 MHz If "BRS Available"=No and "AWS Available"=Yes then "AWS Screen"=125 MHz If "BRS Available"=No and "AWS Available"=No then "AWS Screen"=95 MHz

d) Added one column "AWS Flag." with a value of 1 if "Sum of Spectrum" is greater than or equal to "AWS Screen" Step Four Calculate Sensitivity: This study analyzes the impact of threshold changes to the number of markets flagged by the FCC. To achieve this, we assume the amount of spectrum held by the post-merger company to be fixed, not expanding as the threshold is increased. This distinction is made as threshold changes are often accompanied by the inclusion of new license types, sometimes increasing the holdings of a given licensee. This study does not hypothesize on the regulatory approach to threshold expansion and, as such, relies on a static estimation of spectrum holdings, holding all other variables equal. To calculate sensitivity to threshold changes, the following columns were added:

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a) Added 101 columns with values of 0 to 100 in the top header row. For each cell, assume a value of 1 if the county's "Post-Transaction Attributable Spectrum" + the column's value (e.g. 0-100) is greater than or equal to the county's "Current Screen (MHz)" Step Five Calculate CMA-Level Dataset: The majority of Cellular Market Areas are comprised of more than one county, the level at which AT&T's filing accounts for spectrum holdings and screening thresholds. To conduct an analysis at the CMA-level, the maximum threshold and holding totals were selected from the group of counties. While this method may overstate the holdings of the combined company, this study's bias is to identify the most markets eligible for FCC scrutiny. To maintain consistency with the FCC methodology, a Microsoft Excel Pivot Table based on the dataset above was created. The Pivot Table grouped all the data by CMA and included the following: a) Row Labels: "CMA Name," "MSA/RSA," b) Values: Max of "Original," Sum of "Original Flag" For the purposes of this study, if one county in the CMA was above the threshold, then the CMA was counted as "flagged".

Analyzing Data from the FCC's Spectrum Dashboard

Step One Download and Consolidate Records: Using the FCC Spectrum Dashboard, a public database recording wireless spectrum licenses, retrieve records for 9 large spectrum holders26 and local carriers.27 This study uses data that was downloaded from the FCC site on April 27, 2011.The consolidated dataset includes more than 208,000 records. Each record includes: a) A license identifier, known as the license Call Sign. b) The legal name of the license holder. c) The "Common Name" of the legal license holder (e.g. AT&T for AT&T's subsidiary

The four nationwide carriers, AT&T, Verizon, Sprint, T-Mobile USA, as well as Qualcomm who has agreed to sell 700 MHz holdings to AT&T pending FCC approval; as well as four regional players: U.S. Cellular, Clearwire, Leap, and SpectrumCoAWS.
27

26

For example: Madison, WI (TDS Telecom: 4 licenses), Southern Ohio (Cincinnati Bell: 9 licenses), Alaska (Alaska Communication Systems: 11 licenses; GCI communications 30 licenses), West Texas, New Mexico, Arizona (Plateau Wireless: 15 licenses).

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New Cingular Wireless PCS, LLC). d) A specific band of spectrum (e.g. 824 MHz-835 MHz). e) The total amount of total spectrum (e.g. 6 MHz for a band of 824 MHz-835 MHz). f) The type of Radio Service (e.g. Cellular, 700 MHz, AWS, BRS, etc.). g) A specific geographic area, identified by Market Name, State, and County, using a U.S. Census standardized county code, known as the Federal Information Processing Standard (FIPS) code. To maintain consistency with the methodology AT&T used in its FCC's filing, all Qualcomm holdings are coded as AT&T holdings. Sprint Nextel and Clearwire spectrum is also consolidated. In previous orders28, the FCC has noted that any ownership stake of 10 percent or more in another company would cause the spectrum holdings to be considered together. As of this writing, Sprint Nextel owns a majority of Clearwire shares, according to company filings. No consolidation was required for other carriers: Step Two Filter Records, Including only Flagged CMAs: Since this analysis seeks to determine whether potential buyers will be eligible to purchase spectrum without triggering the threshold, the dataset was filtered to only include the 202 CMAs where AT&T's and T-Mobile's combined holdings is at or above the spectrum screen. Step Three Eliminate duplicate records: The exported data from the Spectrum Dashboard includes duplicate records that allocate the same spectrum in the same county and market area. To eliminate the duplicate records, we created a new field, "Adjusted Spectrum Range." For records with no duplicate records, "Adjusted Spectrum Range" equals the existing "Spectrum Range." If there were multiple records where "County," "Market Name," "Spectrum Range," and standardized "Common Name" matched, one record was kept as-is and subsequent records (duplicates) had "Adjusted Spectrum Range" set to zero. For example, if five records each have the same "County," "Market Name," "Spectrum Range," and standardized "Common Name," the first records would stay and the other four would have "Adjusted Spectrum Range" set to zero. In some cases these are due to leasing arrangements, in which case the record for the owner's Total Spectrum was set to zero and the spectrum for the leasee was kept as-is. In other cases, this is due to the nature of the export. In those cases, the first record was kept as-is and subsequent records had Total Spectrum set to zero.

Applications of Nextel Communications, Inc. and Sprint Corporation, WT Docket No. 05-63, Memorandum Opinion and Order (2005) ("Sprint-Nextel Order"); see also: Applications of AT&T Inc. and Dobson Communications Corporation, WT Docket No. 07153, ("Dobson Order"), (2007) ("Dobson Order"); Applications of Cellco Partnership d/b/a Verizon Wireless and Atlantic Holdings LL, WT Docket No. 08-95, Memorandum Opinion and Order and Declaratory Ruling 27 (2008) ("Verizon Wireless Order")

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Step Four Tabulate Records using Current FCC Convention: Tabulate the sum of spectrum holdings for each common carrier. a. Tabulate the sum of spectrum holdings for each of carrier, by county b. Tabulate the CMA-level spectrum holdings for each carrier by averaging the spectrum for each county within the CMA.29 Each carriers spectrum holdings by CMA was then compared to the CMA's minimum spectrum screening threshold, as listed in the AT&T filing. This comparison resulted in a true/false field for each carrier and CMA combination: This analysis resulted in a finding that (with the exception of the Los Angeles market) the four nationwide wireless providers and eight regional competitors would be able to buy potentially available spectrum without exceeding current FCC threshold for review.

Analysis Involving Both Datasets (AT&T and FCC)

To analyze the potential buyers for divestible spectrum in at-risk CMAs, a combined analysis drew from both the AT&T and FCC datasets. For this analysis table, each row represents an at-risk CMA, with each column representing a major national spectrum holder (Leap, SpectrumCoAWS, US Cellular, Verizon Wireless, Sprint Nextel, Clearwire, AT&T, and TMobile). Non AT&T and T-Mobile cells in this table have the average spectrum holdings for the CMA. For example, if a CMA includes 4 counties where Leap owns 10 MHz in two counties and 20 MHz in two counties, the cell would list 15 MHz for the CMA. For AT&T and T-Mobile cells in this table, the spectrum values are sourced from the AT&T filing. Limitations The spectrum dashboard provides raw licensing data and, in processing the analysis, loses some nuance. This study's analysis considers the largest wireless carriers, but does not consider smaller spectrum holders in local and state markets, for example Bluegrass Wireless in Kentucky. These are not likely to significantly impact the findings as the FCC spectrum thresholds target the most consolidated spectrum holders in a given market. Additionally, the commission issues disclaimers emphasizing the tentative nature of listings on the dashboard.30 The AT&T filing also faces limitations. As seen in the analysis of AWS spectrum, skepticism must be exercised in interpreting the company's reported holdings where the FCC has not issued definitive standards. Also, the inclusion of Qualcomm spectrum purchased

29 30

A CMA one or more counties.

See Appendix III

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attendant on the approval of the commission may overstate the combined entity's holdings. The listings also occasionally diverge between the spectrum dashboard and AT&T's filing as county names and geographic market definitions have changed. When examining AT&T's spectrum holdings, the FCC Spectrum Dashboard data sometimes differs from the AT&T Filing. Upon further analysis, the FCC Spectrum Dashboard indicates bias toward overstating spectrum holdings in a given market. Using only spectrum dashboard data would flag a total of 247 CMAs. Additionally, the AT&T filing identifies 11 CMAs as over the spectrum screen that are not identified when using only the Spectrum Dashboard data. This study favors the AT&T data as the company filing is a matter of the public record and subject to scrutiny by the FCC. As a result, every finding, with the exception of the eligibility of potential buyers, was derived using the AT&T filing data. Neither dataset provides a perfect picture of the U.S. spectrum market, but represent the most complete public records detailing the competitive landscape AT&T and T-Mobile USA face in achieving approval. The records have been used to reinforce and correct each other by eliminating redundancies and standardizing data formats. Despite a potential overstating of holdings in some circumstances, the data and analysis provide a comprehensive review of spectrum agglomeration using the most complete public records available for analysis.

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APPENDIX I: Metropolitan CMAs Where Spectrum Holdings In At Least One County Is Greater Than Or Equal To The Threshold
CMA CMA Name Maximum Amount Above Threshold 80 MHz 56 MHz 45 MHz 36 MHz 36 MHz 36 MHz 36 MHz 35 MHz 35 MHz 35 MHz 33 MHz 33 MHz 30 MHz 30 MHz 30 MHz 30 MHz 28 MHz 25 MHz 25 MHz 24 MHz 23 MHz 23 MHz 23 MHz 21 MHz 21 MHz 20 MHz 20 MHz 20 MHz 20 MHz 20 MHz 20 MHz % of Counties In CMA At or Above Threshold 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 75% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

270 97 39 111 105 7 27 9 75 162 12 72 117 10 17 19 60 137 51 2 220 238 101 130 118 30 20 84 82 168 54

Bellingham, WA Bakersfield, CA Salt Lake City-Ogden, UT Vallejo-Fairfield-Napa, CA Lancaster, PA San Francisco-Oakland, CA San Jose, CA Dallas-Fort Worth, TX Austin, TX Brownsville-Harlingen, TX Miami-Fort Lauderdale-Hollywood, FL West Palm Beach-Boca Raton, FL Colorado Springs, CO Houston, TX Atlanta, GA Denver-Boulder, CO Orlando, FL Melbourne-Titusville-Palm Bay, FL Jacksonville, FL Los Angeles-Long Beach/Anaheim-Santa Ana-Garden Grove/Riverside-San Bernardino-Ontario, CA Abilene, TX Sharon, PA Beaumont-Port Arthur, TX Erie, PA Reading, PA Portland, OR-WA Seattle-Everett, WA Harrisburg, PA Tacoma, WA Tallahassee, FL Gary-Hammond-East Chicago, IN

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50 242 68 99 234 170 121 76 55 6 58 107 38 123 33 214 212 128 159 108 204 91 88 115 147 202 169 146 32 197 5 86 93 167 77 171 25 35

Honolulu, HI Olympia, WA Flint, MI York, PA Athens, GA Galveston-Texas City, TX Trenton, NJ New Bedford-Fall River, MA Worchester-Fitchburg-Leominster, MA Boston-Lowell-Brockton-Lawrence-Haverhill, MA-NH Allentown-Bethlehem-Easton, PA-NJ Stockton, CA Providence-Warwick-Pawtucket, RI Santa Rosa-Petaluma, CA San Antonio, TX Richland-Kennewick-Pasco, WA Bremerton, WA McAllen-Edinburg-Mission, TX Provo-Orem, UT Augusta, GA/SC Aguadilla, PR San Juan-Caguas, PR Chattanooga, TN-GA Utica-Rome, NY Ponce, PR Arecibo, PR Mayaguez, PR Daytona Beach, FL Hartford-New Britain-Bristol, CT Lake Charles, LA Detroit/Ann Arbor, MI Albuquerque, NM Las Vegas, NV Sarasota, FL Tucson, AZ Reno, NV Buffalo, NY Sacramento, CA

20 MHz 20 MHz 20 MHz 20 MHz 18 MHz 18 MHz 16 MHz 16 MHz 16 MHz 16 MHz 16 MHz 16 MHz 16 MHz 16 MHz 15 MHz 15 MHz 15 MHz 15 MHz 15 MHz 15 MHz 13 MHz 13 MHz 13 MHz 13 MHz 13 MHz 13 MHz 13 MHz 13 MHz 11 MHz 11 MHz 10 MHz 10 MHz 10 MHz 10 MHz 10 MHz 10 MHz 10 MHz 10 MHz

100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 50% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

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14 208 257 3 262 287 301 244 303 304 134 56 69 49 302 73 4 142 57 22 81 112 109 46 175 151 66 181 225 295 193 300 133 18 100 74 15 96

Baltimore, MD Fort Pierce, FL Hagerstown, MD Chicago, IL Danville, VA Bryan-College Station, TX Lawrence, KS Kenosha, WI Aurora-Elgin, IL Joliet, IL Atlantic City, NJ Northeast Pennsylvania, PA Wilmington, DE-NJ-MD New Haven-West Haven-Waterbury-Meriden, CT Enid, OK Oxnard-Simi Valley-Ventura, CA Philadelphia, PA Modesto, CA Tulsa, OK Tampa-St. Petersburg, FL El Paso, TX Corpus Christi, TX Spokane, WA Nashville-Davidson, TN Santa Cruz, CA Poughkeepsie, NY Youngstown-Warren, OH Muskegon, MI Altoona, PA Midland, TX Benton Harbor, MI Victoria, TX Manchester-Nashua, NH San Diego, CA Shreveport, Louisiana Fresno, CA Minneapolis-St. Paul, MN-WI Fort Wayne, IN

10 MHz 10 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 6 MHz 6 MHz 6 MHz 6 MHz 6 MHz 6 MHz 6 MHz 6 MHz 5 MHz 5 MHz 5 MHz 5 MHz 5 MHz 5 MHz 4 MHz 4 MHz 3 MHz 3 MHz 3 MHz 3 MHz 3 MHz 1 MHz 1 MHz 0 MHz 0 MHz 0 MHz 0 MHz 0 MHz

100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 67% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 38% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 90% 100%

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150 31 24 114 13 87 8

Visalia-Tulare-Porterville, CA Columbus, OH Kansas City, MO-KS Lakeland-Winter Haven, FL Pittsburgh, PA Canton, OH Washington, DC-MD-VA

0 MHz 0 MHz 0 MHz 0 MHz 0 MHz 0 MHz 0 MHz

100% 100% 100% 100% 100% 100% 100%

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APPENDIX II: Rural CMAs Where Spectrum Holdings In At Least One County Is Greater Than Or Equal To The Threshold
CMA CMA Name Maximum Amount Above Threshold 43 MHz 40 MHz 35 MHz 28 MHz 28 MHz 26 MHz 25 MHz 25 MHz 23 MHz 23 MHz 20 MHz 20 MHz 20 MHz 20 MHz 18 MHz 18 MHz 18 MHz 18 MHz 18 MHz 18 MHz 16 MHz 16 MHz 16 MHz 15 MHz 15 MHz 15 MHz 13 MHz 13 MHz 13 MHz 13 MHz 13 MHz % of Counties In CMA At or Above Threshold 100% 29% 100% 64% 100% 13% 100% 100% 50% 75% 100% 100% 70% 100% 100% 14% 50% 50% 100% 50% 25% 100% 100% 100% 100% 100% 100% 67% 100% 100% 40%

667 488 372 660 595 500 643 695 649 612 691 693 468 698 622 445 322 345 346 699 476 359 478 562 674 647 726 403 370 724 432

Texas 16 - Burleson Minnesota 7 - Chippewa Georgia 2 - Dawson Texas 9 - Runnels Ohio 11 - Columbiana Mississippi 8 - Claiborne Tennessee 1 - Lake Washington 3 - Ferry Tennessee 7 - Bledsoe Pennsylvania 1 - Crawford Virginia 11 - Madison Washington 1 - Clallam Maryland 2 - Kent Washington 6 - Pacific Pennsylvania 11 - Huntingdon Kentucky 3 - Meade Arizona 5 - Gila California 10 - Sierra California 11 - El Dorado Washington 7 - Skamania Michigan 5 - Manistee Delaware 1 - Kent Michigan 7 - Newaygo New York 4 - Yates Utah 2 - Morgan Tennessee 5 - Fayette Puerto Rico 4 - Aibonito Indiana 1 - Newton Florida 11 - Monroe Puerto Rico 2 - Adjuntas Kansas 5 - Brown

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618 697 361 371 591 725 659 374 669 606 629 375 694 613 395 623 384 381 621 487 668 690 704 561 688 598 363 619 602 477 439 597 360 339 563 340 666 587

Pennsylvania 7 - Jefferson Washington 5 - Kittitas Florida 2 - Glades Georgia 1 - Whitfield Ohio 7 - Tuscarawas Puerto Rico 3 - Ciales Texas 8 - Gaines Georgia 4 - Jasper Texas 18 - Edwards Oregon 1 - Clatsop South Carolina 5 - Georgetown Georgia 5 - Haralson Washington 2 - Okanogan Pennsylvania 2 - McKean Illinois 2 - Bureau Pennsylvania 12 - Lebanon Georgia 14 - Worth Georgia 11 - Toombs Pennsylvania 10 - Bedford Minnesota 6 - Hubbard Texas 17 - Newton Virginia 10 - Frederick West Virginia 4 - Grant New York 3 - Chautauqua Virginia 8 - Amelia Oklahoma 3 - Grant Florida 4 - Citrus Pennsylvania 8 - Union Oklahoma 7 - Beckham Michigan 6 - Roscommon Kansas 12 - Hodgeman Oklahoma 2 - Harper Florida 1 - Collier California 4 - Madera New York 5 - Otsego California 5 - San Luis Obispo Texas 15 - Concho Ohio 3 - Ashtabula

13 MHz 13 MHz 13 MHz 13 MHz 13 MHz 13 MHz 11 MHz 11 MHz 11 MHz 10 MHz 10 MHz 10 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 8 MHz 6 MHz 6 MHz 6 MHz 6 MHz 6 MHz 5 MHz 4 MHz 4 MHz 4 MHz 3 MHz 3 MHz

67% 100% 50% 25% 17% 100% 31% 20% 8% 100% 67% 80% 33% 33% 13% 100% 18% 44% 100% 50% 40% 100% 43% 50% 100% 57% 25% 33% 29% 17% 60% 100% 50% 33% 20% 100% 38% 100%

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553 671 617 650 673 495 335 601 727 681 729 373 440 655 728 656 723 480 491

New Mexico 1 - San Juan Texas 20 - Wilson Pennsylvania 6 - Lawrence Tennessee 8 - Johnson Utah 1 - Box Elder Mississippi 3 - Bolivar Arkansas 12 - Ouachita Oklahoma 6 - Seminole Puerto Rico 5 - Ceiba Virginia 1 - Lee Puerto Rico 7 - Culebra Georgia 3 - Chattooga Kansas 13 - Edwards Texas 4 - Briscoe Puerto Rico 6 - Vieques Texas 5 - Hardeman Puerto Rico 1 - Rincon Michigan 9 - Cass Minnesota 10 - Le Sueur

3 MHz 3 MHz 3 MHz 3 MHz 3 MHz 3 MHz 3 MHz 3 MHz 1 MHz 1 MHz 1 MHz 1 MHz 1 MHz 1 MHz 1 MHz 1 MHz 1 MHz 0 MHz 0 MHz

40% 25% 25% 100% 33% 33% 10% 14% 100% 83% 100% 50% 17% 8% 100% 18% 100% 20% 29%

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APPENDIX III: FCC Spectrum Dashboard Data Disclaimer

"The data and analyses provided in the Spectrum Dashboard are for informational purposes and research assistance only. The Spectrum Dashboard does not constitute the official licensing records for the Commission. Specifically, the FCC makes no representations regarding the accuracy or completeness of the information maintained in the Spectrum Dashboard. "The data and analyses contained herein are not relied upon by the Commission in analyzing the competitive marketplace or assessing the spectrum holdings of wireless service providers in any particular geographic area. "The Spectrum Dashboard is also not an endorsement by the FCC of any particular service, technology, product, or service provider, and the FCC makes no representations or warranties about the provision of service on the spectrum included in this database. "Users should be aware that matters not reflected in the Spectrum Dashboard may relate to and affect the status of FCC licenses, including spectrum leasing arrangements, transactions pending before the FCC, transactions approved by the FCC but not consummated by applicants, future proceedings before the FCC, or actions in the courts. Further, actions taken by the FCC that may affect the status of licenses will not be reflected in the Spectrum Dashboard until the next system update." "Spectrum Totals by County: For purposes of the Spectrum Dashboard, spectrum totals may be overestimated in a particular county. For instance, spectrum will be counted towards a licensee's spectrum total for a county if at least one percent of the county falls within a license or service boundary. Each county is then marked as being "fully" or "partially" covered. (See Fully Covered and Partially Covered in the Glossary of Terms link.) For 800 MHz Cellular, the spectrum totals by county may reflect spectrum covered by service area boundaries that extend beyond the Cellular Geographic Service Area, which is the area in which the carrier is licensed to provide service. This is not the method the Commission uses for determining spectrum totals in other contexts, including the Annual CMRS Competition Report and other Commission reports, or for conducting competitive review of license transactions for merger orders."31

31

FCC Spectrum Dashboard, Understanding your Results, http://reboot.fcc.gov/reform/systems/spectrumdashboard/understanding-results. Retrieved April 29, 2011

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